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# South Africa: Labour Appeal Court
South Africa: Labour Appeal Court
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[2023] ZALAC 16
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## Association of Mineworkers and Construction Union v UASA (Formerly named United Association of South Africa) and Others (DA13/2022)
[2023] ZALAC 16; [2023] 11 BLLR 1134 (LAC); (2023) 44 ILJ 2479 (LAC) (17 August 2023)
Association of Mineworkers and Construction Union v UASA (Formerly named United Association of South Africa) and Others (DA13/2022)
[2023] ZALAC 16; [2023] 11 BLLR 1134 (LAC); (2023) 44 ILJ 2479 (LAC) (17 August 2023)
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sino date 17 August 2023
IN THE LABOUR APPEAL
COURT OF SOUTH AFRICA, DURBAN
Reportable
Case no: DA13/2022
In the matter between:
ASSOCIATION OF
MINEWORKERS AND
CONSTRUCTION UNION
Appellant
(Applicant
in court a
quo
)
and
UASA (FORMERLY NAMED
UNITED
ASSOCIATION OF SOUTH
AFRICA)
First
Respondent
(1
st
Respondent in court a quo)
THE FOOD ALLIED
WORKERS UNION
Second
Respondent
(2
nd
Respondent in court a
quo)
SUGAR MANUFACTURERS
AND REFINERS
EMPLOYERS
ASSOCIATION Third
Respondent
(3
rd
Respondent in court a
quo)
NATIONAL BARGAINING
COUNCIL FOR
THE SUGAR
MANUFACTURING AND
REFINING
INDUSTRY
Fourth Respondent
(4
th
Respondent in court a
quo)
L SULLIVAN
N.O. Fifth
Respondent
(5
th
Respondent in court a
quo)
THE COMMISSION FOR
CONCILIATION
MEDIATION AND
ARBITRATION (CCMA) Sixth
Respondent
(6
th
Respondent in court a
quo
)
Heard:
16 May 2023
Delivered:
17 August 2023
Coram:
Waglay JP
et
Musi JA
et
Gqamana AJA
Summary:
Agency shop agreement – Section 25 of the Labour Relations Act
– Agency shop agreement concluded
in terms of which majority
unions deduct agency fees from employees in bargaining unit –
Appellant admitted as bargaining
agent – Agency shop agreement
remained unchanged and appellant’s members were subjected to
both ordinary union dues
and agency fees – Agency fees are
charged as representative trade unions fulfil a duty to bargain
collectively on behalf
of all employees in bargaining unit and fees
are paid as minority union receive service from majority unions - No
justification
for majority union to receive fees from minority
union’s members if minority union renders the service –
Appellant’s
members are not free riders as they pay to be
represented by the appellant at the bargaining table – Agency
shop agreement
has a manifestly unfair and unbusiness-like result –
Agreement must be interpreted in a manner which renders it fair,
reasonable
and business-like – Agency shop agreements are based
on fairness – In agency shop agreements, it must be implied
that
when minority union becomes a bargaining agent, its members
should not pay agency fees unless otherwise expressly set out in
agreement
– Appeal succeeds.
JUDGMENT
MUSI JA
[1]
This is an appeal against an order of the Labour Court. The
appellant, (The Association
of Mineworkers and Construction Union
(AMCU)), sought to review and set aside an award by the fifth
respondent (Commissioner),
wherein the latter concluded that agency
fees are payable by employees who are members of a minority union,
which is also a bargaining
agent. The appellant applied, in the
alternative, in the court
a quo,
for an order declaring the
agency shop agreement invalid. The court
a quo
dismissed both
applications. The appeal is with the leave of the court
a quo
.
[2]
The material facts are undisputed. The fourth respondent (The
National Bargaining
Council for the Sugar Manufacturing and Refining
Industry (NBCS)) is a registered bargaining council in terms of the
provisions
of the Labour Relations Act
[1]
(Act). The employers in the industry have always been represented by
the third respondent (The Sugar Manufacturers and Refiners
Employer’s
Association (SMREA)). The first respondent (UASA, formerly known as
the United Association of South Africa) and
the second respondent
(The Food and Allied Workers Union (FAWU)) are registered trade
unions.
[3]
On 18 November 2004, SMREA on the one hand and FAWU, UASA and
NASARAIEU (three other
unions acting jointly) on the other, entered
into a collective agreement which contained an agency shop agreement.
