Case Law[2024] ZACC 8South Africa
Regenesys Management (Pty) Ltd t/a Regenesys v Ilunga and Others (CCT 220/22) [2024] ZACC 8; 2024 (7) BCLR 901 (CC); [2024] 8 BLLR 777 (CC); (2024) 45 ILJ 1723 (CC); 2024 (5) SA 593 (CC) (21 May 2024)
Constitutional Court of South Africa
21 May 2024
Headnotes
Summary: Employees’ posts declared redundant — inadequate consultation — employees required to apply for own positions unsuccessful — selection criteria — knowledge, skills and behaviour — compensation under section 189A(13)(d) can be standalone remedy — section 189A(18) does not exclude section 189A(13) jurisdiction of the Labour Court — reinstatement — compensation.
Judgment
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## Regenesys Management (Pty) Ltd t/a Regenesys v Ilunga and Others (CCT 220/22) [2024] ZACC 8; 2024 (7) BCLR 901 (CC); [2024] 8 BLLR 777 (CC); (2024) 45 ILJ 1723 (CC); 2024 (5) SA 593 (CC) (21 May 2024)
Regenesys Management (Pty) Ltd t/a Regenesys v Ilunga and Others (CCT 220/22) [2024] ZACC 8; 2024 (7) BCLR 901 (CC); [2024] 8 BLLR 777 (CC); (2024) 45 ILJ 1723 (CC); 2024 (5) SA 593 (CC) (21 May 2024)
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sino date 21 May 2024
FLYNOTES:
LABOUR – Dismissal –
Operational
requirements
–
Employees’
posts declared redundant – Inadequate consultation –
Employees required to apply for own positions
and were
unsuccessful – Selection criteria – Knowledge, skills
and behaviour – Compensation under section
189A(13)(d) can
be standalone remedy – Section 189A(18) does not exclude
jurisdiction of Labour Court – Appeal
dismissed –
Cross-appeal upheld –
Labour Relations
Act 66 of 1995
.
CONSTITUTIONAL
COURT OF SOUTH AFRICA
Case CCT 220/22
In
the matter between:
REGENESYS
MANAGEMENT (PTY)
LIMITED
t/a
REGENESYS
Applicant
and
SIBONGILE
CHARLOTTE ILUNGA
First Respondent
MARIA
ANTONIA OLIVEIRA DOS SANTOS
Second Respondent
MAPASEKA
PATIENCE NKODI
Third Respondent
NOMPUMELELO
MAHLANGU
Fourth Respondent
and
In
the matter between:
SIBONGILE
CHARLOTTE ILUNGA
First Applicant in cross-appeal
MARIA
ANTONIA OLIVEIRA DOS SANTOS
Second Applicant in
cross-appeal
MAPASEKA
PATIENCE NKODI
Third Applicant in cross-appeal
NOMPUMELELO
MAHLANGU
Fourth Applicant in cross-appeal
SUSARA
MARIA NORTJÉ
Fifth Applicant in cross-appeal
BETH
MANN
Sixth Applicant in cross-appeal
STACEY-LEIGH
CHALKLEN
Seventh Applicant in cross-appeal
and
REGENESYS
MANAGEMENT (PTY)
LIMITED
t/a REGENESYS
Respondent
in cross-appeal
Neutral
citation:
Regenesys Management (Pty)
Ltd t/a Regenesys v Ilunga and Others
[2024] ZACC 8
Coram:
Zondo CJ,
Maya DCJ, Kollapen J,
Mathopo J,
Rogers J,
Schippers AJ, Theron J,
Tshiqi J and Van Zyl AJ
Judgments:
Zondo CJ (majority): [1] to [242]
Rogers J
(concurring): [243] to [263]
Heard
on:
14 September 2023
Decided
on:
21 May 2024
Summary:
Employees’ posts declared redundant — inadequate
consultation — employees required to apply for own
positions unsuccessful — selection criteria —
knowledge, skills and behaviour — compensation
under
section 189A(13)(d)
can be standalone remedy —
section 189A(18)
does not exclude
section 189A(13)
jurisdiction of the Labour Court
— reinstatement — compensation.
ORDER
On
appeal from the Labour Appeal Court of South Africa (hearing an
appeal from the Labour Court):
1.
Leave to appeal and to cross-appeal is granted.
2.
The appeal is dismissed with costs including the costs of two
Counsel
where two Counsel were employed.
3.
The cross-appeal is upheld with costs including the costs consequent
upon the employment of two Counsel where two Counsel were employed.
4.
Save in respect of the sixth and ninth respondents in the
Labour Appeal Court
(Ms Wendy Mary Malleson and
Ms Ariadne David):
(a)
the decision of the Labour Appeal Court that the Labour Court
had no jurisdiction to adjudicate disputes about
the procedural
fairness of dismissals for operational requirements is set aside.
(b)
the order of the Labour Appeal Court on costs in that Court is hereby
set aside and replaced with the following:
“
The
appellant is to pay the costs of the appeal including the costs of
two Counsel where two Counsel were employed.”
(c)
the order of the Labour Appeal Court setting aside the order of the
Labour Court on costs is hereby set aside.
(d)
the order of the Labour Court is reinstated.
JUDGMENT
ZONDO CJ
(Maya DCJ, Kollapen J, Mathopo J, Schippers AJ,
Theron J, Tshiqi J and Van Zyl AJ
concurring):
Introduction
[1]
Before us are an application for leave to appeal, and, an
application for leave to cross appeal, against certain orders of
the Labour Appeal Court. The applicant in the application for
leave to appeal is Regenesys Management (Pty) Limited (Regenesys).
Regenesys operates as a private tertiary institution that provides
certain courses including degrees to students. The respondents
in Regenesys’ application are Ms Sibongile Charlotte
Ilunga, first respondent, Dr Maria Antonia Oliveira Dos Santos,
second respondent, Ms Mapaseka Patience Nkodi, third respondent and
Ms Nompumelelo Mahlangu, fourth respondent.
The
respondents are former employees of Regenesys.
[2]
Although I shall deal with the application for leave to
cross-appeal later in this judgment, it seems appropriate to specify
at
this stage who the applicants in the application for leave to
cross-appeal are. This is because, when I set out the factual
background to this matter shortly, that background will relate not
only to the respondents in the application for leave to appeal
but
also to the applicants in the application for leave to cross-appeal.
[3]
The applicants in the application for leave to cross-appeal
are:
(a)
Ms Sibongile Charlotte Ilunga, the first
applicant;
(b)
Dr Maria Antonia Oliveira Dos Santos, the second
applicant;
(c)
Ms Mapaseka Patience Nkodi, the third applicant;
(d)
Ms Nompumelelo Mahlangu, the fourth applicant;
(e)
Ms Susara Maria Nortjé, the fifth
applicant;
(f)
Ms Beth Mann, the sixth applicant;
and,
(g)
Ms Stacey-Leigh Chalklen, the seventh applicant.
The
first, second, third and fourth applicants in the application for
leave to cross appeal are the first, second, third and
fourth
respondents in Regenesys’ application for leave to appeal.
The fifth, sixth and seventh applicants in the application
for leave
to cross appeal are also former employees of Regenesys who were
dismissed at more or less the same time as the respondents
in
Regenesys’ application for leave to appeal. The
respondent in the application for leave to cross appeal is
Regenesys.
[4]
If
we grant Regenesys leave to appeal, its appeal will be against the
dismissal by the Labour Appeal Court of its appeal
against
the Labour Court’s conclusion that the dismissals of certain
employees were substantively unfair and the orders of
reinstatement
granted by the Labour Court in favour of certain of the employees and
the order of a payment of a large amount of
compensation to one of
the employees whose dismissal it had found to be substantively
unfair. If the cross-appeal applicants
are granted leave, their
appeal will be against the decision of the Labour Appeal Court
that, in the light of
section 189A(18)
[1]
of the Labour Relations Act
[2]
(LRA), the Labour Court has no jurisdiction to adjudicate a
dispute about the procedural fairness of a dismissal for operational
requirements including one that is brought in the Labour Court by way
of an application in terms of section 189A(13)
[3]
of the LRA. They will also appeal against the order of the
Labour Appeal Court setting aside the amounts of compensation
awarded
by the Labour Court to the employees whose dismissals it had found to
have been procedurally unfair. Wherever I refer
to a section or
subsection in this judgment without mentioning the LRA, this will be
a reference to a section or subsection of
the LRA.
[5]
When I refer to the respondents in the application for leave
to appeal only, I shall refer to them simply as the appeal
respondents.
I shall refer to the applicants in the application
for leave to cross-appeal as the cross-appeal applicants. When
I want
to refer to both the appeal respondents and the cross-appeal
applicants, I shall refer to them as such or as the “employees”.
Factual
background
[6]
The judgment of the Labour Court is very comprehensive and
sets out detailed evidence heard by that Court. For that
reason,
I do not consider it necessary to set out the background to
this case in any great detail. I shall refer only to those
facts
that I consider necessary for a proper understanding of this
judgment and which are relevant, given the issues before this Court.
[7]
Regenesys called its staff to a meeting on 17 June 2015. At
that meeting the staff were informed that for some time Regenesys
had
been concerned about its revenue and costs and had explored certain
options to deal with its challenges about revenue and costs.
The
management informed the staff that the options that had been
considered were a bank loan, embarking upon efforts to improve
the
efficiency of employees and the management had not been given salary
increases.
[8]
The staff were also informed that there was a need for
retrenchment as a result of Regenesys’ financial position. The
management told the staff that its wage bill made up 43% of its
expenses. The staff were informed that group meetings would
be
held the following day to discuss the possibility of retrenchment.
It is not clear that the staff had much to say in response
at
this meeting. Maybe this should not be surprising because it
seems that Regenesys was simply informing them of what was
going to
happen.
[9]
On 18 June 2015 meetings took place between the management and
the staff of certain departments that Regenesys had identified as
the
affected departments. In those meetings the management showed
the staff a new structure of the organisation that it had
prepared
with which it “proposed” to replace the then existing
structure. In other words, Regenesys had decided
that it needed
to restructure the organisation in order to deal with its financial
problems. The employees were handed the
proposed structure and
invited to make proposals or recommendations on the structure.
[10]
Only two staff members made proposals to the management. They
were Ms Nortjé and Ms Ilunga. One of the
proposals made was that a facilitator from the Commission for
Conciliation, Mediation and Arbitration (CCMA) be secured to
facilitate
the consultation. It is not clear whether Regenesys
responded to this proposal but no facilitation took place. The
probabilities are that Regenesys either rejected it or simply ignored
it and went ahead with its plan of what it wanted to do. If
it
had accepted it, but there was some other reason why in the end the
facilitation did not take place, Regenesys would have highlighted
that such a facilitation did take place, especially when it was
accused of having dismissed the employees in a procedurally unfair
manner. It did not do so.
[11]
On 22 June 2015 Regenesys gave the employees the final
structure. That structure reflected various vacant positions.
Regenesys
then invited the employees to apply for positions to
which they wanted to be appointed in the new structure of the
organisation.
The employees were required to submit their
applications by 13h00 on the same day, namely, 23 June 2015. They
were
provided with abridged application forms to complete and submit.
[12]
The positions which the employees or at least some of the
employees occupied were included in the new structure as positions in
respect of which applications had to be made. The employees
were told that the selection criterion for filling the positions
in
the new structure was competence which was said to include knowledge,
skills, and behaviour. The employees applied for
appointment to
their respective positions and other similar positions. On 24
June 2015 the employees were informed that their
applications were
unsuccessful and that they were then being retrenched with effect
from 31 July 2015. They were informed
that July would serve as
their notice month. However, Ms Wendy Mary Malleson, who was an
applicant in the Labour Court but
is not part of the proceedings in
this Court, fell sick on 23 June 2015 and was only informed of her
retrenchment on 29 June 2015.
Ms Chalklen took a 2.5% salary
cut in order to avoid retrenchment.
[13]
On 5
August 2015 Ms Malleson was informed that her performance was not
commensurate with her salary. Ms Brownlee and Dr Law
of the
management of Regenesys informed her that her job could be outsourced
for R12 000 per month. This was R40 000
less than her
monthly salary. Ms Brownlee and Dr Law handed her a separation
agreement to sign. When she rejected the
separation agreement,
Regenesys gave her a written notice in terms of section 189(3)
[4]
and dismissed her in a meeting held on 17 August 2015.
A
notice in terms of section 189(3) tells the employee that the
employer contemplates his or her dismissal for operational
requirements
and invites the employee to a consultation on the issues
which are set out in the provision.
[14]
Ms Mann was offered the position of Marketing Database
Co-ordinator but she rejected that offer. In her evidence Ms
Brownlee
testified that the reason for Ms Mann’s
retrenchment – when it was contemplated – was recorded by
Regenesys
as being that Regenesys was implementing a new business
model and organisational structure to improve operational
efficiencies
and effectiveness. Ms Brownlee said that the
reason why the section 189(3) notices did not say that the
retrenchment was
due to Regenesys’ financial problems was that
it did not want to alarm the external markets about its financial
position
as that could have had dire consequences for it and could
have scared off students. Regenesys stated that the employees,
including the appeal respondents and the cross-appeal applicants,
were selected for retrenchment because they did not meet the
selection criteria of knowledge, skills and behaviour in respect of
the positions that they had applied for. Strangely, some
of the
positions to which at least some of the appeal respondents and
cross-appeal applicants were not appointed were the positions
that
they occupied for some time before they were retrenched.
[15]
After the employees had received their letters of dismissal
and even before 31 July 2015 – which was the date
from
which the dismissals would take effect – the employees
referred to the CCMA for conciliation an unfair dismissal dispute in
which they contended that their dismissals were both procedurally and
substantively unfair. That dispute was conciliated
by the CCMA
on 13 August 2015 but the conciliation was unsuccessful. The
CCMA issued a certificate that the dispute remained
unresolved. The
employees then referred that dispute to the Labour Court. From
their affidavit in the section 189A(13)
application it seems that the
dispute that they referred to the Labour Court for adjudication
in terms of section 191(5) concerned
both the procedural and
substantive fairness of their dismissals. As will be seen
below, on or about 8 September 2015
they applied in the
Labour Court for the adjudication of their dispute with Regenesys
concerning the procedural fairness of their
dismissals and asked for
temporary reinstatement or compensation. The dismissals took
effect on 31 July 2015.
Labour
Court
[16]
As stated earlier, the appeal respondents
and the cross-appeal applicants were dismissed by Regenesys with
effect from 31 July 2015
except one who was dismissed some time in
August 2015. As already stated, on or about 8 September 2015
the appeal respondents
and the cross-appeal applicants
instituted an application in the Labour Court in terms of
section 189A(13) for an order reinstating
them in Regenesys’
employment until Regenesys had complied with a fair procedure in
terms of section 189A(13)(c) or
alternatively for the award of
compensation in terms of section 189A(13)(d)
.
[17]
The employees brought their section
189A(13) application as an urgent application. The first
prayer they sought in their
notice of motion was condonation for
instituting the application outside the prescribed period of 30 days.
The second was
“dispensing with the provisions of the
rules relating to times and the manner of service in dealing with
this matter as one
of urgency in terms of Rule 8 of the Rules”
of the Labour Court “should the Court upon case management so
direct”.
The third prayer was: “Directing
[Regenesys] to reinstate the [applicants] until such time as it has
complied
with a fair procedure in terms of section 189A alternatively
awarding the applicants compensation in respect of procedurally
unfair
dismissals”. They also asked that “those who
oppose this application” be ordered to pay the costs thereof.
[18]
In the founding affidavit filed in
support of the section 189A(13) application – which
was deposed to by Ms
Nortjé – the employees made this
request to the Labour Court:
“
The
applicants request that a Judge be appointed in terms of item 11.1
of the above Honourable Court’s Practice Manual
to
undertake
management of this case and to ensure an expedited hearing of the
matter
.” (Emphasis added.)
At some stage the Labour
Court, through Gush J, consolidated both matters, namely the one
referred to the Labour Court in terms
of section 191(5)(b)(ii) and
the application under section 189A(13). The Labour Court also
condoned the employees’
late filing of their section 189A(13)
application. Gush J ordered that the two matters be adjudicated
together.
[19]
In due course the two consolidated matters came before
Prinsloo J for trial. The Court found the dismissal of all the
employees
to have been procedurally unfair. It found the
dismissal of some of the employees to have been substantively unfair
as well
and that of others to have been substantively fair. Those
whose dismissals were found to have been both substantively and
procedurally unfair were—
(a)
Ms Ilunga;
(b)
Dr Dos Santos;
(c)
Ms Nkodi; and
(d)
Ms Mahlangu.
Those
whose dismissals were found to have been procedurally unfair only
were—
(a)
Ms Nortjé;
(b)
Ms Mann;
(c)
Ms Malleson;
(d)
Ms Chalklen; and
(e)
Ms Ariadne David (she, like Ms Malleson,
was an applicant in the
Labour Court but is not a party in this Court).
Two
of these, namely, Ms Malleson and Ms David, appeal against the
decision of the Labour Appeal Court setting aside the
Labour Court’s order against Regenesys for the the payment of
compensation.
[20]
The Labour Court ordered Regenesys to reinstate Ms Ilunga, Ms
Nkodi and Ms Mahlangu with effect from the dates of their
respective
dismissals. Although Dr Dos Santos’
dismissal was found to have been both substantively and
procedurally unfair,
the Labour Court did not order her
reinstatement but ordered that she be paid R766 378.08 which was the
equivalent of 12 months’
remuneration calculated at her rate of
remuneration as at the date of dismissal. This was because, by
the time the Labour
Court gave judgment in February 2020, Dr Dos
Santos had already reached her retirement age. Those in whose
favour reinstatement
orders were made were ordered to repay the
severance pay they had received on retrenchment. Regenesys was
given the right
to effect a set-off in respect of what it had to pay
the employees who were to be reinstated and what the employee had to
repay
to the employer.
[21]
The Labour Court awarded compensation to the cross-appeal
applicants whose dismissals it found to have been procedurally unfair
only. Here are the amounts of compensation that the Labour
Court ordered in their favour:
(a)
Ms Nortjé:
R429 999.96 (12 months’ remuneration)
(b)
Ms Mann:
R262 359.36 (12 months’ remuneration)
(c)
Ms Malleson:
R410 970.00 (12 months’ remuneration)
(d)
Ms Chalklen:
R312 000.00 (6 months’ remuneration)
(e)
Ms David:
R384 936.72 (12 months’ remuneration)
(f)
Dr Dos Santos
R766 378.08 (12 months’ remuneration)
The
Labour Court ordered Regenesys to pay the appeal respondents’
and cross appeal applicants’ costs. It
gave specific
reasons as to why it was ordering Regenesys to pay costs when the
norm in labour matters is that no costs are awarded.
[22]
The Labour Court dealt with the case of each one of the
employees before it and gave reasons why it found their dismissals to
have
been either substantively fair or substantively unfair. It
also gave reasons for its conclusion that the dismissal of all
the
employees was procedurally unfair. It then made the orders it
made as already indicated above. I do not consider
it necessary
to record the reasons given by the Labour Court for its
conclusion that the dismissals of certain of the employees
were
substantively unfair. I also do not record its reasons for
its conclusions that the dismissal of all the employees
was
procedurally unfair. This is because it is either common cause
or not seriously disputed that Regenesys did not comply
with a fair
procedure in dismissing the employees. In any event, for both
findings the Labour Court gave detailed reasons
in respect of
each individual. Other than its reliance on knowledge, skills
and behaviour as the selection criteria that
were used by Regenesys,
the Labour Court’s reasons for finding substantive unfairness
are not challenged.
Labour
Appeal Court
[23]
Regenesys applied for and was granted leave to appeal to the
Labour Appeal Court against certain orders of the Labour
Court. Before the Labour Appeal Court Regenesys
challenged the conclusions reached by the Labour Court that
the
dismissals of certain specified employees were substantively unfair
and that it had jurisdiction to determine whether the dismissals
of
the employees were procedurally unfair.
[24]
In
the Labour Appeal Court Regenesys contended that the skills,
knowledge and behaviour that Regenesys had said during the
consultation
process and in the trial were the selection criteria
that had been used were actually not selection criteria. In
other words,
Regenesys was saying that, to the extent that the Labour
Court made its decision on the basis that skills, knowledge and
behaviour
were the selection criteria used, it was wrong.
Skills, knowledge and behaviour were, Regenesys argued, the criteria
used
when the affected employees applied for positions in the new
structure. Regenesys thus distinguished between selection
criteria
for retrenchment and assessment criteria for competition for
new positions. Regenesys relied on the decision of the
Labour Appeal Court
in
Louw
[5]
in support of this contention.
[25]
The Labour Appeal Court rejected Regenesys’ contention.
It distinguished the case of
Louw
. The Labour Appeal
Court, therefore, rejected Regenesys’ contention that the
Labour Court had erred in concluding
that the dismissals of
certain of the employees were substantively unfair. From the
judgment of the Labour Appeal Court this
seems to have been the only
point argued by Regenesys to challenge the conclusion of the
Labour Court on the substantive unfairness
of the dismissals of
some of the employees. Accordingly, Regenesys’ appeal
against the findings of the Labour Court
that the dismissals of
certain of the employees were substantively unfair was dismissed.
[26]
With
regard to whether or not the Labour Court had jurisdiction to
determine the procedural fairness of the dismissals of the employees
for operational requirements, the Labour Appeal Court
concluded on the basis of section 189A(18) that the Labour Court
had no jurisdiction to determine such an issue. It held that it
was not competent for the Labour Court to make the orders
it
made that were based on its conclusion that the dismissals were
procedurally unfair. In support of its conclusion in this
regard the Labour Appeal Court relied on this Court’s
judgment in
CC
Steenkamp
II
.
[6]
I shall deal with this further later in this judgment.
[27]
The Labour Appeal Court then made the following order:
“
1.
The appeal succeeds.
2.
The orders of the Labour Court are set aside and replaced as follows:
‘
1.
The dismissals of the second, third, fifth and seventh applicants [Ms
Ilunga, Dr Dos
Santos, Ms Nkodi and Ms Mahlangu respectively]
are found to be substantively unfair;
2.
The respondent is to retrospectively reinstate the second, fifth and
seventh
applicants, with effect from the date of dismissal, into the
same or similar positions held by them at the time of their
dismissal,
with no loss of benefits;
3.
The second, fifth and seventh applicants are to repay any amount
received from
the respondent as severance pay, or set off any such
amount paid to them by the respondent in respect of severance pay
against
the back pay due to them;
4.
The respondent is within fourteen (14) days of this order to pay to
the third
applicant [Dr Dos Santos] compensation in the sum
of R766 378.08, being equivalent to 12 months’
remuneration
calculated at the rate of remuneration which applied on
the date of dismissal;
5.
There is no order as to costs.’
3.
The appeal against the order of the Labour Court dismissing the
appellant’s
application to adduce further evidence is
dismissed.
4.
There is no order as to costs.”
It
is necessary to make a few observations in regard to this order but
the proper place to make them is not now but later in this
judgment.
In
this Court
Jurisdiction
[28]
As I have already stated earlier, Regenesys applies for leave
to appeal against the judgment and order of the Labour Appeal Court
in terms of which that Court upheld the conclusion of the Labour
Court that the dismissals of some of the employees were substantively
unfair and ordered their reinstatement and payment of a large sum of
compensation to one of those employees. The cross-appeal
applicants apply for leave to cross-appeal against the conclusion of
the Labour Appeal Court that the Labour Court had no
jurisdiction to determine the procedural fairness of the dismissals
for operational requirements of the employees in whose
favour
the Labour Court had made a declaratory order on procedural fairness
and ordered Regenesys to pay them compensation.
The
cross-appeal applicants also appeal against the Labour Appeal Court’s
reversal of the costs orders which the
Labour Court made in their
favour.
