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[1995] ZASCA 109
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National Union of Mine Workers and Others v Free State Consolidated Gold Mines (287/93) [1995] ZASCA 109; 1996 (1) SA 422 (SCA); [1995] 12 BLLR 8 (AD); (1995) 16 ILJ 1371 (A) (21 September 1995)

Case No 287/93
IN THE SUPREME COURT OF SOUTH AFRICA
(APPELLATE DIVISION)
In the matter between:
NATIONAL UNION OF MINE WORKERS Appellant
AND OTHERS (Respondents in the cross-appeal)
and
FREE STATE CONSOLIDATED GOLD
MINES (OPERATIONS) LTD - President Steyn Mine; Respondent President Brand
Mine; Freddies Mine
(Appellant in the cross-appeal)
Coram: JOUBERT, HEFER, NESTADT, F H GROSSKOPF JJA et SCOTT AJA
Date heard: 15 August 1995
Date delivered: 21 September 1995
JUDGMENT NESTADT, JA
:
The broad issue in this matter is whether the
dismissal
of certain employees ("the individual appellants") for taking part
in
a stay-away constituted an unfair labour practice as defined in sec
1
2
of the Labour Relations Act, 28 of 1956 ("the Act") as it read in
1989.
The individual appellants (53 in number), being members of and
represented by the first appellant, were employed on one or other of
the
respondent's three mines, namely President Brand, President Steyn and Freddies.
In September 1989 they were, as a result of having
participated in a stay-away
on the 5th and 6th days of that month, dismissed. Contending that their
dismissals constituted an unfair
labour practice as defined in sec 1 of the Act,
as amended, they together with the first appellant sought a declaratory order to
this effect in the Industrial Court. In addition, orders that they be reinstated
and compensated were claimed. The Industrial Court
in a judgment reported in
(1992) 13 ILJ 366 refused
3
the application. On appeal the Labour Appeal Court
(Transvaal
Division) by a majority held that the dismissals of those
employed
at President Steyn and Freddies constituted an unfair
labour practice
and that they should be reinstated (though without
compensation and
subject to a final warning for absenteeism being
recorded against
their work records). However, the appeal by those
employed at
President Brand was dismissed. One of the assessors,
disagreed.
His view was that all the dismissals were unfair. The
judgment of
the Labour Appeal Court is reported in (1993) 14 ILJ
341. What is
before us (with the leave of the court a quo) is (i) a
further appeal by
those who were employed at President Brand against
the dismissal of
their application by the Industrial Court and by
those who were
employed at President Steyn and Freddies against what
I term the
qualified order of the Labour Appeal Court for their
reinstatement,
4
and (ii) a cross-appeal by the respondent against the Labour Appeal
Court's finding that the dismissal of employees at President Steyn
and Freddies
was unfair and its order that they be reinstated.
The background to the stay-away and the facts relevant to the dismissals
are fully set out in the reported judgments of the courts
below. For the moment,
I emphasise the following:
(i) The stay-away was a country-wide one. More than a million employees
are estimated to have participated in it. It had been called
for by a workers'
summit which was held on 27 August 1989. The stay-away was a protest against the
1988 amendments to the Act and
the (white) general election. Such election took
place on the second day of the stay-away, viz 6 September 1989.
5
(ii) The respondent became aware of the threatened stay-away. It, therefore,
on 1 September 1989, warned employees on the three mines
not to participate in
the stay-away and in the case of President Brand that "severe disciplinary
action would be taken against those
who....absent themselves from
work".
(iii) Nevertheless the stay-away took place. Ft
was, however, limited in its scope. At President Brand, 3 370 employees out of a
total
work force of about 21 653, stayed away on 5 September. In the case of
President Steyn the figure was 1 088 out of approximately
17 000 and in the case
of Freddies, 155 out of approximately 14 200. On the second day of the
6
stay-away, namely, 6 September 1989 the number
of
those who did not work was slightly higher.
