THE LABOUR COURT OF SOUTH AFRICA, CAPE TOWN
Case no:C508/2024
In the matter between:
PRESTON WARELEY Applicant
and
AUDITOR GENERAL OF SOUTH AFRICA Respondent
Heard: 3 November 2025
Delivered: 18 May 2026
Summary: An alleged unfair discrimination claim relating to pay differentials, relying
on the ground of ‘qualifications’. The ground relied upon does not constitute a
recognised arbitrary ground under the EEA. More importantly, ‘qualifications’ is one
of several factors justifying pay differentials.
JUDGMENT
GANDIDZE, J
Introduction
[1] The plaintiff, Mr Preston Warel ey (Wareley), filed an alleged unfair
discrimination claim against his employer, the defendant, the Auditor General
(1) Reportable: No
(2) Of interest to other Judges: No
18 May 2026
Signature Date
of South Africa (AGSA), regarding his pay compared with that of a nother
employee. AGSA pleaded to the claim , a pre-trial minute was concluded, and
the matter was set down for hearing. A week before the set-down date, AGSA
delivered an Amended Statement of Case, in which it pleaded that Wareley
did not plead a ground of discrimination listed in section 6(1) of the
Employment Equity Act 1 (EEA), that ‘qualifications’ is not a recognisable
arbitrary ground for purposes of section 6 of the EEA , and therefore the
Statement of Case did not disclose a cause of action . This was followed by
correspondence to Wareley’s attorneys stating that the legal issue of ‘no
cause of action’ would have to be addressed first. Wareley’s attorneys
disagreed. At the commencement of the trial, in the absence of an agreement,
AGSA raised the legal point which it contended was dispositive of the matter
without having to hear evidence.
The respective parties address whether the point should be entertained
[2] Mr Mpahlwa , for Wareley , addressed the court first. He objected to AGSA’s
conduct in raising a preliminary issue at the commencement of the trial. AGSA
ought to have raised its point by way of an exception, as contemplated in Rule
14 of the Rules Regulating the Proceedings of the Labour Court 2 (Labour Court
Rules). He also relied on Rule 19 of the Labour Court Rules, which he
submitted sets out how points of law are dealt with. Accordingly, the submission
went, because both these rules had not been followed, the court should not
entertain AGSA’s legal point.
[3] He also submitted that the joint pre -trial minute records that there were no
preliminary points, and that, being the case, AGSA was required to bring an
application to vary the pre -trial minute, which has the status of a court order,
because the matter was certified trial ready. The consequence was that AGSA
was required to bring an application to vary it before it could raise its point.
was required to bring an application to vary it before it could raise its point.
[4] In response, Mr Sangoni, for AGSA, submitted that the point was being raised
to shorten the proceedings. He submitted that the joint pre -trial minute was
1 Act No 55 of 1998, as amended.
2 Published: GN 4775, G. 50608 of 3 May 2024. Commencement: 17 July 2024 - GN 5038, G. 50929
of 12 July 2024.
overtaken by the amended statement of response, in which the point sought to
be argued was raised. He also submitted that Wareley’s attorneys had been
forewarned that the issue would be dealt with at the beginning of the trial, and
that the response was ‘conduct your case as you see fit’, and that no
instructions had been received to agree to the amendment of a pre-trial minute.
[5] He submitted that Labour Court Rule 19 applied only to matters in which parties
proceeded by way of a stated case, and was therefore inapplicable. As regards
Rule 14, he submitted that a party can either raise an exception to a statement
of case or file an amended statement of response that raises an issue which
could have been raised by way of an exception, and that such an issue should
be dealt with at the commencement of the trial. Neither Rule 14 nor Rule 19 is
an obstacle to hearing the point of law. H e also rejected the contention that the
pre-trial minutes constitute a court order that can be varied only on application.
[6] In reply, Mr Mpahlwa submitted that the court has discretion to hear the legal
point.