[29]
This
matter relates to the interpretation and application of the LRA which
is legislation enacted to give effect to section 23 of
the Bill of
Rights. In terms of this Court’s decision in
NEHAWU
[7]
and a number of judgments which have since followed that decision,
such a matter raises a constitutional issue.
For
this reason, this Court has jurisdiction to entertain this matter.
[30]
Furthermore, if we grant the cross-appeal applicants leave to
cross-appeal, the cross appeal will raise not only a question
of
the interpretation of the LRA but also a question of law of general
public importance that deserves to be considered by this
Court.
That question is whether, given the provisions of section 189A(18),
the Labour Court has jurisdiction to determine
disputes about
the procedural unfairness of dismissals of employees for operational
requirements in general or the procedural fairness
of a dismissal of
employees for operational requirements to which section 189A
applies and where such employees bring an application
before the
Labour Court in terms of section 189A(13).
The
Labour Appeal Court held that the Labour Court did not have
jurisdiction to adjudicate the procedural fairness of a dismissal
for
operational requirements.
This decision meant that the
Labour Court did not have jurisdiction to adjudicate such matters
even when they have been brought
to the Labour Court by way of an
application in terms subsection (13). It based this conclusion
on this Court’s judgment
in
CC Steenkamp II
.
[31]
If
the Labour Appeal Court’s interpretation is correct, it would
mean that the Labour Court’s jurisdiction to determine
a
dispute about the procedural fairness of a dismissal for operational
requirements is completely ousted irrespective of whether
the dispute
was referred to the Labour Court in terms of section 191(5)(b)(ii)
or section 189A(13). This is so
because in the present
matter the Labour Appeal Court’s decision that the
Labour Court had no jurisdiction to adjudicate
disputes about the
procedural fairness of dismissals for operational requirements is
unqualified and was used in the present case
to preclude the
adjudication of a subsection (13) application. That
interpretation may well be inconsistent with an employee’s
fundamental right to fair labour practices enshrined in section
23(1)
[8]
of the Constitution and
section
34
[9]
of the Constitution
which guarantees every person the right to have their justiciable
disputes adjudicated by a court in a fair public hearing or,
in an
appropriate case, another independent tribunal or forum. It may
also be inconsistent with section 38
[10]
of the Constitution.
[32]
I, therefore, conclude that this Court has jurisdiction in
respect of this matter.
Leave to appeal
[33]
The next question is whether it is in the interests of justice
to grant leave to appeal and leave to cross-appeal.
One of the arguments that Regenesys wishes to advance – on
appeal if it is granted leave to appeal – is that skills,
knowledge and behaviour which it had said at the trial were the
selection criteria that it had used to select the employees who
were
dismissed are not actually selection criteria as contemplated in
section 189(7). If this contention were to be upheld,
this
matter is likely to affect the labour relations community in general
and not just the parties before us. Furthermore,
the
interpretation of section 189A(18) with regard to the jurisdiction of
the Labour Court
to adjudicate disputes about the
procedural fairness of dismissals for operational requirements in
general or those referred to
the Labour Court in terms of
section 191(5)(b)(ii) or with regard to applications in terms of
section 189A(13)
will affect many workers and employers.
With regard to the prospects of success, I am of the opinion that, if
leave to appeal
and leave to cross-appeal, are granted, the appeal
and cross appeal have reasonable prospects of success. The
issues
in this matter are very important. It is in the
interests of justice to grant both sides the leave each side seeks.
[34]
Furthermore,
this matter makes it necessary for this Court to examine the
correctness or accuracy of decisions of the Labour Court,
Labour
Appeal Court and this Court which contain statements or have held
that the Labour Court has no jurisdiction to adjudicate
disputes
about the procedural fairness of dismissals for operational
requirements in general or those brought before the Labour
Court in
terms of section 189A(13). There appears to be confusion
about whether the Labour Court’s general
jurisdiction with
regard to such disputes has been ousted by section 189A(18).
There are a number of cases in the Labour
Appeal Court and this Court
which contain statements which either suggest that the Labour Court
no longer has jurisdiction to adjudicate
disputes about the
procedural fairness of dismissals for operational requirements
including those brought to the Labour Court
in terms of
subsection (13) or that suggest that it no longer has
jurisdiction to adjudicate disputes about the procedural
fairness of
dismissals for operational requirements referred to the Labour Court
in terms of section 191(5)(b)(ii).
[11]
It is in the interests of justice that this Court brings about
clarity in this regard.
[35]
It is in the interests of justice to grant both the leave to
appeal and the leave to cross appeal.
Appeal
Substantive
fairness
[36]
The first issue that Regenesys raises on appeal is the Labour
Court’s conclusion that the dismissal of certain of the
employees
was substantively unfair which the Labour Appeal Court
refused to overturn. Regenesys contends that what the
Labour Court
accepted as the selection criteria that were used
to select the employees who were dismissed were actually not the
selection criteria.
This was a reference to skills, knowledge
and behaviour which Regenesys had told the employees during its
interactions with them
prior to their dismissals were the selection
criteria that would be used to fill the vacant positions. It
was understood
by all concerned that any employee who was not
appointed in one of the vacant positions would be dismissed for
operational requirements.
Indeed, Regenesys’ case
before the Labour Court was that skills, knowledge and behaviour were
the selection criteria it had
used to select the employees who were
ultimately dismissed.
[37]
The employees ran their trial on the basis that the selection
criteria used to select those to be dismissed for operational
requirements
were skills, knowledge and behaviour. It was only
in its appeal in the Labour Appeal Court that Regenesys contended,
for
the first time, that skills, knowledge and behaviour were not the
selection criteria for retrenchment but the assessment criteria
in
the competitive process of applying for positions in the new
structure. It relied, for this submission, on the judgment
of
the Labour Appeal Court in
Louw
. I am unable to find
anything in
Louw
which supports the submission that skills,
knowledge and behaviour, in general, do not or cannot constitute
selection criteria
or that in this case they were not used as
selection criteria.
[38]
Regenesys seems to contend that the presence of the
competitive process relating to the filling of vacant positions
between the
declaration of the employees’ positions as
redundant and their ultimate dismissals after they had not been
successful in
their applications for those vacancies means that they
became disentitled to be selected according to selection criteria
that were
fair and objective if the selection criteria had not been
agreed between the parties. I say this because, if skills,
knowledge
and behaviour were not selection criteria, then the case
must be decided on the basis that the selection of the employees for
retrenchment
was not based on any known selection criteria.
Such a dismissal would be substantively unfair.
[39]
The answer to Regenesys’ contention is that the Court
cannot rely on this contention to assess the conclusion reached by
the
Labour Court on whether the dismissal of some of the employees
was substantively unfair because the trial was run by both parties
on
the footing that skills, knowledge and behaviour were the
selection criteria that were used by Regenesys to select these
employees for dismissal. It would be extremely prejudicial to
the employees to now decide the appeal on the basis that the
selection criteria were not skills, knowledge, and behaviour.
In fact it will be prejudicial to Regenesys itself. It
does not
seem prudent on Regenesys’ part to advance this argument
because, if accepted, it would result in a situation where
Regenesys
would have no selection criteria to rely on for the selection of the
employees for dismissal. It would not have
anything to rely on
in the record as having been the selection criteria that were used
and that were disclosed to the employees
prior to their
retrenchment. That would compound the unfairness of the
dismissal, including at a substantive level.
In these
circumstances, this contention cannot be entertained.
[40]
Regenesys also contends that the Labour Court erred in
rejecting its submission that it (i.e. the Labour Court) was not
entitled
to entertain the employees’ contention that it (i.e.
Regenesys) applied the selection criteria unfairly. This
contention
is based on the proposition that, although the pre-trial
minute agreed to between the parties reflected that this was one of
the
issues to be decided by the Court, the employees did not
subsequently amend their statement of claim to include this issue.
Regenesys submits that, in the absence of such an amendment, the
Labour Court erred in entertaining this point. According
to
Regenesys, on the pleadings the dismissed employees were confined to
a case that the selection criteria were unfair, not that
they were
unfairly applied.
[41]
There is a short answer to this contention. This
is an appeal against a judgment and order of the Labour Appeal
Court.
Therefore, there must be an order or finding or failure
to make a finding by the Labour Appeal Court which Regenesys submits
was
erroneous. In order for Regenesys’ appeal against the
judgment of the Labour Appeal Court to succeed, Regenesys
must show that the Labour Appeal Court erred in a certain
respect. Regenesys cannot contend, and, this Court cannot
conclude, that the Labour Appeal Court erred in regard to a
certain point or finding unless it was required to consider
that
point or finding
.
[42]
If it was not part of Regenesys’
case before the Labour Appeal Court that the
Labour Appeal Court should
consider or reassess a certain
finding or point, the Labour Appeal Court will not have
erred if it did not deal with
that point. In fact, if the
Labour Appeal Court considered a finding or point that was
not in issue between the
parties in the Labour Appeal Court,
any party adversely affected by its conclusion on such point may
legitimately complain.
In fact it would even be a ground of
appeal that the Labour Appeal Court made an adverse finding
on a point which
was not in issue between the parties.
[43]
An exception to this would be a point of law because a court
may raise a point of law
mero motu
if the point does not need
any new evidence to be led and if it would not be unfair to one or
both parties for the court to consider
and take into account that
point of law. A reading of the judgment of the Labour Appeal
Court does not reveal that that Court
ever dealt with this issue or
with the Labour Court’s decision or conclusion rejecting
Regenesys’ contention in this
regard. Indeed, a reading
of Regenesys’ notice of appeal to the Labour Appeal
Court reveals that Regenesys
did not challenge the Labour Court’s
conclusion or finding that the employees’ pleadings covered the
point that
Regenesys had applied the selection criteria unfairly.
That explains why the judgment of the Labour Appeal Court did not
deal with this issue.
[44]
Can a party challenge in the second or further appeal court a
finding or conclusion adverse to it that was made by the court of
first instance which it did not challenge in the first appeal court?
The answer is: When a party appeals to a second or further
appeal
court, it appeals against a judgment or order or conclusion of the
first appeal court. It does not appeal against
the judgment and
order of the court of first instance. Therefore, a finding or
conclusion or order of the court of first
instance that a party did
not appeal against or challenge in its appeal to the first appeal
court cannot be appealed against or
challenged by such a party in an
appeal to a second or further appeal court. In this case
Regenesys applied to this
Court for leave to appeal against the
judgment and order of the Labour Appeal Court and not
against the judgment and
order of the Labour Court. It,
therefore, cannot challenge in this Court a finding or conclusion or
order of the Labour
Court that it did not include in its appeal to
the Labour Appeal Court. Therefore, its contention in
this regard
falls to be rejected.
[45]
Regenesys also contends that the Labour Appeal Court erred in
not setting aside the orders of reinstatement that were made by the
Labour Court pursuant to its conclusion that the dismissals of
certain of the appeal respondents and cross appeal applicants
were substantively unfair. It submits that the Labour Appeal
Court should have set aside those orders. In support of
this
submission Regenesys referred to the fact that the appeal respondents
and the cross-appeal applicants had not given or led
any evidence
including evidence about their personal circumstances.
The
Labour Court gave comprehensive reasons why it found that the
dismissals of certain of the employees were substantively
unfair.
The Labour Appeal Court also concluded that there was no proper
basis advanced by Regenesys that would justify interfering
with the
Labour Court’s conclusion in this regard. I agree
that there were proper grounds for the Labour Court
to find that
the dismissals were substantively unfair. I am here referring
to the dismissal of the employees that the Labour
Court found to have
been substantively unfair.
[46]
Regenesys
also contended that, in granting orders of reinstatement in favour of
certain specified employees, the Labour Court had
failed to have
regard to the provisions of section 193(2) and, for that reason, the
orders of reinstatement that it made should
be set aside and the
employees concerned should be awarded compensation. This
contention was advanced in the event that this
Court was not
persuaded to overturn the Labour Court’s conclusions that
the dismissals of certain employees were substantively
unfair.
In support of its contention Regenesys quoted certain passages from
the judgment of this Court in
SARS
[12]
and the Labour Appeal Court’s judgment in
Mediterranean Textile Mills (Pty) Ltd.
[13]
[47]
This contention cannot be entertained. There is no
indication in the judgment of the Labour Appeal Court that
it
was part of Regenesys’ appeal before that Court that the
Labour Court had erred in granting reinstatement to specified
employees
because it failed to have regard to section 193(2).
Indeed, a reading of the notice of appeal to the Labour Appeal Court
reveals that there was no appeal by Regenesys to the
Labour Appeal Court against the alleged failure of the
Labour Court
to have regard to section 193(2). Regenesys
may not appeal to this Court against a finding or conclusion made by
the
Labour Court which it (i.e. Regenesys) did not challenge in
its appeal to the Labour Appeal Court.
[48]
Furthermore, the orders that the reinstatement in each case be
retrospective to the date of dismissal of each employee in whose
favour the finding of substantive unfairness had been made was also
justified because:
(a)
there is no suggestion that the employees
were responsible for any
delay in the finalisation of the matters; instead Regenesys had
caused some long delays;
(b)
Regenesys had failed to engage in proper consultations
which may have
avoided the dismissals of the appeal respondents and the cross appeal
applicants and this litigation; and
(c)
Regenesys had not been honest with the employees
when it purported to
consult with them in that it did not inform them about the role of
its financial problems in the decision
to restructure the
organisation and to retrench.
[49]
Regenesys also challenged on appeal the Labour Appeal Court’s
failure or refusal to interfere with the Labour Court’s
award
of compensation of 12 months’ remuneration to the second
respondent, Dr Dos Santos. It contended that the
Labour Court
or Labour Appeal Court had not had due regard to the following:
(a)
Dr Dos Santos did not testify as to her personal circumstance.
(b)
Dr Dos Santos did not seek clarity on the retrenchment process.
(c)
Regenesys had a justifiable reason to embark upon a retrenchment
exercise.
(d)
Regenesys’ financial position and Dr Dos Santos’
conduct
just prior to the retrenchment.
The
contention was in effect that, if the Labour Court had had due regard
to the above factors, Dr Dos Santos would not have been
awarded the
maximum compensation permitted in law, namely 12 months’
remuneration.
[50]
I shall deal with the question whether the Labour Court had
jurisdiction to deal with the procedural fairness or otherwise of the
dismissal of the employees and the power to order payment of
compensation when I deal with the cross-appeal. However, for
purposes of dealing with Regenesys’ contention, I am able to
say that, assuming that the Labour Court had the requisite
jurisdiction, it was justified in rejecting Regenesys’
contention in this regard once it accepted that the appeal
respondents
whose dismissals it had found to have been substantively
unfair had to be reinstated retrospectively from the dates of their
respective
dismissals. Those appeal respondents were
effectively awarded back pay of over four years.
[51]
Regenesys also submitted that the Labour Court should have
granted it leave to adduce the further evidence it applied for leave
to adduce after it had closed its case which the Labour Court had
dismissed. Regenesys contended that the Labour Appeal Court
erred in upholding the decision of the Labour Court. The
Labour Appeal Court gave persuasive reasons as to why
the
Labour Court did not err in dismissing Regenesys’ application
to adduce further evidence. I agree with those reasons.
It is not necessary to repeat those reasons here. They can be
found in the Labour Appeal Court’s judgment.
Accordingly, Regenesys’ contention in this regard falls to be
rejected.
[52]
The orders of reinstatement were justified because:
(a)
the dismissals had been found to have been
substantively unfair;
(b)
reinstatement is the primary remedy for substantively
unfair
dismissal unless the employer proves one or more of the exceptions
listed in section 193 of the LRA which Regenesys
did not prove;
and
(c)
these were no-fault terminations in the sense
that the employees were
not dismissed because they had done anything wrong. The
employees were dismissed at the end of July
2015 and the Labour Court
handed down its judgment on 19 June 2019.
There
would have been no justification for the Labour Court to award
Dr Dos Santos compensation that was less than 12
months’
remuneration when her dismissal had been found to have been
substantively unfair where her colleagues whose dismissals
had also
been found to have been substantively unfair were granted
retrospective reinstatement that effectively gave them four
years’
backpay.
[53]
In the circumstances Regenesys’
appeal falls to be dismissed. This is an appropriate case in
which a costs order should
be made against Regenesys. The
success of the employees, the manner in which Regenesys handled the
restructuring and the
retrenchment and the manner in which it failed
to have a proper consultation with the employees all justify an order
of costs against
it. Accordingly, the appeal is to be dismissed
with costs.
The cross-appeal
Disputes about the
procedural fairness of dismissals for operational requirements
[54]
In the present case the Labour
Appeal Court upheld Regenesys’ appeal against the conclusion of
the Labour Court that the Labour
Court had jurisdiction to adjudicate
a dispute about the procedural fairness of a dismissal for
operational requirements.
The cross appeal applicants
cross-appeal against the decision of the Labour Appeal Court
that, given the provisions
of section 189A(18) of the LRA, the
Labour Court did not have jurisdiction to adjudicate a dispute
about the procedural fairness
of a dismissal for operational
requirements.
[55]
Once the Labour Appeal Court had
concluded that the Labour Court did not have such jurisdiction, it
set aside the declaration that
had been made by the Labour Court
that the dismissals of employees were procedurally unfair. It
also set aside the compensation
orders that the Labour Court had made
in favour of those employees whose dismissals it had found to have
been procedurally unfair
only. The cross appeal applicants
also cross-appeal against those orders. The
Labour Appeal Court’s
conclusion that the Labour
Court did not have jurisdiction to adjudicate the dispute about the
procedural fairness of a dismissal
for operational requirements meant
that the Labour Court should have refused to adjudicate the
cross-applicants’ application
brought in terms of section
189A(13).
[56]
The issue for determination in the
cross-appeal is whether, given the provisions of section 189A(18),
the Labour Court has
jurisdiction to adjudicate a dispute about the
procedural fairness of a dismissal for operational requirements
including one brought
to the Labour Court in terms of section
189A(13). Regenesys contends that the Labour Court has no
such jurisdiction
because that jurisdiction has been ousted by
section 189A(18). The employees contend that the Labour
Court does have
jurisdiction in respect of disputes about the
procedural fairness of dismissals for operational requirements to
which section 189A
applies which are brought in the Labour Court
by way of applications in terms of section 189A(13).
[57]
The determination of the issue in
this cross-appeal requires a consideration of section 189A(13),
(18) and other provisions
of the LRA. It is convenient to start
with the issue of the circumstances under which the orders under
subsection (13)
may be granted. It is important to address
right at the outset the question of the circumstances in which
section 189A applies.
That is to be found in section 189A(1).
This provision reads:
“
(1)
This section applies to employers employing more than 50 employees
if–
(a)
the employer contemplates dismissing by reason of the employer’s
operational
requirements, at least–
(i)
10 employees, if the employer employs up to 200 employees;
(ii)
20 employees, if the employer employs more than 200, but not more
than 300, employees;
(iii)
30 employees, if the employer employs more than 300, but not more
than 400, employees.
(iv)
40 employees, if the employer employs more than 400, but not more
than 500, employees;
or
(v)
50 employees if the employer employs more than 500 employees; or
(b)
the number of employees that the employer contemplates dismissing
together with the
number of employees that have been dismissed by
reason of the employer’s operational requirements in the
12 months prior
to the employer issuing a notice in terms of
section 189(3), is equal to or exceeds the relevant number
specified in paragraph
(a).”
[58]
It is clear from this provision that
section 189A applies to dismissals for operational requirements by
employers who employ more
than 50 employees when they contemplate
dismissing certain numbers of employees in their workforce for
operational requirements.
As is the case with employers to
which section 189A does not apply, employers to whom section 189A
applies are obliged to
consult with employees or their
representatives if they contemplate such employees’ dismissals
for operational requirements.
Section 189A(2) to (12) places
various obligations on the employer and employees which are aimed at
enhancing or enriching
the consultation process so as to avoid or
minimise mass retrenchments or disputes about mass retrenchments.
[59]
Section 189A(13) then provides that,
if an employer does not comply with a fair procedure, a consulting
party may approach the Labour
Court for certain orders listed
therein. Subsection (13) reads:
“
(13)
If an employer does not comply with a fair procedure, a consulting
party may approach the Labour Court by way of an application
for an
order–
(a)
compelling the employer to comply with a fair procedure;
(b)
interdicting or restraining the employer from dismissing an employee
prior to complying
with a fair procedure;
(c)
directing the employer to reinstate an employee until it has complied
with a fair
procedure;
(d)
make an award of compensation, if an order in terms of paragraphs
(a) to (c)
is not appropriate.”
[14]
Interpretative
approach
[60]
The determination of the issues that
are raised by the cross-appeal require an interpretation of sections
189A(13), (14), (18) and
191(5)(b)(ii) of the LRA. It is,
therefore, important to bear in mind the correct approach to the
interpretation not only
of legislation in general but also of the LRA
in particular.
[61]
Section 39(2) of the Constitution
deals with the interpretation of legislation. It reads:
“
(2)
When interpreting any legislation, and when developing the common law
or customary law, every
court, tribunal or forum must promote the
spirit, purport and objects of the Bill of Rights.”
[15]
In
Hyundai
[16]
this Court explained the purport and objects of the Bill of Rights
thus:
“
[22]
The purport and objects of the Constitution find expression in
section 1, which lays out the fundamental
values which the
Constitution is designed to achieve. The Constitution requires
that judicial officers read legislation,
where possible, in ways
which give effect to its fundamental values. Consistently with
this, when the constitutionality of
legislation is in issue, they are
under a duty to examine the objects and purport of an Act and to read
the provisions of the legislation,
so far as is possible, in
conformity with the Constitution.”
[17]
[62]
Section 3 of the LRA provides that
anyone interpreting or applying the LRA must do so with due
regard to the purpose of the
LRA, its primary objects, consistently
with the Constitution and in furtherance of section 23 of the
Constitution. Section 23(1)
of the Constitution reads:
“
Labour
Relations
23.
(1) Everyone has the right to fair labour practices.”
[63]
The purpose of the LRA is to:
“
[
A]dvance
economic development, social justice, labour peace and the
democratisation of the workplace by fulfilling the primary objects
of
this Act, which are—
(a)
to give effect to and regulate the fundamental rights
conferred by
section 23 of the Constitution of the Republic of South Africa,
1996;
(b)
to give effect to obligations incurred by the Republic
as a member
state of the International Labour Organisation;
(c)
to provide a framework within which
employees and their trade unions,
employers and employers’ organisations can—
(i)
collectively bargain to determine wages, terms and conditions
of
employment and other matters of mutual interest; and
(ii)
formulate industrial policy; and
(d)
to promote—
(i)
orderly collective bargaining;
(ii)
collective bargaining at sectoral level;
(iii)
employee participation in decision-making in the workplace; and
(iv)
the
effective resolution of labour disputes.”
[18]
Among
the above primary objects of the LRA, I emphasise the ones contained
in paragraphs (a) and (d)(iv).
It is
now settled that the correct approach to the interpretation of the
LRA is purposive interpretation.
Background to the right
not to be dismissed unfairly under the LRA
[64]
Prior to our constitutional
democracy the courts of South Africa had developed an extensive
unfair labour practice jurisprudence
since the establishment of the
Industrial Court of South Africa in the early 1980s. By
the advent of democracy in 1994,
that Court, together with the
old Labour Appeal Court which was established in 1988 and, to
some extent, the then Appellate
Division of the
Supreme Court of South Africa, which is now the
Supreme Court of Appeal, had built upon and
consolidated that
jurisprudence.
[65]
That
unfair labour practice jurisprudence was based effectively on a
definition of the phrase “unfair labour practice”
in the
Labour Relations Act 1956
[19]
as amended (1956 LRA). In fact, that Act, as amended,
effectively meant that the Industrial Court had jurisdiction
to
determine disputes of alleged unfair labour practices between
employers and employees and to grant a remedy where it considered
it
appropriate to do so. That right included the workers’
right not to be dismissed unfairly. In turn, that right
included a component that an employee had to be afforded an
opportunity to be heard (including the right to be consulted before
any termination for operational requirements) before he or she could
be dismissed. That is the component that relates to
procedural
fairness.
