OF INTEREST
IN THE LABOUR COURT OF SOUTH AFRICA
BRAAMFONTEIN CASE NO: J1453/00
DATE OF HEARING: 20020919
DATE OF JUDGMENT: 20020919
In the matter between
CONSTRUCTION & ALLIED WORKERS UNION Applicant
and
GRINAKER CIVIL ENGINEERING Respondent
____________________________________________________________
J U D G M E N T
____________________________________________________________
PILLAY J : My ruling on the second point in limine is as follows:
I am required to determine whether the respondent is the employer.
The evidence for the respondent is: It joined forces with another company
Moolman Brothers Construction (Pty) Ltd, to form a joint venture. Together,
they successfully tendered for a constructionmining project. The
Respondent and Moolman Brothers Construction (Pty) Ltd each contributed
variously to this joint venture. They each seconded employees to the joint
venture. The joint venture also employed its own workers. However, as an
entity with a limited purpose and existence, it had no infrastructure to
manage the workforce. The arrangement was therefore that the salaried
staff it engaged would be administered by the respondent, and the hourly
paid employees would be administered by Moolman Brothers Construction
(Pty) Ltd.
The distinction in the employment of the three categories of employees was
further manifest from their work wear. The respondent's employees wore red
overalls. The employees of the joint venture wore blue and the employees of
Moolman Brothers Construction (Pty) Ltd wore green overalls.
When the second applicant was engaged, Mr Burger, the plant manager of
the respondent and its representative of the joint venture, interviewed the
second applicant and informed him that he was employed by the joint
venture but that his remuneration and benefits would be administered by the
respondent. He further informed him that his salary would be paid by the
respondent.
The evidence in court was that the salary paid by the respondent on behalf
of the joint venture was recovered from the joint venture.
It was the joint venture that terminated the second applicant's services.
That was the case for the respondent.
The second applicant's case is that the respondent is his employer because
it paid his salary and contributed towards his medical aid and provident fund
benefits. It wrote to him periodically informing him about increases in his
salary. He participated in activities like staying in hotels with the respondent's
employees, which could only have occurred if he were its employee. The IRP
that was submitted to the South African Revenue Services on his behalf by
the respondent reflected the respondent as the employer. He denies that he
was advised in the interview with Mr Burger that the respondent would
merely administer his salary and benefits, and that he was in fact employed
by the joint venture.
He acknowledged that employees involved in the joint venture projects wore
blue and green overalls but denied the red overalls were worn on the joint
venture plant.
The following facts are decisive of the issue:
Firstly, in paragraph 11 of the second applicant's affidavit, he states that Mr
Rheighardt had told him that he would be approached by Wonderwater Mine
management, that is, the management of the joint venture, about a
permanent job and that he should in the circumstances be alert. He then
attended, and was interviewed by Mr Burger. A contract was signed. It is
common cause that the document appearing as Annexure O to the second
applicant's bundle B in the application to declare, was signed by Mr Burger
and the second applicant, and is headed “Wonderwaters Strip Mine Joint
Venture”.
Secondly, the second applicant testified that he received a letter on 12
August 1996, that is, before his engagement by the joint venture, confirming
that he was appointed as a welder in the joint venture. That letter is signed
by Mr Burger, on the respondent's letterhead and refers to the joint venture
as "our Wonderwater Mine". Mr Burger's explanation for this letter was that
the second applicant requested it possibly for purposes of securing
accommodation. He was never crossexamined on this issue. In any event,
the plain meaning of the wording of that letter is not inconsistent with the
respondent's evidence. The joint venture was a project of the respondent.
As such, the respondent was entitled to refer to it as “our Wonderwater
Mine”. The signing of the contract signalled that the second applicant was
aware from the outset that the joint venture was his employer.
Thirdly: The joint venture meets the common law requirements for the
establishment of a partnership for a particular purpose. It is an entity that
can therefore employ the second applicant. (See: Young and Bradford,
quoted by Henning in 1996 21 (2) TRW 68 at 70; Pezzutto v Dreyer 1992 (3)
SA 379 (A) at 390 AF).
Fourthly: The fact that the second applicant was aware of the identity of the
true employer, is further evidenced by his referral of a dispute to the CCMA,
relating to allegations of discrimination and victimization. In that dispute, the
joint venture is cited as the employer. It was resolved by a settlement
agreement being signed by Mr Burger on behalf of the joint venture.
Fifthly: The second applicant's salary increases were determined by the joint
venture. This was also not disputed during crossexamination. If the
increases were the same as that of the respondent's employees, then Mr Du
Toit testified that this was pure coincidence.
Lastly: The contract of employment was created and terminated by the same
entity, that is, the joint venture.
The joint venture ceased to exist about November 1999 shortly after the
second applicant's retrenchment. This dispute was referred for conciliation
on 6 December 1999. The probabilities are that by that stage the second
applicant became alive to the possibility that the joint venture would not be
able to meet any claim as it no longer existed at all or in that form. For
whatever reason, the second applicant chose to cite the respondent as the
employer, it is not supported by all the facts that have been presented to me.
I am satisfied that, in substance, the joint venture is the employer. It is not
merely a question of form or a scam, as suggested by Ms Tshabalala for the
applicant. For instance, whether the second applicant might have been able
to qualify for providend fund and medical aid benefits if he was not brought
into the books of the respondent is doubtful as these schemes take some
time to establish. Therefore the incorporation or the administration of the
second applicant’s services through the respondent's books was also for the
second applicant's benefit. In fact, it was for the mutual benefit of the parties.
In all these circumstances my ruling is that I find that the respondent was not
the employer of the second applicant.
In determining the issue of costs, I note the following: The second applicant
was aware from the outset who the true employer was. He was confronted
with the situation that on his dismissal the employer did not exist. The
communications that he received on the respondent’s letterhead was
primarily the basis on which he hoped to hold the respondent responsible for
his claim. The fact that the respondent had an interest in the joint venture
and should therefore be held liable is not the case that was made out.
However, the claim was not pursued frivolously or vexatiously. There was a
bona fide belief that the respondent could be held responsible for his claim.
In the circumstances, I order the second applicant to pay 75% of the
respondent's costs.
______________________
JUDGE D PILLAY