Western Cape Workers Association v Halgang Properties CC (CCT 44/03) [2003] ZACC 14; 2004 (3) BCLR 237 (CC) (14 November 2003)

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[2003] ZACC 14
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Western Cape Workers Association v Halgang Properties CC (CCT 44/03) [2003] ZACC 14; 2004 (3) BCLR 237 (CC) (14 November 2003)

CONSTITUTIONAL
COURT OF SOUTH AFRICA
Case
CCT 44/03
WESTERN CAPE WORKERS ASSOCIATION                                                    Â
Applicant
versus
HALGANG PROPERTIES CC                                                                            Â
Respondent
Decided on     :           14 November 2003
JUDGMENT
THE COURT:
[1]
The applicant is a trade union, acting on beh
alf of two of its members, Ms Ivy Kona and Mr Lungile Bhusakhwe (the
workers).  The workers were, until the dispute giving rise
to the present
proceedings, employees of the respondent, Halgang Properties CC (the
employer).  The applicant seeks leave to appeal
against the decision of the
Labour Appeal Court handed down on 8 August 2002.  In that decision, the Labour
Appeal Court (LAC)
upheld an appeal against the decision of the Labour Court
which had ordered the reinstatement of the workers.
[2]
The facts are largely common cause and appear
from the judgments of the Labour Appeal Court
[1]
and the Labour Court
[2]
.Â
On 24 June 1999, the employer sold its business of a mini-mall to Wembley
Investment Pty Ltd (Wembley).  The business was to
be transferred to Wembley on
29 September 1999.  That is the date when, according to the deed of sale, all
benefits and risks
of ownership in respect of the business were to pass to
Wembley.
[3]
Commencing on or about 17 August 1999, several
meetings were held between the workers and Mr Wagiet, representing Wembley, to
resolve
the question of the transfer of the contracts of employment of the
workers.  These meetings were held with the assistance of an
isiXhosa
interpreter.  The workers were told that their contracts of employment would be
transferred to Wembley, that their years
of service would be recognised, that
the same conditions of employment would apply, but that for administrative
purposes new contracts
would have to be entered into with Wembley.  The workers
insisted that they should be paid for their years of service with the
employer
and that they be kept in employment by the employer.  The explanation given to
the workers that this was not possible,
in view of the sale of the business and
its pending transfer, did not help persuade them otherwise.
[4]
In view of the attitude of the workers, the
employer considered that the only option open to it was to retrench the workers
for
operational reasons.  The underlying reason was the sale of the major asset
of the employer.  The employer accordingly invited
the workers and the
applicant, who had entered the scene by then, to make representations on the
issues relating to the retrenchment,
such as possible ways of avoiding
retrenchments, retrenchment benefits and other matters.  The applicant and the
workers declined
to make any representations, taking the view that the employer
was “still alive and kicking”.  A dispute ensued and this was
subsequently
referred to the Commission for Conciliation, Mediation and Arbitration (CCMA).
[5]
However, discussions continued culminating in an
offer of a one year contract by Wembley and a demand for an indefinite contract