[7] Before addressing whether the legal point should be entertained, it is
appropriate to refer to the relevant provisions of the EEA, as follows:
‘6. Prohibition of unfair discrimination
(1) No person may unfairly discriminate, directly or indirectly, against an
employee, in any employment policy or practice, on one or more
grounds, including race, gender, sex, pregnancy, marital status, family
responsibility, ethnic or social origin, colour, sexual orientation, age,
disability, religion, HIV status, conscience, belief, political opinion,
culture, language, birth or on any other arbitrary ground.
(2) ….
(3) ….
(4) A difference in terms and conditions of employment between employees
of the same employer performing the same or substantially the same
work or work of equal value that is directly or indirectly based on any
one or more of the grounds listed in subsection (1), is unfair
one or more of the grounds listed in subsection (1), is unfair
discrimination.’
Could the legal point be raised at the start of the trial?
[8] The legal point raised by AGSA could have been raised by way of a n exception
in terms of Labour Court Rule 14.3 This did not happen. Instead, it was raised in
the amended Statement of Response. In addition, Wareley’s attorneys were
informed, in writing, on two occasions that the point would be raised at the
beginning of the trial. Therefore, Wareley was not ambushed o n the day of the
trial when the legal point was raised. Wareley’s attorneys did not request more
time to consider the point and, in fact, made their submissions on it.
[9] Indeed, the pre-trial minute did not record that AGSA would raise a preliminary
point at the commencement of the trial. This was because the preliminary point
was raised in an Amended Statement of Response filed after the pre -trial
minute. AGSA was not required to apply to the court for a variation of the pre -
trial minute. The correct procedure would have been for the parties to file a
supplementary minute to address the preliminary point raised in the Amended
Statement of Response and agree that it would be argued first. The absence of
a supplementary minute did not preclude AGSA from raising a legal point that
could dispose of the matter.
[10] A pre-trial minute is not a court order, and Mr Mpahlwa cited no case authority
or rule of this Court to the effect that, on the facts, a variation of the pre -trial
minute on application to this Court was required.
[11] The Labour Court Rule 19, which was relied upon, provides as follows:
‘19. Special cases and adjudication on points of law
(1) The parties to a dispute may, after proceedings have been
instituted, agree on a written statement of facts and/or law in the
form of a special case to be adjudicated by the court. This must
be done under oath so as to constitute evidence before court.’
3 See H v Fetal Assessment Centre 2015 (2) SA 193 (CC) at para 10, which held that:
3 See H v Fetal Assessment Centre 2015 (2) SA 193 (CC) at para 10, which held that:
‘Exceptions provide a useful mechanism 'to weed out cases without legal merit', as Harms JA said in
Telematrix. The test on exception is whether on all possible readings of the facts no cause of action may be
made out. It is for the excipient to satisfy the court that the conclusion of law for which the plaintiff contends
cannot be supported on every interpretation that can be put upon the facts’.
[12] In this matter, the parties did not, under oath, agree to a written statement of
facts and/or law in the form of a special case for adjudication. Accordingly, the
rule does not apply to the legal point raised by AGSA.
[13] The overriding consideration is the speedy and effective resolution of a labour
dispute. In the interests of justice, the legal point must be determined at the
outset, as this could partially resolve the dispute , thereby saving the court’s
time and the parties’ litigation costs.
Parties’ submissions on the legal point
[14] It was submitted on behalf of AGSA that pay differentiation constitutes unfair
discrimination only if it is based on one or more of the grounds listed in section
6(1) of the EEA. As the Statement of Case had not identified a listed ground, it
did not disclose a justiciable cause of action under the EEA.
[15] The submission was that, to the extent that Wareley relied on differentiation
based on qualifications, this was not a ground listed in section 6(1) of the
EEA, and that ground was not analogous or comparable to a listed ground
because it did not relate to attributes and characteristics that have the
potential to impair fundamental human dignity in a comparable manner or to a
similar serious consequence. The submission was that the attributes and
characteristics referred to are those that an applicant cannot control. In this
case, Wareley could control his qualifications, and for that reason, the ground
was not recognisable for purposes of section 6 of the EEA. The submission
was that ‘any other arbitrary ground’ must be accorded a narrow meaning, as
per the decision in Naidoo & Others v Parliament of the Republic of SA 4
(Naidoo), which held that nepotism , which was more egregious, does not
qualify as an arbitrary ground.
