IN THE LABOUR COURT OF SOUTH AFRICA DURBAN
CASE NO: D715/2016
In the matter between:
NATIONAL UNION OF METALWORKERS
OF SOUTH AFRICA (NUMSA) First Applicant
LINDELANI SHEZI & 37 OTHERS Second & F urther
Applicants
and
ASSMANG (PTY) LTD Respondent
Final Closing Submissions: 6 April 2026
Judgment Delivered: 26 August 2026
Summary: dismissal for operational reasons – selection criteria – bumping -
duty of union during consultations – duty of employer to apply a fair and
objective selection criterion, even in the absence of meaningful input from
employees
JUDGMENT
WHITCHER J
(1) Reportable: Yes
(2) Of interest to other Judges: Yes
Signature Date
2
Introduction and background
[1] This matter concerns the retrenchment of 38 employees at the respondent’s
Cato Ridge Works. The employees are represented by NUMSA as first
applicant. The dismissals took place in February 2016 1, pursuant to a large-
scale restructuring under section 189A of the Labour Relations Act. The
process was facilitated by the CCMA over a consultation period of some eight
months.
[2] It is now common cause that the retrenchments were motivated by operational
requirements caused by the respondent’s commercial and financial difficulties
and the restructuring of its furnace operations. The financial and economic
rationale was initially placed in issue in the applicants’ statement of claim.
However, by the time the testimony of the respondent’s witness, Mr Karsten,
had been led, the applicants no longer pursued their claim that the respondent
lacked an operational need for a reduction in staff. The dispute narrowed to the
fairness of the selection criteria and how those criteria were applied.
[3] The respondent’s pleaded case was that it applied “LIFO with the retention of
critical and necessary skills and experience” as its selection criterion. In its
Heads of A rgument, it describes the criteria as “LIFO with retention of skills”.
The applicants, for their part, allege that the respondent imposed its own
special selection criteria which were unfair. The unfairness, they say, lay in the
fact that the respondent retained numerous employees with less service than
the applicants, failed to consider or properly apply bumping, and continued to
use contract workers after the retrenchments. According to the applicants,
these factors rendered the dismissals substantively unfair.
[4] The applicants accept that the Cato Ridge plant has since closed down.
Consequently, if they were to prevail in their claim of substantive unfairness,
they accept that reinstatement is not practicable and ask for compensation
calculated in terms of a submitted schedule.
calculated in terms of a submitted schedule.
1 The prosecution of this trial was repeatedly delayed mostly by the applicant, thus due to no fault of
this Court.
3
[5] The applicants do not posit a general problem with the application of selection
criteria giving rise to a general entitlement to compensation. They identify some
employees who, even on the respondent’s own criteria, should not have been
retrenched, as they were not the shorter -serving applicants in positions where
reductions were necessary. There are, in addition, employees who had been
promoted out of the furnaces and whose promotion resulted in their
retrenchment. The applicants contend that these employees ought to have
been vertically bumped back to the level 2 positions from which they had
previously been promoted. Some among this group were fortunately re-
employed within a 12- month period of retrenchment, and their entitlement to
compensation is accordingly less than that of employees who were never re-
employed. The applicants further identify several employees whom they say
ought to have been accommodated at salary level 1, again distinguishing those
who were re- employed within 12 months from those who were not. Lastly, the
applicants identify three employees, a team captain, Xolani Gebashe, an
electrician, Rishen Sukram and Makhatini, a second assistant in engineering,
whose dismissal is said to be unfair for reasons special to each of them.
[6] To avoid unnecessary repetition, the further detail relating to these employees
is dealt with later in this judgment.
[7] Before turning to the merits, I record that during the course of these protracted
proceedings six of the individual applicants passed away. Applications were
duly brought to substitute the deceased applicants’ estates.
[8] Certain documents were admitted into evidence and are central to this case.
Exhibit C is the Retrenchment Selection Document, which the respondent relied
upon in deciding which employees would be dismissed. The other important
documents are described where they arise below.
The union’s conduct during consultations
documents are described where they arise below.
The union’s conduct during consultations
[9] During the facilitated retrenchment consultations, the applicants took the
position that no operational need existed to justify the retrenchments. Almost as
if the union were negotiating rather than being consulted, it refused to engage
on the other matters specified in section 189 of the Labour Relations Act,
including selection criteria. The applicants disputed the respondent’s severe
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financial and operational pressures well into the trial. This is despite NUMSA’s
own financial advisors having been persuaded of the legitimacy of the
operational requirement to reduce staff, once financial information was
released.