[66]
One component of the right not to be
dismissed unfairly is that there must be a valid or fair reason
before an employee may be dismissed.
When, therefore, the
Constitution proclaimed in 1997 in section 23 that every worker was
entitled to fair labour practices,
an element of that right included
the right not to be dismissed unfairly which in turn has two
components, the one being every
worker’s right not to be
dismissed without being afforded an opportunity to be heard and, the
other being the worker’s
right not be dismissed without a fair
reason.
These two components of the
right not to be dismissed unfairly related, respectively, to
procedural fairness and substantive fairness
of the right not to be
dismissed unfairly.
[67]
The LRA, a piece of legislation
enacted to give effect to section 23 of
the Constitution,
provides in section 185 for a right not to be dismissed unfairly and
a right not to be subjected to an unfair
labour practice. Section
187 of the LRA describes when a dismissal is automatically unfair.
Then section 188 deals
with dismissals other than those that
are automatically unfair. It reads:
“
188
Other unfair dismissals
(1)
A dismissal that is not automatically unfair, is unfair if the
employer fails to prove—
(a)
that the reason for dismissal is a fair reason—
(i)
related to the employee’s conduct or capacity; or
(ii)
based on the employer’s operational requirements; and
(b)
that the dismissal was effected in accordance with a fair procedure.”
[68]
Section 193(1) deals with the
remedies that a court or an arbitrator may grant in a case where it
has concluded that an employee’s
right not to be dismissed
unfairly has been violated or infringed. The remedies include
reinstatement, re-employment and
payment of compensation. Section
193(2) enjoins the Labour Court, or, an arbitrator, to order the
employer to reinstate the
employee if it or he or she finds the
dismissal to have been without a fair reason – in other words,
if the court or an arbitrator
finds the dismissal substantively
unfair unless one of four exceptions provided for therein is present.
One of the exceptions
is where the dismissal is unfair only
because the employer did not follow a fair procedure. In such a
case reinstatement
is not competent and the only remedy is payment of
compensation by the employer.
[69]
Prior to the amendment that was
brought about by the insertion of section 189A into the LRA in
2002, the only adjudication
of the procedural fairness of a dismissal
that could competently be undertaken by the Labour Court was the one
provided for in
section 191(5). That was the case whether
the only issue to be decided by the Court was the procedural fairness
or otherwise
of a dismissal or both the procedural and the
substantive fairness of the dismissal. If its conclusion was
that the dismissal
was procedurally unfair, it would generally award
the employee compensation.
[70]
Whereas in those cases where the
Labour Court had found a dismissal to be substantively unfair, it
could be concerned about ordering
reinstatement if a long time had
lapsed between the date of dismissal and the date of adjudication, no
such concern would arise
in relation to ordering payment of
compensation. If the Court, having found that a dismissal was
substantively unfair, felt
reluctant to order the employee’s
reinstatement because of the long period that had passed since the
dismissal, it would
order payment of compensation. In other
words, while there may be some concerns with the ordering of the
reinstatement of
an employee or group of employees after the lapse of
a long time between the date of dismissal and the date of
adjudication, there
is never such a concern with regard to an order
for the payment of compensation.
[71]
Both before 1994 and for many years
after the LRA had come into operation mass retrenchments were not
subject to a legal regime
that was different to the legal regime
applicable to individual dismissals. The law was the same for
all employers of different
sizes and shapes. However, later, a
special dispensation was enacted for large scale employers by way of
section 189A. The
relevance of this history will become
apparent later.
Purpose, meaning and
scope of section 189A(13)
[72]
If an employer to which section 189A
applies does not comply with a fair procedure, employees may approach
the Labour Court for
one or other relief specified in section
189A(13)(a), (b), (c) and (d). Section 189A(13) provides:
“
If
an employer does not comply with a fair procedure, a consulting party
may approach the Labour Court by way of application for
an order—
(a)
compelling the employer to comply with a fair procedure;
(b)
interdicting or restraining the employer from dismissing an employee
prior to complying
with a fair procedure;
(c)
directing the employer to reinstate an employee until it has complied
with a fair
procedure;
(d)
make an award of compensation, if an order in terms of paragraphs
(a) to (c)
is not appropriate.”
[73]
There is a common feature that the
orders contemplated in paragraphs (a) to (c) share.
They all end with the
phrase “with a fair procedure” but
the provisions relating to an order contemplated in paragraph (d) do
not end with
such a phrase. Another feature that is shared by
paragraphs (a) to (c) is the word that precedes that phrase in each
of the
first three paragraphs. It is the verb “comply”
in different forms. In paragraph (a) it is “to
comply”, in paragraph (b) it is “complying” and in
paragraph (c) it is “complied”. Paragraph
(d)
does not have the verb “comply” in any form or shape.
[74]
Why do paragraphs (a) to (c) share
common features among themselves which they do not share with
paragraph (d)? The reason
is that section 189A(13) has two
purposes. The one purpose, which may be called the primary
purpose, relates to orders contemplated
in paragraphs (a) to (c) but
does not relate to an order contemplated in paragraph (d).
The purpose of orders contemplated
in paragraphs (a) to (c) is to
ensure that the employer complies with a fair procedure before it
dismisses employees for operational
requirements finally. That
is why the provisions of paragraphs (a) to (c) end
with the phrase “with
a fair procedure” and why the verb
“comply” appears in different forms and shapes before
that phrase in these
paragraphs.
[75]
The order contemplated in paragraph
(a) is meant to be granted before or at the start of or during the
consultation process when
there has been no dismissal as yet and when
there is no imminent dismissal. An order contemplated in
paragraph (a) compels
the employer to comply with a fair procedure.
An order contemplated in paragraph (b) is one meant to be
granted where
the dismissal of an employee is imminent in
circumstances where the employer has not complied with a fair
procedure. That
order would interdict or restrain the employer
from dismissing the employee or employees before it complies with a
fair procedure.
The order contemplated in paragraph (c)
applies when a dismissal has happened without compliance with a fair
procedure
when it is still appropriate to reverse the dismissal and
put the consultation process back on track.
[76]
An order contemplated in paragraph
(c) may not be appropriate if a significant time has lapsed between
the date of dismissal and
the date of adjudication. This is
because the reinstatement under paragraph (c) is not necessarily
final. It is granted
to enable the employer’s compliance
with a fair procedure. The outcome of the employer’s
compliance with a fair
procedure could be that the employees remain
in the employer’s employment or they could be dismissed after a
fair procedure
has been followed. It is a temporary order.
In fact, the order contemplated in paragraph (b) is also a
temporary
order in that the employer is not permanently interdicted
from dismissing the employees but is interdicted until it complies
with
a fair procedure.
[77]
The order contemplated in paragraph
(d) is not temporary. It is final. Paragraph (d)
does not say that the payment
of compensation by the employer must be
made until the employer has complied with a fair procedure. The
order in paragraph (d)
is made on the acceptance that the
employer has failed to comply with a fair procedure and the employer
is not given another chance
to comply with a fair procedure.
The order contemplated in paragraph (d) is made to ensure two
objectives, namely to hold
the employer accountable for its failure
to comply with a fair procedure by ensuring that there are
consequences visited upon the
employer for such unacceptable conduct
and to compensate the employee for the infringement by the employer
of his or her right
not to be dismissed in a procedurally unfair
manner.
[78]
No two orders contemplated in
paragraphs (a) to (d) may be granted together. If an order
contemplated in paragraph (b) is
granted, there is no need for an
order under paragraph (a). An order under paragraph (c)
cannot appropriately or competently
be granted together with an order
contemplated in paragraph (b) because an order under paragraph (b)
can only be granted where
a dismissal has not happened whereas an
order contemplated in paragraph (c) can only be granted when a
dismissal has occurred.
Accordingly, it would be inappropriate
to grant an order under paragraph (b) if a dismissal has
happened just as it would
be inappropriate and incompetent for the
Labour Court to grant an order under paragraph (c) before the
dismissal has happened.
Given the provisions of paragraph (d),
an order under that paragraph can only be granted when none of the
orders contemplated in
paragraphs (a) to (c) may be appropriately
granted.
[79]
Questions that arise are: When would
it not be appropriate for the Labour Court to grant an order
contemplated in paragraph
(a) or (b) or (c)? When would it be
appropriate for the Labour Court to grant an order contemplated in
paragraph (d)? Each
case has to be decided on its own merits.
Changes in the operations of the employer may render it inappropriate
for the Labour
Court to grant an order under
paragraph (a) or (b) or (c). If
employees whose retrenchment is contemplated
resign during the
consultation process, an order contemplated in paragraph (a) would
not be appropriate.
[80]
The passage of a long time between
the date of dismissal of employees and the date of adjudication may
render it inappropriate for
the Labour Court to grant an order under
paragraph (a) or (b) or (c) of subsection (13). Where the time
that has lapsed between
the date of dismissal and the date of
adjudication is so long that it cannot reasonably be expected that
the employer should resume
the consultation process, it would be
inappropriate to grant an order under paragraph (a), (b) or (c).
One cannot in abstract
say how long a period would have to be before
it can be said to be too long. However, a court needs to
establish why it would
not be appropriate to grant an order
contemplated in paragraph (a), (b) or (c) of subsection (13). The
employer bears the
onus to place before the Court evidence that would
show that the period in a particular case is so long that it would be
inappropriate
for the Court to grant an order under
paragraph (a) or (b) or (c).
[81]
There is nothing in the nature of
the order contemplated in paragraph (d) nor in the text of the
paragraph that would support
the proposition that, if the
consultation process can no longer be put back on track, an award of
compensation as contemplated
in paragraph (d) would not be
appropriate. In fact, it is quite the opposite. An
appropriate time for the Labour
Court to make an order for the
payment of compensation as contemplated in paragraph (d) is when it
would not be appropriate for
the Labour Court to make an order
contemplated under paragraph (a) or (b) or (c).
Another situation
where it would be inappropriate for the Labour
Court to grant an order in terms of paragraph (a) or (b) or (c) of
subsection (13)
is when the consultation process cannot be continued
with or cannot be put back on track.
[82]
A court is required to grant an
order when it is satisfied that it is appropriate to do so. The
orders contemplated in subsection
(13) are no exception.
Subsection (13)(d) makes it clear in effect that the orders
contemplated in paragraphs (a) to
(c) may only be granted when it is
not appropriate to grant an order under paragraph (d) and
vice versa
.
[83]
While it is unlikely to be
appropriate for the Labour Court to order the reinstatement of
employees pending the employer’s
compliance with a fair
procedure after two years have lapsed since the dismissal of the
employees, it might be perfectly appropriate
for it to order such
reinstatement if, for example, only three months have lapsed.
Indeed, while it would probably not be
appropriate for the
Labour Court to order reinstatement for the purpose of putting
the consultation process back on track
two years after the date of
dismissal, it might still be appropriate for the Labour Court to
make an order for the payment
of compensation as contemplated in
paragraph (d) after a period of two or three years has lapsed
since the date of dismissal.
[84]
The orders in paragraphs (a), (b)
and (c) and the order in paragraph (d) do not serve the same purpose.
Indeed, there is no
reason why each one of the orders
contemplated in paragraphs (a) to (d) cannot be claimed alone. If
an employer is going
through a consultation process and no dismissal
is imminent but the employer is not complying with a fair procedure,
there is no
reason why a union or employees may not approach the
Labour Court and simply ask for an order contemplated in
paragraph (a)
only. Equally, there is no reason why, if an
employer is not complying with a fair procedure and the dismissal is
imminent,
a union or the employees may not approach the Labour Court
and seek an order under paragraph (b) only. They would not
need
an order under paragraph (a) or (c) or (d) at that time.
[85]
If an employer dismisses employees
without following a fair procedure, there is no reason why a union or
employees cannot approach
the Labour Court and seek an order
contemplated in paragraph (c) only. They would not need an
order contemplated in paragraph (a) or (b).
An
order contemplated in paragraph (b) would be inapplicable. An
order contemplated in paragraph (b) is already effectively
included
in the last part of paragraph (c). Therefore, there is no
room for an order contemplated in paragraph (a)
when there is a
dismissal.
[86]
So, just like an order contemplated
in paragraph (a) has a time when it is appropriate and orders in
paragraphs (b) and (c) would
not be applicable, an order contemplated
under paragraph (c) only applies when an order in paragraph (a) and
an order in paragraph
(b) would not be applicable. An order
contemplated in paragraph (d) applies in a scenario where
paragraphs (a), (b)
and (c) would no longer be appropriate. Indeed,
an order contemplated in paragraph (d) can only be granted if any
order contemplated
in paragraphs (a) to (c) is inappropriate.
Employees would not need an order of compensation contemplated in
paragraph (d)
nor would they be entitled to one, if an order
contemplated in paragraph (a), (b) or (c) was granted and achieved
the statutory
purpose of the employer complying with a fair procedure
before it can dismiss employees.
[87]
As will have been realised from what
I have said earlier in this judgment, as a norm, when employees are
dismissed for operational
requirements by an employer to which
section 189A applies, for a certain number of months, perhaps three
months, four months or
maybe more an order of reinstatement might be
appropriate. In those circumstances, compensation would not be
competent and,
therefore, cannot be claimed. It can only be
claimed and granted when an order of reinstatement would no longer be
appropriate.
However, the question arises as to whether
compensation can never be claimable immediately after dismissal and
whether it
is only claimable after some months have lapsed since the
dismissal of the employees.
[88]
In my view, compensation will
normally not be claimable soon after the dismissal because at that
stage reinstatement would still
be appropriate. However, there
may be exceptional cases where compensation will be claimable soon
after the dismissal. However,
those cases will be those when
reinstatement will not be appropriate even soon after the dismissal
has been effected. One
example is where the employer of more
than fifty workers is a natural person and he or she dies a few
days after the dismissal
of the employees. In such a case
reinstatement will not be appropriate the moment the employer dies.
In fact reinstatement
would not be competent. If the
death happens before the employees launch their section 189A(13)
application, the position
would be that, when the employees prepare
their section 189A(13) application, they would be aware that
reinstatement would
not be appropriate because their employer had
died. Therefore, in their papers they could only claim
compensation. They
would claim compensation on its own and
without first claiming reinstatement and compensation only as an
alternative.
[89]
Another situation where compensation
may be claimable soon after the dismissal is a situation where the
reason for dismissal is
that the employer is selling his or her
business but not as a going concern. In other words, where
section 197 of the LRA
does not apply – and a few days after
the dismissal of the employees, the transaction gets completed. In
such a case
reinstatement might not be appropriate even after a few
days of the dismissal. Compensation would be claimable a few
days
after dismissal if the sale of the business has been completed.
Where section 197 applied, reinstatement would be appropriate.
There may be other examples where compensation can be claimed
soon after dismissal but it is not necessary to look for other
examples. These two examples are enough to make the point that
an order of compensation under
subsection
(13)(d)
can be claimed and granted as a standalone remedy.
[90]
What I have set out above shows that
each one of the orders contemplated in paragraphs (a) to (d)
in section 189A(13)
can be claimed alone. In
CC Steenkamp II
this Court held, in a unanimous judgment by Basson AJ, that an order
contemplated in section 189A(13)(d) cannot be claimed
as a
standalone order. A reading of
CC Steenkamp II
does not reveal that the conclusion that an order under paragraph (d)
cannot be claimed as a standalone order was based on
any analysis of
the orders contemplated in paragraphs (a) to (d). There was no
analysis of the language used in section 189A(13).
That
conclusion seems to me to have been a result of the Court focusing on
the primary purpose of section 189A(13) and not
its secondary
purpose.
[91]
Throughout the discussion of section
189A(13) in this Court’s judgment in
CC Steenkamp II
,
Basson AJ emphasised the primary purpose of
subsection (13) – which relates to the orders
contemplated
in paragraphs(a) to (c) and not
paragraph (d) – and overlooked the secondary
purpose of the subsection
which is served by an order contemplated in
paragraph (d). I said earlier that the primary purpose of
subsection (13)
is to ensure that the employer complies with a
fair procedure before employees may be dismissed finally. That
is why an order
contemplated in paragraph (c) will reverse a
dismissal which has been effected without compliance with a fair
procedure.
[92]
There is no difference in purpose
between an order of compensation under section 189A(13)(d) and
an order of compensation granted
under section 191. They both
serve the same purpose, namely, to afford the employee effective
relief when his or her right
to procedural fairness has been
infringed and holding the employer accountable for the violation of
the employee’s right.
In fact the remedy of compensation
provided for in section 189(13)(d) is the same remedy of compensation
that is provided for in
section 191. I say this because, prior
to the enactment of section
189A
in 2002 employees retrenched by large scale employers without
compliance with a fair procedure had a right to claim the remedy
of
compensation but, when section 189A(13) was enacted, that right
under section 191 insofar as it related to such employees
was moved
to section 189A. Accordingly, the right to claim compensation
provided for in section 189A(13) is the same
right that such
employees used to enjoy under section 191 prior to the enactment
of section 191 of the LRA. The only
difference is that under
section 189A(13) they can only claim compensation when it is not
appropriate to claim reinstatement.
[93]
This interpretation of section
189(13)(a) ensures that, when it comes to seeking compensation for
procedural unfairness, the employee
who uses the section 189A(13)
route is treated in the same way as the one who uses the section 191
route. This is subject
to the qualification that an employee
who seeks compensation under section 189A(13)(d) is required to
only seek it when an
order under section 189A(13)(a) to (c) is
inappropriate and must comply with the 30-day time limit imposed by
section 189A(17)
or obtain condonation for non-compliance with
that time limit if he or she fails to comply with it. A court
considering an
application for condonation would be entitled to take
into account that the 30-day time limit has been imposed because an
order
in terms of section 189A(13)(a) to (c) is the lawmaker’s
preferred remedy so as to get the consultation process back on track.
[94]
It is important to point out that section 189A(13) prescribes
only one requirement that must be met in order for an employee to
seek the relief contemplated in paragraph (d) of section
189A(13) i.e. compensation. That requirement is that
compensation
may be sought “if an order in terms of paragraph
(a) to (c) is not appropriate.” Therefore, any
proposition that
effectively says an employee may not seek
compensation when it is no longer appropriate to seek an order under
paragraphs (a) to (c)
of section 189A(13) is in
conflict with paragraph (d) of section 189A(13) and,
therefore, contrary to the statute.
[95]
The proposition that an employee may
pursue his or her claim for compensation some months after dismissal
is simply based on the
fact that section 189A(13)(d) itself precludes
the claiming of compensation while an order under paragraphs (a) to
(c) is appropriate
and it can take a few months at least for the
point to be reached where an order under paragraphs (a) to (c)
becomes inappropriate.
I do not mean that employees who have a
dispute with an employer about the procedural fairness of their
dismissal for operational
requirements to which section 189A applies
may simply sit back and do nothing about launching a section 189A(13)
application and
lodge their application at a time convenient to
themselves.
[96]
Any proposition to the effect that an employee who launches
his section 189A(13) application at a time when it is no longer
feasible to
put the consultation process back on
track is precluded from claiming compensation is in conflict with the
express provision of
section 189A(13)(d). I say this because,
precisely when it becomes not feasible to put the consultation
process back on track
is the time when it becomes inappropriate to
grant any order under section 189A(13)(a), (b) or (c).
Paragraph (d)
of section 189A(13) expressly says that
that is when compensation can be claimed. Subsection (13)
should not be interpreted
as if there is another provision in it
which overrides the clear wording of section 189A(13)(d) because it
simply has no such provision.
The statute makes it quite clear
that as long as one or more of the orders contemplated in section
189A(13)(a), (b) or (c) is still
appropriate, an order for
compensation is not appropriate and that the moment an order under
section 189A(13)(a), (b) or (c)
is no longer
appropriate, that is the moment when it is appropriate to claim
compensation
.
As I have said, however, this does not mean that, just because relief
in terms of paragraphs (a), (b) or (c) has, due to
the passing of
time, become inappropriate, condonation for bringing an application
in terms of section 189A(13) outside the
30-day time limit
should be granted as a matter of course. Employees to whom
section 189A applies are generally expected
to protect their right to
procedural fairness by an application brought within the prescribed
30-day time limit. If they
lodge their application outside of
the 30-day time period, they are obliged to apply for condonation
and, among others, furnish
an acceptable explanation for their delay.
[97]
Orders contemplated in paragraphs
(a) to (c) serve the primary purpose of subsection (13) whereas
paragraph (d) serves the
secondary purpose of the subsection. The
secondary purpose is to ensure that an employer who dismisses
employees for operational
requirements without complying with a fair
procedure and, therefore, in violation of the employees’ right
to procedural fairness
does not do so with impunity and to ensure
that employees whose rights to procedural fairness have been
infringed are granted an
appropriate remedy for the infringement of
their rights in line with the principle that where there is a right,
there is a remedy.
Discussion of case law on
the meaning, scope and function of section 189A(13)
[98]
There
are cases in all our courts which have jurisdiction to adjudicate
labour disputes at different levels in which our courts
have not
interpreted subsection (13) as reflected above.
[20]
It is not necessary to mention all of them. Those cases have
dealt with subsection (13) as if it has one purpose
–
namely, the primary purpose of subsection (13) as articulated
above which is linked to paragraphs (a) to (c). They
did not
identify the secondary purpose of subsection (13) which is linked to
paragraph (d). In my view this was an error
and this error
led those courts to conclude that, when the consultation process can
no longer be put back on track, none of the
orders contemplated in
paragraphs (a) to (d) may be granted. Those
cases are dealt with later in this judgment.
[99]
As an order contemplated in
paragraph (d) has nothing to do with the primary purpose of
subsection (13), the proposition that an
order for compensation under
paragraph (d) of subsection (13) could not be granted when the
consultation process could no
longer be put back on track was, in my
view, incorrect. An order under paragraph (d) could and
can be made when the
consultation process can no longer be put back
on track. Therefore, when some cases say that an order under
paragraphs (a) or (b) or
(c) cannot be granted
when the consultation process can no longer be put back on track,
they are correct. However, when they
say that even an order of
compensation under paragraph (d) cannot be granted when the
consultation process can no longer be put
back on track, they are,
with respect, not correct. Actually, section 189A(13)(d)
is quite clear that it is when an
order under paragraphs (a) to (c)
is inappropriate that an order for compensation may be granted.
An order
under paragraphs (a) to (c) is inappropriate
when the consultation process can no longer be put back on track.
An order for compensation is appropriate at that stage.
[100]
When one considers how much time
should elapse before it can be said that an order contemplated in
paragraph (c) would not be appropriate,
one should remember that
provisions in labour legislation that grant a court the power to
order a
status
quo
order pending some processes are not new in our labour law.
Under the 1956 LRA as amended, two sections gave the Industrial
Court such powers. The one was section 17(11)(a) and the
other section 43(4). For purposes of this matter it is
only
necessary to say something about section 43. Under that section
the Industrial Court had powers to order the temporary
reinstatement of an employee whose dismissal it found to
prima
facie
constitute an unfair labour
practice. That order of reinstatement was popularly known as a
status quo
order. Such an order of reinstatement endured for 90 days
or until one of certain events stipulated in that provision
occurred
but the Court could extend the operation of that order beyond 90
days.
[101]
The purpose of such a reinstatement
was to place the employee in the position that he or she was in
before the
prima facie
unfair labour practice was committed by the employer to enable the
parties to try and settle the dispute. In the case of
a
dismissal for operational requirements – which is what we are
dealing with in the present case – the basis
of the
conclusion that the dismissal
prima
facie
constituted an
unfair labour practice could be that the employer had not
complied with a fair procedure in the sense
that there was no
consultation or because, although there was consultation, such
consultation was not a proper consultation.
The point I want to
make is that under section 43 of the 1956 LRA the Industrial
Court did not regard it as inappropriate
to make a
status
quo
order three months, four months or
even six months after the date of dismissal. Such orders were
frequently made and the
employer could go through the consultation
process afresh if it accepted that there had not been a proper
consultation with regard
to that employee or group of employees.