(iv)
Employees who participated in the stay-away were not
paid for the
two days that they were not at work. In
addition, however, they were
disciplined. This took
place in terms of the mines' separate but
broadly similar
disciplinary codes. They each draw a
distinction
between what is termed "absenteeism" and
(illegal)
"strike action". The recommended penalty
for
absenteeism is, in the case of a first offence, a
warning,
in the case of a second offence a severe (also called
a
final) warning and in the case of a third
offence,
dismissal (or termination). As far as illegal
strike
7
action is concerned the recommended disciplinary action is dismissal save
that in the case of Freddies the action to be taken is stipulated
to be "in
terms of agreements", (v) There being no reference to stay-aways in the
disciplinary codes, the respondent chose to charge
those employees who
participated in the stay-away with absenteeism. In accordance with the
provisions of the disciplinary codes those
who had a clean record for
absenteeism received a warning. In respect of employees having a previous
warning (for individual absenteeism)
a second (or final) warning was imposed.
And employees who had a second warning were, after a hearing, dismissed. It was
not in dispute
that such
8
persons' warnings as also their hearings
were
procedurally and substantively fair. (vi) A total of 108 employees were in
this way dismissed.
And of those, 53 are, as I have indicated, involved in
this appeal. As between the three mines, 44 are from
President Brand, 6 from President Steyn and 3 from
Freddies.
I have already said that the matter has to be decided
on
the basis of the definition of "unfair
labour practice" as it read in
1989. Such definition (as introduced by sec 1(h) of Act 83 of
1988)
was in somewhat different terms to its present form (as to
which, see
sec 1(a) of Act 9 of 1991). It included:
"(a) The dismissal, by reason of any disciplinary action against one or more
employees, without a valid and fair
reason
9
and not in compliance with a fair procedure". There being no complaint
against any procedural aspects of the dismissals, and the dismissals
having
followed on disciplinary action, the narrow issue that arises is whether the
participation in the stay-away of those employees
who had previous second
warnings for absenteeism constituted a "valid and fair reason" for their
dismissals. In particular, the matter
turns on whether the dismissals were
(substantively) fair.
Plainly, the individual appellants, by deliberately absenting themselves
from work, committed a breach of their contracts of employment.
I shall assume
that at common law the respondent was therefore entitled to dismiss them. The
enquiry does not, however, lie only
within the field of contract. A dismissal
can
10
be lawful in contractual terms and yet be unfair within the
meaning
of the unfair labour practice concept (Le Roux and van Niekerk:
The
South African Law of Unfair Dismissal
, 294-296). But what is
a
fair reason (for a dismissal)? A helpful answer, in general
terms,
is that given by Cameron, Cheadle and Thompson:
The New
Labour
Relations Act: The Law after the 1988 Amendments,
at 144 -
145.
It is said:
"A fair reason in the context of disciplinary action is an act of
misconduct sufficiently grave as to justify the permanent termination
of the
relationship .... Fairness is a broad concept in any context, and especially in
the present. It means that the dismissal must
be justified according to the
requirements of equity when all the relevant features of the case - including
the action with which
the employee is charged - are considered."
Ultimately the task of the court is to pass a moral or value
judgment
(
Media Workers Association of South Africa and Others vs
Press
11
Corporation of South Africa Ltd
1992(4) SA 791(A) at 798 I and 802
A),
Before us, Mr
Brassey
, on behalf of the appellant, argued in the
first place that participation in the stay-away was not an act of misconduct
entitling
the respondent to take any disciplinary action against the individual
appellants; it was collective action in pursuit, by reasonable
means, of a
legitimate socio-economic interest, namely, to protest against the general
election and the introduction of the 1988
amendments to the Act; these were
matters which directly affected the workers; accordingly their absence from work
was justifiable
and so excusable. As appears from its reported judgment (354
C-D), the Labour Appeal Court rejected a similar argument. It did so
for a
number of reasons. In summary they were that the
12
stay-away was for a political purpose and in contravention of sec 65(1 A)
of the Act; it was in breach of agreements between the first
appellant and the
mines that there would be no recourse to industrial action until all procedures
for the peaceful settlement of
disputes had been exhausted; less harmful forms
of protest were available; the mines could not afford a stay-away; and the
respondent
was not given formal notice that it was to take place (at 354 J - 356
H). In the result, it was held that the stay-away was not an
appropriate form of
protest action and that it was not legitimate; on the contrary it was "illegal,
indiscriminate, damaging and
unfair" (354 1).
