IN THE LABOUR COURT OF SOUTH AFRICA
SITTING IN DURBAN
CASE NO P290/2001
DATE 2002/06/19
In the matter between:
GILLILAND AND PHILLIPS BOOTH
& ASSOCIATES
(t/a TAXAID) Applicant
and
MARTIN KOORTS N.O. First Respondent
COMMISSION FOR CONCILIATION
MEDIATION AND ARBITRATION Second Respondent
JOSEPH HENRY PIERRE TURRO Third Respondent
KAREN McGRATH Fourth Respondent
CHRISTOPHER JAMES VIVIERS Fifth Respondent
BEFORE THE HONOURABLE MR ACTING JUSTICE
NGCAMU
ON BEHALF OF APPLICANT: MR DE WET
ON BEHALF OF RESPONDENTS: ADV. KROON
TRANSCRIBER
SNELLER RECORDINGS (PROPRIETARY) LTD - DURBAN
CASE NO: P290/2001
DATE: 19 June 2002
In the matter between:
GILLILAND & ASSOCIATES
and
CCMA & OTHERS
J U D G M E N T
NGCAMU AJ
[1] This is an application for the review and setting aside of the
arbitration award. The application is brought in terms of
Section 145 of the Labour Relations Act.
[2] The third to the fifth respondents were employed by the
applicant. The applicant informed the respondents that they
would be laid off for a period of three months, after which they
would have to come to see if work was available for them. The
respondents lodged an urgent application for an order
directing the applicant to pay their salaries. The application
was dismissed on the basis of urgency. The respondents
resigned on the basis that their employment had been made
intolerable. The dispute was referred to the CCMA for
conciliation. When conciliation failed the dispute was
arbitrated by the first respondent. The first respondent issued
an award in terms of which the dismissal of the respondents
was declared unfair. The applicant was ordered to
compensate the respondents. The applicant seeks to review
and set aside this award.
[3] The applicant has submitted that the Commissioner failed to
arbitrate the dispute fairly and equitably. It was alleged that
the arbitrator was partial and biased towards the respondents
and failed to hand down an award that is justifiable. It was
also argued that the award is muddled, misdirected and
contradictory and contains inaccuracies of a material nature.
It was further submitted that the arbitrator failed to take into
account the material evidence. Another ground for the review
was that the record was incomplete.
[4] The applicant filed the record of the arbitration proceedings.
The transcript was served. The respondents submitted that
the applicant failed to place before Court the complete record
in that the bundle submitted to the Commissioner was not
filed. The applicant has taken a view that the first and second
respondents are obliged to file the record with the Registrar.
Respondents submitted that the failure by the first and the
second respondents to file the record is in itself a ground for
setting aside the award.
[5] In support of this submission Mr de Wet cited the case of UEE-
Dantex Explosives (Pty) Ltd v Maseko & Others [2001] 22 ILJ
1905 LC. This case is not relevant in a matter where the
record is available and applicant fails to file it. Rule 7A places
an onus on the applicant to furnish the record. If the record is
available and the applicant fails to place it before Court, the
Court is entitled to dismiss the application on that ground
alone. [See in this case JDG Trading (Pty) Ltd (t/a Russells) v
Whitcher & Others [2001] 3 BLLR 300 LAC.
[6] Rule 7A(5) and (6) obliges the applicant to file the portion
necessary for the review. The applicant submitted that it did
not have this bundle that was submitted to the CCMA. If the
record is available and the applicant fails to file it the Court
canot set aside the award on the basis of the absence of the
record. The Court in such instance will dismiss the application.
[7] The applicant submitted that the portion of the record that is
missing is not relevant. If the arbitrator fails to file the record,
the applicant is entitled in terms of Rule 11 to compel the filing
of the record. Such an application becomes necessary for the
reason that it is the applicant who wants the award to be
reviewed. There is, therefore, an obligation on the applicant to
file the complete record.
[8] The respondent has in this case filed the record that was
missing. The applicant submitted that if the record was
necessary it tenders costs of the record. I will return to the
question of costs at a later stage.