That being the case I do not think that the mere fact that three or
four months have
elapsed before a section 189A(13) application
is made or adjudicated under the current Act would make it
necessarily inappropriate
for the Labour Court to grant an order of
reinstatement under paragraph (c) of subsection (13).
SA Five Engineering
[102]
In
SA
Five Engineering
[21]
the National Union of Metalworkers of South Africa (NUMSA) and
its affected members launched an application in terms of
subsection (13)
within a few days of the dismissal which
occurred in October 2002. The employees were dismissed for
operational requirements
by an employer to which section 189A
applied. It would appear from the judgment of Murphy AJ,
sitting in the Labour Court,
that NUMSA and its members
subsequently referred to the Labour Court a dispute about the
substantive fairness of their dismissal.
In their application
in terms of subsection (13) NUMSA and its members sought relief
in terms of subsection (13)
including reinstatement pending
compliance by the employer with a fair procedure or alternatively
compensation. The basis
for seeking such relief was that in
dismissing the employees, the employer had failed to comply with a
fair procedure. It
appears that at some stage the Labour Court,
through Waglay J, made an order the effect of which seems to
have been to consolidate
both the subsection (13) application and the
dispute about the substantive fairness of the dismissal.
[103]
In
SA
Five Engineering
the employees launched
their subsection (13) application timeously but there were
delays before the matter could be adjudicated.
The employees
had asked for reinstatement in terms of paragraph (c) of subsection
(13) but by the time that the adjudication took
place reinstatement
was considered no longer appropriate. Compensation had been
asked for in the alternative.
[104]
With regard to section 189A(13)
Murphy AJ held that the Labour Court “was competent to proceed
with the adjudication of the
dispute about procedural fairness in
terms of section 189A(13)”. The Labour Court made this
decision in that case in
2004 despite the fact that the dismissal had
occurred in October 2002. In other words, in
SA Five Engineering
the Labour Court did not take the view that the remedy of
compensation contemplated in paragraph (d) could not be granted when
the consultation process could no longer be put back on track as that
Court subsequently held in
Parkinson
and
Clinix
.
[105]
Murphy AJ said in
SA
Five Engineering
about section
189A(13):
“
As
explained earlier, the applicants initially moved the court in terms
of this section for an order of reinstatement and to compel
compliance with fair procedure. As also explained, the order of
Waglay J of 6 March 2003 can be interpreted
as having
referred that dispute to oral evidence under rule 7(8)(b). However,
with
the effluxion of a considerable period of time since the dismissals,
the applicants are less interested in the adjudication
of the
procedural dispute and would prefer resolution of the dispute about
substantive unfairness. Certainly, in practical
terms, the time
for a pre emptive interdict has long passed. But section
189A(13)(d) also bestows on the applicants
the right to seek
compensation for procedural irregularities where interdictory relief
or specific performance is not appropriate.
Moreover,
section 189A(14) preserves the court’s general power to
award compensation under section 158(1)(a)
in such cases.
Hence, even though the horse long bolted the stable, there is
no reason why the applicants should be barred
from proceeding with
their claim for relief in respect of any procedural irregularities
that may have tainted their dismissals.
For that reason, I was
prepared to grant a postponement for the adjudication of the
procedural dispute under section 189A(13).
”
[22]
(Emphasis added.)
[106]
I
agree with what Murphy AJ said in this passage about section
189A(13). What he said reflects that he understood the
different
purposes served by paragraphs (a) to (c), on
the one hand, and paragraph (d), on the other, and by any order
contemplated
in either (a), or (b), or (c), on
the one hand, and, by an order contemplated in paragraph (d) of
subsection (13).
It is a pity that this important passage
in this judgment of the Labour Court does not appear to have
been noticed or
brought to the attention of the Labour Court in
Parkinson
,
Clinix
and to the Labour Appeal Court in
LAC Steenkamp II
,
[23]
referred to below, and in the present case. In the end
Murphy AJ postponed the section 189A(13) application for later
adjudication on the basis that the remedy of compensation under
paragraph (d) of subsection (13) could still be competently granted
even after two years had lapsed since the dismissal.
Parkinson
[107]
In
Parkinson
the Labour Court had this to say about an application that had been
brought in terms of subsection (13) seven months after the
dismissal:
“
Even
if I were to grant to the applicant the benefit of the doubt in
relation to the explanation for the delay in bringing this
application, she has no prospect of success on the merits. This
court has made clear on more than one occasion that the purpose
of
section 189A(13) is one that enables this court to supervise an
ongoing retrenchment process or one that has recently been
concluded;
it is not a remedy that is available well after dismissals have been
effected. The section intends to ensure that
a fair process is
followed; it is not a means to thwart retrenchment itself (see
Insurance
and Banking Staff Association v Old Mutual Services and Technology
).
In the present instance, the applicant’s date of dismissal, as
I have indicated, is 25 August 2014, a little short
of two years
ago. The irresistible conclusion to be drawn is that having
abandoned her unfair dismissal claim, the applicant
seeks redress in
terms of section 189A(13), a provision ordinarily reserved for
urgent intervention in a consultation process
involving a significant
number of employees. There is no basis, in these circumstances,
for the court to intervene in the
present dispute, and the
applicant’s prospects of success are accordingly minimal, if
they exist at all.”
[24]
[108]
It will be seen from this extract
that the Labour Court understood subsection (13) to have one
purpose only and failed to appreciate
that paragraph (d) had a
different purpose and an order under paragraph (d) could be granted
years after the dismissal of the employees,
unlike the orders
contemplated under paragraphs (a) to (c).
Murphy AJ’s judgment in
SA
Five Engineering
does not appear to
have been cited to Van Niekerk J who decided
Parkinson
.
Had Van Niekerk J been aware of Murphy AJ’s judgment,
he would have realised that Murphy AJ had held that
compensation
under paragraph (d) of subsection (13) could be awarded two
years after dismissal when the consultation process
could no longer
be put back on track. That Murphy AJ’s judgment was
not drawn to Van Niekerk J’s attention
is regrettable because
Parkinson
,
Clinix
and
other cases might not have followed what
Parkinson
erroneously said in this regard.
Clinix
[109]
The
reference to
Clinix
is a reference to the judgment of the Labour Court in
Clinix
.
[25]
The error that the Labour Court made in
Parkinson
was repeated in a subsequent case in the Labour Court, namely
Clinix
.
Clinix
was
also a judgment of Van Niekerk J. That case had
similarities to
CC
Steenkamp II
.
The employees had initially challenged the validity of their
dismissals in the same way the employees in
CC
Steenkamp I
did. After the handing down of this Court’s judgment in
CC Steenkamp I
,
the employees in
Clinix
abandoned the
CC Steenkamp I
route and brought an application in the Labour Court in terms of
subsection (13) and sought certain orders under subsection (13).
In
CC Steenkamp I
this Court held that the LRA did not provide for the remedy of
an invalid dismissal for a breach of the LRA. The orders
they
sought included reinstatement with effect from 1 June 2015 plus
directions on a consultation process and some interdict preventing
the employer from issuing notices of dismissal before certain events
occurred or before the expiry of a certain period. They
had
lodged the application about nine months after the notices of
dismissals were issued or about eight months after the effective
date
of dismissal. That was way out of time but not as late as the
employees in
CC Steenkamp II
did.
[110]
Although in
Clinix
the Labour Court was satisfied that dismissing the condonation
application without having regard to the prospects of success was
justified, it, nevertheless, had this to say about the merits of the
applicants’ section 189A(13) application:
“
[The
remedy provided in section 189A(13)] must necessarily be seen in
terms
of
its proper context and purpose. It is a mechanism that enables
this court to supervise an ongoing retrenchment process
or one that
has recently been concluded; it is not a remedy that is available
well after dismissals have been effected. In
short, the section
intends to ensure that a fair process is followed; it is not a means
to thwart retrenchment itself (see
Insurance
and Banking Staff Association
).”
[26]
From this excerpt it can
be seen that
Clinix
followed
Parkinson
.
[111]
In paragraph 7 in
Clinix
the Labour Court said in part:
“
The
failure to furnish a reasonable explanation for an inordinate delay
has the consequence that any prospects of success in the
main
application and the respective prejudice to the parties are not
relevant. I would mention though given the strict temporal
limits that attach to a section 189A (13) application, I fail to
appreciate what prospects there are at this late stage that
this
court will order the respondent to recommence the consultation
process.
To
the extent that the applicants seek an alternative remedy of
compensation, it is not the purpose of section 189A to provide
for compensation for any procedural shortcomings in the consultation
process well after any retrenchments have been effected
.”
[27]
(Emphasis added.)
[112]
The last sentence of this excerpt –
namely that it is not the purpose of section 189A to provide
compensation for any
procedural shortcomings in the consultation
process well after any retrenchments have been effected – is,
in my view, incorrect.
It flows from a failure to appreciate
that paragraph (d) of subsection (13) has a different purpose to
the purpose of paragraphs
(a) to (c). There is no reason why
the Labour Court cannot award compensation under paragraph (d)
one, two or even three
years after the dismissal in the same way that
the Labour Court is able to award compensation for procedural
unfairness in
dismissals for operational requirements to which
section 189A does not apply. An order for the award of
compensation
under paragraph (d) has nothing to do with putting
the consultation process back on track or reversing the dismissal of
the
employees. It is important to point out that, whereas the
Labour Court regarded the employees’ explanation for
the
delay in launching their subsection (13) application in
Clinix
as unsatisfactory, both the Labour Appeal Court and this
Court in
CC Steenkamp II
accepted a similar explanation as plausible.
CC Steenkamp I
[113]
The
reference to
CC
Steenkamp I
is a reference to the judgment of this Court in
CC
Steenkamp I
.
[28]
The issue in that case was whether or not the remedy of an order of
invalidity of a dismissal for a breach of the LRA was
available. Two
judgments were produced. The one was written by Cameron J
in which Van der Westhuizen J
concurred. I wrote
the other one. The rest of the Justices of this Court who sat
in that matter concurred in my judgment.
In considering the
issue before us in that matter, I discussed various provisions of the
LRA including the provisions of section 189A including 189A(13).
[114]
Here is part of what this Court said
in
CC Steenkamp I
in regard to section 189A(13):
“
[157]
Subsection (8)(b)(ii)(aa) and (bb) provide the only remedies
available to workers or their trade union if they dispute
the
fairness of the reason for their dismissal. They do not have
any other remedies. However, they are still better
off than
their colleagues to whom section 189A does not apply. This
is in so far as they may be challenging the fairness
of the reason
for their dismissal. What if they challenge only the procedural
fairness of the dismissal?
[158]
It is to be noted that in such a case subsection (8)(b)(ii)(aa)
and (bb) does not contemplate
the referral of a dispute
concerning the procedural fairness of a dismissal to the Labour Court
for adjudication. In
terms of that provision only a dispute
concerning whether there is a fair reason for dismissal may be
referred to the Labour Court
for adjudication. In fact
subsection (18) precludes the Labour Court from adjudicating any
dispute about the procedural
fairness of a dismissal for
operational requirements referred to it in terms of
section 191(5)(b)(ii). It reads:
‘
The
Labour Court may not adjudicate a
dispute
about the procedural fairness of a dismissal based on the employer’s
operational requirements in any dispute referred to
it in terms of
section 191(5)(b)(ii).’
Subsection (18) may seem
very drastic and harsh on employees who may be having a dispute with
their employer concerning the procedural
fairness of their dismissal.
However, it will be seen that, when read with subsection (13),
it is not harsh at all. Subsection
(13) provides extensive
protections to employees where the employer has failed to comply with
a fair procedure.
[159] I
cannot think of any relief that an employee could ask for which is
not provided for in this section. Subsection
(17)(a) provides
that an application such as the one contemplated in subsection (13)
must be made not later than 30 days after
the employer has given
notice to terminate the employees’ contracts of employment or
if notice is not given, the date on
which the employees were
dismissed. So, a challenge based on procedural unfairness may
be brought after the dismissals have
taken place. However,
subsection (17)(b) gives the Labour Court power to condone, on
good cause shown, any failure to
comply with that time limit.
[160]
If an employer has not issued notices of dismissal but has failed or
is failing to comply with a fair procedure
in the pre-dismissal
process, a consulting party may make use of the remedy in
subsection (13)(a). In such a case the
consulting party
would apply to the Labour Court for an order compelling the employer
to comply with a fair procedure. If
an employer gives employees
notices of dismissal without complying with a fair procedure, or, if
an employer dismisses employees
without complying with a fair
procedure, the consulting party may apply to the Labour Court
for an order interdicting the
dismissal of employees in terms of
subsection (13)(b) until there is compliance with a fair
procedure. This would include
giving premature notices of
dismissal.
[161]
If any employer has already dismissed employees without complying
with the fair procedure, the consulting
party may apply to the Labour
Court in terms of subsection (13)(c) for an order reinstating
the employees until the employer
has complied with the fair
procedure. The significance of the remedy of reinstatement in
subsection (13)(c) is that
it is made available even for a
dismissal that is unfair only because of non-compliance with a fair
procedure. That is significant
because it is a departure from
the normal provision that reinstatement may not be granted in a case
where the only basis for the
finding that the dismissal is unfair is
the employer’s failure to comply with a fair procedure. In
such a case the
norm is that the Labour Court or an arbitrator
may award the employee only compensation.
[162]
Subsection (13)(d) provides that a consulting party may apply to the
Labour Court for an award of compensation
‘if an order in
terms of paragraphs (a) to (c) is not appropriate’.
It seems to me that the phrase
‘if an order in terms of
paragraphs (a) to (c) is not appropriate’ constitutes
a condition precedent that
must exist before the Court may award
compensation. The significance of this condition precedent is
that its effect is that
the Labour Court is required to regard
the orders provided for in subsection (13)(a) to (c)
as the preferred
remedies in the sense that the Labour Court
should only consider the remedy in subsection (13)(d) when it is
not appropriate
to make any of the orders in subsection (13)(a) to
(c).
[163]
This is a reversal of the legal position that obtains in the case of
dismissals for the employers operational
requirements governed by
only section 189 where dismissal is only procedurally unfair and not
substantively unfair as well. In
these cases the Labour Court
is required not to order reinstatement at all. So, in making
the remedy of reinstatement
available for a procedurally unfair
dismissal and also making it one of the preferred remedies in
subsection (13), the Legislature
has gone out of its way to give
special protection for the rights of employees and to protect the
integrity of the procedural requirements
of dismissals governed by
section 189A.
[164]
The extensive remedies in subsection (13) provide at least partial
compensation for the fact that in respect
of disputes concerning the
procedure of fairness of dismissals the employees have been deprived
of the right to adjudication that
other employees have. In part
the extensive remedies in subsection (13) for non-compliance with
procedural fairness have
been provided because of the importance of
the pre-dismissal process.”
[29]
[115]
What this Court said in
CC Steenkamp I
about section 189A(13) and (18) is consistent with what I
say in this judgment about the same provisions.
LC
Steenkamp II
[116]
The
reference to
LC
Steenkamp II
[30]
is a reference to the judgment of the Labour Court in
LC Steenkamp II
.
After this Court’s judgment in
CC Steenkamp I
,
the employees involved in that case instituted an application in the
Labour Court in terms of subsection (13) and sought
an
order of compensation as contemplated in paragraph (d) of
subsection 13. By then a period of more than two years
had
lapsed since their dismissal. They had instituted the
application two or so years outside the 30 day period after
they
were notified of their dismissal. They applied for condonation
in instituting the section 189A(13) application way out
of the 30-day
period.
[117]
It
is important to note that both the Labour Appeal Court in
LAC Steenkamp II
and this Court in the same case effectively accepted that the
employees’ explanation for their delay in lodging the
subsection
(13) application could not be faulted. The
explanation was that the employees were pursuing the remedy of an
invalid dismissal
which they pursued up to this Court when they had
lost in this Court in
CC Steenkamp I
before they lodged their subsection (13) application.
[31]
In
fact in
CC Steenkamp II
this Court said:
“
Although
I do accept that a subsequently overturned legal strategy may
constitute a reasonable explanation for the delay, this explanation
must be viewed in its proper context.”
[32]
The fact that both the
Labour Appeal Court and this Court appeared to accept that the
explanation for the delay could not be faulted
means that in both
courts the employees in
LAC Steenkamp II
and
CC Steenkamp II
lost because both courts thought
they had no reasonable prospects of success on the merits.
[118]
In
LC Steenkamp
II
the Labour Court, through
Malindi AJ, correctly took the view that, if the employees in
that case succeeded in showing that
the employer had failed to follow
a fair procedure in dismissing them, “they would be entitled at
least to relief under section
189A(13)(d) if relief in terms of
subparagraphs (a) to (c) was not appropriate. The applicants
seek relief under sub-paragraph
(d).” The Labour Court
made this statement in a case where the subsection (13) application
had been lodged after
a period of more than two years since the
dismissal of the employees in that case. The view expressed by
the Labour Court
in
LC Steenkamp II
as referred to above accords with the analysis of subsection (13)
given above. Malindi AJ may not have referred to
Murphy AJ’s judgment in
SA
Five Engineering
but his decision was
in line with Murphy AJ’s decision in
SA Five Engineering
that compensation could still be granted more than two years after
the dismissal of the employees in that case.
[119]
The Labour Court, through Malindi
AJ, granted condonation. Malindi AJ was satisfied that
under paragraph (d) of subsection
(13) the employees could be granted
compensation if the Court was satisfied that they had been dismissed
without compliance with
a fair procedure.
LAC Steenkamp II
[120]
The
reference to
LAC Steenkamp II
is a reference to the judgment of the Labour Appeal Court
in
LAC Steenkamp II
.
[33]
The employer then appealed to the Labour Appeal Court
against the decision of the Labour Court on condonation even
before
the Labour Court could decide the merits of the section 189A(13)
application. The error which the Labour Court
had
committed in
Parkinson
and
Clinix
was repeated by the Labour Appeal Court in
LAC
Steenkamp II
.
In
LAC
Steenkamp II
the Labour Appeal Court, through Sutherland JA, with
Musi and Coppin JJA concurring, said that the principal
controversy before it was “whether the granting of condonation
to the respondents to bring an application in terms of section
189A(13) of the LRA after the expiry of the prescribed 30-day period
was an incorrect exercise of judicial discretion. Upon
the fate
of that issue, hangs the propriety of consolidating the several other
cases.”
[34]
[121]
In considering that controversy the
Labour Appeal Court had to consider the employees’ prospects of
success in their subsection
(13) application. It, therefore,
expressly considered the purpose, function and scope of subsection
(13). In considering
the purpose, scope and function of
subsection (13) the Labour Appeal Court referred to the judgments of
the Labour Court in
Parkinson
and
Clinix
.
Unfortunately, it seems that the judgment of the Labour Court in
SA
Five Engineering
, particularly
paragraph 10 thereof, was not brought to the attention of the
Labour Appeal Court just as it seems not to have
been brought to the
attention of Van Niekerk J in
Parkinson
and
Clinix
.
[122]
In paragraph 13 in
LAC Steenkamp II
the Labour Appeal Court said:
“
[13]
The complications that this present application envisages resolving
arise from the fact that the sole issue
upon which the respondents’
grievances have hitherto been advanced have been the alleged
invalidity of their dismissals,
having expressly abandoned claims for
procedural and substantive unfairness claims under the circumstances
described. Because
the viability of the ‘invalidity’
premise, as a cause of action, [was] dashed by this Court and by the
Constitutional Court,
what
the respondents want now is a chance to get a compensation order for
procedural unfairness using section 189A(13)(d) as
a hook. The
foundation of the present claim rests on two legs; (1) first, that it
can pursue a trial about unfair procedure
to obtain relief in terms
of section 189A(13)(d), and (2) second, they can
obtain condonation of the late referral
of a section 189A(13)
application, years out of time, on the basis of the alleged
reasonableness of pursuing an invalidity
claim until the
Constitutional Court scotched that hope, and thus the delay is
satisfactorily explained
.”
[35]
(Emphasis added.)
[123]
In
paragraph 24 and, referring to the periods in section
189A(17)(a) and (b),
[36]
the Labour Appeal Court said in
LAC
Steenkamp II
:
“
[24]
In context, these time periods speak plainly to the intrinsic urgency
of judicial intervention pursuant to
section 189A(13), if a party
wishes a procedural fairness dispute to be addressed. The
relief that a court might grant in
terms of section 189A(13)(a)
– (d) must be understood in that context. The remedies
are designed to be available
when an aggrieved applicant brings the
application by not later than 30 days after the notification of
the possible retrenchment,
and thus, 30 days before a dismissal
notice may be given.
The
primary purpose is to get the retrenchment process back onto a track
that is fair.
Remedies (a)
and (b) plainly are appropriate before a dismissal is effected.
Remedy (c) is aimed at not only reversing
a dismissal, but
obligating the employer in future to comply with fairness during an
implicitly resumed process, which implies
timeous proximity to the
dismissals
.
Remedy
(d) is plainly contingent on remedies (a) (b) or (c) being
inappropriate in given circumstances; it is thus subordinated
to the
first three options, and cannot be read disjunctively from the rest.
Were it appropriate to separate remedy (d) from
the rest, the
effect of the section would be to totally contradict section
189A(18). Such an interpretation cannot therefore
be sustained,
and it is not open to a party to seek primary relief in terms of
section 189A(13)(d). The function of
section 189A(13)(d)
is a residual power, if the given circumstances make the first three
remedies inappropriate
.”
[37]
(Emphasis added.)
[124]
In paragraphs 25 and 26 in
LAC Steenkamp II
the Labour Appeal Court went on to say:
“
[25]
In summary, section189A(13) is a procedure designed to enable the
Labour Court to urgently intervene
in a large scale
retrenchment to ensure that fair procedure is followed. It is
not designed to offer a platform for
ex post de facto adjudication of
unfair procedure disputes. Although a failure to comply with
the 30 day period can
be condoned, the merits of any condonation
application must be understood within the context of an urgent
intervention, that being
the critical functional characteristic of an
application in terms of section 189A(13).
[26]
Moreover, the intervention contemplated, by its nature does not
contemplate a trial at some future
remote time. It exists not
to facilitate a post mortem but, rather, to oversee the process of
retrenchment while it is taking
place or shortly thereafter where
precipitate dismissals make intervention before actual dismissal
impossible, and to reverse the
dismissals. Remedy (d) is a last
resort back up to cater only for the inappropriateness of remedies
(a), (b) or (c).”
[38]
[125]
In paragraphs 44 and 45 in
LAC Steenkamp II
the Labour Appeal Court said:
“
[44]
At paragraph [43] of the judgment
a quo
,
the findings are premised onthe assumption that a self-standing
remedy in terms of section 189A(13)(d) exists. As
addressed above, that reading is incorrect.
[45]
The Court
a
quo
therefore misdirected itself in the several respects addressed in
this judgment; i.e. the proper purpose of section 189A(13)
and
its limitations were not recognised and the explanation in support of
condonation, relying on a failed legal strategy to justify
the delay
is not acceptable, especially, as alluded to above, because earlier
opportunities to seek condonation were spurned, causing
further
delay, to which must be added the express and fatal abandonment of
the alternative cause of action.”
[39]
(Emphasis added.)
[126]
Two or three of the features of the
Labour Appeal Court’s judgment in
LAC Steenkamp II
are that the remedy of compensation contemplated in paragraph (d)
of subsection (13) cannot be claimed as a standalone
order and
cannot be a primary remedy. I have expressed the view
elsewhere in this judgment that this would be incorrect,
if it meant
that compensation could not be claimed separately from the orders
contemplated in paragraphs (a) to (c). The
Labour Appeal Court
also said that the remedy of compensation under paragraph (d) could
not be granted when a lot of time had passed
since dismissal. I
have also expressed the view that this is not correct because the
purpose of paragraph (d) is different
from the purpose of
paragraphs (a) to (c) of subsection (13).