In April 2017,
NASARAIEU was deregistered. After NASARAIEU’s
deregistration SMREA’s chairperson wrote a briefing note to its
members
wherein he stated the following:
‘
All
ex NASARAIEU members are reminded that with effect from 7 April 2017,
they have automatically defaulted to the Agency Shop and
are paying
the R120 per month agency fee.
The
alternative to this is to join one of the other unions affiliated to
the Bargaining Council, i.e. FAWU or UASA or any other
registered
trade union. However, choosing any ‘other’ union might
mean that the Employee will have to pay the agency
fee (R120) on top
of the subscription of the union he/she has joined.
This will be
the case until the ‘other’ union has recruited enough
members to join the Bargaining Council, at which
stage the agency fee
will fall away
…’ [Own emphasis]
[4]
AMCU seized the opportunity and began recruiting within the sugar
industry. In or
around May or June 2017, AMCU’s membership was
such that it was entitled to representation in the NBCS, in terms of
the NBCS’
constitution. On 1 August 2017 AMCU was officially
admitted as a member of the NBCS.
[5]
On 25 July 2017, a few days before AMCU’s admission to the
NBCS, SMREA, FAWU
and UASA (acting jointly as the majority or
representative union)
[2]
entered
into an agency shop agreement. They,
inter
alia,
agreed that the employer will deduct an agency fee of 1,4% of the
basic wages of employees in the bargaining unit, provided that
the
agency fee must be equivalent to or no less than the highest amount
of the subscription that would apply to a member of the
union. They
further agreed that the agency fee may be deducted without an
employee’s authorization and that such fee must
be deducted
monthly and paid into a separate account administered by the unions,
provided that a conscientious objector may request
that his or her
fee should be paid into a fund administered by the Department of
Labour. The rest of the provisions are a repetition
of s 25 of the
Act.
[6]
Notwithstanding AMCU’s admission as a member of the NBCS, the
agency shop agreement
remained the same with the result that AMCU’s
members were still compelled to pay the agency fee. As a result of
negotiations
between the parties to the agency shop agreement and
AMCU, a draft agreement was concluded. It,
inter alia,
stated
that all AMCU members would pay both AMCU levies plus the agency fees
for 9 months and that the agency shop funds would
be determined by
FAWU and UASA for two years. AMCU members were dissatisfied with the
compromise and they refused to give their
representatives a mandate
to enter into the agreement. AMCU members, therefore, remained
subject to double deductions: their ordinary
union levies and the
agency fees.
[7]
Since the parties reached an impasse, AMCU referred a dispute to the
sixth respondent
(The Commission for the Conciliation, Mediation and
Arbitration (CCMA)). It stated that the dispute was about the
interpretation
and application of “
the main collective
agreement and the council constitution to resolve the s 25 of the
Labour Relations Act [agency shop] agreement
”. The dispute
was conciliated on 10 November 2017, but could not be resolved.
[8]
AMCU thereafter referred the dispute to arbitration and stated that
the relief it
sought was the cessation of agency fee deductions from
its members and that it be part of the respondent’s [NBCS]
members
who are excluded from paying agency fees.
[9]
During the arbitration hearing, AMCU expressly stated that it does
not challenge the
constitutionality of s 25 and that it accepts that
the agreement complies with the provisions of s 25. It also accepted
the legislature’s
policy choice in favour of majoritarianism
and did not challenge the majoritarianism principle.
[10]
It contended that the agency shop agreement should be interpreted in
such a manner that its members
should not be subjected to paying the
agency fee because the effect of the agreement is unfair towards its
members. It argued that
its members are not free riders since they
are represented at the NBCS. It further argued that it assumed that
its admission as
a bargaining agent would result in the cessation of
the agency fee that its members are compelled to pay. It pointed out
that since
its members are compelled to pay the agency fee and the
union levies of their bargaining agent, the agency fee is used as a
discreet
tool to induce AMCU members to join FAWU or UASA.
[11]
The second to fourth respondents argued that the closed shop
agreement conformed with the requirements
in s 25 and that textually,
the section was clear and unambiguous. With regard to the briefing
note, the third respondent argued
that it had been ill-advised, and
it does not align itself with Mr Lane’s view anymore. FAWU and
UASA argued that the briefing
note is not binding because it
expresses the view of only one of the parties to the closed shop
agreement.