[9] The respondents were served with the application by the
applicant. They failed to file a reply in time. An application
has been filed for the Court to condone the late filing. The
record was served on 28 August 2001. The answering affidavit
was only served and filed in January 2002. This is five months
late. The respondents have submitted that they did not have
to file the answering affidavit when the record was materially
defective. Respondents' attorney explained that the delay was
due to illness. The attorney was not in the office as a result of
being incapacitated. The applicant submitted that the delay
was gross and that condonation should not be granted.
[10] The delay of five months is a long delay. I also have to
consider the fact that the respondent was always of the view
that a complete record had to be filed before they could be
expected to file a reply. This is the point which was debated in
this court as a preliminary issue. The respondents contended
that the complete record was necessary. I accept that the
attorney for the applicant was ill. However, he was not away
from the office all the time. The attorney was in the office
when the documents were served. This must be weighed
against the respondent's attitude regarding the filing of the
record. It must be considered further that the respondents are
not to blame for the attitude taken by the attorney.
Respondents have an award in their favour. This should count
in their favour as well when it comes to the Court’s discretion
regarding the granting of the condonation. The applicant has
not shown any prejudice in the matter. I, however, consider it
unfair to unsuit a litigant who already has an award in his
favour. In the circumstances I grant the application for
condonation.
[12] The test for the review was considered by the Labour Appeal
Court in Carephone (Pty) Ltd v Marcus N.O. and Others [1998]
11 BLLR 1093 [LAC]; Countyfair Foods (Pty) Ltd v Commission
for Conciliation Mediation and Arbitration and Others [1999]
20 ILJ 1701 [LAC] and Shoprite Checkers (Pty) Ltd v Ramdaw
N.O. and Others [2001] 22 ILJ 1603 [LAC].
[13] The question to be asked is whether there is a rational
objective basis justifying the connection made by the
arbitrator between the material properly available to him and
the conclusion he eventually arrived at. [See in this case
Carephone at page 1103, paras A-D.]
[14] In Countyfair Foods the Court held that the decision of the
Commissioner must be supported by the facts and the
applicable law. The reviewing court must ask itself whether
the award can be sustained by the facts and the applicable
law. If the award can be sustained by the facts and the law,
interference with the award is not warranted. If it cannot,
interference is unwarranted. [See in this case Countyfair Foods
at page 1712 paras H-J.
[15] The applicant submitted that the respondents made opening
statements but the Commissioner did not invite the applicant
to make an opening statement. The applicant further
submitted that the Commissioner based the award on the
respondents' opening statement. A party in proceedings is not
obliged to make an opening statement. If a party wishes to
make such a statement he may do so. The purpose of the
opening statement is to indicate to the presiding officer what
the dispute is all about and what issues are involved, and the
evidence that would be led to prove the matters in dispute.
Put differently, the opening statement is meant to alert the
presiding officer of the relevance of the evidence to be led.
The respondents' representative made an opening statement
as it was entitled to do so. The respondents' representative
had to make his statement first because the onus was on the
respondents to prove the dismissal. The opening statement is
not evidence.
[16] After the opening statement the evidence of the respondents
was led. The applicant elected not to lead evidence at the end
of the respondents' case. It was, therefore, unnecessary for
the applicant to make an opening statement. The arbitrator
could only ask the applicant if it wanted to make an opening
statement in the event of the applicant wishing to lead
evidence. The applicant elected to close its case without any
viva voce evidence. There is, therefore, no merit in the
argument that the arbitrator committed an irregularity by not
inviting the applicant to make an opening statement. The
applicant's case was never opened.
[17] It is common cause that the arbitrator had the affidavit
submitted by the applicant. It is further common cause that
the applicant cross-examined the respondent. The applicant
has failed to show which portion of the findings was not
supported by the evidence. There is nothing in the opening
statement not supported by the evidence. This ground of
review cannot succeed.
[18] It was submitted further that the arbitrator failed to apply his
mind to the facts and the case presented to him. This is based
on the fact that the respondents amended their claim for four
months' notice pay to three weeks. The Commissioner made
an award for compensation for five months. The
Commissioner did not make any award in respect of the notice
pay for the reason that he could not reconcile the question of
notice and the situation which had become intolerable. The
compensation awarded by the Commissioner was from the
period of resignation to the date of conclusion of the
arbitration. The error recorded by the arbitrator does not
render the award reviewable. This is so because the question
of the notice pay is irrelevant if one considers the reasoning of
the arbitrator. This ground of review is, therefore, dismissed.
