July 2011

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Hightlights to the Industrial Law Reports

The Test for the Review of Awards Revisited

In an appeal from the Labour Appeal Court the Supreme Court of Appeal has in National Union of Mineworkers & another v Samancor Ltd (Tubatse Ferrochrome) & others once more considered the distinction between appeals and the review of awards, having regard to the grounds for review set out in s 145 of the LRA and in the light of the CC's judgment in Sidumo & another v Rustenburg Platinum Mines Ltd & others (2007) 28 ILJ 2405 (CC).  The SCA found that, in allowing an appeal from a review judgment by the Labour Court in the manner that it did, the LAC had failed to appreciate the limited nature of the question that had been before the Labour Court, and hence the question that was before it on appeal.  Nowhere in its reasons had the LAC made any express finding that the award being reviewed was one that no reasonable decision maker could make, nor did this appear by implication.  The SCA accepted that it should not interfere with a decision of the LAC only because it considered it to be wrong, but found that, by overturning the decision of the court below, the LAC had misconceived its role and had effectively denied the employee a chance to answer the appeal, and that intervention was warranted.  The appeal accordingly succeeded.

In Transnet Freight Rail v Transnet Bargaining Council & others the Labour Court similarly considered case law on the standard of review, and the circumstances in which a court may interfere with the award of an arbitrator.

 

Strikes and Essential Services

The Constitutional Court in SA Police Service v Police & Prisons Civil Rights Union & another has now upheld the earlier judgment of the Labour Appeal Court (reported at (2010) 31 ILJ 2844 (LAC)), in which that court found that only members and deemed members of the SAPS employed under the SA Police Service Act 68 of 1995, and engaged in police duties, are prohibited from striking in terms of s 65 read with s 71(10) of the Labour Relations Act 66 of 1995.  The CC considered the meaning of an 'essential service' as defined in s 213 of the LRA and concluded that it should be interpreted restrictively so as to avoid any impermissible limitation on the constitutionally protected right to strike.  Other persons employed by the SAPS in terms of the Public Service Act (Proc 103 of 1994) are not engaged in an essential service and may take part in strike action in accordance with the provisions of the LRA.

 

Other Strike Issues

The Labour Court refused in Ekurhuleni Metropolitan Municipality v SA Municipal Workers Unions & others to grant a final interdict confirming an earlier interim order restraining essential service workers from taking part in strike action, and other employees from engaging in unlawful conduct during such action.  By the time of the return day the strike had been called off and with it the likelihood of future harm.  The court found that in the circumstances to confirm the order would not merely reaffirm that the employer was entitled to the relief at the time the prohibitory order was sought, but would also have the prospective effect of barring such future conduct indefinitely, which would be legally wrong.

However, in  Ram Transport (SA) (Pty) Ltd v SA Transport & Allied Workers Union & others  the Labour Court granted an interdict prohibiting strike action over an employer's decision to change the starting and finishing times of its workers' shifts.  The court found, following its decision in Johannesburg Metropolitan Bus Services (Pty) Ltd v SA Municipal Workers Union & others (2011) 32 ILJ 1107 (LC), that the employees had no vested right to any specific shift system either in their collective agreement or in their contracts of employment, and that the variation in shift times did not amount to a change to their terms and conditions of employment.

 

Transfer of Business as a Going Concern

Hydro Colour Inks (Pty) Ltd v Chemical Energy Paper Printing Wood & Allied Workers Union concerned an appeal from an order of the Labour Court, which had found that there had been a transfer of a business as a going concern to the appellant company, notwithstanding the prior liquidation of the transferring company.  On appeal the Labour Appeal Court held that s 197A of the LRA applied to the transfer, and that the principles for establishing whether a transfer had taken place as a going concern under s 197 applied equally to the transfer of an insolvent business in terms of s 197A, save for the consequences of such a transfer.  In the case of a s 179A transfer the automatic substitution related only to contracts of employment in existence immediately before the old employer's winding-up or sequestration, and the new employer was not liable for the previous actions of the old employer.  In the case before it the old company's retrenched employees had already obtained an order for their reinstatement before the order for liquidation was granted.  This had restored their contracts of employment, and they had therefore automatically been transferred to the new company.

In Chemical Energy Paper Printing Wood & Allied Workers Union on behalf of Members v Hydro Colour (Pty) Ltd & another the Labour Court reviewed the relevant authorities on the principles applicable when determining whether a business has been transferred in terms of s 197, and granted an urgent application for an order declaring that the employment of the applicant employees had been transferred from the first to the second respondent.

 

Employment Equity Act 55 of 1998 - Unfair Discrimination

The applicant in Allpass v Mooikloof Estates (Pty) Ltd t/a Mooikloof Equestrian Centre claimed that he had been automatically unfairly dismissed in terms of s 187(1)(f) of the LRA and had been discriminated against in terms of s 6(1) of the Employment Equity Act 55 of 1998, in both cases on account of his HIV status.  The Labour Court rejected the employer's claim that the employee had been dismissed for failing to disclose his HIV status at his initial interview for employment, and that this had lead to a breakdown in the trust relationship.  It  accepted that the applicant had been dismissed because of his HIV status and noted that the employee was under no duty to reveal his status and that the employer's expectation that he should do so violated his rights to dignity and privacy.  The court undertook a detailed study of court decisions in which relief had been claimed in terms of both the LRA and the EEA, and found that it was competent to award relief for both the unfair dismissal under the LRA and for discrimination under the EEA arising from the same facts.  Substantial compensation was awarded in respect of the automatically unfair dismissal, but a claim for damages for continued unfair treatment after the employee's dismissal was dismissed for lack of evidence of a causal nexus.

