IN THE LABOUR COURT OF SOUTH AFRICA
CASE NO P640/2000
In the matter between:
TRANSNET LIMITED Applicant
and
COMMISSION FOR CONCILIATION
MEDIATION AND ARBITRATION First Respondent
COMMISSIONER JOHAN NIEHAUS NO Second Respondent
MARITIME INDUSTRIES TRADE UNION
OF SOUTH AFRICA Third Respondent
O'BRIEN & OTHERS Fourth to Further Respondents
ÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄ
JUDGMENT
ÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄ
JAMMY AJ
1. The salient facts in this matter are succinctly set out in the Heads of Argument
presented by Counsel for the respective parties and may be summarised as
follows:
2. The Fourth and further Respondents are ex-naval officers who were recruited
by the Applicant as tug masters during the period 1996 to 1998.
3. Two factors encouraged that recruitment. The Applicant, prior thereto was in
need of tug masters and naval officers were provided with an opportunity to
exploit their skills and experience in the private sector. Whereas, prior to their
employment by the Applicant, they were not qualified to function as tug
masters, a basis for their retention as such was negotiated by the Applicant
with the regulating authority, at the time the Department of Transport.
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4. Pursuant thereto the Applicant advertised the vacant tug master positions and
at much the same time, the Department of Transport issued a "Marine Circular
10 of 1997" ("the Circular"), addressed to all principal officers under the
heading "The Employment of Naval Officers on Portnet Tugs."
5. Whereas, prior to the recruitment of the individual Respondents, the minimum
qualification for appointment as a tug master was a certificate known as the
"Standard Training Certificate for Watchkeeping" ("STCW"), the broad effect of
the Circular was to permit the Applicant to employ naval officers on Portnet
tugs on certain conditions, inter alia, exemption by the Department, on
application by the Applicant, from the stringent qualifying prerequisites, save
for the requirement that the officers were required to undergo a training period
of six months.
6. The STCW was and remained a prerequisite for tug master functions on the
open sea and the exemption related therefore only to activities within port
limits. It is appropriate, in that general context, that reference is here made to
certain further provisions of the Circular. They are the following:
"The above is an interim measure. Portnet is developing a training
programme and plan to take officers through from rating to master.
There will be a programme for certificates limited to port operations
and another to enable the officer to obtain an STCW endorsement to
his or her certificate of competency.
It is the aim of the programme to slot naval officers into these
training programmes and in so doing, dispense with the need for
exemptions. Should a naval officer want to obtain a Deck Officer
certificate of competency with STCW endorsement, the current
system and practice calls for him or her to show proof of the following
for the issue of a Deck Officer Class 3 certificate of
competency..............."
for the issue of a Deck Officer Class 3 certificate of
competency..............."
7. The granting of the exemption and the other specific conditions of employment
set out in the Circular were, as indicated, expressly stated therein to be an
"interim measure" pending the full qualification of the ex-naval officers through
specified training programmes and the resultant obviation of the need for
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exemptions.
8. One of the requirements for the STCW endorsement to the naval officers'
certificate of competency was defined as "12 months sea service on trading
vessels on long voyages."
9. The Port Operations Certificate restricted the holder to operations within ports
whilst the "open sea" STCW certificate was an internationally recognised
marine qualification of obvious benefit in the context of the development of the
career paths of the individuals concerned.
10. The exemptions under which the Respondents operated were extended from
time to time to enable them to obtain the Port Operations Certificate, subject
ultimately to a final deadline which, if not complied with, would result in their
dismissal. It is common cause that, under protest, the Respondents timeously
completed the course.
11. That protest was sourced in their contention that, based on the Circular, which
they considered to constitute a material term of their employment, they had
accepted that employment on the assumption that they would be trained to
attain the STCW qualification. As matters now stood however, that course was
not made available to them as an element of their employment.