[10] While a trade union is entitled to dispute the facts an employer raises in
retrenchment consultations, and, as here, to quibble about confidentiality
restrictions placed on financial disclosures, having heard the evidence of Mr
Karsten, (the substance of which had already been disclosed to NUMSA during
retrenchment consultations), it is difficult to understand why the need to
retrench continued to be disputed. Although the Court appreciates counsel’s
eventual concession, considerable trial time was wasted entertaining what may
colloquially be described as a non-starter.
[11] Had the union acknowledged the glaring fact that market conditions beyond its
control had forced upon the respondent the need to reduce staff, consultations
might have focused on other matters instead. Even if the applicants harboured
suspicion about the existence of a genuine operational requirement, refusing to
consult on all the other matters listed in section 189 of the LRA had an
unfortunate effect. Union members were deprived of representation on the full
range of issues relevant to a retrenchment.
[12] A trade union may reserve its rights to dispute the primary need for dismissal
while still vigorously engaging the employer on the other matters. Had the union
engaged the respondent on its proposed selection criteria with the same
attention it later mustered for the same subject at trial, the union’s preferred
criterion, LIFO with bumping, might well have been accepted once ideas and
arguments were properly aired. This is precisely what section 189 of the Labour
Relations Act envisages. It is an unfortunate use of scarce court resources to
unpick, years later, an error in the knitting of a jersey that might have been
pointed out at the time.
pointed out at the time.
[13] The respondent did not merely bemoan this state of affairs . It contends that the
union’s conduct deprived the applicants of the right to complain that better
selection criteria might have been applied. The respondent led evidence that
the consultation process was extensive, lasting approximately eight months,
5
with numerous meetings between the parties and CCMA commissioners, and
additional bilateral meetings. According to Ms Mngoma, the respondent’s HR
manager, the respondent repeatedly sought to consult on selection criteria, but
the union refused to engage on criteria until it was satisfied with the economic
rationale, notwithstanding its access to forensic financial expertise and
documentation.
[14] The respondent accordingly contended that NUMSA’s intransigence impeded
the section 189A process and had a bearing on the subsequent selection
decisions. It invoked sections 189A( 13) and (18) to argue that consultation
duties are reciprocal, that the union had the capacity to understand and engage
with the respondent’s operations (as shown by its own “Organised Labour
Proposal”), and that any deficiencies in consultation over criteria should be
viewed against the backdrop of the union’s deliberate avoidance of the topic.
[15] Applicants’ counsel conceded that NUMSA refused to consult on selection
criteria. He sought to explain this by reference to the respondent’s initial failure
to provide adequate financial information and the need to sign confidentiality
agreements and pursue a referral to the CCMA before meaningful disclosure
occurred. The applicants argued that meaningful engagement on the financial
information only occurred on 15 January 2016, after which the economic
rationale was no longer contested. They contend that , in any event, in law, the
breakdown in negotiations and the reasons for it are irrelevant to substantive
fairness. In the absence of agreed criteria, the employer must still apply criteria
that are fair and objective, as required by section 189(7) of the LRA The
allocation of blame for the failure to reach consensus does not bear on the
fairness of the dismissals.
[16] I am bound to agree with the union’s argument that its refusal to engage on
selection criteria, and its failure to contest the criteria applied by the respondent
selection criteria, and its failure to contest the criteria applied by the respondent
during consultations, did not relieve the employer of its duty to apply criteria
that were fair and objective. It ought to have occurred to the respondent, when
it formulated the criteria it ultimately used (discussed below), that those criteria
had the effect of selecting long- standing employees for dismissal
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notwithstanding that they were capable of performing, at a lower level, a job
then being performed by employees with less service to the company overall.
[17] Our labour law places a premium on long service when it comes to selection for
retrenchment. It is almost the default criterion, and an employer who wishes to
depart from it must have solid reasons for doing so, and the basis of selection
must, overall, still be fair and objective. One cannot apply LIFO to give effect to
the value of privileging long service without considering the question of
bumping. Bumping concerns whether more senior employees, in terms of total
service to the respondent, should be moved into similar or lower positions held
by employees with less service. Bumping is integral to the proper application of
LIFO.