In Biggar v City of Johannesburg the Labour Court considered both the extent of an employer's liability in terms of the EEA for the racial harassment of one of its employees at the hands of other employees whilst off duty, and the crafting of an appropriate remedy for the employee in terms of s 50(2) of the Act.  The employee, a member of the respondent's fire department, complained of being racially harassed by fellow employees while living in common residential premises.  The court found that the employer had not done everything that was reasonably practicable to prevent the continued harassment of the employee, and that it was therefore liable in terms of the Act.  Compensation was awarded and the employer was, in addition, ordered to take proactive steps to find the employee alternative employment, and to take any necessary disciplinary action to prevent further racial harassment in future.  In National Education Health & Allied Workers Union & another v Office of the Premier: Province of the Eastern Cape & another the Labour Court found that the respondent's decision to appoint a coloured female to a vacant post in preference to an African male was in accordance with its affirmative action policy and its equity objectives, and did not amount to unfair discrimination against the unsuccessful candidate.

 

Sporting Contracts

The Dispute Resolution Chamber of the National Soccer League was required in Mntuyedwa and Black Leopards Football Club to consider whether the respondent club had repudiated the applicant's contract of employment when it placed him on indefinite leave without pay after he suffered injuries that were not connected to his work as a footballer.  The DRC found that the club had in reality suspended him indefinitely without pay, and that this amounted to a repudiation which entitled him to cancel the contract and to claim damages.  Mtakati and Bay United Football Club concerned a settlement agreement between the club and the football players' union whereby the proceeds of sale of the club would be paid to the union for pro-rata distribution amongst members.  The DRC ruled that the agreement amounted to a collective agreement as defined in s 213 of the LRA, and that it accordingly bound all members of the union. 

 

Dismissal for Misconduct - Alcohol Abuse

In Transnet Freight Rail v Transnet Bargaining Council & others the Labour Court reviewed and set aside an award in which the arbitrator ordered the reinstatement of an employee dismissed for reporting for work under the influence of alcohol, and in addition ordered the employee to submit to rehabilitation.  The court distinguished between employees who suffered from alcoholism, which must be treated as a disease amounting to incapacity, and those who simply reported for duty under the influence of alcohol, who were guilty of misconduct.  The arbitrator had committed a gross irregularity by failing to distinguish between the two, and in certain other respects.  As the employee was engaged in a post where safety was critical, and was already on a final warning for a similar offence her dismissal was fair.

 

SA Police Service - Regulations

The applicant employee in Zondi and SA Police Service was acquitted of corruption at an internal investigation, but later pleaded guilty to a criminal charge for the same offence.  An administrative board of enquiry then found him unfit to remain in the service, and recommended his dismissal.  At arbitration the bargaining council arbitrator rejected his contention that he had been subjected to 'double jeopardy', having been acquitted on the original charge.  The board was not convened to determine his guilt but to consider in terms of the SAPS regulations whether he was fit to remain in the service.  

 

The Certification and Prescription of Awards

In SA Transport & Allied Workers Union on behalf of Phakathi v Ghekko Services (Pty) Ltd & others the employer party failed to comply with the terms of an award which had been certified in terms of s 143 of the LRA.  When the employee party later launched contempt proceedings in the Labour Court the court confirmed that certification did not give the award the same status as an order of the Labour Court, but found that the employee could enforce the award by way of contempt proceedings without the need first to approach the court for an order in terms of s 158(1)(c).  However, the court found that as more than three years had elapsed since the award was certified the employee's claim had prescribed.  An unsuccessful attempt by the employer in the meantime to have the award reviewed had not interrupted the running of prescription.

 

The Rescission of Awards

The Labour Court reviewed and set aside a commissioner's decision in Silver Unicorn Trading 33 (Pty) Ltd v Commission for Conciliation, Mediation & Arbitration & others to refuse to rescind a default award granted in the absence of the employer party.  The commissioner's decision was taken without affording the employer an opportunity to be heard on the issue, and was based on the fact that the application for rescission was out of time and not accompanied by an application for condonation.  The court found it was a well established practice of the CCMA, in line with rule 31(9) of the CCMA Rules, to inform a party that its application was late and that it should apply for condonation.  By not complying the commissioner had failed to satisfy the requirements of natural justice.

 

Practice and Procedure

The Labour Court set aside a commissioner's ruling in Production Institute of Southern Africa (Pty) Ltd v Commission for Conciliation, Mediation & Arbitration & others, in which she had granted the rescission of an earlier ruling dismissing the application before her.  The court observed that even before considering such a rescission application the commissioner had to be satisfied that he or she had jurisdiction to entertain it.  In the case before the court it was clear that the application for rescission had been filed late and that the application for condonation of the late filing had not been served on the respondent.  The application was therefore not properly before the commissioner.   The Labour Court refused in Silplat (Pty) Ltd v Commission for Conciliation, Mediation & Arbitration & others to condone a late application to review a commissioner's rescission ruling where the application finally came before the court some five and a half years after the dismissal of the employee.  The court found the delays to have arisen from a combination of the employer's attorney's incompetence and the employer's desire to delay and frustrate the proceedings.   The court restated the principles applicable and found that in the circumstances the employer could not hide behind its attorney's negligence.