[12]
The Commissioner, in dismissing the application, found as follows:
‘
Nowhere
in the section is there any mention of unions that become bargaining
agents having a special dispensation. Neither, with
the greatest
imagination, can it be said that any section even suggests, however
obscurely, a special dispensation for unions who
are bargaining
agents. The agency shop agreement likewise does not give the
bargaining agents any special dispensation…
[The
CCMA] does not have the ability to make binding orders relating to
the legislator’s intention…
In
this matter the interpretation and application of the section has
already been clearly set out: members of unions who are the
majority
or majority allied unions must pay the additional fee.’
[13]
Dissatisfied with the arbitration award, the appellant approached the
court
a quo
seeking to have it reviewed and set aside. In the
alternative, it sought an order declaring the agency shop agreement
null and
void. It contended that the Commissioner misconstrued the
nature of the enquiry because AMCU’s case was about the
interpretation
of the agency shop agreement rather than s 25 of the
Act. It further contended that the Commissioner misdirected himself
by applying
his mind to an issue that was never before him.
[14]
AMCU argued that the agency shop agreement is ill-conceived and it
should, in good faith, have included
AMCU. The effect of the agency
shop agreement, so the argument went, was to drive AMCU members away
from their union and to discourage
the non-union employees from
joining AMCU. It characterized the situation caused by the agency
shop agreement as ‘absurd’,
‘punitive’,
‘unfair’, ‘unjust’, and ‘unenforceable’.
It further argued that there
is no rational basis why AMCU members
should pay the agency fee because they are represented at the
bargaining council and therefore
not free riders.
[15]
Only NBCS opposed the applications. It contended that the agency shop
agreement was properly entered
into by the majority union (FAWU and
UASA acting jointly) and that it was done in accordance with the
majoritarianism principle.
It submitted that no fault can be found
with the commissioner’s award and that he determined the issue
that was referred
to him.
[16]
The court
a quo
, rhetorically asked: “
where a
majority union (or alliance of unions) is present in a bargaining
council, how effective is the service provided by a minority
union?
”
It stated that it is not convinced that the plain meaning of s 25
leads to such an absurd or iniquitous result that it should
be
tempted to rewrite the provisions of the law under the guise of
rendering a purposive interpretation. It concluded that in wording,
content and format the agreement complies with s 25 and that is all
that is required.
[17]
Section 25 provides:
‘
(1)
A representative
trade union
and an employer or
employers'
organisation
may conclude a
collective
agreement
, to be known as an agency
shop agreement, requiring the employer to deduct an agreed agency fee
from the wages of
employees
identified in the agreement who are not members of the
trade
union
but are eligible for membership
thereof.
(2)
For the purposes of this section, “representative trade union”
means a
registered
trade union
, or two or more registered
trade unions
acting jointly, whose members are a majority of
the
employees
employed –
(a)
by an employer in a
workplace
;
or
(b)
by the members of an
employers'
organisation
in a
sector
and
area
in respect of which the agency shop agreement applies.
(3)
An agency shop agreement is binding only if it provides that –
(a)
employees
who are not members of the representative
trade
union
are not compelled to become members of that
trade
union
;
(b)
the agreed agency fee must be equivalent to, or
less than –
(i)
the amount of the subscription payable by the members of the
representative
trade union
;
(ii)
if the subscription of the representative
trade union
is
calculated as a percentage of an
employee
's salary, that
percentage; or
(iii)
if there are two or more registered
trade unions
party
to the agreement, the highest amount of the subscription that would
apply to an
employee
;
(c)
the
amount deducted must be paid into a separate account administered by
the representative
trade
union
;
and
(d)
no agency fee deducted may be –
(i)
paid to a political party as an affiliation fee;
(ii)
contributed in cash or kind to a political party or a person standing
for election to
any political office; or
(iii)
used for any expenditure that does not advance or protect the
socio-economic interests
of
employees
.
(4)
(a)
Despite the provisions of any law or contract, an employer may
deduct the agreed agency fee from the wages of an
employee
without the
employee
's authorisation.
(b)
Despite subsection (3)
(c)
,
a conscientious objector may request the employer to pay the amount
deducted from that employee's wages into a fund administered
by the
Department of Labour.’