12. The Second Respondent identified the crux of the dispute referred to him for
arbitration as lying in the wording of the Circular relating to the two training
programmes in question. Portnet, he concluded, "maintained that it had a
discretion as to what qualification it would allow its employees to obtain.
Mitusa (the Third Respondent) maintained the discretion was the employee's."
The wording of the paragraph, he stated, "can be interpreted to support either
one of the opposing positions."
13. In that context, the issue for determination by him, as defined by agreement
between the parties, was recorded in his award in the following terms:
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"1. Whether or not there was an agreement to the effect that the affected
Employees were entitled to undergo STCW Training (Standard
Training Certificate for Watchkeeping);
2. Whether or not the Employer's conduct in not allowing the affected
Employees to undergo STCW Training was, in the totality of the
circumstances, unfair and as such constituted unfair conduct by the
Employer-party in relation to training as envisaged in Item 2(1)(b) of
Schedule 7 to the Labour Relations Act, No 66 of 1995 as amended."
14. The conclusions reached by the Second Respondent followed a detailed review
by him of the evidence presented to him and his Order, in its terms, was a
comprehensive one. The Second Respondent expressly found that there was
"an agreement in respect of training", ........... "that STCW training or equivalent
formed part of the Employee's conditions of service" and that "the Employer
unilaterally changed the conditions of service." The circumstances in which
that occurred, having regard to "the impact the lack of a STCW qualification will
have on the career advancement of those affected", he held, amounted to an
unfair labour practice as envisaged in Item 2(1)(b) of Schedule 7 of the Labour
Relations Act 1995 ("the Act"). The Order that he proceeded to make, in its full
terms, read as follows:
"AWARD
I find that the Employer, Portnet, did commit an unfair labour practice
as envisaged in Item 2(1)(b) of Schedule 7 to the Labour Relations
Act, No 66 of 1995, as amended and I make the following order:
1. Portnet shall allow the affected-Employees to gain such training and
experience necessary for purposes of obtaining a STCW endorsement
to their certificates of competency;
2. To the extent that it may be necessary to gain experience at sea on
commercial vessels of companies other than Portnet, Portnet shall
advise such companies of the fact that the affected-Employee is on an
official Portnet training programme and Portnet shall provide such
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support necessary to enable the affected-Employee to secure
placement on the said commercial vessel;
3. Should the aforesaid result in any absence on leave, Portnet shall pay
such Employee his full remuneration and benefits during the period of
absence of leave, provided that in the event of the Employee
receiving any remuneration or benefits from another source in
relation to the Employee's duties on such commercial vessel, then
that amount shall be taken into account to the benefit of Portnet;
4. To the extent that an Employee has to attend to academical studies
on a full-time basis for purposes of obtaining the STCW endorsement,
Portnet shall grant such Employee absence of leave on full
remuneration and with retention of benefits, for the prescribed period
in which such course can be completed in the normal course of
events;
5. Any absence on leave granted to an Employee in terms of 3 and 4
above, shall result in such Employee being obliged to work for Portnet
for a period equal to three times the period of absence on leave,
failing which the Employee shall pay to Portnet such pro-rata portion
of the expenses incurred by Portnet as represented by the period the
Employee failed to render services;
6. The affected-Employees shall be permitted to attend such further
studies and/or experience at sea on a staggered basis within five (5)
years from the date of this award;
7. For purposes of 6 above, the parties shall agree on criteria to
determine a schedule reflecting which Employees will be granted
leave first, failing such agreement, Employees will be scheduled on
the basis of the results of the Port Operations Certificate exams with
those Employees who scored the highest marks being placed first on
the schedule'
8. Should Portnet succeed in compiling a programme on the basis of the
affected Employees receiving recognition for previous sea time
affected Employees receiving recognition for previous sea time
acquired or courses completed, or should Portnet succeed in
compiling a programme which will ensure that the Employees qualify
for a STCW endorsement on an expedited basis, then such programme
shall get preference over this award;
9. Nothing in this award prohibits the parties on reaching agreement on
ways and means acceptable to both parties, in attaining an STCW
endorsement."