1 am not sure that I can entirely agree with this conclusion or the
reasoning underlying it. Some of the criticism voiced against
the judgment by
Professor Thompson in a note in
13
(1993) 14 ILJ 315 has merit. I am, nevertheless, satisfied that the
stay-away was illegitimate. Counsel rightly conceded that participation
in it
was, as the court a
quo
found (at 355 A), in contravention of sec 65(1 A)
of the Act. The disciplinary codes must be taken to have been respectively
incorporated
into employees' contracts of employment. And the respondent was, in
my opinion, entitled to classify the stay-away as a species of
absenteeism
(though 1 will later, in a different context, have to return to this aspect of
the matter). For these reasons alone the
stay-away constituted an act of
misconduct which justified the respondent in taking disciplinary action against
those who participated
in it.
14
This brings me to the second (alternative) argument on which Mr
Brassey
relied. It was that even if disciplinary action was warranted,
dismissal was not; it was an inappropriate and therefore unfair sanction;
this
was because it was too drastic a remedy and in any event it amounted to
unjustified selective action resulting in inconsistent
treatment of those who
stayed away. Undoubtedly, there are factors which militate against the argument.
They are the following:
(i) Absenteeism was a major problem to the mines. It had serious
consequences. Both productivity and safety were thereby adversely
affected. In
fact, the stay-away resulted in the three mines suffering substantial losses
(353 E of the judgment a quo). To the knowledge
of
15
employees, the mines' financial positions were such that they could not
afford such losses. It was accordingly essential for the respondent
to
discipline and thus discourage absenteeism. In the words of Mr Cloete, the
former personnel manager of President Brand and who
was the respondent's main
witness, "if we do not apply the disciplinary code...the incidents of
absenteeism would increase...(T)he
disciplinary code is there to be consistently
applied". Mr Webster, one of the appellants' witnesses, largely agreed with this
evidence.
(ii) The legality of the industrial action in question is often a
critical factor in assessing the fairness of a dismissal. Indeed,
the view has
been expressed that as a matter of
16
public policy a court should not order the reinstatement of an employee
who has participated in an illegal strike (
Tshabalala and Others vs Minister
of Health and Others
1987(1) SA 513(W) at 523 B). This case was, however,
decided under the common law. And it is now clear that illegal strikers may
enjoy
protection against dismissal. But such a strike constitutes serious and
unacceptable misconduct by employees
(Performing Arts Council of the
Transvaal vs Paper Printing Wood and Allied Workers Union and Others
1994(2)
SA 204(A) at 216 E). (iii) The effect of what I said earlier is that the
stay-away amounted to illegal industrial action.
It was not
17
embarked upon for the purposes of a strike as defined. If it was not a
purely political protest, it had a strong political flavour.
Its main thrust was
directed not so much against the respondent but against the Government. Yet the
aim was to cause harm to employers.
The mines and other employers were therefore
virtually made the scapegoats of what the appellants admitted was a deliberate
"power-play".
Not surprisingly, therefore, other less harmful forms of protest
such as a petition or meeting or a brief work stoppage or even a
one-day
stay-away were eschewed. The result was that the stay-away went ahead (a)
without formal notification to the respondent,
(b)
18
contrary to the respondent's admonition that it should not be held, (c)
in the knowledge that the individual appellants were acting
contrary to the
disciplinary codes, (d) in defiance of a court order prohibiting it (352 E and
356 I-J), and (e) in breach of the
first appellants' undertaking (contained in
the agreements referred to at 345 E, 346 B and 355 B) not to resort to
industrial action
until settlement procedures had been exhausted; that position
had not been reached; negotiations were still taking place (350 C).