[18]
Section 25 recognises agency shop agreements as a form of union
security arrangement based on the majoritarianism
principle. The
section deliberately does not provide for all kinds of manifestations
of agency shop agreements. This is so because
the legislature cannot
make laws that make provision for all eventualities. It therefore
enacted a general or framework section
and left it to the parties to
craft the specific terms of their agreement. The section contains, at
once, prescriptive and proscriptive
norms.
[19]
It,
inter alia
, prescribes that only a majority union or two
or more unions acting jointly and whose members are the majority and
the employer
or employers’ organisation may enter into an
agency shop agreement, requiring the employer to deduct an agency fee
from the
wages of employees identified in the agreement who are not
members of the majority union but are eligible to become members
thereof.
It further prescribes what the agreement should provide and
for the maximum agency fee. It,
inter alia
, proscribes the
utilization of agency fee collected from non-union members for
political party affiliation or as a contribution
to a political party
or a person standing for political office.
[20]
Although the section is prescriptive and proscriptive it is not
exhaustive and by-and-large leaves
it to the parties to agree about
their respective rights, duties and responsibilities within the
permissible parameters set out
by the section. The parties may, for
example agree on exclusion and exclusivity: that unions other than
the majority union will
be excluded from the bargaining table and
that the majority union would be the exclusive bargaining agent for
the employees in
the bargaining unit. Members of minority unions will
therefore pay an agency fee until they or one of them become the
majority
union. They may agree that a minority union will be excluded
from the bargaining table until it achieves a specified threshold of
members, in which case it will become a bargaining agent or that
members of the minority union will cease to pay an agency fee
when it
becomes a bargaining agent. Why should non-members of the minority
union pay agency fees?
[21]
The legal philosophy behind making agency fees compulsory is to
address the free-rider problem: those
who receive a benefit without
the concomitant burden of paying therefor. Making those who receive a
benefit pay a consideration
for enjoying the benefit is rooted in the
fairness or fair-play principle.
[22]
The political philosophers, Hart and Rawls explained it differently.
Hart characterised it as the principle
of mutual restriction and
explained it thus:
‘…
when a number of persons
conduct any joint enterprise according to rules and thus restrict
their liberty, those who have submitted
to these restrictions when
required have a right to a similar submission from those who
benefited by their submission.’
[3]
[23]
In terms of Hart’s mutual restriction principle, those who make
a sacrifice that benefits others
have a right to insist that the
beneficiaries make a corresponding sacrifice. Put differently, those
who benefit from a sacrifice
by others have an obligation to make a
corresponding sacrifice. Rawls restated the mutual restriction
principle as the principle
of fairness as follows:
‘…
when a number of persons
engage in a just, mutually advantageous, cooperative venture
according to rules and thus restrain their
liberty in ways necessary
to yield advantages for all, those who have submitted to these
restrictions have a right to similar acquiescence
on the part of
those who have benefited from their submission.’
[4]
[24]
Lowe
[5]
summarizes and locates
the fair-play principle in Labour Relations and points out that if
the benefits of collective bargaining
could be had without paying the
costs of such collective bargaining, it would be in an employee’s
rational self-interest
not to join the union responsible for the
benefits. He further states:
‘
It
is clear that union fare share fees are an application of the
principle of fair play. The arguments in support of imposing fair
share fees certainly share features central to the principle of fair
play in their appeal to fairness, in their being required
in response
to the production of benefits (at least legally) fall on all alike,
and in their concern with avoiding free riding.’
[6]
[25]
One of the first judicial pronouncements of the fairness principle in
Labour Relations was by Justice
Rand of the Canadian Supreme Court,
in an arbitration, where he said:
’
24
…the employees as a whole become the beneficiaries of union
action, and I doubt
if any circumstance provokes more resentment in a
plant than this sharing of the fruits of unionist work and courage by
the non-members…
…
26
I consider it entirely equitable then that all employees should be
required to
shoulder their portion of the burden of expense for
administering the law of their employment, the union contract; that
they must
take the burden along with the benefit.’
[7]
[26]
Locally, in
National
Manufactured Fibres Employers Association and Another v Bikwani and
others
[8]
(
Bikwani
),
the Labour Court explained that non-members of the representative
union pay agency fees as a contribution towards the representative
trade union’s costs incurred in connection with collective
bargaining. The Labour Court put it thus:
‘
[20]
It takes time, effort and money for a union to strike good deals with
the employer of its members.
Time and effort - because proper
training and preparation on the part of the union's negotiators are
necessary if the negotiators
are to engage in effective bargaining.