[16] The submission was further that it is insufficient for an applicant to contend
that the conduct was unjustifiable and irrational without identifying a ground
that the conduct was unjustifiable and irrational without identifying a ground
justiciable under section 6 of the EEA, and that Naidoo clarified this point.
4 (2020) 41 ILJ 1931 (LAC).
[17] The submission further stated that, in terms of the Code of Good Practice on
Equal Pay/Remuneration for Work of Equal Value 5 (Code of Good Practice)
and the Employment Equity Regulations6 (EEA Regulations), pay differentials
based on qualifications were not discriminatory.
[18] In the further alternative, if the court found that ‘qualifications’ was a
recognised unlisted ground under section 6 of the EEA, the discrimination
claim would fall to be dismissed on the basis that the differentiation was
neither discrimination nor unfair discrimination, because:
18.1 employees with a Chartered Accountant (CA) qualification are more
highly valued and in greater demand than those with the Registered
Government Auditors (RGA) qualification, and therefore must be paid on
a higher scale to retain their services. s.
18.2 unlike the RGA qualification, the CA qualification is internationally
recognised, IRBA-accredited, and recognised by all audit firms ms
[19] On behalf of Wareley, it was submitted that , because AGSA was raising an
exception, the test, as per H v Fetal Assessment Centre 7, was whether, on all
pleaded facts , no cause of action was disclosed. He submitted that AGSA
admitted most of the facts pleaded by Wareley , including that there was a
salary disparity between what Wareley earned and what the comparator
earned, that the dispute was referred to the CCMA, and that the differentiation
5 GG038837N 0006 GN 0448 150530 (Government Gazette, 1 June 2015), which states as follows:
7.3. Regulation 7 of the Employment Equity regulations lists a number of grounds which are
commonly taken into account in determining pay /remuneration. Subject to what is stated
below, it is not unfair discrimination if the difference is fair and rational and is based on any
one or a combination of the following factors –
7.3.2. the individuals' respective qualifications, ability, competence or potential above the
minimum acceptable levels required for the performance of the job.
minimum acceptable levels required for the performance of the job.
6 GN 6125 of 15 April 2025: Employment Equity Regulations 2025 (Government Gazette No 52515).
Regulation 7(1)(b) states as follows:
7. Factors justifying differentiation in terms and conditions of employment
(1) If employees perform work that is of equal value, a difference in terms and conditions of employment,
including remuneration, is not unfair discrimination if the difference is fair and rational and is based on
any one or a combination of the following grounds:
(b) the individuals’ respective qualifications, ability, competence or potential above the minimum
acceptable levels required for the performance of the job.
7 Supra n 3.
impairs the claimant’s dignity because he is not recognised .8 The submission
was that the facts in Naidoo were distinguishable because the claimants relied
on nepotism, whereas in this matter, Wareley relied on qualifications. Both
candidates were trained internally and competed for the same position , and
Wareley was successful. However, the comparator was appointed to a senior
manager position nineteen months later. Reliance was placed on EEA
Regulation 6 (which addresses assessing work of equal value) and EEA
Regulation 7 (which addresses factors justifying differentiation in terms and
conditions of employment).
[20] Reliance was also placed on Pioneer Foods Pty Ltd v Workers against
Regression9 (Pioneer Foods), which found that length of service was not an y
arbitrary ground. As I understood it, the submission was that , in that matter ,
the employees did not plead a ground and, for the first time, relied on ‘length
of service’ in the heads of argument. In the present case, Wareley’s case was
that his qualifications were not recognised, and that is the pleaded ground ,
which constitutes an arbitrary ground.