[18] Bumping is not, however, the sine qua non of fair and objective selection
criteria. A long- serving hospital administrator cannot be bumped into a nursing
position. Here, though, the respondent’s own workforce profile reveals that a
number of the applicants had previously worked in lower positions, the
furnaces, for instance, which were saved from retrenchment. In that event, the
employer ought at least to have considered LIFO with bumping as a possible
selection criterion. It may be that LIFO with bumping could still have been
avoided for countervailing reasons like operational complexity, dislocation, or
the loss of critical skills, but bumping ought properly to have been discounted,
one way or the other, with or without the union’s engagement.
[19] This Court is bound to find as it does because this is the position taken by the
Labour Appeal Court in Fischer Tube Technik SA v Bayene and Another .
2
There the Court held:
In South African Law, bumping forms an integral part of the application of LIFO.
While there is no absolute obligation on an employer applying LIFO to bump, it is a
matter that ought properly to be canvassed during the consultation process when
matter that ought properly to be canvassed during the consultation process when
LIFO is agreed. Indeed, it is not open to an employer to contend that employees
cannot raise the issue of bumping only because they failed to do so during the
consultation process.
22024 45 ILJ 1804 (LAC) at para 14.
7
[20] It should be recorded, in fairness to the respondent, that the Labour Appeal
Court in Fischer Tube Technik ultimately upheld the employer’s appeal on the
facts before it. There, the employer had candidly canvassed vertical bumping
with the affected employees, who declined a bona fide offer to be moved into
lower-paid positions. The Court held that a fair offer of bumping, once made
and refused, does not without more render a dismissal unfair. The position here
is materially different. As appears below, the respondent never candidly
canvassed, still less offered, bumping to the applicants in 2016. It cannot claim
the benefit of the qualification that saved the employer in Fischer Tube Technik.
The court does not accept the respondent’s suggestion that a consideration of
bumping only arises as part and parcel of the consultation process.
[21] It follows, of course, that the union cannot now be heard to complain about the
procedural fairness of the retrenchment process itself, for two independent
reasons. First, and decisively, section 189A( 18) of the LRA provides that this
Court “may not adjudicate a dispute about the procedural fairness of a
dismissal based on the employer’s operational requirements” in a dispute
referred to it in terms of section 191(5)(b)(ii), as this one was. Any complaint
about the fairness of the consultation process ought properly to have been
raised by way of an urgent application under section 189A( 13) during the
retrenchment process itself, not resurrected as a ground of attack years later at
trial. Second, and in any event, even if this were not a bar, the union’s own
refusal to engage on selection criteria during consultation would go a long way
towards disentitling it from now complaining that the process was procedurally
unfair. Neither of these considerations, however, dilutes the employer’s
separate and substantive duty, under section 189(7)(b) of the LRA, to apply a
separate and substantive duty, under section 189(7)(b) of the LRA, to apply a
fair and objective selection criterion, even in the absence of meaningful input
from employees. Whether the respondent discharged that substantive duty is
considered later in this judgment, once I have dealt with a preliminary pleading
point raised by the parties.
The applicants’ pleaded case
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[22] A second issue to be determined is whether the applicants’ complaint that LIFO
with bumping ought to have been applied as a selection criterion was properly
pleaded.
[23] The applicants’ complaint that the selection criteria used by the respondent
were unfair, or not properly applied, was certainly not central to their pleaded
case. Despite this, I am satisfied that the issue was nevertheless brought within
the ambit of the cause of action. In their pleadings, the applicants averred that
the fairness of the manner in which employees had been selected was in
dispute, and that the proper application of LIFO required fair consideration of
the principles of bumping.
[24] In the pre- trial minute, the Court was further required to decide whether the
dismissals were substantively fair, including whether proper consideration had
been given to alternatives short of dismissal and to the continued employment
of contractors. The applicants emphasised that the precise methodology of
selection lay within the special knowledge of the respondent, and that the
respondent bore the onus of proving that the selection was fair and lawful.
[25] Further, as counsel for the applicants pointed out, the Labour Appeal Court in
Sibiya v SA Police Services , a matter concerned with the amendment of a
pleaded remedy rather than with un- pleaded issues generally, but in which the
Court articulated a wider principle, held:
In substantiation of that principle, this Court further accepted in ‘Trellicor’ that while
the object of pleadings is to define the issues and while parties are to be kept strictly
to their pleadings where any departure would cause prejudice, or prevent full enquiry,
the Court has a wide discretion within those limits, since ‘pleadings are made for the
Court, not the Court for the pleadings’. It is also accepted that our Courts have
decided issues not specifically pleaded where the parties have widened the issues to
decided issues not specifically pleaded where the parties have widened the issues to
include those not pleaded, and have even decided such issues where no amendment
has been sought to regularise the position where there was no prejudice (ie which
would ordinarily arise if those un -pleaded issues were not fully canvassed at the
trial).”