Money - because all of those things cost money. Where the benefits of
the deals secured
through the efforts of the representative trade
union in collective bargaining are passed on to other employees who
are not members
of the representative trade union, such employees
should make a contribution towards the costs which the representative
trade union
incurs in connection with its collective bargaining work.
If they do not pay that is unfair because members of the
representative
trade union pay for those costs. An agency shop
agreement seeks to make them pay without compelling them to join the
representative
trade union.
[21]
The fact that such workers may be members of another union in the
workplace to which they pay
union dues does not turn them into paying
riders. They remain free riders… because they make no
contribution towards the
collective bargaining costs of the
representative union and yet they receive and enjoy the benefits of
that union's efforts in
the same way as that union's members who foot
the bill thereof.’
[9]
[27]
In
Bikwani
, the minority union was not a bargaining agent. Its
members would therefore receive a benefit from the representative
union’s
collective bargaining efforts, enabled by the
representative union’s members’ levies, without the
concomitant burden.
[28]
The reasoning in
Bikwani
was approved by this Court in
Municipal
& Allied Trade Union of SA v Central Karoo District Municipality
and Others
[10]
(
MATUSA)
.
In
MATUSA,
this
Court found that s 25 advances the policy of majoritarianism and is
in compliance with the Constitution, the Act and International
law
and Conventions. AMCU properly accepted the correctness of
Bikwani
and
MATUSA
.
Bikwani
and
MATUSA
were not confronted with the controversy that we are faced with:
should members of a minority trade union that is a bargaining
agent
pay agency fees? I now pass to look at the specific agreement in this
matter.
[29]
In The
City
of Tshwane Metropolitan Municipality v Blair Atholl Homeowners
Association,
[11]
the Supreme Court of Appeal reiterated the unitary approach to
interpretation of documents. It said:
‘
It
is fair to say that this court has navigated away from a narrow
peering at words in an agreement and has repeatedly stated that
words
in a document must not be considered in isolation. It has repeatedly
been emphatic that a restrictive consideration of words
without
regard to context has to be avoided. It is also correct that the
distinction between context and background circumstances
has been
jettisoned. This court, in
Natal
Joint Municipal Pension Fund v Endumeni Municipality
,
stated that the purpose of the provision being interpreted is also
encompassed in the enquiry. The words have to be interpreted
sensibly
and not have an un-business-like result. These factors have to be
considered holistically, akin to the unitary approach.’
[12]
[30]
I have illustrated above that s 25 is rooted in the fairness or fair
play principle. In
Bikwani,
this principle was not implicated
because the minority union wanted to benefit without carrying the
concomitant burden. Generally,
the majority union receives the agency
fee because it fulfils a duty to bargain collectively for all the
employees in the bargaining
unit. In this matter, however, AMCU is a
bargaining agent. It sits with the majority unions and the employers’
representatives
around the same bargaining table. It, like the
majority unions, incurs expenses to enable it to efficaciously
bargain on behalf
of its members. Its members are not free riders,
because they pay to be represented by their union at the bargaining
table.
[31]
The court
a quo
’s question about the effectiveness of
the service provided by a minority union where a majority union (or
alliance of unions)
is present in a bargaining council is, in my
view, irrelevant. It is an inappropriate yardstick. The minority
union can bring a
fresh perspective to the negotiations which may be
beneficial to all the employees in the bargaining unit. The fact of
the matter
is that the minority union will also utilize money,
effort, research and other activities connected to collective
bargaining in
order to strike a good deal for its members.
[32]
I agree with the court
a quo
that textually, the collective
agreement passes muster. However, when one has regard to the purpose
of agency fee arrangements
it becomes manifestly clear that the
collective agreement in this matter is utterly unfair. It offends the
principle on which it
is based. The majority unions receive money for
a service which they do not provide for AMCU’s members. AMCU is
there to
negotiate on behalf of its members. Why should they pay the
majority unions whilst they are not free riders? The mischief of free
riding is eliminated by AMCU’s presence at the bargaining
table. There seems to me to be no fair justification for the majority
unions in this case to receive any fair share contributions from AMCU
members.
[33]
It is common cause between the parties that the collective agreement
does not expressly exclude
a minority union from becoming a
bargaining agent, after meeting the threshold determined by the
parties in the constitution of
the bargaining council. Why would the
constitution allow a union to become a bargaining agent on behalf of
its members and then
still burden them with the obligation to pay
agency fees? The added burden is, in my opinion, manifestly
unconscionable. How should
this unfairness be addressed?