[127]
Another feature of the judgment of
the Labour Appeal Court in
LAC Steenkamp II
is that it is based upon an identification of only the primary
purpose of section 189A((13). It said nothing about the
secondary purpose of the subsection which is linked to paragraph (d)
of subsection (13). The Labour Appeal Court
based its
judgment on the view that all the orders under subsection (13),
including an order under paragraph (d), serve the
primary
purpose of the subsection. This is not correct because an order
under paragraph (d) serves the secondary purpose
of subsection (13)
and not the primary purpose.
[128]
I have given above two scenarios
where an order for compensation may be claimed a few days after the
dismissal of the employees.
I need not repeat those scenarios
again.
[129]
In so far as the Labour Appeal Court
criticised the Labour Court for the assumption that a self-standing
remedy in terms of section
189A(13)(d) exists, that criticism is not
justified in so far as it may suggest that an order of compensation
as contemplated in
paragraph (d) of subsection (13) cannot be granted
alone at a time when no order contemplated in paragraphs (a) to (c)
can appropriately
be granted. Indeed, in so far as the
Labour Appeal Court criticised the Labour Court that it had
misdirected itself
and did not recognise the “proper purpose of
section 189A(13) and its limitations”, that criticism was
erroneous.
The Labour Court correctly took the view that an
order of compensation as contemplated in paragraph (d) of
subsection (13)
could be granted long after the consultation
process had ended.
CC Steenkamp II
[130]
The
reference to
CC
Steenkamp II
is a reference to the judgment of this Court in
CC Steenkamp II
.
In paragraph 52 in
CC Steenkamp II
this Court quoted a passage from the judgment of the Labour Court
in
Insurance
and Banking Staff Association
[40]
and said it recognised the purpose of section 189A(13). That
passage reads:
“
The
overriding consideration under section 189A is to correct and prevent
procedurally unfair retrenchments as soon as procedural
flaws are
detected, so that job losses can be avoided. Correcting a
procedurally flawed mass retrenchment long after the
process has been
completed is often economically prohibitive and practically
impossible. All too often the changes in an
enterprise with the
passage of time deter reinstatement as a remedy. So, the key
elements of section 189A are: early expedited,
effective intervention
and job retention in mass dismissals.”
[41]
This passage is to be
found in paragraph 9 of Pillay J’s judgment in
Insurance and Banking Staff Association
in
the Labour Court.
[131]
In
paragraph 12 Pillay J said that, “if there was undue delay
between the occurrence of the procedural flaw, or if the flaw
was
formal or insignificant, ‘remedies under subsections (13)(a)
to (c) would be inappropriate’”.
[42]
Pillay J did not say between the occurrence of the procedural
flaw and what. She may have meant between the occurrence
of the
procedural flaw and the launching of the application or the
adjudication of the application. It is difficult to speculate
what the said event is that she may have had in mind.
Nevertheless, it is clear that Pillay J deliberately did not include
the remedy of compensation contemplated in paragraph (d) of
subsection (13) when she mentioned remedies in subsection (13) that
would be affected by a delay between the occurrence of the procedural
flaw and whatever event.
[132]
Pillay J seems to have recognised
some difference in the purpose of the remedy in paragraphs (a)
to (c) of subsection (13)
and the purpose of the remedy
contemplated in paragraph (d) of the same subsection. In
fact she began the next paragraph
with a sentence that reinforced
this idea. I will quote the whole paragraph. It reads:
“
[13]
In my opinion, therefore, the remedies under section
189A(13)(a)(c)
should not be granted after the retrenchment process is completed and
if any of the circumstances in the preceding
paragraph obtain.
However, in this application, the employee does not seek relief in
terms of subsections
(a)(c).
If it is foreseeable at the time the application is launched that the
relief in terms of subsections (13)(a)(c)
are
inappropriate, or if orders in terms of those subsections are not
sought, the next question that arises is whether the employee
can
have recourse to relief under subsection (d).”
[43]
[133]
In
CC Steenkamp II
this Court also fell into the error into which both the Labour Court
and the Labour Appeal Court had, respectively, fallen
in
Parkinson
and
Clinix
and in
LAC Steenkamp II
.
This Court said in
CC
Steenkamp
II
:
“
[52]
Where procedural irregularities arise, the process provided for in
section 189A(13) of the LRA allows
for the urgent intervention
of the Labour Court to correct any such irregularities as and when
they arise so that the integrity
of the consultation process can be
restored and the consultation process can be forced back on track.
The purpose of section 189A(13)
has been recognised in a
long line of cases.”
[44]
This Court then quoted
from Pillay J’s judgment in
Insurance and Banking Staff
Association
the paragraph quoted above concerning what Pillay J
called “The overriding consideration under section 189A.”
Immediately after this, this Court quoted a passage from Murphy AJ’s
judgment in
SA Five Engineering
but, unfortunately, that
passage was not paragraph 10 of Murphy AJ’s judgment.
Paragraph 10 of Murphy AJ’s
judgment contains a different
view and, in fact, the correct view about compensation under
paragraph (d) of subsection (13).
[134]
This Court went on to say in
CC Steenkamp II
:
“
[58]
A central dispute between the parties is the question whether the
remedy of ‘compensation’ provided
for in section
189A(13)(d) is a self standing remedy. The applicants
insist that it is. Edcon disputes this.
[59]
The remedies provided for in section 189A(13)(a)-(d) must be
considered in the broader context of section 189A of the LRA and
keeping
in mind the overall purpose of section 189A(13).
[60]
The primary purpose of section 189A(13) is thus to allow for early
corrective action to get the retrenchment process back on track.
Paragraphs (a)-(d) establish a hierarchy of appropriate
relief. Only where it is not appropriate to grant an order
in
terms of paragraphs (a) (c) may an order for compensation
be granted in terms of paragraph (d)
.
[61]
Can it be said then that the compensation remedy provided for in
paragraph (d) is self-standing?
The answer is no. The
remedy provided for in section 189A(13)(d) cannot, as contended
by the applicants, be divorced
from the remainder of this section and
given self standing meaning.
[62]
Before this Court, counsel for the respondent conceded that a
postponement by a Judge of the
consideration of the paragraph (d)
compensation remedy may create the basis for compensation being
considered separately.
I think not.
[63]
Whereas a postponement of the consideration of compensation at a
later stage may separate its
determination procedurally, a Judge who
postpones consideration of paragraph (d) compensation would at least
have had the benefit
of considering the other three remedies and
determined their inappropriateness.
[64]
On its own terms, paragraph (d) provides for an exceptional remedy
which is granted only where
the primary remedies provided for in
paragraphs (a)-(c) are inappropriate. From the reading of the
language in the text of
paragraph (d), it is cogent that remedy (d)
will only be considered where (a)-(c) are ‘not appropriate’.
This
therefore means that a Judge who reaches the decision to
postpone the consideration of paragraph (d) would have
considered
remedies in paragraphs (a)-(c) first and would have
found these remedies inappropriate. Thus the compensation
remedy
can never be a stand alone remedy. This was made
clear by this Court in
Steenkamp I
, where it stated:
‘
Subsection
(13)(d) provides that a consulting party may apply to the Labour
Court for an award of compensation “if an order
in terms of
paragraphs (a) to (c) is not appropriate”. It seems to me
that the phrase “if an order in terms of
paragraphs (a) to (c)
is not appropriate” constitutes a condition precedent that must
exist before the court may award compensation.
The significance
of this condition precedent is that its effect is that the
Labour Court is required to regard the orders
provided for in
subsection (13)(a)-(c) as the preferred remedies in the sense that
the Labour Court should only consider the remedy
in subsection
(13)(d) when it is not appropriate to make any of the orders in
subsection (13)(a)-(c).’”
[45]
(Emphasis added.)
[135]
A reading of the passage quoted from
CC Steenkamp I
at the end of this excerpt reveals that the passage from
CC Steenkamp I
does not say nor does it support the statement that the order
contemplated in paragraph (d) can never be a standalone remedy.
On the contrary that passage from
CC
Steenkamp I
shows the opposite,
namely, that an order of an award of compensation contemplated in
paragraph (d) can only be granted when
it would no longer be
appropriate to grant any of the orders contemplated in paragraphs (a)
to (c).
[136]
In paragraph 66 this Court also said
in
CC
Steenkamp II
:
“
[66]
The main purpose of the section and the remedies it provides is thus
to ‘get the retrenchment process
back onto a track that is
fair.’ Even the remedy of compensation must be read in
the context of the short-term remedies
provided for in the same
subsection and in light of the jurisdictional restriction provided
for in section 189A(18). Compensation
in terms of section
189A(13)(d) cannot be the primary relief.”
[46]
(Emphasis added.)
[137]
What the above reveals is that an
error that started in the Labour Court in
Parkinson
was repeated by the Labour Appeal Court and in this Court.
Nevertheless, it is in the interests of justice that this error
be
corrected in order to prevent injustices from being visited upon many
workers who may need to be granted a remedy under section 189A(13)(d)
if their employer has failed to comply with a fair procedure in
dismissing them. If the erroneous interpretation of subsection
(13) is allowed to continue, there are many workers whose rights not
to be dismissed without compliance with a fair procedure will
be
violated by employers. In such a case such employees will not
be granted the remedy contemplated in paragraph (d) on the
basis that
the consultation process can no longer be put back on track.
Such employees could be awarded compensation under
paragraph (d)
because that remedy has nothing to do with putting the consultation
process back on track. The purpose of paragraph (d)
of
subsection (13) is to ensure accountability, the vindication of
employees’ right not to be dismissed without compliance
with a
fair procedure and the granting of an effective remedy to the
affected employees for the infringement of their rights by
their
employer.
[138]
It
appears from this Court’s judgment in
CC Steenkamp
II
that the Labour Court had expressed the view, in deciding the
condonation application in
LC
Steenkamp II
,
that, should the employees in that case be successful in their
procedural unfairness claim, they would at least be entitled to
relief under section 189A(13)(d), if relief in terms of paragraphs
(a) – (c) was no longer appropriate.
[47]
[139]
When the present matter came before
the Labour Court as an application in terms of section 189A(13),
Prinsloo J did not take
the view that an order contemplated in
paragraph (d) could no longer be granted because the
consultation process could no
longer be put back on track. She
went ahead to adjudicate the section 189A(13) application and
awarded compensation
in terms of paragraph (d) to those employees
whose dismissal was unfair only because there was no compliance with
a fair procedure.
In the present matter the Labour Court
concluded that it had jurisdiction to adjudicate the employees’
application
brought under section 189A(13) concerning a dispute
about the procedural fairness of their dismissal for operational
requirements.
On appeal the Labour Appeal Court
decided that the Labour Court had no such jurisdiction. It did
so without any
analysis of section 189A(13), 189A(18) or 191 and
without any analysis of any case law including its own previous
decisions on
the section. It relied on the judgment of this
Court in
CC Steenkamp II
for its conclusion in this regard.
[140]
In summary, therefore, the position
is, in my view, that:
(a)
subsection (13) has two purposes, not one.
(i)
the primary purpose of subsection (13) is
to enable the Labour Court to make an order to compel the
employer to comply with
a fair procedure before employees may be
dismissed finally for operational requirements.
(ii)
orders of the Labour Court that are capable
of achieving the primary purpose of subsection (13) as articulated in
(i) above are
the orders contemplated in paragraphs (a) to (c) of
subsection (13).
(iii)
an order for the award of compensation
contemplated in paragraph (d) of subsection (13) is not capable
of achieving the primary
purpose of subsection (13) as articulated in
(i) above but serves a different purpose, namely, the secondary
purpose of subsection
(13) as articulated in (iv) below.
(iv)
the secondary purpose of subsection (13) is
to hold an employer who has dismissed employees finally for
operational requirements
without compliance with a fair procedure
accountable and ensure that the employees whose rights have been
violated are granted
appropriate relief without insisting on
compliance with a fair procedure.
(v)
the secondary purpose of subsection (13)
relates to an order for the payment of compensation contemplated in
paragraph (d).
(vi)
it is correct to say that an order
contemplated in paragraphs (a) to (c) cannot be granted when the
consultation process can no
longer be put back on track because
putting the consultation process back on track is the primary purpose
of orders contemplated
in paragraphs (a) to (c).
(vii)
an order for the payment of compensation
contemplated in paragraph (d) cannot be refused on the basis that at
that time the consultation
process cannot be put back on track
because that is not the purpose served by an order for the payment of
compensation. The
purpose served by an order of compensation is
the secondary purpose.
(viii)
the orders contemplated in paragraphs (a)
to (c) are the primary or preferred orders under subsection (13).
(ix)
the order contemplated in paragraph (d) is
an order that is granted only when an order contemplated in
paragraphs (a) to (c) is
not appropriate.
(x)
there is a limited time during which orders
contemplated in paragraphs (a) to (c) may
appropriately be granted but,
once that limited period has expired,
only an order of compensation contemplated in paragraph (d) can
appropriately be granted
because at that stage no order contemplated
in paragraphs (a) to (c) is appropriate.
(xi)
while an order under paragraphs (a) to (c)
may not be granted years after the dismissal of the employees, an
order for an award
of compensation as contemplated in paragraph (d)
may be granted appropriately even years after the dismissal.
(xii)
whereas the orders contemplated in
paragraphs (a) to (c) are granted on the basis of a rejection of the
employer’s failure
to comply with a fair procedure, an order of
compensation contemplated under paragraph (d) is granted on the basis
of an acceptance
that the employer has failed to comply with a fair
procedure and there is no insistence that the employer complies with
a fair
procedure.
(xiii)
although compensation would normally not be
claimable soon after the dismissal of the employees, there are few
instances where it
would be claimable soon after the dismissal; in
each one of those instances an order under paragraphs (a) to (c) in
section 189A(13)
would not be appropriate.
(xiv)
although an order for the payment of
compensation would normally not be claimable or cannot be granted as
a standalone remedy, there
are circumstances in which it can be
granted as a standalone remedy.
[141]
It is now necessary to discuss the
issue for determination in the cross appeal. That is
whether section 189A(18) excludes
any jurisdiction of the
Labour Court to adjudicate disputes about the procedural
fairnesss of dismissals for operational requirements
and, if so,
whether all such disputes or only some.
Section 189A(18) and the
jurisdiction of the Labour Court in regard to disputes about
procedural fairness
[142]
The errors disclosed above in regard
to the meaning, scope and functioning of section 189A(13) of the
LRA are not the only
errors by the Labour Court,
Labour Appeal Court and, ultimately, this Court in
applications brought before the Labour Court
in terms of
subsection (13) and in subsequent appeals to the Labour Appeal Court
and this Court. Another one is
that the Labour Appeal Court
has held that the Labour Court has no jurisdiction to adjudicate
disputes about the
procedural fairness of dismissals for operational
requirements, even in a case where employees have approached the
Labour Court
by way of an application in terms of section 189A(13)
complaining that, in dismissing them for operational requirements,
their
employer to which section 189A applied did not comply with
a fair procedure. In such a case they would be asking for
one
or other order in terms of subsection (13)(a) to (d).
[143]
This is what the Labour Appeal Court
decided in the present matter when this matter was before that Court.
The Labour Appeal
Court relied upon section 189A(18) for
this holding and on this Court’s judgment in
CC
Steenkamp II
. The Labour Court,
the Labour Appeal Court and this Court have also made
various statements in certain cases
that by virtue of section
189A(18) the Labour Court has no jurisdiction at all to adjudicate
disputes about the procedural fairness
of dismissals based on the
employer’s operational requirements or that it has no
jurisdiction to adjudicate such matters
under section 191 or
that the Labour Court has no jurisdiction to adjudicate such matters
under section 189A(13) even
when the dismissal relates to
employees to whose employer section 189A applies.
[144]
The Labour Court, Labour Appeal
Court and this Court have made such statements at the different
levels of the cases in
Steenkamp
and/or
Barloword
and, in the case of the Labour Appeal Court, also in the present
matter. I propose to quote section 189A(18), then deal
with what the provision means and, thereafter, discuss various cases
which dealt with the meaning and effect of section 189A(18)
and the
jurisdiction of the Labour Court in regard to disputes about the
procedural fairness of dismissals for operational requirements.
[145]
Section 189A(18) reads:
“
The
Labour Court may not adjudicate a dispute about the procedural
fairness of a dismissal based on the employer’s operational
requirements in any dispute referred to it in terms of
section 191(5)(b)(ii).”
The
first feature that, in my view, needs to be borne in mind in
interpreting this provision is that subsection (18) is a
subsection under section 189A. The implication hereof is that
under section 189A any reference to “employer” is
a
reference to an employer as contemplated in section 189A(1). That
means an employer who employs more than 50 employees.
This
alone immediately tells one that the dismissal referred to in
subsection (18) is a dismissal of employees to whose
employer
section 189A applies or, put differently, whose employer employs more
than 50 employees as contemplated in section 189A(1).
That,
therefore, must mean that in terms of section 189A(18) the
Labour Court may not adjudicate a dispute about the
procedural
fairness of a dismissal for the employer’s operational
requirements in a dispute referred to the Labour Court
for
adjudication under section 191 where the employer concerned employs
more than 50 employees. Section 189A(18) precludes
the
Labour Court from adjudicating under section 191 any dispute
about the procedural fairness of dismissals for operational
requirements relating to employees to whose employer section 189A
applies if such dispute is referred to the Labour Court in terms
of
section 191 of the Act.
[146]
In my view, the following points
must be emphasised about subsection (18), read with
section 191(5)(b)(ii) and subsection
(13):
(a)
The Labour Court has jurisdiction to adjudicate
disputes about the
procedural fairness of dismissals for operational requirements to
which section 189A applies and which
are brought to the Labour
Court by way of applications in terms of subsection (13).
(b)
By virtue of subsection (18), the Labour Court
has no jurisdiction to
adjudicate in terms of section 191(5)(b)(ii) a dispute about the
procedural fairness of a dismissal for
operational requirements to
which section 189A applies because the LRA provides a special
procedure and special remedies in
subsection (13) for such disputes.
In other words, such disputes cannot competently be referred to
the Labour Court in terms
of section 191(5)(b)(ii) for
adjudication because the LRA has a special procedure and special
remedies for such disputes in
subsection (13) in terms of which
they can be adjudicated by the Labour Court.
(c)
The Labour Court’s jurisdiction to
adjudicate disputes about
the procedural fairness of dismissals for operational requirements to
which section 189A does not
apply and which are referred to it
for adjudication in terms of section 191(5)(b)(ii) is not ousted by
subsection (18). That
jurisdiction remains intact and the
Labour Court has jurisdiction to adjudicate such disputes.
[147]
If subsection (18) was a subsection
of section 191, it, indeed, would have ousted the Labour Court’s
jurisdiction to
adjudicate disputes about the procedural fairness of
dismissals for operational requirements to which section 189A does
not apply
and which are referred to the Labour Court in terms of
section 191(5)(b)(ii) for adjudication. However, subsection
(18) is
not located as a subsection to section 191. It is
located as a subsection of section 189A. That is not a
coincidence.
The reason for that is that, like all the
subsections to section 189A, subsection (18) relates to dismissals
for operational requirements
to which section 189A applies. If
it was meant to relate to dismissals for operational requirements to
which section 189A
does not apply, it would have been located as a
subsection to section 191.
[148]
The interpretation that subsection
189A(18) has ousted the jurisdiction of the Labour Court to
adjudicate disputes about the
procedural fairness of dismissals for
operational requirements referred to it in terms of section
191(5)(b)(ii) is not accurate.
What is accurate is the
interpretation that says that, by virtue of subsection (18), the
Labour Court’s jurisdiction
to adjudicate under section
191 disputes about the procedural fairness of dismissals for
operational requirements of employees
to whose employer section 189A
applies has been ousted because the LRA has created a special process
and remedy for such disputes
in terms of subsection (13). I now
proceed to refer to and discuss the cases in which the Labour Court,
Labour Appeal Court
and this Court have made inaccurate statements
about the jurisdiction of the Labour Court in respect of disputes
about the procedural
fairness of dismissals for operational
requirements.
Discussion of relevant
case law
CC Steenkamp I
[149]
The
reference to
CC
Steenkamp I
is a reference to the judgment of this Court in
Steenkamp I
.
[48]
This
Court pointed out in
CC
Steenkamp
I
that “section 189A creates special rights and obligations
for which it provides special remedies.”
[49]
This Court went on to say in paragraphs 157 and 158:
“
[157]
Subsections (8)(b)(ii)(aa) and (bb) [of section 189A] provide the
only remedies available to workers or their trade
union if they
dispute the fairness of the reason for their dismissal. They do
not have any other remedies. However,
they are still better off
than their colleagues to whom section 189A does not apply. That
is insofar as they may be challenging
the fairness of the reason for
their dismissal. What if they challenge only the procedural
fairness of the dismissal?
[158]
It is to be noted that in such a case subsection (8)(b)(ii)(bb)
does not contemplate the referral of a dispute concerning
the
procedural fairness of a dismissal
to the Labour Court for
adjudication
. In terms of that provision only a dispute
concerning whether there is a fair reason for dismissal may be
referred to the
Labour Court for adjudication. In
fact subsection (18) precludes the Labour Court from adjudicating any
dispute
about the procedural fairness of a dismissal for operational
requirements referred to it in terms of section 191(5)(b)(ii).
It reads:
‘
The
Labour Court may not adjudicate a dispute about the procedural
fairness of a dismissal based on the employer’s operational
requirements in any dispute referred to it in terms of
section 191(5)(b)(ii).’
Subsection (18)
may seem very drastic and harsh on employees who may be having a
dispute with their employer concerning the
procedural fairness of
their dismissal. However it will be seen that when read with
subsection (13), it is not harsh
at all. Subsection (13)
provides extensive protections to employees where the employer has
failed to comply with a fair procedure.”
[50]
(Emphasis added.)
What the last two
sentences in this excerpt mean is that subsection (18) is not so
harsh because disputes about the procedural fairness
of dismissals
for operational requirements of employees to whose employer section
189A applies can still be adjudicated by the
Labour Court under
section 189A(13). In saying that in
CC Steenkamp II
this Court affirmed that the disputes about the procedural fairness
of dismissals based on the employer’s operational requirements
which subsection (18) says cannot be adjudicated by the
Labour Court under section 191 can actually be adjudicated
by that same court under section 189A(13).
[150]
It needs to be made clear that, in
stating in
CC Steenkamp I
that subsection (18) “precludes the Labour Court from
adjudicating any dispute about the procedural fairness of a dismissal
for operational requirements”, this Court did not stop there
but it added the qualification “referred to [the Labour
Court]
in terms of section 191(5)(b)(ii)” which is part of
subsection (18). What this Court said in
CC Steenkamp I
regarding subsection (18) is simply the literal meaning of
subsection (18) as it is without any interpretation. Some
of
the cases have ignored that qualification and have given
subsection (18) a meaning to the effect that except for
subsection
(13) jurisdiction, the Labour Court has no
jurisdiction to adjudicate any cases relating to procedural fairness
in dismissals
for operational requirements whatsoever or has no
jurisdiction if those disputes have been referred to the Labour Court
in terms
of section 191(5)(b)(ii).
[151]
Those cases have said that
subsection (18) has ousted the jurisdiction of the Labour Court
to adjudicate disputes about the
procedural fairness of dismissals
for operational requirements without any reference to section 191.
What subsection (18)
means is that a dispute about the
procedural fairness of a dismissal for operational requirements to
which section 189A applies
cannot be referred to the Labour Court
in terms of section 191(5)(b)(ii) for adjudication. This
is because the
legislature has provided a special process for the
adjudication of such disputes under subsection (13).
[152]
Subsection (18) does not relate to
disputes about the procedural fairness of dismissals to which section
189A does not apply.