The award in this regard is justifiable on the facts before the
Commissioner.
[19] The rules require that the award be issued within a period of
fourteen days. The arbitrator is permitted to ask for an
extension of time in terms of section 138(8) of the Labour
Relations Act. The extension is requested from the Director of
the CCMA and not from the parties. The applicant submitted
that the Commissioner was biassed because he requested an
extension of time from the respondents and not from the
applicant. There is no merit in this argument. Even if the
request was made from the respondents, or not made at all,
that would not render the award reviewable. The fact that an
award is issued outside the fourteen day period does not make
the award null and void and reviewable. The submission
made, therefore, should fail. [See in this case Free State
Buying Association Ltd (t/a Alpha Pharm) v SACCAWU and
Another [1999] 3 BLLR 223 [LC].]
[20] The Commissioner has a discretion with regard to the award of
costs. It was submitted on behalf of the applicant that it was
not shown that it acted frivolously in defending the
constructive dismissal. The Commissioner does not have to
explain meticulously any findings he makes. The fact that the
Commissioner did not explain why he made an order for costs
cannot make the award reviewable. It must be noted that the
applicant elected not to pay the employees' salary when it was
able to do so and decided to defend the dispute. In the light of
this, the Court cannot interfere with the Commissioner's
discretion.
[22] Mr de Wet submitted that the Commissioner misinterpreted
the evidence in that he recorded that the third to the fifth
respondents were laid off on 8 June 2000 and were to report
for duty on 9 October 2000. The Commissioner also recorded
in his award that:
"The applicants' representative's claim is based on the
circumstances that the respondent acted unilaterally in laying
off the applicants for an indefinite period without any
remuneration at all."
[23] It is necessary that I quote the full paragraph of the letter of
7 June 2000 in terms of which the employees were laid off.
The letter reads:
"That it was at that point that the employer decided to revert
to the implementation of the lay-off with effect from Monday, 3
June 2000, as indicated in the meeting on Monday, 5 June
2000. The office will be closed with immediate effect and the
employees will be paid in lieu of notice of the lay-off and will
receive payment of this remuneration at the end of June 2000.;
that in essence the duration of the lay-off will be until Monday,
9 October 2000, the date on which all affected employees will
be required to report to the employer's premises to determine
the availability of work; that during the lay-off period affected
employees will be provided with their duly completed
unemployment insurance fund cards, if applicable, and will be
entitled to take up alternative employment on a permanent
and/or temporary basis."
[24] In the letter I have quoted above, the purpose of returning on
9 October 2000 would not have been for the purpose of
commencement of work but to see if the work was available.
There was, accordingly, no guarantee that the employees
would work. This is strengthened by the fact that the
employees would be issued with unemployment cards.
Moreover, the employees were specifically advised that they
would be entitled to take up alternative employment on a
permanent or a temporary basis. The result of this would have
been that the employees would lose any benefits from the
applicant. If they took new employment on a permanent basis
the applicant would not have had to pay them any
retrenchment package. It follows then that if they did not take
alternative employment and return on 9 October 2000 and find
no work available, they would remain on lay-off without any
income. This is what led the Commissioner to conclude that
the lay-off was indefinite. I, therefore, reject the submission
that the Commissioner was under the incorrect impression that
employees were laid off for an indefinite period.
[25] The applicant has applied a microscopic examination of Turro's
evidence to find contradictions in his evidence. It was
submitted that Turro testified on one hand that there was no
lay-off agreement and on the other said there was a lay-off
agreement on additional terms. It is the applicant who relies
on the agreement on lay-off. It is not the employees who must
prove it. It does not assist the applicant to point out
contradictions. The evidence of Mr Turro is that proposals
were discussed with the sole purpose of saving jobs. An
agreement was reached as to what could be done if the
applicant agreed the proposal made by the employees. The
applicant did not come back to the employees but wanted the
employees to sign that they agreed to the reduction of their
salaries. The employees could not sign when the company
had not responded to their proposals. There was, therefore,
no agreement between the applicant and the employees. This
resulted in the applicant laying off the employees. No
agreement was proved by the applicant before the
Commissioner. The Commissioner cannot be faulted on this.
