IN THE LABOUR COURT OF SOUTH AFRICA
HELD AT JOHANNESBURG
CASE NO. JR 850/01
In the matter between:
WYETH SA (PTY) LIMITED Applicant
and
MANQELE, T First Respondent
MOLETSANE, R N.O. Second Respondent
THE COMMISSION FOR CONCILIATION,
MEDIATION AND ARBITRATION Third Respondent
SECURITY, RETAIL, TRANSPORT AND ALLIED
WORKERS UNION OF SOUTH AFRICA Fourth Respondent
______________________________________________________________________________________
____________________________
JUDGMENT
_______________________________________________________________
CORAM : A VAN NIEKERK AJ
[1] This is an application brought in terms of section 158(1)(g) of the Labour
Relations Act, 66 of 1995 (“the LRA”) in which the Applicant seeks to
review and set aside the ruling made by the Second Respondent, a
Commissioner of the Commission for Conciliation, Mediation and
Arbitration (“the CCMA”), on 2 March 2001.
[2] The Applicant has raised two grounds for review. The first is that
the Commissioner committed a gross irregularity in handing down a ruling in
circumstances where another Commissioner had heard oral submissions from
the parties’ respective representatives concerning the merits of the matter.
Secondly, it is contended that the Commissioner committed a material error of
law, alternatively, that he arrived at an unjustifiable conclusion in ruling that the
First Respondent was an “employee” of the Applicant as defined by section 213
of the LRA.
[3] The facts giving rise to this application are largely common cause.
The First Respondent was offered a position by the Applicant as a sales
representative. They concluded a written contract of employment on 15 March
2000 in terms of which the First Respondent was to commence employment on 1
April 2000.
[4] Prior to the First Respondent commencing employment, the First
Respondent was advised that the Applicant was no longer prepared to
employ him.
[5] The Applicant’s decision not to employ the First Respondent was directly
related to the allocation of a motor vehicle to the First Respondent. In
terms of the contract of employment, the First Respondent was entitled, as
part of his remuneration package, to be provided with a company vehicle
for company business and reasonable use for private purposes. The
Applicant avers that the First Respondent was advised that he could
purchase a new motor vehicle in pursuance of this term of his contract,
subject to a maximum purchase price of R124 000. The Applicant avers
further that the First Respondent was advised that he was to acquire a
new motor vehicle, since the leasing company that financed vehicles for
and on behalf of the Applicant would not finance a second hand vehicle.
The Applicant selected a BMW 316 motor vehicle, which after inspection
by the leasing company, transpired to be a used vehicle. The First
Respondent thereafter identified an Opal Astra motor vehicle as the
vehicle to be purchased on his behalf. After signature of the contract of
employment, the Applicant was contacted by the leasing company and
advised that the vehicle selected by the First Respondent was no longer in
production and could not be a new vehicle. The Applicant viewed what it
considered to be a misrepresentation by the First Respondent of the
status of the vehicle in a serious light, and advised him that there was no
contract of employment between them since the parties had been unable
to reach consensus as to the condition of the motor vehicle stipulated in
the letter of employment.
[6] The Fourth Respondent, on behalf of the First Respondent, thereafter
referred a dispute concerning an alleged unfair dismissal to the CCMA.
The Applicant took the point that the First Respondent was not an
employee as defined in section 213 of the LRA. The Presiding
Commissioner, Commissioner Nagdee, is alleged to have heard oral
submissions from the parties’ representatives. On 25 August 2000, an
agreement was reached between the parties in terms of which the point in
limine would be addressed by the filing of affidavits by both sides and
once these had been exchanged, the parties further agreed to furnish the
CCMA with “written submissions/arguments”. The parties agreed that the
Commissioner would thereafter make a ruling, and that they were in
agreement that it would not be necessary to schedule a hearing for
arguments and that the “ruling will be made on the affidavits and
submissions.”
[7] On 6 October 2000, the Fourth Respondent addressed a letter to the
Senior Convening Commissioner recording that it intended to request
Commissioner Nagdee’s recusal on the basis that he was alleged to have
suggested at the conciliation proceedings that the CCMA would not have
jurisdiction and that the dispute ought to be dealt with by the civil courts.
Without any recourse to the Applicant, the matter was thereafter allocated
to another Commissioner, the Second Respondent in these proceedings,
Commissioner Moletsane. The Second Respondent ruled that the First
Respondent became an employee “the moment he accepted an offer of
employment” and dismissed the point in limine.