Those may still be referred to the
Labour Court in terms of section 191(5)(b)(ii) for
adjudication. Later on, this Court
said in paragraph 164 in
CC
Steenkamp I
:
“
[164]
The
extensive remedies in subsection (13) provide at least partial
compensation for the fact that, in respect of disputes
concerning
the procedural fairness of dismissals, the employees have been
deprived of the right to adjudication that other employees
have
.
In part, the extensive remedies in subsection (13) for
non-compliance with procedural fairness have been provided because
of
the importance of the pre-dismissal process.”
[51]
(Emphasis added.)
It is vitally important
to point out that the first sentence of paragraph 164 does not say
that employees to whom section 189A does
not apply have been deprived
of the right to adjudication in respect of their disputes about the
procedural fairness of dismissals
for operational requirements.
[153]
The reference to “the
employees” at the beginning of the second half of that sentence
is a reference to employees to
whom “[t]he extensive remedies
in subsection (13)”, which appears at the beginning of the
sentence, are available
and those are the employees to which section
189A applies. In other words, that sentence says in effect
that, although the
employees to which section 189A applies are
deprived of the right of adjudication which other employees have,
which is the right
of adjudication of a dispute about the procedural
fairness of a dismissal for operational requirements that follows
after a referral
of such dispute to the Labour Court in terms of
sections 191(5)(b)(ii), subsection (13) provides employees to
which section 189A
applies with “partial compensation”.
[154]
Subsection (18) is the provision on
which the Labour Appeal Court and this Court in
CC Steenkamp II
relied to say that the Labour Court’s jurisdiction to
adjudicate the procedural fairness of dismissals for operational
requirements
had been ousted. In saying so, both the
Labour Appeal Court and this Court were also referring to
disputes about
the procedural fairness of dismissals for operational
requirements to which section 189A applies and which are brought
in
the Labour Court by way of applications in terms of section
189A(13). As I say elsewhere in this judgment, in giving
section 189A(18)
that meaning, this Court and the Labour Appeal
Court interpreted section 189A(18) as if the words that appear
after the word
“dispute” in that provision are not
there. The view that section 189A(18) ousts the jurisdiction of
the Labour Court
to adjudicate the procedural fairness of
dismissals for operational requirements including where a dispute
about procedural fairness
is brought before the Labour Court in
terms of subsection (13) is not correct.
LC
Steenkamp II
[155]
The
reference to
LC
Steenkamp II
is a reference to the judgment of the Labour Court in
Steenkamp
II
.
[52]
After the employees involved in
CC Steenkamp I
had failed in their bid to obtain an order that their dismissals had
been invalid, they approached the Labour Court by way
of an
application in terms of section 189A(13) for an order for the payment
of compensation. The employees’ section
189A(13)
application was more than two years late. They applied for
condonation. The Labour Court granted condonation.
It
said that the employees would still be able to be awarded
compensation in terms of section 189A(13) if they succeeded
in
proving that the employer had failed to comply with a fair procedure.
This shows that the Labour Court, through Malindi
AJ, did not
think that the Labour Court had no jurisdiction to adjudicate
under section 189A(13) disputes about the procedural
fairness of
dismissals for operational requirements in respect of employees to
whose employer section 189A applies.
LAC
Steenkamp II
[156]
The
reference to
LAC
Steenkamp II
is a reference to the judgment of the Labour Appeal Court
in
Steenkamp II
.
[53]
In
LAC
Steenkamp II
the Labour Appeal Court accepted that the Labour Court had
jurisdiction to adjudicate disputes about the procedural fairness
of
dismissals for operational requirements properly brought before the
Labour Court in terms of section 189A(13). However,
without any qualification the Labour Appeal Court made
certain statements about the Labour Court not having
jurisdiction.
In
LAC Steenkamp
II
the Labour Appeal Court also
said, after quoting section 189A(13):
“
This
jurisdictional competence cannot be read disjunctively from
section 191(5)(b)(ii) and section 189A(18).
Plainly,
this power is an exception to the primary prescription that no
adjudication can occur about unfair procedure
.”
[54]
(Emphasis added.)
[157]
These statements do not say that the Labour Court has no
jurisdiction under section 191 to adjudicate disputes about the
procedural
fairness of the dismissals for operational requirements of
employees to which section 189A applies and that such disputes, in so
far as they may relate to employees to whose employer section 189A
does not apply, can still be adjudicated by the Labour
Appeal Court.
[158]
After quoting subsection (18), the
Labour Appeal Court said in
LAC Steenkamp II
in paragraphs 18 and 19:
“
[18]
An employer who dismisses an employee must justify the decision to do
so. Section 189 regulates that
obligation. Furthermore,
in large scale retrenchments, like that in this case, additional
obligations are imposed on the
employer by section 189A.
Central to the present controversy is section 189A(18) which provides
that:
‘
The
Labour Court may not adjudicate a dispute about procedural fairness
of a dismissal based on the employer’s operational
requirements
referred to it in terms of section 191(5)(b)(ii)’.
[19]
There
could be no clearer indication that after a dismissal had taken place
under the stipulated circumstances of operational requirements
of an
employer, the Labour Court is bereft of jurisdiction, save in respect
of substantive fairness
.
That express exclusion of jurisdiction to evaluate procedural
unfairness ex post facto is in stark contrast to the jurisdictional
competence of the Labour Court in other kinds of dismissal
disputes.”
[55]
(Emphasis added.)
What
the Labour Appeal Court was saying in the emphasised sentence is in
effect that the Labour Court has no jurisdiction to
adjudicate
disputes about the procedural fairness of dismissals based on the
employer’s operational requirements. It
was also saying
that, in disputes concerning dismissals for operational requirements,
the Labour Court remains only with the
jurisdiction in respect
of the substantive fairness of such dismissals. That statement
is not correct because the Labour
Court still has jurisdiction to
adjudicate disputes about the procedural fairness of dismissals of
employees whose employer employs
less than 50 employees.
CC
Steenkamp II
[159]
The
reference to
CC
Steenkamp II
is a reference to the judgment of this Court in
Steenkamp II
.
[56]
I repeat that this was a case where employees launched their
application in terms of section 189A(13) more than two years
after
the dismissal of the employees. The issues before this Court
were whether the Labour Appeal Court’s decision
setting aside
the Labour Court’s decision granting condonation for the
delay in the launching of the section 189A(13)
application was
correct and whether the remedy of compensation under section
189A(13)(d) was a self-standing-remedy.
[160]
Although this Court concluded that the Labour Appeal Court had
correctly exercised its discretion in setting aside the Labour
Court’s
decision, it, through Basson AJ, made various
statements about section 189A(18) and the jurisdiction of the
Labour Court
in respect of disputes about the procedural
fairness of dismissals for operational requirements. Some of
those statements
about the jurisdiction of the Labour Court and
section 189A(18) are inaccurate. One of the statements made by
this Court
in
CC Steenkamp II
was this:
“
Disputes
about procedural fairness have been removed from the adjudicative
reach of the Labour Court and may no longer be referred
to the Labour
Court as a distinctive claim or cause of action that a dismissal on
the basis of operational requirements was procedurally
unfair.”
[57]
This
statement is unqualified and basically says that the Labour Court no
longer has jurisdiction in respect of disputes about procedural
fairness and such disputes may no longer be referred to the Labour
Court “as a distinctive claim or cause of action”
relating to a dismissal for operational requirements.
[161]
This is not correct because the Labour Court still has
jurisdiction in respect of disputes about the procedural fairness of
dismissals for operational requirements in regard to employees to
whose employer section 189A does not apply. This Court
itself accepted that the Labour Court has jurisdiction in respect of
disputes about the procedural fairness of dismissals for operational
requirements that are properly brought before the Labour Court in
terms of section 189A(13). What this Court should
have
said is that the Labour Court may not adjudicate under section
191(5)(b)(ii) a dispute about the procedural fairness of a
dismissal
for operational requirements of employees to whose employer
section 189A applied.
[162]
Under the heading “Nature, purpose and functioning”
of section 189A(13), in
CC Steenkamp II
this
Court, inter alia, said at paragraphs 47 to 48:
“
[47]
A distinctive feature of section 189A(13) of the LRA is the
separation of disputes about procedural fairness.
Disputes
about substantive fairness may be dealt with by resorting to strike
action or by referring a dispute about the substantive
fairness of
the dismissals to the Labour Court in terms of section 191(11) of the
LRA.
[48]
Disputes
about procedural fairness have been removed from the adjudicative
reach of the Labour Court and may no longer be referred
to the Labour
Court as a distinctive claim or cause of action that a dismissal on
the basis of operational requirements was procedurally
unfair
.”
[58]
[163]
This Court also made the following statements about the
jurisdiction of the Labour Court:
“
[49]
Although a clear policy decision has been made to remove claims
of procedural unfairness from the ex
post facto jurisdictional
competence of the Labour Court, employees are not left without a
remedy. In what the Labour Appeal
Court referred to as a
‘partial claw back of jurisdiction’, they may
approach the Labour Court in terms of
section 189A(13) of the LRA for
an order compelling the employer to comply with a fair
procedure. Where employees have
already been dismissed, the
Labour Court has the additional power in terms of section
189A(13)(c) of the LRA to reinstate
such an employee to allow
for the consultation process to run its course.
.
. .
[51]
The rationale for the removal of the Labour Court’s
jurisdiction in respect of procedural
issues from the ambit of
section 191(5)(b)(ii) of the LRA must be viewed against the
broader context and purpose of section 189A
as a whole.
Recognising that large-scale retrenchments may benefit from the
intervention of third parties, section 189A
provides for an
assisted consultative framework in the context of large scale
retrenchments albeit only for a limited time.”
[59]
[164]
This Court commented on the Labour Appeal Court’s
interference with the Labour Court’s decision to grant the
employees
condonation for their delay in launching their
section 189A(13) application. This Court said:
“
[69]
The Labour Appeal Court interfered with the Labour Court’s
discretion because of the Labour Court’s
misconception about
the purpose and functioning of section 189A(13) of the LRA. Here
the Labour Appeal Court criticises the
Labour Court’s
acceptance that it has jurisdiction to adjudicate disputes about
unfair procedure in the context of large
scale retrenchments. It
concludes by emphasising the point that the jurisdictional competence
assigned to the Labour Court
in section 189A(13) cannot be
read disjunctively from sections 191(5)(b)(ii) and section
189A(18) because ‘plainly,
this power is an exception to the
primary prescription that no adjudication can occur about unfair
procedure.’
[70]
The Labour Appeal Court’s criticism is warranted. The
Labour Court misunderstood
the jurisdictional competence
conferred on it by section 189A(13) of the LRA. This much is
clear if regard is had to the
order granted by the Labour Court. In
its order the Labour Court consolidated the application for
compensation in respect
of procedural unfairness under section 189A
with the main action and referred it to trial. This is wrong.
The jurisdiction
of the Labour Court to adjudicate on the
procedural fairness of a dismissal based on the employer’s
operational requirements
has been ousted by section 189A(18) of
the LRA. As the Labour Appeal Court correctly stated, the
Labour Court’s
jurisdictional competence ‘cannot be read
disjunctively from section 191(5)(b)(ii) of the LRA and
section 189A(18)
of the LRA.’”
[60]
[165]
In paragraph 69 there is a sentence where this Court says the
Labour Appeal Court criticised the Labour Court for
accepting
that it (i.e. the Labour Court) had “jurisdiction
to adjudicate disputes about unfair procedure in the context of large
scale retrenchments.” Although I accept that the Labour
Appeal Court criticised the Labour Court extensively, I do
not think
that it criticised the Labour Court for accepting that it had
jurisdiction to adjudicate a dispute about the procedural
fairness of
dismissals for operational requirements in large scale retrenchments.
In its judgment the Labour Appeal Court
made some
statements about the jurisdiction of the Labour Court but it is
not clear from its judgment why those statements
were relevant
because the issue of jurisdiction of the Labour Court to adjudicate a
dispute about the procedural fairness of a
dismissal based on the
employer’s operational requirements of employees to whose
employer section 189A applied that was brought
in the Labour Court
in terms of section 189A(13) was not in dispute. The
Labour Court clearly had jurisdiction
in terms of section
189A(13) to adjudicate this matter because this was a dispute about
the procedural fairness of dismissals for
operational requirements of
employees to whose employer section 189A applied and which had been
brought in the Labour Court
in terms of section 189A(13). The
employees had launched their section 189A application very late but
they applied for condonation
and whether or not the Labour Court
would get to adjudicate the dispute depended upon whether or not the
employees’ delay
in launching their application was to be
condoned. The Labour Court had granted condonation but the
Labour Appeal Court
had reversed that decision and
dismissed the condonation application.
[166]
It will have been seen from paragraph 70 in
CC Steenkamp II
as quoted above that this Court went on to say that it was wrong for
the Labour Court to consolidate the matter relating to procedural
fairness (that was brought in the Labour Court in terms of
section 189A(13)) and the matter relating to the substantive
fairness
of the dismissal (that was referred to the Labour Court in
terms of section 191(5)(b)(ii) for adjudication). This Court
gave
the basis for its criticism as being the following:
“
The
jurisdiction of the Labour Court to adjudicate on the procedural
fairness of a dismissal based on the employer’s operational
requirements has been ousted by section 189A(18) of the LRA. As
the Labour Appeal Court correctly stated, the Labour
Court’s jurisdictional competence ‘cannot be read
disjunctively from section 191(5)(b)(ii) of the LRA and section
189A(18) of the LRA.’”
[61]
Quite
clearly, this passage relates to the dispute about the procedural
fairness that was consolidated by an order of the Labour
Court with
the dispute about the substantive fairness of the dismissal.
[167]
The dispute about the procedural fairness was not referred to
the Labour Court in terms of section 191(5)(b)(ii). Because
of that, the exclusion of the Labour Court’s jurisdiction
in section 189A(18) did not get triggered. That dispute
was
brought in the Labour Court in terms of section 189A(13) and,
quite clearly, the Labour Court had jurisdiction to
adjudicate
it if condonation for the delay was granted. Paragraph 70 of
this Court’s judgment in
CC Steenkamp II
may well be the
paragraph that led the Labour Appeal Court in the present
matter to think that that judgment was authority
for the proposition
that the Labour Court had no jurisdiction to adjudicate disputes
about the procedural fairness of dismissals
for operational
requirements of employees to whose employer section 189A applied even
if it had been brought in the Labour Court
in terms of section
189A(13). I say this because that is what the
Labour Appeal Court effectively decided in the
present
matter despite the clear language of section 189A(13). To the
extent that this is what paragraph 70 says, it is not
correct.
[168]
To the extent that this Court criticised the Labour Court for
consolidating the matter of substantive fairness of the dismissal
that was referred to the Labour Court in terms of section 191
with the matter of the procedural fairness of the dismissal that
was
brought in the Labour Court in terms of section 189A(13), I do not
think that it was justified. Actually, the consolidation
of
such matters (where the employees in a section 189A(13)
application only seek compensation) and the substantive fairness
matter makes sense because these are two components of the same
dispute. The role players in the two matters will usually
be
the same. If such matters are consolidated, they will be heard
by the same Judge whereas, if they are not consolidated,
they could
be heard by different Judges. If that were to happen, the one
Judge could find that a particular witness is unreliable
or dishonest
and the Judge hearing the other matter finds that the same witness’
evidence is credible with all the problems
that could flow from that.
If the matters are consolidated and heard by the same Judge,
the Judge would simply have to bear
in mind that he or she is
adjudicating one matter under section 191 and the other under
section 189A(13).
[169]
There
are statements made by this Court in
CC
Steenkamp II
which suggest that this Court accepted that the Labour Court has
jurisdiction to adjudicate disputes about the procedural fairness
of
dismissals for operational requirements that are brought in the
Labour Court by way of applications in terms of section
189A(13).
[62]
LC Barloworld
[170]
The
reference to
LC
Barloworld
is a reference to the judgment of the Labour Court in
Barloworld
.
[63]
In
Barloworld
the
Labour Court dealt with two applications brought by two unions in
terms of section 189A(13). The two unions complained
that the
employer, namely, Barloworld, had dismissed their respective members
without compliance with a fair procedure. Both
unions contended
that such consultation as Barloworld may have purported to undertake
was inadequate. The Labour Court
held that the
applications did not raise issues of non-compliance with a fair
procedure but they raised issues of procedural fairness.
The
Labour Court sought to draw a distinction between the concept of
procedural fairness of a dismissal and the concept of
compliance with
a fair procedure.
[171]
The Labour Court went on to say that the
matters that could be brought to it in terms of subsection (13) were
those that related
to a failure to comply with a fair procedure and
not matters that related to the procedural fairness of a dismissal.
It held
that matters concerning the procedural fairness of dismissals
could not be brought to it in terms of subsection (13). The
Labour Court’s conclusion in
LC Barloworld
that the two phrases meant different things was contrary to a
decision of this Court in
CC Steenkamp I
where this Court expressly said:
“
[126]
The procedural obligations placed upon an employer in section 189A,
including those in section 189A(8), relate
to procedural fairness
contemplated in section 188(1)(b). Then, when subsection (13)
refers to non-compliance with a
fair procedure, it refers to
procedural fairness made up of the procedural obligations and rights
provided for in section 189A.”
[64]
[172]
In
LC Barloworld
the Labour Court dismissed the two subsection (13)
applications. The basis for the Labour Court’s decision
to
dismiss these two applications was that the two unions were
complaining about the dismissal of employees on the basis that the
dismissals were procedurally unfair whereas section 189A(13) did
not relate to disputes about the procedural fairness of dismissals
but about dismissals without compliance with a fair procedure. The
distinction that the Labour Court tried to make about
these
phrases is without any justification.
[173]
Although the Labour Court did not
therefore say that it had no jurisdiction to adjudicate disputes
about non-compliance with a fair
procedure, in saying that it had no
jurisdiction to adjudicate under section 189A(13) disputes about the
procedural fairness of
dismissals for operational requirements of
employees to whose employer section 189A applied, it created the
impression that
there were some disputes concerning the procedural
fairness of dismissals for operational requirements in respect of
which the
Labour Court had no jurisdiction.
[174]
Nevertheless, the Labour Court made this statement which,
unqualified as it is, could be understood as meaning that the Labour
Court’s
jurisdiction to adjudicate disputes about the
procedural fairness of dismissals for operational requirements that
the Labour Court
adjudicates under section 191 of the LRA had been
ousted. The passage reads:
“
As
a build up to what was said in
TAWUSA
,
it is important to add that in terms of section 189A (18) of the LRA,
this Court is precluded from adjudicating disputes about
the
procedural fairness of a dismissal based on the employer’s
operational requirements. As confirmed by the
Constitutional Court
in [
CC Steenkamp II
]
the jurisdiction of the Labour Court to adjudicate on procedural
fairness of a dismissal based on the employer’s operational
requirements has been ousted.”
[65]
So,
the judgment purported to bar certain workers from bringing some of
their disputes to the Labour Court and bar workers
to which
section 189A did not apply from having their disputes about the
procedural fairness of dismissals for operational requirements
brought to the Labour Court for adjudication. In the
LC Barloworld
case the Labour Court also said:
“
[13]
Where this Court adjudicates procedural fairness disputes under the
banner of section 189A(13) this Court
would be acting
ultra vires.
Its powers were taken away by section 189A(18).”
[66]
Quite clearly, in this
passage the Labour Court was saying that it has no power or
jurisdiction to adjudicate disputes about procedural
unfairness under
section 189A(13) which is clearly incorrect. In this
passage the Labour Court says the Labour Court’s
power to
adjudicate such disputes were taken away by section 189A(18). That
is also not correct. The Labour Appeal
Court refused leave to
appeal. The Labour Appeal Court’s refusal of
leave meant that the Labour Appeal Court
agreed with the decision of
the Labour Court.
CC Barloworld
[175]
The
reference to
CC
Barloworld
is a reference to the judgment of this Court in
Barloworld
.
[67]
CC
Barloworld
was an appeal to this Court by Solidarity against the Labour Court’s
judgment in
LC Barloworld
.
Tshiqi J gave this Court’s unanimous judgment.
[68]
This Court considered the merits of the two applications
brought by these two unions in the Labour Court in terms of section
189A(13) of the LRA and concluded that there had been a meaningful
consultation before the members of the two unions were dismissed
and
that, for that reason, the appeals fell to be dismissed. NUMSA
did not take part in the appeal before this Court.
[176]
The essence of the dispute, said
Tshiqi J in her judgment in this Court, was whether or not there had
been a meaningful joint consensus-seeking
process as envisaged in
section 189(2). In
CC
Barloworld
this Court, quite correctly, rejected the distinction that the Labour
Court sought to make between procedural fairness and compliance
with
a fair procedure in the context of dismissal disputes. I would
go further than this Court did in
CC
Barloworld
.
This Court seemed to leave open a window of opportunity for an
argument in some future case in which the distinction could
be shown
to exist. There is no such chance. These are different
phrases which mean exactly the same thing. In
essence they both
relate to the observance or non-observance of the
audi alteram partem
rule in labour law.
[177]
A look at the history of our
jurisprudence on unfair dismissal law in the 1980s will reveal that
in its first few unfair labour
practice cases in the early 1980s the
Industrial Court relied on the
audi alteram partem
rule to hold that an employer was obliged to give
an employee an opportunity to be heard before such employee could be
dismissed.
In the context of dismissals for misconduct that
requirement remained one for a hearing. In the context of
dismissals
for incapacity, that requirement developed in due course
to be counselling. In the case of retrenchment, that
requirement
developed to a requirement for consultation. Also,
in due course, our courts and academic writers began to refer to
procedural
fairness and to failure to follow, or, comply with, a fair
procedure interchangeably. The notorious 1988 amendments to the
1956 LRA included a reference to a “fair procedure”.
Accordingly, not only is the distinction sought to be drawn
by the
Labour Court not supported by common sense and logic, it is also
inconsistent with the historical development of our jurisprudence
on
unfair dismissal law. Accordingly,
procedural
fairness and fair procedure in the context of
dismissal disputes refer to the same thing. Their origin is the
same.
It is the
audi alteram partem
rule.
[178]
In
CC
Barloworld
this Court referred to this Court’s judgment in
CC Steenkamp I
extensively. It then concluded that in
CC
Steenkamp
I
this Court had stated on the basis of
subsection (18) that the Labour Court had no jurisdiction to
adjudicate disputes about
the procedural fairness in dismissals for
operational requirements referred to it in terms of
section 191(5)(b)(ii).
In
CC Barloworld
this Court then said:
“
[65]
It is thus clear that the Labour Court
may not adjudicate a dispute about the procedural fairness of a
dismissal based on the employer’s
operational requirements in
any dispute referred to it in terms of section 191(5)(b)(ii)
.
As this Court reasoned, in
Steenkamp I
,
section 189A(13) provides adequate protection for employees
where there has been a failure to comply with a fair procedure.
Moreover, in
Steenkamp II
,
this Court confirmed the features of section 189A(13) and said:
‘
A
distinctive feature of section 189A(13) of the LRA is the separation
of disputes about procedural fairness from disputes about
substantive
fairness. Disputes about substantive fairness may be dealt with
by resorting to strike action or by referring
a dispute about the
substantive fairness of the dismissals to the Labour Court in
terms of section 191(11) of the LRA.
Disputes
about procedural fairness have been removed from the adjudicative
reach of the Labour Court and may no longer be referred
to the Labour
Court as a distinctive claim or cause of action that a dismissal on
the basis of operational requirements was procedurally
unfair.
’
. . .
[67]
The above excerpts read with section
189A(18) remove disputes about procedural fairness, as a distinctive
claim or cause of action,
that a dismissal on the basis of
operational requirements was procedurally unfair, from the
adjudicative reach of the Labour Court.
[68]
It
follows from this jurisprudence that, in order for the Labour Court
to adjudicate a claim of the unfairness of a procedure
in dismissals
for operational requirements, the Court must be approached in terms
of section 189A(13) on the basis of non-compliance
with the
procedures prescribed by sections 189 or 189A of the LRA
.”