And, of
course, the individual appellants' participation was voluntary; there was no
evidence of intimidation. What has been stated
are, I consider, aggravating
features
19
of the appellants' conduct. Yet there is another side to the
picture.
It is the following:
(i) I leave open the question whether dismissal is only justified where
the misconduct has the effect of destroying or irreparably
harming the
relationship between employer and employee or where the relationship is thereby
rendered intolerable or futile (these
being some of the tests which the
industrial courts have applied). It is I think safe to say that what is at least
required is that
the misconduct be serious. After all, dismissal, as has often
been said, is the ultimate sanction; a course of last resort. (ii)
The
individual appellants were dismissed for (a third
20
offence of) absenteeism. In each case the previous two were for what is
described as "individual absenteeism". They were not for participating
in a
stay-away. Indeed there is no evidence that the individual appellants had
previously participated in. a stay-away. One must
therefore consider whether the
stay-away on 5 and 6 September 1989 can properly be regarded as a case of
absenteeism. I have already
found that, for the purposes of deciding whether the
disciplinary codes were breached, it can. But when it comes to the fairness
of
the sanction imposed, I think the position is different. The stay-away was no
ordinary case of absenteeism. Its underlying cause
was a sense of
21
grievance and frustration, not only with the Government, but with + as
well (349 E - H; 350 B). Its object was to protest and thus
exert pressure. In
the view of the court a
quo
(355 H-I), employees were entitled to protest
(though not in the form of a stay-away). But in the perception of those who
participated,
the stay-away was a legitimate form of protest; they obviously
regarded their absence as being for good reason. Any equitable assessment
of the
fairness of the dismissals must surely take these subjective, and in my view
mitigating, factors into account. And the disciplinary
codes themselves allowed
for this. The progressive disciplinary measures provided for are stated
22
to be guidelines only; they are not to be applied rigidly. (iii) The
problem of whether an individualised, selective approach to discipline
should be
applied for collective misconduct is a difficult one (see
Le Roux and van
Nieker,
op cit, 116, 177-8, 183, 298 and 313-4). It may be accepted that
consistency is not always required. In casu, however, I cannot but
help feel
that it was. Though it was left to each employee to decide whether to
participate, their doing so resulted in collective
action. And in the light of
what has been stated in the previous paragraph, I do not consider that the
individual appellants' previous
offences for absenteeism were a sufficient basis
for them being disciplined differently to
23
the others. Cloete testified that the respondent found the
continued employment of those who stayed away but
who were not on final warning for absenteeism
"perfectly acceptable" despite their "serious
misconduct".
(iv) The appellants are, as I have found,
to be criticised for
failing to exhaust the procedures for the settlement of
disputes before the stay-away was decided on. On the
other hand, this point must not be taken too far. To
begin with, prior deadlock is not a
sine qua non
to
subsequent industrial action
(National Union of
Metalworkers of SA and Others vs Macsteel (Pty)
Ltd
1992(3) SA 809(A) at 817 H-l). The evidence for
the
appellants provides some explanation for their conduct.
24
Its effect was that it was considered anomalous that resort be had to the
dispute procedures of the Act as amended when that was one
of the matters that
was being protested against (349 J). Moreover, employers had refused to abandon
reliance on the 1988 amendments;
they were, according to a Mr Schreiner, another
of appellants' witnesses, "using (them) against us regularly and all the time"
(350
B-D). His further evidence was that there was no alternative form of
protest that would have been effective; less drastic ones had
been resorted to
in vain. (v) It is not always necessary to warn an employee that his misconduct
will or even might result in dismissal
(the
25
Performing Arts Council
case at 216 D-E). However, I agree with
the court a
quo
(358 D-H) that in the present matter, as a question of
fairness, the respondent was obliged to inform its employees that they might
be
dismissed. On the basis that employees of President Brand were on 1 September
1989 reminded that "severe disciplinary action will
be taken against those
who...absent themselves from work", it was held that they must have known that
they stood the risk of dismissal
if they took part in the stay-away. 1 have some
doubt as to the correctness of this conclusion. But despite the individual
appellants
concerned not having testified in this regard, 1 fully agree with the
court's
26
finding (359 H-J) that in the case of President Steyn and Freddies, an
adequate warning of dismissal was not given. (vi) Finally,
account must be taken
of a number of miscellaneous considerations. The stay-away was peaceful. Without
wishing to minimise its harmful
effects, its duration was moderate. The
respondent was well aware that it was to take place. Several of the individual
appellants
had been in the service of the respondent for ten years and more.