3
[26] I respectfully adopt that general principle for present purposes.
3 Sibiya v SA Police Services (2022) 43 ILJ 1805 (LAC) at para 31.
9
[27] In this case, the respondent led evidence on how employees had been
selected for dismissal. During this testimony, the respondent complained of
being at a disadvantage without knowing the applicants’ proposed comparators;
that is, which employees the applicants contended ought to have been
retrenched instead of the individual applicants. The Court ordered the
applicants to provide further particulars identifying those employees. In
compliance, the applicants produced Exhibit X, essentially a list of employees
with fewer years of service than the applicants who, on the applicants’ case,
should have been retrenched instead.
[28] In response, the respondent produced Exhibit Y and Ms Mngoma was led in
further evidence- in-chief on its contents. Exhibit Y comprised a schedule, for
each applicant and comparator listed in Exhibit X , of information including
name, position when retrenched, date of engagement, last position, years of
service, a skills differentiator, dates of re-employment and current status.
[29] To the extent that it could be said that the applicants had not pleaded the
respondent’s failure to apply bumping as an element of substantive unfairness,
the admission of, and evidence led on, Exhibits X and Y operated as an
extension of the applicants’ pleadings on selection fairness. The issue was
thoroughly canvassed, and no prejudice was occasioned to either party.
Summary and evaluation of evidence
Operational rationale
[30] The respondent’s case on the commercial rationale for dismissal was advanced
primarily through Bundle A and the evidence of Mr Karsten, which provided a
detailed analysis of the financial position at the Cato Ridge facility, the need to
reduce production capacity, and the impact on headcount. It is unnecessary to
discuss the operational rationale in any detail, since, as noted, the applicants
no longer pursue a challenge that the retrenchments were commercially
unnecessary. The dispute turned on whether otherwise justifiable
unnecessary. The dispute turned on whether otherwise justifiable
retrenchments were rendered unfair by defective selection criteria or their
application, by a failure to consider alternatives, or by the continued
employment of contractors.
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Selection criteria and methodology
[31] The respondent claimed that the selection criteria used were the date of an
employee’s commencement in a position in a department, together with that
employee’s position and skills. According to Ms Mngoma, and with reference to
Exhibit Y, Heads of Department were involved and were said to know the
personnel and skills requirements of their departments and which
retrenchments would not affect the company’s functioning from a skills
perspective. The respondent described its criteria as “LIFO with retention of
skills”.
[32] The applicants point to a number of concessions made by Ms Mngoma in her
testimony which undermine the contention that the criteria applied were fair and
objective. When taken through the Retrenchment Criteria Document, she
acknowledged that where a position had been made redundant, employees in
that position were retrenched as a matter of course and that where the number
of employees in a position needed to be reduced, the employee with the fewest
years of service in that position, regardless of total service to the company, was
selected for retrenchment. Total service served only as a tie- break where years
in position were equal. This methodology was confirmed in cross -examination
and by the Court, and became the basis on which Exhibits X and Y were
compiled.
[33] As already stated, the applicants contend that it was unfair for the respondent
to retain in its employ numerous employees with less service than those who
were retrenched, in circumstances where the retrenched employees possessed
the skills and experience to be vertically bumped into positions the company
retained. This was the theme set out in Exhibit X which NUMSA produced and
which was explored in evidence, alongside concessions made in respect of
Exhibit Y and the details of skills and training the individual applicants
possessed set out in Exhibits AA and BB. Taken cumulatively, this evidentiary
possessed set out in Exhibits AA and BB. Taken cumulatively, this evidentiary
material shows, on a balance of probabilities, that the applicants possessed the
skills and experience necessary to perform the jobs of employees who were
retained despite having fewer years of service with the respondent.
11
[34] Ms Mngoma contended that bumping would have been impractical, and that its
combination of LIFO and retention of skills was appropriate and fair in the
circumstances. Ms Mngoma’s evidence was that bumping would have caused a
“mess” and would have been detrimental if applied without regard to skills.