[69]
(Emphasis added.)
What this Court was
saying here was that the only remaining route for the adjudication of
disputes about the procedural fairness
of dismissals for operational
requirements was section 189A(13). This is not correct
because the Labour Court still
has jurisdiction to adjudicate
disputes about the procedural fairness of dismissals on the basis of
the employer’s operational
requirements in regard to employees
to whose employer section 189A applies.
[179]
In
CC Barloworld
this Court also made certain
unqualified statements which suggested that the Labour Court had no
jurisdiction to adjudicate disputes
about the procedural fairness of
dismissals for operational requirements of employees to whose
employer section 189A applied. It
said:
“
[65]
It is thus clear that the Labour Court may not adjudicate a
dispute about the procedural fairness of
a dismissal based on the
employer’s operational requirements
in any dispute
referred to it in terms of section 191(5)
(b)
(ii). As
this Court reasoned in
Steenkamp I
, section 189A(13)
provides adequate protection for employees where there has been a
failure to comply with a fair procedure.
Moreover,
in
Steenkamp II
, this Court confirmed the features
of section 189A(13) and said:
‘
A
distinctive feature of section 189A(13) of the LRA is the separation
of disputes about procedural fairness from disputes about
substantive
fairness. Disputes about substantive fairness may be dealt with
by resorting to strike action or by referring
a dispute about the
substantive fairness of the dismissals to the Labour Court in terms
of section 191(11) of the LRA.
Disputes about procedural
fairness have been removed from the adjudicative reach of the
Labour Court and may no longer be
referred to the Labour Court
as a distinctive claim or cause of action that a dismissal on the
basis of operational requirements
was procedurally unfair.’”
[70]
[180]
Later on, this Court also said in
CC Barloworld
:
“
It
follows from this jurisprudence that,
in
order for the Labour Court to adjudicate a claim of the
unfairness of a procedure in dismissals for operational requirements,
the court must be approached in terms of section 189A(13) on the
basis of non-compliance with the procedures prescribed by
section 189
or 189A of the LRA.”
[71]
[181]
Later, this Court went on to say in
CC Barloworld
:
“
[71]
The following emanates from the above discussion.
Firstly, the power of the Labour Court to adjudicate the
procedural
fairness of retrenchment consultations is limited to the
‘fair procedure’ that is prescribed in sections189 and
189A,
which give effect to section 188.
Secondly,
it is evident that a party seeking
the
Labour Court’s intervention
when an employer fails to follow a fair procedure during retrenchment
consultations must approach the Court for
relief
in terms of section 189A(13). This is because the Labour
Court is barred from determining the procedural fairness
of a
dismissal based on operational requirements when it is approached in
terms of section 191(5)(b)(ii)
.”
(Emphasis added.)
[182]
This
Court also stated that until there was a basis for drawing a
distinction between non-compliance with a fair procedure and
procedural unfairness, “it may be safely concluded that the
Labour Court’s jurisdiction to adjudicate procedural fairness
is only ousted in respect of unfair dismissal proceedings brought in
terms of section 191(5)(b)(ii). It is uncontroversial
and
has been settled by this Court that if an employer fails to follow
the procedures prescribed by sections 189 and 189A of the
LRA, a
party is entitled to approach the Labour Court in terms of section
189A(13) and the Court, in turn, is entitled to grant
any of the
remedies contained in that provision.”
[72]
[183]
The essence of this Court’s
judgment in
CC
Barloworld
was that, by virtue of subsection (18), the
Labour Court no longer had jurisdiction to adjudicate disputes about
the procedural
fairness of dismissals for operational requirements
referred to it in terms of section 191(5)(b)(ii) but that it did have
jurisdiction
to adjudicate disputes about the procedural fairness in
dismissals for operational requirements to which section 189A
applied
if they were brought by way of applications in terms of
subsection (13). While the second part of this statement
correctly
reflects the legal position, the first part does not, in my
respectful view, reflect the correct interpretation of
subsection (18).
This is so because the Labour Court still
has jurisdiction to adjudicate disputes about the procedural fairness
of dismissals
based on the employer’s operational requirements
of employees to whose employer section 189A does not apply and the
first
part of that statement says the opposite.
LAC Regenesys
[184]
The
reference to
LAC
Regenesys
is a reference to the Labour Appeal Court’s judgment in
Regenesys
[73]
which is the present matter. Regenesys’ appeal against
the judgment and order of the Labour Court came before the
Labour Appeal Court. The Labour Appeal Court
upheld Regenesys’ appeal against the decision of the
Labour Court that the dismissal was effected without compliance
with a fair procedure and the order for the payment of various
amounts of compensation.
[185]
The
dispute
between
the employees and Regenesys in this case has two components. The
one component relates to the procedural fairness
of the dismissal.
That is the one referred to in the above excerpt. The
dismissal here was based on the employer’s
operational
requirements. Regenesys employed more than 50 employees.
The other component of the dispute relates
to the substantive
fairness of the dismissal. The two components of the dispute
were consolidated by an order of the Labour Court.
[186]
In a judgment penned by Savage AJA
and concurred in by Davis JA and Coppin JA, the
Labour Appeal Court
said:
“
The
first issue in this appeal is whether the Labour Court had
jurisdiction to determine the procedural fairness together with the
substantive fairness of a dismissal of the respondents”
[74]
[187]
Savage AJA then quoted section
189A(13) and 189A(18) in succession and said:
“
In [
CC
Steenkamp II
], the
Constitutional Court noted that the primary purpose of section
189A(13) is thus to allow for early corrective
action to get the
retrenchment process back on track.
Section
189A regulates dismissals for operational requirements by employers
with more than 50 employees, with it
found
that section 189A(18) expressly deprives the Labour Court of
jurisdiction to determine procedural fairness in such cases.
As
a result,
it was found that the Labour Court erred in
consolidating the application for compensation in respect of
procedural unfairness under section 189A with
the main
action and refer it to trial, on the basis that:
‘
The
jurisdiction of the Labour Court to adjudicate on the procedural
fairness of a dismissal based on the employer’s operational
requirements has been ousted by section 189A(18) of the
LRA. As the Labour Appeal Court correctly stated,
the
Labour Court’s jurisdictional competence ‘cannot be read
disjunctively from section 191(5)(b)(ii) of
the LRA
and section 189A(18) of the LRA.’”
[75]
[188]
The
Labour
Appeal Court
continued at para 17:
“
It
was incompetent for Gush J to issue the order that he did in
that section 189A(18) expressly provides that the Labour
Court
may not adjudicate
a dispute concerned
with the procedural fairness of a dismissal based on the employer’s
operational requirements.
In such circumstances, Prinsloo J
ought properly to have refused to conduct the trial in accordance
with the terms of
that order. The Labour Court erred in
adjudicating the procedural fairness of the respondents’
retrenchment given that
its jurisdiction to do so has been ousted
by
section
189A(18). It follows that the finding that the dismissals of
the respondents were procedurally unfair must consequently
be set
aside.”
[76]
[189]
It
is
not very clear from the
judgment of the Labour Appeal Court in
LAC Regenesys
what
role the consolidation of the substantive fairness matter and the
procedural fairness matter played in determining whether
the Labour
Court had jurisdiction to deal with this matter which was brought
before it in terms of section 189A(13). Of
course, the
consolidation of any matter with another matter cannot affect the
jurisdiction of a court to deal with a particular
matter.
Accordingly, if the Labour Court had jurisdiction in
respect of a matter before its consolidation with another
matter, it
would still have jurisdiction in respect of that matter even after
the matter has been consolidated with the other one.
Consolidation
cannot confer upon a court jurisdiction which the Court otherwise
does not have. Nor can consolidation
take away from a court
jurisdiction that the Court otherwise has.
[190]
The
Labour Appeal Court could not
have intended to say the Labour Court did not have jurisdiction
to adjudicate this matter because
of its consolidation with the
matter relating to the substantive fairness matter. However, I
do not understand why it included
the issue of the consolidation of
the two matters in articulating the first issue for determination
before it. The Labour
Appeal Court articulated the first issue
before it thus:
“
The
first issue in this appeal is whether the Labour Court
had
jurisdiction to determine the procedural fairness together with the
substantive fairness of a dismissal of the respondents.
”
[77]
[191]
It must be noted that the Labour Appeal Court did not say: The
first issue in this appeal is whether the Labour Court had
jurisdiction
to determine the dispute about the procedural fairness
of the dismissal for operational requirements brought to the
Labour Court
in terms of section 189A(13). It said “The
first issue in this appeal is whether the Labour Court had
jurisdiction
to determine the procedural fairness
together with
the substantive fairness of a dismissal of the respondents
.”
This way of formulating the first issue in that appeal suggests
that the Labour Appeal Court may have considered
the consolidation of
the two matters as relevant to the determination of the
Labour Court’s jurisdiction.
[192]
The Labour Appeal Court also said in
Regenesys
:
“
As
a result, it was found that the Labour Court erred
in
consolidating the application for compensation in respect of
procedural unfairness under section 189A with the main action and
refer it to trial, on the basis that
:
‘
The
jurisdiction of the Labour Court to adjudicate on the procedural
fairness of a dismissal based on the employer’s operational
requirements has been ousted by section 189A(18) of the LRA. As
the Labour Appeal Court correctly stated, the Labour Court’s
jurisdictional competence ‘cannot be read disjunctively from
section 191(5)(b)(ii) of the LRA and section 189A(18) of
the
LRA.’”
[78]
[193]
If the Labour Appeal Court was of the view that the Labour
Court was wrong to have consolidated the two matters but it,
otherwise,
accepted that the Labour Court had jurisdiction to
adjudicate the two matters under different sections of the LRA, one
would have
expected that it would have remitted the matter to the
Labour Court to adjudicate it separately from the substantive
fairness matter
or that it would have dealt with the matter itself in
the way in which it believed the Labour Court should have dealt with
it.
The fact that the Labour Appeal Court made the decision it
made suggests that, indeed, the view it took was that the Labour
Court had no jurisdiction to adjudicate a dispute about the
procedural fairness of a dismissal for operational requirements of
employees to whose employer section 189A applied despite the clear
language of section 189A(13).
[194]
It
is
quite
clear that in paragraph 17 in
LAC
Regenesys
, quoted above, the
Labour Appeal Court was saying that in
CC Steenkamp II
this Court held that “section 189A(13)
expressly
deprive[d] the Labour Court of jurisdiction to determine procedural
fairness in such cases
”. The
reference to such cases at the end of the sentence is a reference to
cases brought before the Labour Court
under section 189A(13).
It is difficult to understand how the Labour Appeal Court could
say that section 189A(18)
took away the Labour Court’s
jurisdiction to deal with a matter brought before it in terms of
section 189A(13)
when the latter section is so clear and
it expressly refers to the Labour Court making the orders that are
listed in the subsection.
[195]
One
would
have
expected that the moment the
Labour Appeal Court was thinking of saying section 189A(18)
meant that the Labour Court had
no jurisdiction to adjudicate
disputes about the procedural fairness of dismissals for operational
requirements brought in the
Labour Court in terms of section
189A(13), the question that would have arisen in their minds would
have been: How can the Labour Court
not have jurisdiction to
entertain such matters under section 189A(13) because the subsection
is so clear? Another question
that one expects to have arisen
in their minds is: if employees to whose employer section 189A
applies cannot bring to the Labour Court
their disputes about
the procedural fairness of their dismissals for operational
requirements under section 189A(13), where may
they take those
disputes to because it cannot be that the LRA means that they may not
take them anywhere? If these questions
had arisen in the minds
of the Labour Appeal Court panel, they would have appreciated that
there was something wrong with that
interpretation and would have
analysed this Court’s judgment in
CC
Steenkamp II
on which they relied and,
the relevant statutory provisions, closely.
[196]
The Labour Appeal Court relied on a portion of paragraph 70 of
this Court’s judgment in
CC Steenkamp II
to
support its conclusion that the Labour Court had no jurisdiction to
determine this dispute. It is appropriate to quote
the whole of
paragraph 70. It reads:
“
[70]
The Labour Appeal Court’s criticism is warranted. The
Labour Court misunderstood the jurisdictional
competence
conferred on it by
section
189A(13)
of the LRA. This much is clear if regard is had to the order
granted by the Labour Court. In its order the Labour Court
consolidated the application for compensation in respect of
procedural unfairness under
section
189A
with the main action and referred it to trial. This is wrong.
The jurisdiction of the Labour Court to adjudicate
on the
procedural fairness of a dismissal based on the employer’s
operational requirements has been ousted by
section 189A(18)
of the LRA. As the Labour Appeal Court correctly stated, the
Labour Court’s jurisdictional competence ‘cannot
be read
disjunctively from
section
191(5)(b)(ii)
of the LRA and
section 189A(18)
of the LRA.’”
[79]
[197]
While the statements made by this Court in paragraph 70 in
CC Steenkamp II
may, when read alone, have justified
the Labour Appeal Court’s conclusion that this Court had held
that the Labour Court
had no jurisdiction “to adjudicate on the
procedural fairness of a dismissal based on the employer’s
operational requirements”
because it was ousted by section
189A(18), if the Labour Appeal Court had also looked at the next
paragraph, namely, paragraph
71, it would have realised that this
Court also said that the Labour Court could deal with disputes about
the procedural fairness
of dismissals for operational requirements if
brought as applications in terms of section 189A(13). In
paragraph 71
in
CC Steenkamp II
this Court said in part:
“
[71]
Moreover, the procedure within section 189A(13) of the LRA provides
for an urgent remedy on application whilst
the parties are still
locked in consultations or shortly thereafter in circumstances where
the reinstatement of the dismissed employees
can still salvage the
consultation process by restoring the status quo ante. This
process does not contemplate a trial at
some future time after the
horse has bolted. It cannot be said that the application had
any prospects of success and thus
it could not be said to have been
in the interests of justice to grant condonation.”
[80]
[198]
Although there are statements in
CC
Steenkamp II
which suggest that this
Court may have been saying that the Labour Court had no jurisdiction
to adjudicate a dispute about the
procedural fairness of a dismissal
for operational requirements – whether under section 191 or
189A(13) – a proper
reading of this Court’s
CC
Steenkamp
II
judgment
reveals
that this Court did not hold that the Labour Court had no
jurisdiction to adjudicate under section 189A(13) disputes about
the
procedural fairness of dismissals for operational requirements to
which section 189A applied. In support of this, let
me refer
below to a few areas in this Court’s judgment in
CC
Steenkamp II
.
[199]
In
CC
Steenkamp II
this Court said in
paragraphs 49-50:
“
[49]
Although a clear policy decision has been made to remove claims of
procedural unfairness from the ex
post facto jurisdictional
competence of the Labour Court,
employees
are not left without a remedy. In what the Labour Appeal
Court referred to as a ‘partial claw-back of
jurisdiction’, they may
approach
the
Labour Court in terms of section 189(A)(13) of the LRA for
an order compelling the employer to comply with a fair
procedure. Where employees have already been dismissed,
the Labour Court has the additional power in terms of
section
189A(13)(c)
of
the LRA to reinstate such an employee to allow for the consultation
process to run its course.
[50]
Only
where these orders are not appropriate, may the Labour Court,
where it is appropriate to do so, order compensation in
terms of
subsection (d).
”
[81]
(Emphasis added.)
These two paragraphs also
make it clear that this Court was saying that the Labour Court
had jurisdiction under section 189A(13)
to adjudicate disputes about
the procedural fairness of dismissals based on the employer’s
operational requirements concerning
employees to whose employer
section 189A applied.
[200]
This Court also said in
CC
Steenkamp II
at paragraph 52:
“
[52]
Where
procedural irregularities arise, the process provided for
in
section 189A(13)
of
the LRA allows for the urgent
intervention
of the Labour Court to correct any such irregularities as and when
they arise so that the integrity of the consultation
process can be
restored and the consultation process can be forced back on
track
.”
[82]
(Emphasis added.)
This
Court
pointed out in this paragraph in
CC
Steenkamp II
that, where there are
procedural irregularities, the Labour Court could intervene in terms
of section 189A(13).
[201]
In paragraph 54 in
CC
Steenkamp II
this Court said:
“
[54]
In
exercising its powers in terms of
section
189A(13)
of
the LRA, the Labour Court thus acts ‘as the guardian of
the process’ and exercises a ‘degree
of
judicial’ management or oversight over the process. The
aim is to proactively foster the consultation process
by allowing
parties to seek the intervention of the Labour Court on an expedited
basis to ensure that procedural irregularities
do not undermine or
derail the consultation process before it ends. The
Labour Court in
Anglo
American
expounds:
‘
Section
189A(13)
was
introduced in 2002 and was intended, broadly speaking, to provide for
the adjudication of disputes about procedural fairness
in
retrenchments at an earlier stage in the ordinary dispute-
resolution
process, and by providing for their determination, inevitably as a
matter of urgency, on application rather than by way
of referral.
The
section empowers employees and their representatives to approach the
court to require an employer to apply fair procedure, assuming,
of
course, that the jurisdictional requirements set out in
section
189A
are
met. The section affords the court a broad range of powers,
most of which appear to suggest that where a complaint about
procedure is made by a consulting party, the court has a broad
discretion to make orders and issue directives, thereby extending
to
the
court
an element of what might be termed a degree of judicial management
into a contested consultation process.’”
(Emphasis added.)
It
is
quite clear
from these passages in the judgment of this Court in
CC Steenkamp II
that this Court accepted that the Labour Court had jurisdiction to
adjudicate disputes about the procedural fairness of dismissals
for
operational requirements that have been brought before the Labour
Court in terms of section 189A(13).
[202]
After paragraph 57 of this Court’s
judgment in
CC Steenkamp II
there is a heading that reads: “Is section 189A(13)(d) a
self-standing remedy?” It is written in bold. Seeing
that heading alone should have alerted the Labour Appeal Court that
this Court could not have been saying that the Labour Court
had no
jurisdiction to adjudicate disputes about the procedural fairness of
dismissals for operational requirements brought in
the Labour Court
under section 189A(13). The discussion in the second half of
that page consisting of paragraphs 58 –
66 could only mean that
this Court was saying that the Labour Court had jurisdiction to
adjudicate disputes about the procedural
fairness of dismissals for
operational requirements brought in terms of section 189A(13).
[203]
Lastly, this Court also said in part
in
CC Steenkamp II
at paragraph 71:
“
[
71]
Moreover, the procedure within
section
189A(13)
of
the LRA provides
for
an urgent remedy on application whilst the parties are still locked
in consultations or shortly thereafter in circumstances
where the
reinstatement
of the dismissed employees can still salvage the consultation process
by restoring the status quo ante.” (Emphasis
added.)
[204]
Given these passages which clearly
show that this Court accepted that the Labour Court had
jurisdiction to adjudicate disputes
about the procedural fairness of
dismissals for operational requirements brought in the Labour Court
in terms of section 189A(13),
one can only conclude that the
Labour Appeal Court did not properly apply its mind to this Court’s
judgment in
CC Steenkamp II
.
It is also unfortunate that there is no indication in the
Labour Appeal Court judgment that the Labour Appeal Court
undertook any analysis of this Court’s judgment in
CC Steenkamp II
.
The Labour Appeal Court erred in a serious way in
attributing to this Court’s judgment in
CC Steenkamp II
the holding that it did. The Labour Appeal Court
should have rejected Regenesys’ contention and held that
the
Labour Court was correct in adjudicating the procedural fairness
dispute under section 189A(13).
[205]
I believe
that
the statements I have quoted above do show that,
indeed, there are judgments in which the Labour Court, Labour Appeal
Court and
this Court made statements about the jurisdiction of the
Labour Court and section 189A(18) which were inaccurate and created
the
impression either that the Labour Court had no jurisdiction
whatsoever to adjudicate disputes about the procedural fairness of
dismissals for operational requirements or that the Labour Court had
no jurisdiction to adjudicate such disputes in terms of section
191
or section 189A(13) or both. I have also shown that in relying
on this Court’s judgment in
CC
Steenkamp II
to hold that the
Labour Court had no jurisdiction to adjudicate disputes about
the procedural fairness of dismissals in the
present case, the Labour
Appeal Court had overlooked a number of passages which made it clear
that this Court accepted that the
Labour Court had jurisdiction to
adjudicate disputes about procedural fairness contemplated in section
189A(13) under that provision.
[206]
The interpretation of subsection
(18) to the effect that the latter provision has ousted the
jurisdiction of the Labour Court to
adjudicate disputes about the
procedural fairness in dismissals for operational requirements
brought before it in terms of section 191(5)(b)(ii)
or in terms
of subsection (13) or both is inconsistent with the right of access
to courts in terms of section 34 of the Constitution
and section 38
of the Constitution.
[207]
Section 34 of the Constitution
reads:
“
Everyone
has the right to have any dispute that can be resolved by the
application of law decided in a fair public hearing before
a court
or, where appropriate, another independent and impartial tribunal or
forum.”
Section 38 of the
Constitution reads:
“
Anyone
listed in this section has the right to approach a competent court,
alleging that a right in the Bill of Rights has been
infringed or
threatened, and the court may grant appropriate relief, including a
declaration of rights. The persons who may
approach a court
are—
(a)
anyone acting in their own interest;
(b)
anyone acting on behalf of another person who cannot act in their
own
name;
(c)
anyone acting as a member of, or in the interest of, a group or class
of persons;
(d)
anyone acting in the public interest; and
(e)
an association acting in the interest of its members.”
[208]
The reason why the interpretation of
subsection (18) that the Labour Court has no jurisdiction to
adjudicate disputes about procedural
fairness of dismissals for
operational requirements either in general or those referred to it in
terms of section 191 (5)(b)(ii)
is that it means that
workers/trade unions and employers which have such disputes –
which are clearly disputes that can be
resolved by the application of
law – have nowhere to take such disputes. That
interpretation means that workers have
a right to procedural fairness
but they have nowhere to go in order to enforce that right.
Such an interpretation should
be avoided if there is another
interpretation which can be adopted without doing violence to the
language of the statute.
In terms of the interpretation
advanced in this judgment no worker who has a right to procedural
fairness has nowhere to go to
enforce or protect that right.
[209]
In my view, although in both
CC
Steenkamp II
and
CC
Barloworld
this Court discussed what
subsection (18) means, the statements it made on the meaning of
subsection (18) were not necessary
for its decision in both
cases. Therefore, what this Court said about the meaning of
subsection (18) was not part of the
ratio of its decision in each
case.
CC Steenkamp II
was an appeal to this Court against the judgment of the
Labour Appeal Court in
LAC
Steenkamp II
.
In its judgment in
LAC
Steenkamp II
the Labour Appeal Court said:
“
[2]
The principal controversy in the appeal is whether the granting of
condonation to the respondents
to bring an application in terms of
section 189A(13) of the [LRA] after the expiry of the prescribed
30 day period was
an incorrect exercise of judicial
discretion. Upon the fate of that issue, hangs the propriety of
consolidating the several
other cases.”
[83]
It
is clear from this excerpt that the case before the
Labour Appeal Court in
LAC Steenkamp II
had little, if anything, to do with subsection (18).
[210]
Later on, the Labour Appeal Court
said in
LAC Steenkamp II
:
“
[15]
In our view the application by the respondents is fatally flawed and
the judgment
a
quo
in
error. Upon these grounds the appeal has to succeed. The
principal reason for this outcome is the misconception
about the
purpose and functioning of section 189A(13).”
[84]
From
this it is clear that the principal or main reason for the
Labour Appeal Court’s decision which was on appeal
before this Court in
CC Steenkamp II
was based on the purpose
and functioning of section 189A(13) and not the purpose, meaning and
functioning of section 189A(18).
[211]
The Labour Appeal Court did not anywhere
decide or say that the Labour Court had no jurisdiction to
adjudicate disputes about
the procedural fairness of dismissals for
operational requirements brought to it by way of applications in
terms of section 189A(13).
The case before it was an
appeal on a decision on condonation in regard to the failure by the
employees to lodge their section
189A(13) application timeously.