by the workers.  The demand for an indefinite contract was rejected by
Wembley.  Then, on 20 September 1999, the employer addressed
a letter to the
workers recording their dismissal for operational reasons, tendering four weeks
written notice, and indicating
that their refusal of the offer of employment
disentitled them to severance pay.
[6]
The sequel was the proceedings in the Labour
Court in which the workers sought an order for reinstatement.  That court found
that
the workers had been unfairly dismissed by the employer on 20 September
1999 and directed the employer to reinstate them.
[7]
On appeal, the LAC found that the business had
been transferred to Wembley as a going concern and that as a result the
reinstatement
of the workers by the employer was no longer possible.  It held,
therefore, that if the workers sought a reinstatement order which
would be
binding on Wembley, they should have joined Wembley as a party to the
proceedings.  It accordingly upheld the appeal
for want of joinder.  In view of
this conclusion, the LAC found it unnecessary to consider the question whether
the dismissal
of the workers on 20 September had been substantively or
procedurally unfair.
[8]
The applicant is now seeking to appeal against
the order of the LAC.  It appears from the response of the employer that the
applicant
applied for a certificate in terms of Rule 18 and that on 16 July
2003, the LAC declined a certificate on the basis that no proper
case had been
made for the condonation of the late application for such a certificate.  The
application for leave to appeal to
this Court is also out of time.  In the
notice of application, the applicant intimates that it will seek condonation.Â
No such
application has been received.  However, in the view we take of the
merits of the application for leave to appeal, we consider
it desirable in the
interests of justice to deal with the matter at once.
[9]
This Court has jurisdiction to hear the
application.  The applicant alleges that the decision of the LAC infringed the
rights of
the workers to fair labour practices.  That allegation raises a
constitutional matter.
[3]
Â
The question is whether it is in the interests of justice to grant leave to
appeal.  It is trite that in determining whether
leave to appeal should be
granted, prospects of success are a relevant consideration though not decisive.
[4]
[10]
The applicant is seeking an order for
reinstatement.  It is by now common cause that the employer’s business was
transferred
as a going concern to Wembley on 29 September 1999.  Both the
Labour Court and the LAC found that the business was sold “as a
going concern”
within the meaning of section 197 of the Labour Relations Act.
[5]
  The applicant does not
challenge this finding in the Court.  In this regard the applicant alleges that
as “from 29 September
members should have been working for Wembley Investments.”Â
But the applicant nevertheless contends that the unfair dismissal
by the
employer must be deemed to have been committed by Wembley and that a
reinstatement order against the employer must, consequently,
be deemed to be a
reinstatement order against Wembley.
[11]
The hurdle that blocks the applicant’s path to
the order for reinstatement is the fact that the business has since been
transferred
to Wembley.  What the applicant contemplates are further
proceedings against Wembley in which it will seek a declarator or some
similar
relief to the effect that Wembley is bound by the order for reinstatement
against the employer.  Such procedure was apparently
sanctioned by the LAC in
Success
Panel Beaters & Service Centre CC v NUMSA and Another.
[6]
[12]
The LAC found that the
Success Panel Beaters
case
was distinguishable from the present case because there was no waiver of the
right to be joined in these proceedings.  In
Success Panel Beaters
case
there had been such a waiver.  It was in this context that the LAC held that if
the applicant were seeking an order for reinstatement
that would be binding on
Wembley, the correct procedure was to join Wembley as a party in the
proceedings.  In our view, this
holding by the LAC cannot be faulted.
[13]
In view of the transfer of the business to
Wembley, it is no longer possible for the employer to reinstate the workers.  For
the
purposes of
section 193(2)(c)
of the
Labour Relations Act, 1995
, “it is not
reasonably practicable for the employer to re-instate or re-employ the
[workers]”.  It is not necessary for us
to express any opinion on the procedure
contemplated in the
Success Panel Beaters
case.
[14]
In the light of this, the applicant has no
prospects of persuading this Court that it is entitled to an order for
reinstatement.
 It is therefore not in the interests of justice to grant leave
to appeal.  It follows that the application for leave to appeal
must be and is
dismissed.  There is no order for costs.
By the Court: Chaskalson CJ, Langa
DCJ, Ackermann J, Madala J, Mokgoro J, Moseneke J, Ngcobo J, O’Regan J, Sachs
J, Yacoob J.
For the applicant:                           Western Cape Workers Association
For the respondent:                        Hofmeyr Herbstein Gihwala
Inc
[1]
Halgang Properties CC v Western Cape Workers Association
[2008] ZALAC 5
;
[2002] 10 BLLR 919
(LAC) at paras 1 - 5.
[2]
Western Cape Workers Association v Halgang Properties CC
(2001)
22 ILJ 1421 (LC) at paras 1 - 3.
[3]
National Education Health & Allied Workers Union
v University of Cape Town and Others
2003 (3) SA 1
(CC);
2003 (2) BCLR 154
(CC) at para 14;
National Union of Metalworkers of South Africa and Others v
Bader Bop (Pty) Ltd and Another
[2002] ZACC 30
;
2003 (3) SA 513
(CC);
2003 (2) BCLR 182
(CC) at para 15;
Alexkor Limited and Another v The Richtersveld Community
and Others
CCT 19/03, 14 October 2003, as yet unreported, at para 23.
[4]
Fraser v Naude
1999 (1) SA 1
(CC);
1998 (11) BCLR 1357
(CC)
at para 10;
Boesak v The State
[2000] ZACC 25
;
2001 (1) SA 912
(CC);
2001 (1) BCLR 36
at
para 12;
Minister of Health and Others v Treatment Action Campaign and
Others (No 1)
[2002] ZACC 16
;
2002 (5) SA 703
(CC) at para 10;
NEHAWU
above n 3 at
para 25;
NUMSA
above n 3 at para 17.
[5]
Act 66 of 1995.  The decision of the Labour Court, in the present
matter, was handed down prior to the appeal against the decision
of the Labour
Court in the matter of
National Education Health & Allied Workers Union
v University of Cape Town and Others
(2000) 21 ILJ 1618 (LC).  In the
Western
Cape Workers Association
case (above n 2) the Labour Court declined to
follow the Labour Court’s decision in the
NEHAWU
case as to the proper
interpretation and meaning of section 197 of the Labour Relations Act.Â
However, by the time the present
case came on appeal to the LAC, that court had
already decided the appeal in
National Education Health & Allied Workers
Union v University of Cape Town & Others
[2002] 4 BLLR 311
(LAC);
(2002) 23 ILJ 306 (LAC), but before the
NEHAWU
case was heard by this
Court.  The Labour Appeal Court was nevertheless satisfied that on the basis of
the majority decision of
the LAC in the
NEHAWU
case, the business had
nevertheless been transferred “as a going concern” within the meaning of
section 197.  Nothing turns
on this for present purposes.
[6]
[2000] 6 BLLR 635
(LAC).