If the applicant relies on the existence of an agreement, the
onus is on it to prove it and not the employees. The applicant
was obliged to consult on lay-off as this affected the
respondents' wages and conditions of employment. [See in
this case TAWU v Motorvia (Pty) Ltd [1996] 9 BLLR 1189 [IC] at
page 1190 para.D-F.]
[26] The applicant submitted that the respondents' attorney shut
the doors for consultation for the purpose of resolving the
dispute. This submission is taken from the letter dated 29
June 2000. Paragraph 12 of the said letter reads:
"Unfortunately our clients do not see their way clear to
resolving this matter on any basis whatsoever."
This portion of the letter must be read in conjunction with the
whole contents of this letter. This is so because the letter goes
further to state in para.13:
"As far as our clients are concerned they are and continue to
be employed by yourselves and as such are entitled to be
paid."
Para.14:
"If you disagree with the contentions raised herein please be
courteous enough to advise us thereof. If you do not disagree
but are not in a position to pay, please advise us."
This letter cannot be interpreted as having closed the doors for
the discussions.
[27] The applicant has attacked the award on the basis that there
was no evidence led to justify the conclusion reached by the
arbitrator. I must pause here to point out that the material
before the Commissioner did not consist only of oral evidence.
It included the documents and correspondence. The
respondents first engaged the applicant in discussions and the
correspondence. They then instructed attorneys. They also
launched an application to this Court. They were still not paid.
[28] As an indication that they were not going to be paid, I have to
look at the letter dated 19 June 2000 appearing on page 46 of
the bundle. The first paragraph on page 47 records the
following:
"By virtue of the fact that the principle of 'No Work No Pay'
applies in this instance, your clients will not be remunerated
during this period. Notwithstanding they will be paid their
monthly earnings for June 2000 in lieu of notice of the pending
lay-off."
This letter was delivered to the Commissioner. The submission
that there was no evidence justifying and supporting the
conclusion therefore has no basis and is rejected.
[29] The respondents were placed in an untenable position
although the employment was not terminated by the
applicant. The three months' unilateral lay-off was hard for
them. This is what caused them to approach the Court. The
issue before the Court was the payment of salaries. It was not
concerned with the question of retrenchment. There had been
no consultation envisaged in Section 189 of the Labour
Relations Act. The Court did not deal with the constructive
dismissal. The Court did not make a finding on the
retrenchment process. The Court also did not hear oral
evidence as the Commissioner did. The Commissioner was
therefore not precluded from coming to the conclusion that the
applicant was not in the process of retrenchment exercise.
Even if the notice of possible retrenchment was before the
Commissioner, no consultation in terms of Section 189 were
proved by the applicant. The position is that the applicant did
not dismiss the respondents. They were, however, left with no
alternative. The applicant had to perform its obligation of
paying their salaries which it failed. The respondents were not
invited to consult for purposes of retrenchment. The
Commissioner was, therefore, entitled to find that the
applicant acted unfairly. The submission that the findings
were irrational is, therefore, rejected.
[30] It was submitted that the Commissioner failed to evaluate the
evidence and show why he accepted the evidence of the
employees. There is no merit in this submission. The
Commissioner was aware that the onus was on the employee
to prove constructive dismissal. He was aware that he had to
determine if employees had endeavoured to resolve the
grievance prior to their resignation. He found that the
evidence indicated that the employees made attempts by way
of discussions, letter and through attorneys and the Court
application. Based on this he concluded that the employees
fulfilled the requirement of attempting to resolve the dispute.
When all these attempts had failed it was inevitable for the
Commissioner not to conclude that the applicant made
continued employment intolerable. The Commissioner
properly applied his mind on the question of constructive
dismissal and explained why he came to the conclusion he
reached. According to the evidence the arrangement was for
a fifty percent reduction in salary and one month lay-off. The
applicant did not implement this arrangement. With regard to
the business of Turro there is no evidence that it was making
any profit or that he received any income.