15. It is the review and setting aside of that Award that the Applicant pursues in
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these proceedings. It seeks the following additional relief:
"2. Substituting the award made by the Second Respondent with an order
that the First Respondent had no jurisdiction to arbitrate the dispute,
alternatively;
3. substituting the award made by the Second Respondent with an order
that there was no factual or legal basis for concluding that an unfair
labour practice had been committed;
4. Making such order as the Court deems appropriate for the further
conduct of proceedings, if any, including an order that the dispute
should be referred to a Senior Commissioner of the First Respondent
for a re-hearing."
16. The grounds of review which the Applicant submits are that the Second
Respondent "committed a gross irregularity and/or alternatively, committed
misconduct and/or alternatively exceeded his powers." The first element of
alleged irregularity addressed, is the contention that the First Respondent, the
CCMA, lacked jurisdiction to be seized of the matter and that the Second
Respondent was therefore not entitled to arbitrate the dispute, with the result
that his award "is accordingly a nullity and should be set aside." This, the
Applicant submits, is because the Second Respondent concludes on the one
hand, that the provision of STCW training was a condition of employment
which, without consultation or negotiation, was unilaterally amended by the
Applicant to the prejudice of the Respondents, but then proceeds to classify the
dispute as one relating to training. A dispute relating to the unilateral change
of terms and conditions of service, the Applicant contends, is one of mutual
interest which is not arbitrable by the CCMA.
17. In ordering that training be provided moreover, with paid leave to the
Respondents for that purpose, the Second Respondent, it is submitted,
exceeded his powers. The manner in which that training must be provided
exceeded his powers. The manner in which that training must be provided
"must be looked for in the contract and no provision is made therein in that
regard." Nor, says the Applicant, was any evidence adduced on that issue in
the arbitration.
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18. In essence, the Applicant submits, both the grievance and the Award
necessitate the diversion of resources and funds from the Applicant for the
benefit of the Respondents, with no guaranteed return on that investment.
The procurement by the Respondents of that form of benefit and the
circumstances in and conditions upon which it is obtained, are economic issues
properly left to collective bargaining and the power play involved in that
concept. They are issues of mutual interest, rather than right and as such, are
not arbitrable under the provisions of Schedule 7 or otherwise.
19. Support for that contention is sought in
Hospersa & another v Northern Cape Provincial Administration (2000)
21 ILJ 1066 (LAC) at 107 D.
"The provisions of Schedule 7 Item 2(1)(b) were not meant to allow
arbitrators to adjudicate upon collective bargaining disputes. This
much has been expressly recognised by the Labour Appeal Court in
Hospersa & Another v Northern Cape Provincial Administration (2000)
21 ILJ 1066 LAC where the Court at 107 D says as follows:
'A dispute of interest should be dealt with in terns of the collective
bargaining structures and is therefore not arbitrable. A dispute of
interest should not be allowed to be arbitrated in terms of Item 2(1)
(b) read with Item 3(4)(b) under the pretext that it is a dispute of
right. To To do so would possibly result in each individual employee
theoretically cloaking himself or herself with precisely the same
description of the dispute that is the true subject matter of collective
bargaining. And if such an individual employee could legitimately
insist on his or her particular case being separately adjudicated,
whether through arbitration or otherwise, the result would inevitably
be a fundamental subversion of the collective bargaining process
itself (see by way of example Public Servants Association & Others v
itself (see by way of example Public Servants Association & Others v
Department of Correctional Services 1998 19 ILJ 1665 CCMA at 166
9CE and 167 4DE. If individuals can properly secure orders that have
the effect of determining the evaluation of different interests on the
merits thereof, then the distinction between dispute of interests and
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dispute of right would be distorted ........' "
Recognising however that the provisions of Schedule 7 Item 2(1)(b) of the Act
classify as unfair labour practices -
"the unfair conduct of the employer relating to the promotion,
demotion or training of an employee or relating to the provision of
benefits to an employee,"
disputes relating to which are arbitrable in terms of Item 3(4)(b), the Applicant
argues that not all training disputes are disputes of right. It points to the
legislated functions of bargaining and statutory councils whose functions, inter
alia, are to "promote and establish education and training schemes." (Sections
28 (f) and 43 (b)). Section 84(1)(i) moreover, designates for consultation with
workplace forums, in the absence of collective agreements dealing with the
subject, matters relating, inter alia, to education and training.