[35] The applicants argue that bumping was never actually considered at the time of
the retrenchments, and that much of Ms Mngoma’s testimony on the topic
constitutes an ex post facto attempt to rationalise the dismissals. They submit
that her evidence consists of vague generalities, unsubstantiated opinion, and
claims unsupported by shop- floor knowledge. The applicants also point to Ms
Mngoma’s concession that the retrenched employees were multi -skilled and
could have taken up alternative positions.
[36] Counsel for the applicants further points out, not without merit, that Ms
Mngoma’s responsibilities were confined to HR, and that she could not explain
the duties of entry-level employees in key departments even when asked by the
respondent’s own counsel. I accept that this lack of operational insight
undermined her conclusions about the impracticality of bumping and the risk of
losing essential skills, particularly where Bundles AA and BB reveal extensive
training and multi-skilling amongst the applicants.
[37] Exhibit D is a spreadsheet handed up by the respondent during Ms Mngoma’s
evidence. It sets out the employment details of the applicants who were
retrenched because, tellingly, they were “last in the position”, and compares
their total years of service with other employees in the same position who were
not retrenched. In my view, the evidence shows that this is not truly a debate
between LIFO with retention of skills and LIFO with bumping at all. The
evidence does not establish that the respondent actually applied LIFO with
retention of skills. While Exhibit Y did reflect for each applicant and comparator,
retention of skills. While Exhibit Y did reflect for each applicant and comparator,
information about their position when retrenched, date of engagement, last
position, years of service, a skills differentiator, dates of re- employment and
current status, Exhibit Y was not in existence when the dismissals occurred. It
certainly was not the blueprint the respondent actually used to determine who
would stay and who would go.
12
[38] Despite extensive correspondence, full proof of Exhibit Y’s accuracy had not
been provided by the time the matter resumed in October 2022, and its
adequacy became a central issue in cross -examination. It became apparent
that Exhibit Y did not reflect the full range of training and qualifications held by
the applicants and comparators, that “skills” in Exhibit Y were not drawn from
comprehensive training files, and that several employees with significant
training, the production foreman, Mr Hlongwane, among them, were incorrectly
recorded as having none.
[39] Under cross-examination, Ms Mngoma further conceded that the best indication
of training received by any applicant was contained in their training files, which
were only made available late in the trial and are summarised in Bundles AA
and BB. She accepted that Exhibit Y did not include licences to operate
machinery, formal qualifications, or all training received, explaining the
omissions by saying she had not been instructed what training to include and
believed she would have the opportunity to “add more information” as the case
continued.
[40] In my view, t hese concessions demonstrate that Exhibit Y does not present a
full or reliable reflection of skills or training, and that it cannot serve as an
answer to Exhibit X, which showed that a number of the applicants were suited
to vertical bumping.
[41] The question then arises: what selection criteria were, in fact, adopted and
applied in 2016, as opposed to those advanced ex post facto ? The evidence
shows that at the time the employer made its retrenchment decisions in 2016,
the true selection criterion was LIFO per position, as in fact named in Exhibit D.
Employees who had previously worked in a position, no matter for how long,
were not considered for retention in it. To the extent that skills played any
differentiating role, at best, employees presently in a position were deemed
more skilled and useful to the employer than those who may have had greater
more skilled and useful to the employer than those who may have had greater
overall service but now occupied another position. The “skill” possessed by
employees who were retained was, in substance, already being in the job,
being part of an existing team, and their retention occasioning the least “mess”.
The employer did not take a comprehensive and objective view of the skills
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possessed by the applicants and their comparators beyond assum ing that
incumbency meant capacity.
[42] This selection criterion was, understandably, an attractive one for the
respondent. Long- serving employees who had been promoted to other jobs
would inevitably take time to readjust to jobs at a lower rank, even where they
had previously performed those jobs, nor would operations resume as
seamlessly under vertical bumping as they would under LIFO per position.
Counsel for respondent accurately contends that bumping would have forced
people from different departments into teams with which they were not
necessarily familiar and leadership with which they were not familiar. It may
even have caused some strife. However, in my view, the employer did too little
to show, in credible evidence, that these operational considerations fairly
outweighed a consideration integral to the fair application of LIFO; namely,
whether bumping could be applied. Instead, the respondent sought to persuade
this Court that LIFO plus skills were the objective factors distinguishing those
who stayed from those who went, when incumbency was, in truth, the operative
consideration. This is precisely the pattern of subjective, inadequately
evidenced departure from LIFO that the Labour Appeal Court found fault with in
Umicore Catalyst South Africa (Pty) Ltd v NUMSA and Others . In that case a
“skills” or behavioural overlay was found to be subjective and uncorrelated to
actual performance was further held not to rescue a departure from an
otherwise fair and agreed criterion.