[8] In so far as the first ground of review is concerned, the Applicant’s primary
complaint is that Commissioner Nagdee had been seized of the matter
and that it was irregular for Commissioner Moletsane to make a ruling, I
am not persuaded that it can be said that Commissioner Nagdee had
been seized of the matter in the sense that any submissions addressed to
him were of such a nature or extent so as to preclude another
Commissioner from making a ruling on the point in limine.
[9] The tentative nature of any proceedings before Commissioner
Nagdee is apparent from the terms of the agreement the parties themselves
concluded as to how the point in limine would be determined. The agreement
contemplated the filing of a founding affidavit, an answering affidavit and a
replying affidavit, as well as arguments to be submitted in writing by both parties.
It is also clear that the parties contemplated that the ruling would be made on the
basis of the affidavits and submissions filed in terms of the agreement. There is
nothing in the agreement between them to indicate that anything that may have
been submitted to Commissioner Nagdee was to be of any consequence in the
determination of the point in limine.
[10] The letter addressed to the CCMA by the Fourth Respondent on
6 October 2000 was not an application for Commissioner Nagdee’s
recusal. The letter clearly states that the Fourth Respondent intended to
request his recusal, not that it was doing so. What actions the Senior
Convening Commissioner took consequent on the delivery of the Fourth
Respondent’s letter are not disclosed on the papers but it is clear that at
some point, Commissioner Nagdee withdrew from the proceedings.
There is nothing to preclude a commissioner from withdrawing from
proceedings without a formal application for recusal being brought. The
Fourth Respondent had raised a concern based on a view that
Commissioner Nagdee had allegedly expressed and it may well have
been for this reason that Commissioner Nagdee and/or the Senior
Convening Commissioner agreed that the point in limine would be
determined by Commissioner Moletsane without a formal application for
Commissioner Nagdee’s recusal.
[11] I do not agree with the Applicant’s submission that the Fourth
Respondent’s actions amounted to “Commissioner shopping” and that to
condone its actions would encourage abuse of the statutory dispute resolution
process. It remained open for the Senior Convening Commissioner and/or
Commissioner Nagdee to disagree with the view expressed by the Fourth
Respondent in its letter, and to insist that Commissioner Nagdee determine the
point in limine or that a formal application for recusal be brought. Given the
nature of the agreement between the parties, and their clear instruction that the
point in limine was to be determined by what followed the agreement rather than
what preceded it, there was no prejudice in this instance to the Applicant by
having Commissioner Moletsane determine the matter in accordance with the
terms of their agreement.
[12] The first ground for review must therefore fail.
[13] In so far as it is alleged that Commissioner Moletsane misconducted
himself by finding that the First Respondent was an employee of the
Applicant by virtue of their having concluded a contract of employment,
this Court has previously held that a person who is a party to a contract of
employment but who has not yet commenced employment is not an
employee for the purposes of the LRA. In Whitehead v Woolworths (Pty)
Ltd (1999) 20 ILJ 2133 (LC), Wagley AJ, as he then was, held that even if
on the facts of that case he were to find that a contract of employment had
been concluded, Ms Whitehead was not an employee because she did not
work for nor was she entitled to receive remuneration from the respondent
in that matter.
[14] Section 213 of the LRA defines “employee” to mean:
“(a) any person, excluding an independent contractor,
who works for another person or for the state and who receives, or is entitled to
receive, any remuneration; and
(b) any other person who in any manner assists in carrying on or
conducting the business of an employer,
and “employed” and “employment” have meanings
corresponding to that of “employee”.
[15] In this regard, Wagley AJ stated the following:
“[7] In terms of the definition a person is only an employee when
such person actually works for another person. The employee
must therefore have rendered a service to another which
services are not that of an independent contractor. In addition to
working for another the employee must also ‘receive’ or be
‘entitled to receive’ remuneration. The remuneration referred to
must correspondingly mean remuneration for work done or
tendered to be done. In the circumstances where an offer of
employment is made to another and the offer is accepted a
contract of employment may come into existence but the parties
to that contract do not enjoy the protection of the Act until such
time as the offeree actually commences her performance or at
least tenders performance in terms of the contract.”