[21] In reply, AGSA submitted that Wareley’s competency was not in issue, but
that qualifications determine one’s salary. Pioneer Foods did not support
Wareley because the factors listed in EEA Regulation 7 (which include length
of service) constitute a fair reason for pay differentials. Finally, the submission
was that the throwaway line that conduct impairs one’s dignity is insufficient,
given what the court held in Naidoo.
Discussion
[22] Read together, sections 6(1) and (4) of the EEA require an applicant alleging
discrimination to rely either on a listed ground or on an arbitrary ground. In
this case, Wareley alleges that he was discriminated against on the arbitrary
ground of ‘qualifications’. The question is whether the alleged arbitrary ground
of ‘qualifications’ qualifies as an arbitrary ground for the purposes of section 6
of the EEA.
of the EEA.
8 This pleaded fact was denied.
9 (2016) 37 ILJ 2872 (LC).
[23] The main obstacle for Wareley is that both the EEA Regulation 7 and the
Code of Good Practice list ‘qualifications’ as one of the factors justifying
differentiation in the terms and conditions of employment. That being the
case, ‘qualifications’ cannot be a factor justifying pay differentials, yet at the
same time constitute an arbitrary ground for pay differentials.
[24] In the seminal case of Harksen v Lane NO & others 10 (Harksen), the court
clarified that an arbitrary ground is an unspecified ground, but one analogous
to the grounds listed in section 8 of the Interim Constitution, which applied at
the time the judgment was handed down. The current Constitution 11 lists
these grounds in section 9(3). The same grounds are listed in section 6(1) of
the EEA; the only difference is that section 6(1) refers to an arbitrary ground,
which the Constitution does not.
[25] The court in Harksen held that whether an arbitrary ground qualifies depends
on whether it is based on attributes or characteristics that have the potential to
impair the fundamental dignity of persons as human beings, or to affect them
adversely in a comparably serious manner. Therefore, the ground must relate
to a person's attributes or characteristics.
[26] In Naidoo & Others v Parliament of the Republic of SA 12 (Naidoo), which
AGSA relied upon , the court stated that section 6(1) of the EEA is not a
remedy for grievances without limits or a catch-all, or a panacea. Like section
9 of the Constitution, it provides a remedy on the grounds of intimate
attributes, whether inherent or adopted. The Court further stated that the
ground must be similar to the listed grounds and agreed with the view
expressed by Garbers and Le Roux 13 that anti-discrimination law cannot be
used to solve all labour market ills.
[27] In Naidoo, the applicants relied, inter alia , on the ground of nepotism . The
court rejected this argument, reasoning as follows:
10 1998 (1) SA 300 (CC).
11 Constitution of the Republic of SA 1996.
10 1998 (1) SA 300 (CC).
11 Constitution of the Republic of SA 1996.
12 (2020) 41 ILJ 1931 (LAC).
13 Christoph Garbers & Pieter le Roux ‘Employment Discrimination into the Future’ 2018 (2) Stell LR
237-69 at 249.
‘[30] …To be neglected because of nepotism implies no characteristic of a
person so victimised nor does it invoke any pejorative perspective of such
person, whether inherent or adopted.’
[28] The court further held that, if nepotism was applied, the conduct, however
wrongful, would not have constituted unfair discrimination within the meaning
of s 6(1) of the EEA.
[29] In Tshazibane v Montego Pet Nutrition & Others 14 (Montego Pet Nutrition) ,
this court, per Kroon AJ, added its voice to the test for what is required when
an applicant alleges discrimination on an arbitrary ground, as follows:
‘[5] To summarise, where reliance is placed on an arbitrary ground a
complainant in an unfair discrimination claim is required to establish that
he has been the object of unequal treatment based on attributes and
characteristics he either possesses or with which he is associated and
which have the potential to sully or diminish his intrinsic humanity and
that of others in his situation…’
[30] The attributes and characteristics referred to must be those of an applicant or
of those with whom he is associated. Qualifications do not relate to an
attribute or characteristic of Wareley that has the potential to impair his
dignity. As correctly pointed out on behalf of AGSA, Wareley can do
something about his qualifications. More importantly, qualifications are
accepted as a factor that justifies pay differentials.