4
[43] Selection criteria must be fair and objective. I have so far principally considered
fairness, but objectivity also comes into play in causa . The respondent found
itself on the horns of a dilemma: its real selection criterion, LIFO per position,
was objectively easy to determine, but the criterion it pleaded, LIFO with
retention of skills, could not be objectively justified on the evidence it produced,
retention of skills, could not be objectively justified on the evidence it produced,
for the reasons set out above.
4 Umicore Catalyst South Africa (Pty) Ltd v National Union of Metalworkers of South Africa
and Others (PA3/23) [2024] ZALAC 37; [2024] 11 BLLR 1138 (LAC); (2024) 45 ILJ 2545
(LAC) (29 August 2024).
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[44] This is not quite the end of the matter. While an employer has a duty to apply
fair and objective selection criteria, what happens if the application of an unfair
and subjective criterion produces the same result as the criterion the dismissed
employees and the union contend should have been applied? In other words,
what happens if it can be shown that an employee selected for retrenchment on
an unfair basis would nevertheless still have been retrenched had fair and
objective criteria been applied? Section 189(7) of the LRA provides:
[45] The employer must select the employees to be dismissed according to
selection criteria:
45.1.1 that have been agreed to by the consulting parties; or
45.1.2 if no criteria have been agreed, criteria that are fair and objective.
[46] Section 192(2) of the LRA provides that “if the existence of the dismissal is
established, the employer must prove that the dismissal is fair.” I cannot see
how the overall fairness of a dismissal for operational requirements can be
delinked from the fairness of the selection criteria according to which
employees were dismissed. If the criteria applied at the time lacked fairness
and objectivity, the dismissal is accordingly substantively unfair.
[47] Besides the fact that the employer did not apply LIFO plus bumping, the
applicants also allege that, in respect of nine employees, even the respondent’s
own stated criterion, LIFO per position, was not accurately applied. In one case,
that of Xolani Gebashe, the employee ironically appears to have been vertically
bumped when there was no cause to do so. These instances, the applicants
contend, also rendered the dismissals substantively unfair.
Findings
[48] The applicants’ complaint that the respondent’s continued use of contract
labour after the retrenchments points to a failure to consider alternatives short
of dismissal was raised in the pre- trial minute but it was not pursued with any
energy in evidence or argument. The real purpose of the point seems to have
energy in evidence or argument. The real purpose of the point seems to have
been the belt to the brace of the primary argument the applicants advanced:
that is, that they ought to have been bumped into positions within the company.
If the court found against them on that claim, then their eligibility for contract
15
cleaning work as an alternative to dismissal might have come into play. Given
what follows, that argument falls away.
[49] Exhibit X was not challenged on the basis that the applicants lacked longer
overall service than the comparators. To the extent it is not already clear, it is
this Court’s finding that the respondent did not consider whether comparators
with lesser service should have been “bumped” and, more importantly, did not
have proper reasons at the time for discounting bumping. It follows that the
respondent’s selection of employees for dismissal was substantively unfair.
[50] The other selection anomalies described above, including the nine instances in
which the respondent’s own stated criterion of LIFO per position was
inconsistently applied, and Mr Gebashe’s anomalous vertical demotion, were
not rebutted in evidence, and I accept them as established.
[51] The dismissals occurred in 2016. The applicants accept that the plant has since
shut down and that reinstatement is no longer practical. They seek
compensation instead. Section 194 of the LRA caps compensation for an unfair
dismissal: an order must be just and equitable in all the circumstances, but may
not exceed the equivalent of 12 months’ remuneration calculated at the
employee’s rate of remuneration on the date of dismissal. Our courts have
identified a broad, non- exhaustive range of factors relevant to the exercise of
this discretion, including the nature and degree of the unfairness, any conduct
by either party that promotes or undermines any of the objects of the Act, for
example, effective resolution of disputes, and the consequences to each of an
award being made or withheld.