21. In that context, it is submitted, training disputes are matters of mutual interest.
That is how the instant dispute should have been classified by the Second
Respondent and in determining that he had jurisdiction to arbitrate it, he was
manifestly wrong.
22. The irregularity committed by the Second Respondent is further compounded,
the Applicant alleges, by his unequivocal conclusion that the Applicant's
conduct constituted a unilateral change in the terms and conditions of
employment of the Respondents. Section 64 of the Act regulates the right to
strike and recourse to lock-outs. Inherent in these concepts are contests of
power emanating from interest disputes and sub-section (4) makes express
reference in that context to disputes relating to unilateral changes to terms
and conditions of employment, which must, of necessity, be classified as
disputes of interest, precluding arbitration in the CCMA. That they were
manifestly in that position, was acknowledged by the Respondents in their
written closing submissions to the Second Respondent, thus -
written closing submissions to the Second Respondent, thus -
Recognition should be given to MITUSA for not invoking Section 64(4)
of the Labour Relations Act and excercising our right to embark on a
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protected strike.
23. In determining that he had jurisdiction to deal with the matter, the Second
Respondent was undeterred by these arguments. He was, as I have said, left
in no doubt that Portnet's actions, "amounted to a change in conditions of
service", a dispute relating to which, if unresolved by conciliation in the CCMA,
cannot be arbitrated but must be "resolved through power play." Schedule 7
to the Act moreover, he emphasised, "confers limited jurisdiction on the CCMA
to interfere in certain employment matters and cannot be interpreted as
conferring a general unfair labour practice or equity based jurisdiction on the
CCMA." Support for that conclusion is found by the Second Respondent in the
comments by Thompson in
Cheadle et al, Current Labour Law 1999, page 51 (footnote)
"It is submitted that the remedy is not intended for deciding
'quantum-type' issues but for combating unfair conduct associated
with demotions etc, such as inconsistency, arbitrariness, and a lack of
due process ............ Where restructuring involves changes to terms
and conditions of employment .............. fairness generally does not
come directly into the picture."
24. Significantly, in my view, and on the strength of the authorities referred to by
him, the Second Respondent then says this:
"In the present matter I have already concluded that STCW training or
equivalent training was a term of contract by means of the express
agreement between the parties at the interviews, together with the
importation of Marine Circular 10 of 1997's provisions into the
employment contract. It follows that Portnet was not entitled to vary
these provisions without the consent of Mitusa or the affected
employees. What was required was 'consent'. This implies that
Portnet had to, in order to have effected the change in respect of the
qualification requirements, negotiate with the affected employees as
opposed to mere consultation."
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25. Having then reviewed certain facts which indicated in his view a failure by
Portnet to "engage in proper negotiations" and concluding, once again, that
"Portnet effected a substantive amendment to contracts of employment
without having followed a proper process" the Second Respondent continues
thus -
"However, what is the true nature of the dispute? If it is in fact a
dispute relating to the unilateral change in conditions of employment,
the provisions of Schedule 7 to the LRA do not confer jurisdiction to
arbitrate the matter. I will only be clothed with jurisdiction should the
matter in fact be capable of resorting under Item 2(1)(b) of Schedule
7. This is what Mitusa claimed and it was not challenged by the
employer. However, even in the absence of a party questioning the
CCMA jurisdiction, I still have to determine this issue. Although the
dispute could also be categorised as a dispute pertaining to the
unilateral change in conditions of service, there can be no doubt that
the dispute is primarily one relating to training. Having regard to the
comments of Thompson referred to above, I also do not believe that
the issue in respect of STCW training can be said to fall within the
category "quantum-type" disputes. As such the dispute is arbitrable
under the provisions of Schedule 7."