Bear in mind also that in most cases we do not know how long before
the
stay-away they received their previous warnings for absenteeism.
27
On behalf of the respondent, Mr
Wallis
, on the authority of the
Media Workers
case (at 800 C-G), rightly conceded that we were at large
to decide afresh whether the dismissals were unfair. Counsel, however,
strongly
argued that they were fair. There is much to be said for this view. That is what
makes this matter a difficult one. The
need for the respondent to enforce
discipline in the type of situation with which it was faced must not be
underestimated. Nor should
the enforcement of a system of progressive discipline
be undermined. And the individual appellants' motives, though perceived by
them
to be laudable, must be balanced against the fact that the stay-away constituted
illegal industrial action. I have, nevertheless,
come to the firm conclusion, on
the basis of the cumulative weight of the factors referred to, that dismissal
was an
28
excessive and therefore inappropriate response. It was too harsh a
sanction. The circumstances of the stay-away make this an exceptional
case. In
my opinion, the preferable view is that of the dissenting assessor, viz, that
all the participants in the stay-away should
have been dealt with on the same
basis. The individual appellants should rather have been issued with an
appropriate further warning.
Their absence having been caused by the stay-away,
their misconduct was of substantially the same kind and degree as that of the
others. This being so, it was inequitable to take their previous warnings, which
were the basis of their dismissals, into account
in the way they were. I find
therefore that the dismissals were unfair. It was not in dispute that in the
event of the dismissals
being set aside, the reinstatement of the individual
appellants should
29
follow. This being so, the question of the date from which such
reinstatement should be ordered and the terms thereof and the type
of warning to
be recorded against their records as also what compensation, if any, should be
awarded arises. These matters were unfortunately
not fully debated before us. It
is therefore not appropriate that we should deal with them. What I propose to do
is to adopt the
course followed in the
Performing Arts Council
case (at
220-221) and order that, in the event of the parties themselves not being able
to resolve these outstanding matters, they
be decided by the Industrial Court.
Seeing, however, the parties may be dissatisfied with this part of the order, it
will be a provisional
one in the terms which follow.
I make the following order -
30
(A) The order of the Labour Appeal Court is set aside and replaced by the
following: "1. The appeal against the dismissal by President
Brand
Mine, President Steyn Mine and Freddies Mine of
those
who participated in the stay-away on 5 and 6 September
1989 is upheld. 2. The order of the Industrial Court is set aside
and
replaced by the following:
'(a) The dismissal of the individual applicants is declared to have been
an unfair labour practice.
(b)
The respondent
is directed to reinstate the individual applicants in their
employment.
(c)
No order is
made as to costs.'
31
3. No order as to the costs of the appeal is made".
(B) If any dispute arises between any of the individual appellants and the
respondent concerning the date of the individual appellants'
reinstatement, the
terms thereof, the type of warning to be recorded against their records, or what
compensation, if any, should
be awarded to any of them, such dispute shall be
determined by the Industrial Court in terms of the provisions of sec 46(9) read
with sec 17(ll)(h) of the Labour Relations Act, 28 of
1956.
(C)
Paragraph
(B) of this order is provisional. The parties
may
within fourteen days hereof submit written argument against
it
becoming final. In the event of this not being done,
it shall become final.
32
(D) The cross-appeal is dismissed.
(E) No order is made as to the costs of the appeal or of
the
applications for leave to appeal.
H H
Nestadt Judge of Appeal
Joubert, JA )
Hefer, JA ) Concur
F H Grosskopf, JA )
Scott, AJA )