[31] The applicant further submitted that the Commissioner erred
in finding that no severance pay was proposed. It was
submitted that the severance pay was discussed. Mr Turro's
evidence is that it was discussed but he was not present in
that discussion. The fact is that it was not offered to the
respondents as an alternative. There is no evidence from the
applicant before the Commissioner to prove that severance
pay was offered to the respondents. The award can be set
aside where the Commissioner has ignored material evidence
placed before him. See in this case SASCO (Pty) Ltd v
Buthelezi and Others [1997] 12 BLLR 1639 [LC], in which
LANDMAN J at page 1643, para. D commented on this by
stating the following:
"The third respondent simply ignored this evidence. Had he
not ignored it but dealt with it then this judgment may possibly
have had a different result. However, as he simply ignored
relevant evidence, this is grossly unreasonable and amounts to
a misconduct which is a defect as envisaged in section 145(2)
of the Act."
[32] The award can also be set aside if the findings are based on
erroneous inference of facts. See Kynoch Feeds (Pty) Ltd v
CCMA and Others [1998] 4 BLLR 384 [LC] at 398 para.58. In
the present case in my view there was sufficient evidence
before the Commissioner.
[33] The applicant acted in serious breach of the employment
contract in laying off the respondents without agreement. The
applicant's actions were unilateral. This went into the heart of
the employment relationship. Although the applicant did not
dismiss the respondents and expected them to return to work,
it does not mean no breach of contract was committed. The
respondents were, therefore, entitled to cancel the contract or
keep the contract. Respondents accordingly elected to
terminate the contract by resigning.
[34] The applicant did not consult with the respondents in terms of
Section 189 of the Labour Relations Act. He did not pay their
salaries and indicated to the employees that they could obtain
alternative employment. In my view they were placed in an
invidious position. Their further employment was uncertain.
The applicant clearly acted unfairly towards them. In Coetzee
and Another v Pitani (Pty) Ltd [t/a Pitani Electrification Projects
and Others [2000] 8 BLLR 907 [LC] at 916 paras 50-51
BASSON J stated:
"Should an employer that contemplates dismissing employees
not consult with the affected employees in terms of the duty to
do so contained in section 189 of the Labour Relations Act, the
employer is acting in a manifestly unfair manner towards
them. Should such an employer then further exacerbate
matters by committing a breach of contract that goes to the
root of the employment or contract, it may well be that the
affected employees are being placed in an invidious position.
Such employees can, of course, elect to accept the breach of
contract and cancel or terminate the contract of their own
accord and claim contractual damages. More important,
however, is the fact that such employees may become entitled
to claim constructive dismissal in terms of Section 186[e] of
the Labour Relations Act."
[35] The evidence proved that the applicant acted unfairly towards
the respondents. I am satisfied that the Commissioner clearly
applied his mind to the evidence before him. The award was
fair. It cannot be said that he misinterpreted the evidence
before him. I cannot find any irregularity or misconduct on the
part of the Commissioner.
[36] In the light of what I have stated, it follows that the application
for review should fail.
[37] It will be fair in the circumstances of the case that the costs
follow the result. I will, therefore, make the order for costs in
favour of the respondents.
[38] I have considered the question of costs of the additional record
filed by the respondents. I have made use of this bundle with
regard to the assessment of the material that was before the
Commissioner. I, therefore, conclude that this bundle was
relevant. The applicant tendered costs of this bundle in the
event the Court finds that it was necessary. I will, accordingly,
make an order in favour of the respondents regarding such
costs.
[39] I am satisfied that the application in terms of Section 158(1)(c)
is in order. I, therefore, intend making the award an order of
Court. The order that I make is the following:
(a) The application for review is dismissed.
(b) The arbitration award is hereby made an order of Court.
(c) The applicant is ordered to pay the respondents' costs
including the cost of the additional bundle filed by the
respondents.
(d) The applicant is to pay the costs of the respondents in the
application to make the award an order of Court.
THE HONOURABLE MR JUSTICE NGCAMU
LABOUR COURT JUDGE