5
[52] In deciding what compensation would be just and equitable, I repeat that my
criticism of the union’s conduct in refusing to discuss selection criteria did not
bear on my finding that the dismissals were substantively unfair. That criticism
does, however, return as a factor relevant to quantum. Our courts recognise
does, however, return as a factor relevant to quantum. Our courts recognise
that a party’s own conduct during the process leading to the dispute, including
conduct that undermines the objects of the Act, such as effective and timeous
5 See Dr D.C. Kemp t/a Centralmed v Rawlins (2009) 30 ILJ 2677 (LAC); [2009] 11 BLLR
1027 (LAC), [at para 20]
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engagement, may properly reduce (or, in an appropriate case, even eliminate)
an award of compensation notwithstanding an underlying finding of unfairness.
[53] While the respondent ought to have considered bumping at the outset and,
absent serious countervailing operational or fairness considerations, ought to
have applied LIFO with bumping, the union’s lack of engagement on this topic
lessens, in my view, the degree of fault properly attributable to the respondent.
Put differently, had the union engaged on selection and demanded LIFO plus
bumping in 2016, and had the employer then stubbornly persisted with LIFO
per position, the quantum of just and equitable compensation would, justly and
equitably, have tended towards, if not reached, the statutory maximum. That is
not this case. The respondent did not stubbornly persist with a wrong- headed
criterion having rejected good arguments to the contrary, because it was never
given the opportunity to hear those arguments. Section 189 consultations are
meant to foster agreement and to avoid later disputes about the fairness of a
dismissal. They are not bowling alleys, in which an employer sets up the pins
only for the union to knock them down later in litigation.
[54] The court accepts counsel for the r espondent’s invitation to show some
displeasure at the conduct of NUMSA in regard to its refusal to consult. Just as
an employee who unnecessarily draws out or complicates a disciplinary hearing
may recover less compensation than would otherwise be the case, even where
the ultimate dismissal is found to be unfair, so too here is compensation
affected by conduct during the retrenchment consultations. There is no reason
to believe the respondent would have rejected LIFO with bumping out of hand.
When called upon to justify the need for retrenchments, it in fact engaged at
length and in good faith, and the Court has the distinct impression, rising to a
probability, that it would have had an open mind on selection criteria too,
probability, that it would have had an open mind on selection criteria too,
especially if they knew the union demanded it.
[55] I set out below the categories of employees who were retrenched, together with
the compensation this Court considers just and equitable in each case. I have
adopted nine of the available twelve months as an appropriate baseline. I have
not awarded the statutory maximum, because this is not a case of egregious,
wilful, or contumelious conduct on the respondent’s part of the kind that would
17
ordinarily attract it (as explained above). The respondent’s failure, as found
above, lay in a subjective and inadequately evidenced departure from a fair
criterion, not a bad- faith disregard of its obligations. Within that baseline, the
employees in category 1 below suffer no discount, because their claim does not
depend on the vindication of the union’s bumping argument at all. Even on the
respondent’s own chosen, if unfairly applied, methodology, they were the wrong
candidates for retrenchment. Categories 2 and 3, by contrast, depend on
vindicating the bumping argument, on which, as found above, the union’s own
intransigence in consultation is a relevant, if secondary, consideration. This
accounts for the 10% discount common to both categories where the employee
concerned was not re-employed. Category 3’s discount is also 10%, applicable
to those who were not re-employed and those subsequently re-employed.
Relief
[56] The ten employees identified from Exhibit “D” 6 ought not to have been
retrenched, as they were not the shorter -serving applicants in positions where
reductions were necessary. They are accordingly awarded compensation in the
sum of nine (9) months’ salary at the salary level which pertained to them at the
time of their dismissals.
[57] The six production employees who were promoted from the furnaces, which
promotion resulted in their retrenchment (whose situation is described in
paragraph 75 of the applicants’ heads of argument, and who are identified from
Exhibit X)
7 ought to have been vertically bumped back to the level 2 positions
6 Mishack Mshengu (employee number 00035), Goodman Miya (employee number 03537),
Sizwe Hlongwane, Hlengiwe Gasa (employee number 00655), Vusimuzi Magubane
(employee number 03585), Nkosinathi Mhlaba (employee number 00529), Zwelitshe
Makhatini, Malusi Miya (employee number 00525), Alexia Ngubane (employee number
00643); Bhekisisa Phetha.
7 Nosithembiso Gebashe was retrenched but was re-employed from 7 February 2017 as a
7 Nosithembiso Gebashe was retrenched but was re-employed from 7 February 2017 as a
second assistant, furnaces. Princess Nduli was retrenched but was re-employed from 7
February 2017 as a second assistant, furnaces. Ntombifuthi Tyani was retrenched but was
re-employed from 10 August 2016 as a second assistant, furnaces. Nontsikelelo Tshongwe
was retrenched but was re-employed from 26 October 2016 as a Sheq officer in training.