[34]
The collective agreement has a negative and prejudicial effect on
AMCU’s members. Although
they are not parties to the agreement,
it affects them directly. The textual interpretation of the agreement
does not yield a sensible
result, in fact, it has a manifestly unfair
and unbusiness-like result.
[35]
I disagree with AMCU’s contention that the briefing note penned
by Mr Lane evinces a practice
in the NBCS. In my view, it, at least,
indicates that one of the contracting parties (the employer’s
association) interpreted
their arrangement in a manner consistent
with AMCU’s contention. Likewise, the draft agreement does not
point to a practice
in the industry but is indicative of the fact
that the parties were of the view that exempting AMCU’s members
from paying
the agency fees is not expressly excluded by their
agreement and can be accommodated. These indicators are, significant
because
they set the surrounding circumstances that ought to be
considered when interpreting the contract.
[36]
Importantly, these factors point to the fact that no violence would
be done to the agreement
if it is interpreted in a manner which
renders the agreement fair, reasonable, business-like and in
conformity with the purpose
of this kind of union security
arrangement. In my view, the only way to give business efficacy which
does not contradict the express
terms of the agreement and addresses
the free rider problem is as follows: once AMCU became a bargaining
agent its members were
no longer free riders and they should
therefore not pay agency fees. This is how the agreement should be
interpreted, because all
the parties to the contract knew why agency
fees are paid. They were aware that the
raison d’etre
(reason for the existence) of the agency fee would dissipate when
AMCU becomes a bargaining agent. It was clearly within their
contemplation. The agreement does not expressly prohibit such an
arrangement. The same result is achieved if a term were to be
implied
in this contract.
[37]
In
Alfred
McAlphine & Son (Pty) Ltd v Transvaal Provincial
Administration
,
[13]
Corbett AJA, in a minority judgment, eloquently explained the
expression ‘implied term’ as follows:
‘
In
legal parlance the expression “implied term” is an
ambiguous one in that it is often used, without discrimination,
to
denote two, possibly three, distinct concepts. In the first place, it
is used to describe an unexpressed provision of the contract
which
the law imports therein, generally as a matter of course, without
reference to the actual intention of the parties. The intention
of
the parties is not totally ignored. Such a term is not normally
implied if it is in conflict with the express provisions of
the
contract. On the other hand, it does not originate in the contractual
consensus
:
it is imposed by the law from without. Indeed, terms are often
implied by law in cases where it is by no means clear that the
parties would have agreed to incorporate them in their contract.
’
[14]
[38]
In
BP
Refinery (Westernport) Pty Ltd v President, Councillors and
Ratepayers of the Shire of Hastings
[15]
(
BP
Refinery
),
Lord Simon, speaking for the majority, summarised it as follows:
‘
[F]or
a term to be implied, the following conditions (which may overlap)
must be satisfied: (1) it must be reasonable and equitable;
(2) it
must be necessary to give business efficacy to the contract so that
no term will be implied if the contract is effective
without it; (3)
it must be so obvious that “it goes without saying”; (4)
it must be capable of clear expression; (5)
it must not contradict
any express term of the contract.’
[16]
[39]
In
Marks
& Spencer plc v BNP Paribas Securities Services Trust Company
(Jersey) Limited and Another,
[17]
Lord
Neuberger, speaking for the majority, reviewed academic writings and
judicial precedent and qualified what was said in
BP
Refinery
and other cases. He,
inter
alia
,
emphasised that implication of a term is not critically dependent on
the intention of the parties, when negotiating the contract.
Further
that a term should not be implied in a detailed commercial contract
merely because one considers that the parties would
have agreed it,
if it had been suggested to them.
[40]
As pointed out above, agency shop agreements are based on fairness.
The agency fee is paid because
the minority union receives a service
from the majority union or unions. When no service is rendered or it
is rendered by the minority
union, there is no justification for the
majority union to receive agency fees from such minority union’s
members.
[41]
Generally, in agency shop agreements, it must be implied that when a
minority union becomes a
bargaining agent, its members should not pay
an agency fee unless there are express terms to the contrary in the
contract between
the parties. The implied term, in this matter, is
clear. It is necessary and obvious to give business efficacy to such
agreements.