[31] In Association of Mineworkers & Construction Union on Behalf of Members v
Aberdare Cables (Pty) Ltd & Others15 (Aberdare Cables), the court held that:
‘[25] …It is trite that an applicant alleging discrimination must set out
explicitly and disclose in no uncertain terms what the ground for
discrimination is. The ground of discrimination is to be disclosed , and it
is not an issue to be ‘confirmed' or ‘established' by evidence, as the
evidence must support the disclosed ground of discrimination for an
applicant to succeed with a claim for discrimination.’
14 (2022) 43 ILJ 2610 (LC).
applicant to succeed with a claim for discrimination.’
14 (2022) 43 ILJ 2610 (LC).
15 (2024) 45 ILJ 511 (LC).
[32] As no amount of evidence could cure the defect in the Statement of Case,
AGSA did not have to wait until evidence had been led and then apply for
absolution from the instance as argued on Wareley’s behalf.
[33] In Aberdare Cables , the court found that the alleged unpleaded ground,
namely, the date of commencement of employment, was not an attribute akin
to an immutable human characteristic and did not constitute an arbitrary
ground for discrimination. Aberdare Cables interpreted Naidoo as having laid
down the principle that:
‘[58] In short: it is not sufficient to simply allege differentiation or that the
differentiation is arbitrary or that an employee’s dignity has been
impaired. An applicant must allege a specific ground of discrimination,
must prove that the pleaded ground of discrimination is the basis for
differentiation and that it is unfair. There is a distinction to be drawn
between differentiation and discrimination and differentiation per se
does not constitute discrimination on an arbitrary ground, which must
be clearly identified and pleaded.’
[34] It is difficult to understand how Pioneer Foods assists Wareley’s case.
[35] As the Statement of Case does not disclose a cause of action, that has to be
the end of the matter for now. The court apologises for the delay in delivering
the judgment.
Costs
[36] On Wareley's behalf, it was submitted that the AGSA should be ordered to
pay costs because it pleaded to the Statement of Case on the merits and then
raised the legal point seven months later.
[37] On behalf of the AGSA, it was submitted that , on the authority of Union for
Police Security & Corrections Organisation v SA Custodial Management (Pty)
Ltd & Others16, a consideration of the law and fairness justifies deviating from
the general rule that costs do not follow the result in labour matters. This was
because Wareley was legally represented , yet his attorneys ignored the
16 (2021) 42 ILJ 2371 (CC).
Amended Statement of Response , which made it clear that ‘qualifications’ is
not a recognisable, arbitrary ground in terms of section 6 of the EEA. The
legal point was again raised in the AGSA’s Practice Note filed days before the
trial, yet the claim was persisted with. The submission was that the claim was
frivolous and vexatious and that costs should follow the result.
[38] A costs order against Wareley would be wholly unjust, given that he brought
the claim on the basis of legal advice.
[39] Taking into account the requirements of law and fairness as contemplated in
section 162 of the Labour Relations Act 17, an appropriate order is that each
party pays its own costs. Although the AGSA was successful on its legal
point, it raised the issue for the first time in its amended Statement of
Response, delivered a week before the trial. It also did not raise the legal
point by way of exception , in which case the matter would have been placed
on the motion court roll rather than the trial roll. As a result, the three days
allocated for a trial were wasted.
[40] In the result, the following order is made:
Order
1. The Statement of Case does not disclose a cause of action.
2. Should he be so advised, the plaintiff is afforded an opportunity to
deliver a Notice of Intention to Amend the Statement of Case within 10
court days of this order.
3. There is no order as to costs.
_______________________
T. Gandidze
Judge of the Labour Court of South Africa
17 Act 66 of 1995, as amended.
Appearances:
For the Applicant: Mr Mpahlwa
Instructed by: Mpahlwa & Co Inc.
For the Respondent: Advocate F Sangoni
Instructed by: Majang & Associates Inc.