(See Whitehead v Woolworths (Pty) Ltd at p 2137 AC)
[16] Reference was made in a submission on behalf of the First Respondent in
these proceedings to an obiter by Zondo JP in the Labour Appeal Court
proceedings in the same matter, reported as Woolworths (Pty) Ltd v
Whitehead [2000] 6 BLLR 640 (LAC). In that case, Zondo JP stated that:
“In that event the question that arises is whether, between the
date of the interview and the date of the taking of the final
decision by the employer on which of the candidates he gives
the job to, an employer is not entitled to change his mind about
which candidate he thinks is the best for the job. Clearly, an
employer is entitled to change his mind between those two
events provided he has not yet made an offer to anyone of the
candidates. In my judgment it is irrelevant whether the change
of mind is due to his own reconsideration of issues or whether
he has spoken to a colleague or an adviser. The fact of the
matter is that the period between the interview and the taking of
the final decision is for the employer to consider all the
candidates – their strengths and weaknesses as well as what
his/her business requirements are before he makes the final
decision to give the job to one of the candidates or, indeed, not
to give the job to anyone of the candidates.”
[17] The proviso in this passage relating to the making of an offer to a
prospective employee is principally the basis on which Commissioner
Moletsane came to the conclusion he did. It also forms the rationale
of a judgment in this Court by Pillay J in Jack v Director General :
Department of Environmental Affairs (Labour Court) case number
P734/02, 11 November 2002.
[18] It should be recalled that while Wagley AJ found that Ms Whitehead was
not an employee for the purpose of her claim of unfair dismissal, there
was no dispute that she was an applicant for employment for the purposes
of her claim of unfair discrimination. The LRA at that time conferred locus
standi for the purposes of an equality claim on persons who were
applicants for employment. The Whitehead case was decided on that
basis, and the judgment of the Labour Appeal Court in which the obiter by
Zondo JP appears was a judgment given in the context of a claim for
unfair discrimination rather than unfair dismissal. It is not clear whether
the obiter extends to a statutory claim for unfair dismissal by an aggrieved
party to an unfulfilled employment contract or whether the observation by
Zondo JP concerned a possible remedy for breach of contract.
[19] Be that as it may, I am not persuaded that the view expressed by Wagley
AJ on the meaning of “work” is necessarily correct. To require that the
statutory reference to “work” is necessarily confined to work actually
performed for another person is a limitation that is not justified either by
the wording of the definition or the protection extended by the LRA to
rights of work security. Section 186 defines “dismissal” to mean inter alia
that “an employer has terminated a contract of employment with or without
notice” (see section 186(1)(a)). That provision makes no reference to an
employee, and simply requires the existence of a valid contract of
employment and a termination of that contract, summarily or on notice, by
an employer. The section is not qualified, as one might expect were the
Whitehead v Woolworths (Pty) Ltd approach to be correct, by any
reference to a contract of employment entered into by an employee.
[20] The interpretation of the definition of “employee” adopted in Whitehead v
Woolworths (Pty) Ltd necessarily consigns a person such as the First
Respondent, who is an employee party to a valid contract of employment
to become effective on a later date, to a jurisprudential limbo unless and
until that party physically renders services in terms of that contract.
Persons in these circumstances may well have resigned from their
existing employment and put themselves at considerable financial risk in
the expectation of commencing work in terms of an agreement that is
binding on both parties at common law. To deny the statutory protection
of the security of employment conferred by the LRA in the interregnum
between the conclusion of a valid contract of employment and the physical
commencement of work seems to me to be contrary to a purposive
interpretation of the definition of ”employee”.
[21] A less literal approach to the statutory definition of employee is further
justified by the extent of the constitutional protection of employment rights.
Section 23 (1) of the Constitution provides that “Everyone has the right to
fair labour practices”. The choice of the word “everyone” was deliberate;
other constitutional labour rights extend to a “worker”.
[22] A person who is an employee party to a binding contract of employment is
obliged to commence work, and entitled to receive remuneration on the
date that the parties agree that these respective rights and obligations will
commence. In my view, the term “employee” as defined in section 213 of
the LRA and the requirement that a person ‘work’ for another to be an
employee extends to a person who is contracted to work.
[23] It follows that the Applicant’s second ground for review must also fail.
Whether the First Respondent was dismissed and the fairness of any dismissal is
a matter to be determined by the CCMA. I find only that as a party to a valid and
binding contract of employment, she is an “employee” for the purposes of a claim
under Chapter VIII of the LRA.
[24] I accordingly make the following order:
The application is dismissed with costs.
_________________________________
ANDRE VAN NIEKERK,
Acting Judge of the Labour
Date of hearing: 23 May 2003
Date of judgment: 26 May 2003
Counsel for Applicant: Advocate M van As
Attorneys for Applicant: Webber Wentzel Bowens
For the First and Fourth Respondents: Mr Sebola
Union official