Menzi Mbeje was retrenched but was re-employed from 7 February 2017 as a second
assistant, furnaces. Buyisile Ndlovu was retrenched and was considered for re-employment
in February 2017 but failed her medical examination at that point. Since there is no evidence
that Ms Ndlovu would not have been able to be bumped into the lower position in 2016, I
18
from which they had previously been promoted. Of this group, the one applicant
who was not subsequently re- employed is awarded nine (9) months’
compensation at salary level 2, minus 10%.
[58] Those applicants who were subsequently re- employed within a 12- month
period from the date of dismissal are awarded compensation for the period from
dismissal until re-employment, calculated at salary level 2, minus 10%.
[59] Having regard to the Retrenchment Selection Document (Exhibit C), read
together with Exhibit X, which identifies comparators with lesser service, six
Engineering department employees
8 and seven Materials department
employees9 ought to have been accommodated at salary level 1 had LIFO with
bumping been applied. They are awarded nine (9) months’ compensation at
that salary level, minus 10%, or, in the event that any of them was re -employed
by the respondent within such 12- month period, compensation for the period
from dismissal to re-employment, minus 10%.
[60] I turn now to t hree special cases. The respondent did not, in evidence, gainsay
that Xolani Gebashe ought to have been retained as a team captain at salary
level 4, but was instead re- employed in August 2016 at salary level 2. In other
words, he was unfairly bumped downward when there was no cause to bump
him at all. He is accordingly awarded compensation at the salary level 4 rate
until the date of his re- employment, and thereafter the difference between
make nothing of her subsequent failure to meet a medical standard, and she is treated as
not having been re-employed.
8 Engineering department: Nkosikhona Magcaba originally employed on 31 December 2006
Emmanuel Gwala originally employed on 20 October 2008. Pretty Buthelezi employed on 3
September 2007. Zanele Mabaso employed on 5 November 2006. Joyce Shange employed on
29 October 2007. Fikile Ndwandwe employed on 15 July 2010.
9 Materials Department: Lungasile Mncwabe start date 27 August 2008. Sizeka Nyoko start
9 Materials Department: Lungasile Mncwabe start date 27 August 2008. Sizeka Nyoko start
date 6 November 2008. Renehoe Makufanwe commenced employment on 27 August 2008.
Mhlengi Khanyezi started work on 1 October 2010. Ngethembi Mtungwa started on 6
November 2008. Maxwell Dladla started on 3 September 2007.Lindelani Shezi started on 27
August 2008.
19
whatever salary he received and the level 4 salary, until he again reached that
salary level, provided that this does not exceed 12 months in total.
[61] Rishen Sukram was not considered for bumping downward into a position in
Stores, despite having significantly more service than comparator storemen
who were not retrenched. The applicants contended that Mr Sukram might also
have been accommodated as an electrician. It is not for this Court to award him
compensation attached to the higher of the two positions into which he might
have been bumped. He is awarded nine (9) months’ compensation at the salary
level of the Stores post into which he should have been bumped, minus 10%.
[62] The Retrenchment Criteria Document in relation to Mr Makhatini
10
demonstrates he commenced work with the respondent as a general labourer
in the produc tion furnaces on 23 November 1993. He thus had approximately
23 years of unbroken service with the respondent when he was retrenched. He
worked in various departments, but his last position was as second assistant in
engineering to which he was transferred on 16 August 2010. He was
retrenched because he had shorter service than other assistants in the position,
despite his overall years of service and six years of experience as a second
assistant. He is awarded nine (9) months’ compensation at the salary level he
occupied at the time of his retrenchment.
Costs
[63] Given the complex nature of this case11, no cost order is made.
Order
[64] The dismissal of the applicants listed in the section marked ‘relief’ (above) was
substantively unfair and each is awarded compensation as outlined therein.
Benita Whitcher
Judge of the Labour Court of South Africa
10 Page 547 of the record, Exhibit C.
11 Basically, the union must start taking a more responsible position in retrenchment consultations.
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Appearances:
For the Applicants: P Schumann, instructed by Harkoo, Brijlal & Reddy
For the Respondent: A Snider SC, instructed by Cliffe Dekker Hofmeyer
Inc