[42]
It is manifestly clear in the contract under consideration that a
term such as the one in the
preceding paragraph gives obvious
business efficacy to the agreement. Without it, the agency fee
agreement ‘would lack, commercial
or practical coherence’.
[18]
[43]
At our request, the parties submitted supplementary heads of argument
on whether the contract
is in consonance with public policy. As a
result of the conclusions reached above, I do not deem it necessary
to deal with this
aspect.
[44]
Although the unitary approach to interpretation and the implication
of a term lead to the same
conclusion in this case, they are governed
by different rules. In most cases there would be no need to imply
additional words in
the contract after a contextual and purposive
interpretation. Both processes, construing the words which the
parties used in the
contract and implying terms into the contract,
involve determining its scope and meaning.
[19]
[45]
It therefore entails the interpretation and application of a contract
(collective agreement).
The commissioner and the court
a quo
misconstrued AMCU’s case. They both erred in finding that AMCU
wanted them to read words into s 25 of the Act.
[46]
AMCU prayed that the money paid by its members be reimbursed. Its
individual members were not
cited. The money was paid by AMCU members
in their individual capacities. The agency fees paid by them post 1
August 2017 should
be repaid. This is something that can be debated
and settled by the parties, hopefully, without further litigation.
[47]
The commissioner should have found in AMCU’s favour. The appeal
ought to succeed.
[48]
I therefore make the following order:
(i)
The appeal succeeds with no order as to costs.
(ii)
The order of the court
a quo
is set aside and replaced with
the following:
1.
The arbitration award is reviewed and set aside.
2.
The award is substituted with the following order:
2.1 The
agency shop agreement entered into between the First, Second and the
Third Respondents dated 17 July 2017
(“
Agency Shop
Agreement
”) is interpreted and applied such that:
a)
The deduction of the agency fee in terms of the Agency Shop Agreement
shall not be made from employees,
subject to the Agency Shop
Agreement who are members of the Applicant for so long as the
Applicant remains a bargaining agent in
accordance with the Fourth
Respondent’s Constitution.
b)
Any and all agency fee deductions made from the members of the
Applicant ostensibly in accordance with
the Agency Shop Agreement
post 1 August 2017 be refunded to such members by the First and
Second Respondents within 2 (two) calendar
months from the date of
this order.
c)
The First and Second Respondents must, with the assistance of the
Applicant, design and implement
a claim mechanism in order to give
effect to paragraph b) of this order.
________________
CJ Musi JA
Waglay
JP
et
Gqamana
AJA
concur in the judgment of CJ Musi JA.
APPEARANCES:
FOR THE
APPELLANT:
Mr M Futcher of Futcher & Poppesgou Inc
FOR THE FOURTH
RESPONDENT: Mr J Whyte of Norton Rose
Fulbright SA
[1]
Act 66 of 1995, as amended.
[2]
As
at December 2017,
FAWU
and UASA acting jointly represented 62,33% of the employees, AMCU
represented 23,05% and the non-unionised employees were
14,62%.
[3]
H L T Hart, “
Are
there any natural rights?”,
Philosophical Review 64 (1955) 175 at 185.
[4]
J Rawls “
A
Theory of Justice
”,
(Harvard University Press: Cambridge), 1971.
[5]
S
C Lowe, “
Free
Riders, ‘Fair Share,’ and the Principle of Fair Play
”,
Public Affairs Quarterly vol. 10, No 1 January 1996.
[6]
Ibid
at p 59.
[7]
Ford
Motor Co of Canada v. International Union United Automobile,
Aircraft and Agricultural Implement Workers of America (U.A.W.
–
C.I.O.) (Union Security Grievance)
[1946]
O.L.A.A. No 1 at paras 24 and 26.
[8]
[1999]
ZALC 78
;
(1999)
20 ILJ 2637 (LC) at para
[9]
Ibid
paras 20 to 21.
[10]
[2020]
ZALAC 20
;
(2020)
41 ILJ 1918 (LAC).
[11]
[2018]
ZASCA 176; [2019] 1 All SA 291 (SCA).
[12]
At
p
ara
61.
[13]
1974
(3) SA 506 (AD).
[14]
At
531D-F.
[15]
(1977)
52 ALJR 20
at para 21.
[16]
At p 26.
[17]
[2015] UKSC 72.
[18]
Ibid para 21.
[19]
Ibid para 26.
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