26. I have difficulty with that conclusion. The Applicant, whilst endeavouring to
rationalise the economic and practical motivation for Portnet having done so,
does not seem to me to mount a serious substantive challenge to the
submission by the Third and Further Respondents, and the emphatic finding by
the Second Respondent, that its actions constituted a unilateral change to the
terms and conditions of the individual Respondents' employment. What would
otherwise be the Second Respondent's acknowledged lack of jurisdiction to
arbitrate a dispute arising therefrom and which, he reiterates, is a matter for
arbitrate a dispute arising therefrom and which, he reiterates, is a matter for
resolution by "power play", is then, so to speak, side-stepped and not, to all
intents and purposes, revisited by him. Jurisdictional comfort is quite simply
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sourced by him in his conclusion, stated to be open to no doubt, "that the
dispute is primarily one relating to training" and, a fortiori arbitrable in terms of
the provisions of Schedule 7 Item 2(1)(b).
27. The Second Respondent's confidence in that conclusion is however, in my view,
misplaced. For Portnet's conduct to constitute an unfair labour practice
relating to the "training of an employee" as envisaged in Item 2(1)(b) of
Schedule 7, it must embody characteristics directly associated therewith, such
as referred to by Thompson ( supra) by way of example - inconsistency,
arbitrariness and a lack of due process.
28. Disputes in that context would not relate to matters of mutual interest but
rather to the unfair infringement of the rights of employees in the context of
probation, job performance and so forth, linked to the right not to be unfairly
dismissed as generally provided for in Schedule 8 to
the Act. As such, the arbitration jurisdiction of the First Respondent in relation
thereto is clearly defined.
29. The individual Respondents' case before the Second Respondent was premised
on no such allegations or submissions. The essence of the Second
Respondent's determination, on the comprehensive evidence presented to him,
was that the dispute was one "primarily relating to training" and which had
arisen out of a change to terms and conditions of employment effected
unilaterally and not through the collective bargaining process, constituted by
discussions between Portnet, Mitusa and the affected employees, which had
been their original source. The change in question, he determined, had been
implemented "without the consent of Mitusa or the affected employees", a
consent which, by implication, should have been sought and obtained through
the same bargaining process.
30. The Applicant, as emphasised by Adv Grogan representing the Respondents,
30. The Applicant, as emphasised by Adv Grogan representing the Respondents,
seeks the review of the Second Respondent's award as allegedly defective in
terms of Section 145(2)(a)(ii) and (iii) of the Act. There is no basis, in my
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opinion, for the Second Repondent's conclusion that, on the evidence
presented to him, Portnet's conduct constituted an unfair labour practice
arbitrable in terms of Schedule 7. That being the case, the dispute could not be
the subject of arbitration under the Act. In purporting to determine a dispute in
the absence of statutory jurisdiction to have done so, a Commissioner will
manifestly have exceeded his powers. For the cumulative reasons which I
have stated, I find that to have been the case in the present instance.
31. Having reached that conclusion, it is unnecessary for me to deal with the
remaining grounds of review submitted by the Applicant and the order which I
therefore make is the following:
31.1 The Arbitration Award by the Second Respondent dated 4 July 2000 in CCMA
Case No EC16971 is reviewed and set aside.
31.2 The Third, Fourth and Further Respondents, jointly and severally are to pay the
Applicant's costs.
--------------------------------------------
Acting Judge of the Labour Court
26 March 2001
Representation:
For the Applicant: Adv. F A Boda
Instructed by Maserumule Inc
For the Respondents: Adv J G Grogan
Instructed by Oosthuizen & Associates
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