The Labour Appeal Court’s conclusions at the end of
its judgment in
LAC Steenkamp II
do not include a conclusion on subsection (18). Its conclusions
are recorded as follows:
“
Conclusions
[46]
Accordingly, our findings can be summarised thus:
On
the law:
46.1.
Section 189A(13) is a procedure to be utilised expeditiously, to
address an ongoing retrenchment process
and is not available long
after.
46.2.
Section 189A(13)(d) is not a self-standing remedy that can be
disaggregated from (a), (b) and (c), because
it is subordinate and
ancillary to those provisions.
46.3.
The explanation that a failed legal choice of strategy is the reason
why a delay occurred to exercise a
legal option is not an acceptable
explanation.”
[85]
After
this, the Labour Appeal Court said: “The respondent made out no
sound case for condonation.”
[86]
[212]
In
CC
Steenkamp II
this Court
described the issues it was called upon to adjudicate in these terms:
“
[21]
The pertinent issues before this Court are: first, whether the
Labour Appeal Court was correct
in overturning the decision
of the Labour Court granting condonation to the applicants, in
circumstances where they launched
their procedurally unfair dismissal
claim years outside of the 30-day statutorily prescribed time period
and where the cause of
action initially relied upon was found to be
inappropriate by this Court in
Steenkamp I
, and second,
whether compensation for procedural unfairness can be claimed as a
self-standing remedy in the context of large-scale
retrenchments in
terms of section 189A(13)(d) of the LRA.”
It
is clear from this passage that the meaning of subsection (18)
was not one of the issues that this Court was called upon
to decide.
Therefore, its pronouncement on the meaning of subsection (18)
was
obiter dictum
and is, therefore, not binding.
[213]
In
CC
Barloworld
this Court made statements
both to the effect that the Labour Court had no jurisdiction to
adjudicate disputes about the procedural
fairness of dismissals for
operational requirements and that the Labour Court had no
jurisdiction to adjudicate disputes about
the procedural fairness of
dismissals for operational requirements referred to it in terms of
section 191(5)(b)(ii). I show
this below.
[214]
It must be remembered that in
CC
Barloworld
the employees had lodged
their subsection (13) application about a month after the
employer had issued notices of dismissals.
Accordingly, the
applications were lodged within the prescribed 30 days from the
date when the notices of dismissals were
issued. This Court
said that the matter concerned “the interpretation of the LRA
and the crisp question before the
Court relates to the interpretation
of sections 189 and 189A.” After referring to, and
quoting extensively from,
CC
Steenkamp
II
,
this
Court said in
CC
Barloworld
:
“
[65]
It is thus clear that the Labour Court may not adjudicate a dispute
about the procedural fairness of a dismissal
based on the employer's
operational requirements
in
any dispute referred to it in terms of section 191(5)(b)(ii)
”.
[87]
(Emphasis added.)
This is in accordance
with the text of subsection (18).
[215]
After having regard to various
statements in
CC
Steenkamp
II
, this Court said in
CC Barloworld
:
“
[71]
The following emanates from the above discussion.
Firstly,
the power of the Labour Court to adjudicate the procedural fairness
of retrenchment consultations is limited to the ‘fair
procedure’ that is prescribed in sections 189 and 189A, which
give effect to section 188. Secondly, it is evident
that a
party seeking the Labour Court’s intervention when an
employer fails to follow a fair procedure during retrenchment
consultations must approach the court for relief in terms of section
189A(13). This is because the Labour Court is barred
from
determining the procedural fairness of a dismissal based on
operational requirements when it is approached in terms of
section 191(5)(b)(ii).
Thirdly, it is evident that these provisions are in place to
serve the interests of expediency and efficiency, and to ensure
that
the procedure requirements of the LRA are followed when parties
engage in consultation in anticipation of a large-scale retrenchment,
and that any defects in the procedures can be cured before jobs are
lost. This policy choice was adopted to avoid the courts
having
to adjudicate alleged procedural unfairness in the aftermath of mass
retrenchments. It was self-evidently a sensible
legislative
decision, for it reduces the likelihood of parties being exposed to
the inconveniences and complications that could
arise from a court
ordering them to unscramble the proverbial scrambled egg. Of
course section 189A(13) does envisage, and
apply to a situation where
it dismissal has already taken place. Paragraph (c) of this
section empowers the court to direct
‘the employer to reinstate
an employee until it has complied with a fair procedure’.
Because the section 189A(13)
process is meant to take place
immediately and to be finalised expeditiously, the paragraph (c)
power does not detract from
the metaphor of the
scrambled
egg,
because the scrambling will not be complete.”
[88]
[216]
It
will be realised that one of this Court’s conclusions after
referring to, and, quoting from,
CC
Steenkamp
II
was
that “
a
party seeking the Labour Court’s intervention when an
employer fails to follow a fair procedure during retrenchment
consultations must approach the Court for relief in terms of section
189A(13)
.”
[89]
To the extent that in this statement this Court meant employees
to whose employer section 189A applies, that statement
is
correct. However, if it was meant to suggest that even
employees whose employer is not subject to section 189A could use
section 189A(13) for relief in regard to a dispute about the
procedural fairness of a dismissal for operational requirements,
I
would respectfully disagree. The following statement in
CC
Barloworld
suggests that this Court was saying that the Labour Court’s
jurisdiction to adjudicate disputes about the procedural
fairness of
dismissals for operational requirements had been ousted. That
statement
reads:
“
[47]
A distinctive feature of section 189A(13) of the LRA is the
separation of disputes about procedural fairness
from disputes about
substantive fairness. Disputes about substantive fairness may
be dealt with by resorting to strike action
or by referring a dispute
about the substantive fairness of the dismissals to the Labour Court
in terms of section 191(11)
of the LRA.
[48]
Disputes about procedural fairness have been removed from the
adjudicative reach of the Labour
Court and may no longer be referred
to the Labour Court as a distinctive claim or cause of action that a
dismissal on the basis
of operational requirements was procedurally
unfair.”
[90]
[217]
The procedure and remedies provided
for in subsection (13) only apply to employees whose employer is
subject to section 189A, namely
employers who employ more than 50
employees. Employees employed or formerly employed by an
employer who employed less than
50 employees cannot utilise section
189A(13). Those may use section 191 of the LRA to get
their disputes about the procedural
fairness of a dismissal for
operational requirements resolved. Lastly, in
CC
Barloworld
this
Court decided the appeal on the merits of whether or not the
consultation that had been undertaken constituted a
joint-consensus-seeking
process. It concluded that that
consultation was such a process. In that way this Court decided
that section 189A(13)
application on its merits.
[218]
I conclude that that the Labour
Appeal Court erred when it decided in the present case that the
Labour Court had no jurisdiction
to adjudicate disputes about the
procedural fairness in dismissals for operational requirements. The
position is that the
only jurisdiction of the Labour Court that
subsection (18) has ousted is its jurisdiction to adjudicate under
section 191 disputes
about the procedural fairness of dismissals for
operational requirements of employees to whose employer section 189A
applies. Otherwise,
the Labour Court still has jurisdiction to
adjudicate disputes about the procedural fairness of the dismissals
for operational
requirements to which section 189A does not
apply.
[219]
Contrary to certain statements that
appear in judgments of the Labour Court in
Parkinson
,
Clinix
,
those of the Labour Appeal Court in
LAC Steenkamp II
and
LAC Regenesys
and those of this Court in
CC Steenkamp II
and
CC Barloworld
,
the effect of this judgment in regard to section 189A(13) is as set
out in paragraph 140 above. Contrary to certain
statements
by the Labour Appeal Court in
LAC Steenkamp II
,
the judgment of the Labour Appeal Court in
LAC Regenesys
and certain statements by this Court in
CC Steenkamp II
and
CC Barloworld
,
the effect of this judgment in regard to section 189A(18) is that:
(a)
section 189A(18) does not take away the
jurisdiction of the Labour Court to:
(i)
adjudicate under section 191 a dispute
about the procedural fairness of a dismissal for the employer’s
operational requirements
of employees to whose employer section 189A
does not apply.
(ii)
adjudicate under section 189A(13) disputes
about the procedural fairness of dismissals for operational
requirements of employees
to whose employer section 189A
applies.
(b)
section 189A(18) takes away the
jurisdiction of the Labour Court to adjudicate under section
191(5)(b)(ii) a dispute about the procedural
fairness of a dismissal
for operational requirements of employees to whose employer section
189A applies.
(c)
there is nothing wrong with the
consolidation of a dispute about procedural fairness brought in the
Labour Court in terms of
section 189A(13) with a dispute
about the substantive fairness of a dismissal for operational
requirements referred to the
Labour Court for adjudication in
terms of section 191(5)(b)(ii) where an order under
section 189A(13)(a) to (c) is not
appropriate and the remedy
being pursued by the employees at the time is compensation in terms
of section 189A(13)(d). Indeed,
in such a case a
consolidation of the two matters makes sense.
Was the Labour Court
right in awarding compensation in terms of section 189A(13)(d)?
[220]
Unlike some of the cases referred to
earlier in this judgment which were brought to the Labour Court in
terms of subsection (13)
which were lodged in the Labour Court a
year or two after the dismissal, the employees’ application in
terms of subsection (13)
in the present case was lodged about
five weeks after the effective date of the employees’
dismissal. They applied
for condonation for their failure to
lodge it within the prescribed 30 days from the date the notices of
dismissal were issued.
The Labour Court granted
condonation. The effect of that decision of the Labour Court
condoning their failure
to comply is that their application must be
treated in the same way the Court would have treated an application
that was lodged
within the prescribed period. Nobody can
legitimately suggest that the consultation process could not have
been put back
on track as at 8 September to 15 September 2015 if the
Labour Court had adjudicated the application as an urgent
application.
[221]
In their notice of motion, the
employees asked that their application be dealt with on an urgent
basis. They also asked that
a Judge be assigned to their
application in terms of the Labour Court Practice Manual so as to
ensure that their application was
dealt with expeditiously. It
would appear that Gush J may have been assigned to “case
manage” the application.
At some stage during the first
two weeks of October 2015 – that is about a
month or just over a month after
the application had been
lodged – Gush J made an order consolidating the
employees’ section 189A(13)
application and the dismissal
dispute referred to the Labour Court for adjudication in terms of
section 191(5) of the LRA
so that the two matters would be
adjudicated together. The dismissal dispute that was referred
to the Labour Court in terms
of section 191(5) included the
procedural fairness of the dismissal.
[222]
In their section 189A(13)
application the employees asked for the orders contemplated in
paragraphs (a) to (c) alternatively an
award of compensation in terms
of section 189A(13)(d). There is a good chance that Gush
J, being a Judge of the Labour Court,
took the view, rightly or
wrongly, that as at October 2015, the orders contemplated in
paragraphs (a) to (c) of subsection (13)
were no longer appropriate
and that the only order that could be appropriate at that stage was
an order of compensation contemplated
in paragraph (d) of subsection
(13). In such a case he may have realised that there was no
urgency about an order for the
payment of compensation and that, in
all of the circumstances, it made sense that the two matters be
decided by the same Judge,
hence the consolidation.
[223]
Those two matters were the dispute
about the procedural fairness of the dismissal of the employees for
operational requirements
brought to the Labour Court by way of a
subsection (13) application and the dispute about the
substantive fairness of the
dismissal of the same employees for
operational requirements. That would explain why Gush J
consolidated the two matters
and ordered that they be adjudicated
together. Once it would no longer be appropriate for the
Labour Court to grant
any of the orders contemplated in
paragraphs (a) to (c), it became appropriate for compensation to be
awarded if it was established
that Regenesys had failed to comply
with a fair procedure in dismissing the employees.
[224]
Although it may still have been
appropriate for the Labour Court to grant an order contemplated in
paragraph (c) of subsection (13)
when Gush J consolidated the two
matters in October 2015, it certainly would no longer have been
appropriate for the Labour Court
to grant the orders
contemplated in paragraphs (a) to (c) when the Labour Court
eventually adjudicated the two matters in
February 2020, because that
was more than four-and-a-half years after the dismissals.
Therefore, the Labour Court was
obliged to adjudicate both
disputes when it did.
[225]
Section 189A(14) reads:
“
Subject
to this section, the Labour Court may make any appropriate order
referred to in section 158(1)(a).”
Section 158(1)(a) of the
LRA reads:
“
158.
Powers of Labour Court
(1)
The Labour Court may—
(a)
make any appropriate order, including—
(i)
the grant of urgent interim relief;
(ii)
an interdict;
(iii)
an order directing the performance of any particular act which order,
when implemented,
will remedy a wrong and give effect to the primary
objects of this Act;
(iv)
a declaratory order;
(v)
an award of compensation in any circumstance contemplated in this
Act;
(vi)
an award of damages in any circumstances contemplated in this Act;
and
(vii)
an order for costs;”
[226]
When Prinsloo J adjudicated the
dispute about the procedural fairness of the dismissal in the Labour
Court in this matter, she was
alive to the fact that that dispute had
been
brought in the Labour Court by way of
an application in terms of section 189A(13) and it was not a
dispute about the procedural
fairness of dismissals referred to the
Labour Court in terms of section 191(5)(b)(ii) for adjudication.
It will be recalled
that I said earlier that the dismissal dispute
that was consolidated with the section 189A(13) application
concerned both
the procedural and substantive fairness of the
dismissal of the employees. In paragraph 138 of her judgment
Prinsloo J said
that “it is undisputed that [Regenesys] did not
comply with the consultation period or the process provided for in
section
189A of the LRA”. Just above paragraph 153, she
put this heading: “Was there compliance with section 189A”.
[227]
The
Labour
Court dealt with the procedural fairness of the dismissal from
paragraph 133 to paragraph 155. In paragraph 133
Prinsloo
J said that the employees “challenged the procedural fairness
of their dismissal in the section 189A(13) application
of the
LRA filed in this Court in September 2015.” She mentioned
four grounds advanced by the employees in support
of their challenge
to the procedural fairness of their dismissal. She recorded the
first one as being:
“
[Regenesys’]
retrenchment exercise fell squarely within the ambit of section 189
of the LRA, yet [Regenesys] has not
complied with the provisions of
the said section and terminated the [employees’] services
within a few days after they were
issued with a notice in terms of
section 189(3) of the LRA, in total disregard for the period
prescribed by section 189A.”
[91]
She recorded that the
employees contended that they were dismissed within a few days after
they had been issued with section 189(3)
notices and there was no
justification for the consultation process to be concluded so
quickly.
[228]
Another ground was that there was no
meaningful joint consensus seeking process. Another one was
that there was no proper
attempt to avoid the retrenchment. The
last one was that the employees were given only one opportunity to
make representations
on very short notice.
[229]
In
paragraph 134 Prinsloo J referred to the relationship between
sections 189 and 189A. She quoted a passage in paragraph
34 of the Labour Appeal Court’s judgment in
Gijima
.
[92]
The passage reads:
“
[134]
The relationship between sections 189 and 189A of the LRA is
symbiotic and this was confirmed by the Labour Appeal Court
in
[
Gijima
]
where it was held that:
‘
The
two sections must be read together since they both apply to
dismissals for operational requirements. Further, the overall
obligation imposed by the two sections is for consultation on the
matters referred to in section 189. It is also significant
to
note that the section 189A process is initiated by the very same
section 189(3) notification issued for retrenchments.
The items
that form the subject of consultation are only listed in section
189(2) which includes the method for selecting employees
to be
dismissed. Such a provision is not found in section 189A.’”
[93]
[230]
Prinsloo J said in paragraphs 149 to
152 of her judgment:
“
[149]
It is evident from the section 189(3) letter issued on 18 June 2015
that the reason for the contemplated retrenchment
was stated as
‘because the company is implementing a new business model and
the organisational structure to improve operational
efficiencies and
effectiveness.’ Accordingly, the Respondent’s
affected employees were invited to make proposals
and recommendations
‘regarding the proposed restructuring process and the proposed
organisational structure’.
No mention was made of the
financial crisis the Respondent experienced and the employees were
not invited to make any submissions
on that.
[150]
The Applicants were only invited to comment on the proposed structure
and there was no consultation on any
of the issues prescribed by
section 189 of the LRA. In fact, Ms Brownlee conceded in her
evidence that there was no consultation
with the Applicants on
measures to avoid dismissal, on minimising the dismissals, on the
timing thereof or to mitigate the adverse
effect of the dismissal,
severance pay or selection criteria. These are not only topics
of crucial importance to consult
on, but are prescribed by the LRA
and which were ignored by the Respondent.
[151]
Not only were the Applicants deprived of an opportunity to consult,
they were also not provided with information
relating to the real
reason behind the retrenchment. Up to the moment the
section 189(3) notice was issued, the Respondent
presented a
sugar coated version and never communicated and engaged with its
employees on the real reason behind the restructuring
and the
retrenchments. For that the Respondent was far too concerned
about its own image, its own interests and its own livelihood.
[152]
The Applicants were not consulted on the issues prescribed by the LRA
and the Respondent made no serious
effort to engage them in a joint
consensus-seeking process.”
[94]
[231]
In paragraph 153 Prinsloo J said:
“
[153]
It was conceded by Dr Law that the process and time frames prescribed
by section 189A had not been complied with.
The rushed process
followed by [Regenesys] underlines [Regenesys’] failure in this
regard.”
[95]
[232]
The
Labour
Court concluded that the dismissal of the employees for operational
requirements “was procedurally unfair.”
[96]
The Labour Court made this conclusion under a heading that read: “Was
there compliance with section 189A?” This,
once again,
shows that Prinsloo J was alive to the fact that she was adjudicating
a dispute about the procedural fairness brought
to the Labour Court
in terms of subsection (13) and not one referred to the Labour
Court in terms of section 191(5)(b)(ii).
[233]
In the light of the above, there can
be no doubt that the Labour Court adjudicated the procedural fairness
of the dismissal that
was brought in the Labour Court by a way of an
application in terms of section 189A(13). It did not adjudicate
the procedural
fairness of a dismissal dispute referred to it in
terms of section 191(5)(b)(ii) as contemplated in section 189A(18).
This
means that, as is stated elsewhere in this judgment, in the
present matter the Labour Appeal Court’s decision was to the
effect that the Labour Court did not have jurisdiction to adjudicate
disputes about the procedural fairness of dismissals for operational
requirements irrespective of whether such disputes were brought
before it by way of section 189(13) or section 191(5)(b)(ii).
[234]
There can be no basis for suggesting
that the Labour Appeal Court thought that in this case the Labour
Court had adjudicated under
section 191 a dispute about procedural
fairness of the dismissals of employees to which section 189A
applied. I say this
because, as I have indicated above,
Prinsloo J’s judgment made it crystal clear in a number of
areas that the Labour Court
was adjudicating a section 189A(13)
matter. There is no way that the Labour Appeal Court could not have
appreciated this. In
fact, the Labour Appeal Court
had thought that the Labour Court had adjudicated the matter under
section 191 when it
should have adjudicated it under section 189A(13)
it (i.e. the Labour Appeal Court) would have said that the
Labour Court
had no jurisdiction to adjudicate the dispute under
section 191 because it was a section 189A(13) matter. The
Labour Appeal Court
did not make that distinction. In fact
none of the judgments in which the Labour Appeal Court dealt with
matters that had been
brought to the Labour Court under section
189A(13) did it make such a distinction. This includes its
judgment in
LAC
Steenkamp II
.
The reason why it did not make that distinction is that its
view was that the Labour Court’s jurisdiction to adjudicate
disputes about the procedural fairness of dismissals for operational
requirements – whether under section 191 or 189A(13)
–
had been ousted. The Labour Appeal Court believed, wrongly in
my view, that that was the effect of this Court’s
judgment in
CC Steenkamp II
.
This is not a conclusion that one can reach lightly but it is
the only explanation of the Labour Appeal Court’s
decision in the present case.
[235]
If the reason
why
the Labour
Appeal Court made the decision that it made was that it was of the
view that the Labour Court had adjudicated under
section 191 a
dispute that it should have adjudicated under section 189A(13), it
would have done one of two things. Since
all the evidence was
in the record before it, it could have proceeded to adjudicate the
employees’ section 189A(13) claim
on the merits. It did
not follow this route. Another route would have been for the
Labour Appeal Court to remit the
matter to the Labour Court and
direct that the Labour Court should adjudicate it under
section 189A(13). It did not
follow this route either.
The Labour Appeal Court simply held that the Labour Court had
no jurisdiction to adjudicate the
dispute about the procedural
fairness of the dismissal for operational requirements and did not
qualify this statement in any way
by reference to either section 191
or 189A(13).
[236]
This position taken by the Labour Appeal Court is consistent
only with the view that the Labour Court’s jurisdiction to
adjudicate
disputes about the procedural fairness of dismissals for
operational requirements – whether under section 191 or
189A(13) – had
been ousted. I accept that it is
difficult to understand how the Labour Appeal Court could
reach the decision that
the Labour Court had no jurisdiction even to
adjudicate disputes about the procedural fairness of dismissals for
operational requirements
of employees to which section 189A applied
which were brought to the Labour Court in terms of section
189A(13) when the statute
is as clear as it is in that provision.
However, I come back to the question: if the Labour Appeal
Court believed that the
Labour Court did have jurisdiction to
adjudicate disputes about the procedural fairness of dismissals for
operational requirements
under section 189A(13) if section 189A
applied to the employees concerned, why did it not adjudicate the
matter on the merits
or remit it to the Labour Court to
adjudicate it under section 189A(13)?
[237]
The effects of that decision of the
Labour Appeal Court were far-reaching. The decision meant that
potentially
millions of workers in this
country who have disputes with their employers about the procedural
fairness of their dismissal for
operational requirements, can no
longer bring those disputes to the Labour Court or any independent
tribunal or forum as contemplated
in section 34 of the Constitution
for adjudication. Those are the disputes about the procedural
fairness of dismissals for
operational requirements irrespective of
whether such disputes have been brought by way of applications as
contemplated by subsection
(13) or by way of a referral to the
Labour Court in terms of section 191(5).
[238]
The Labour Appeal
Court
erred
in concluding that the Labour Court had no jurisdiction to adjudicate
disputes about procedural fairness of dismissals for
operational
requirements that it adjudicated. Its decision in this regard
falls to be set aside. It is not correct,
as the Labour Appeal
Court said, that the Labour Court had misunderstood the legal
position. The Labour Court had correctly
understood the legal
position in taking the approach that it had jurisdiction to
adjudicate the procedural fairness of the employees’
dismissal
for operational requirements which had been brought before it by way
of an application in terms of subsection (13).
Other
misdirections in the Labour Appeal Court’s order
[239]
The order that was made by the Labour Appeal Court setting
aside the whole order of the Labour Court including orders that it
had
not concluded were wrongly granted by the Labour Court is
strange. The only orders that the Labour Appeal Court
was entitled to set aside were the Labour Court’s declaration
that the dismissals of the employees were procedurally unfair
and the
order for the payment of compensation to those employees whose
dismissals had been found to be procedurally unfair only.
When
I say “entitled”, this is on the assumption that the
Labour Appeal Court was correct in its conclusion
that the
Labour Court had no jurisdiction to adjudicate the procedural
fairness of the dismissals of the employees.
[240]
Furthermore, the Labour Appeal Court set aside the order of
costs made by the Labour Court against Regenesys and replaced it
with an order that “there is no order as to costs” even
though there is no indication in its judgment that Regenesys
had
appealed against the Labour Court’s court order. Indeed,
for all intents and purposes the position must be that
Regenesys did
not seek to pursue any appeal against the costs order because, if it
had, the Labour Appeal Court would have covered
its contentions on
costs in its judgment. The Labour Appeal Court erred in this
regard. A court of appeal cannot just
set aside an order of a
lower court if it has not been appealed against and such appeal has
been upheld. Furthermore, a costs
order is an order that a
court grants in the exercise of a
true
discretion and such orders can only be interfered with on
appeal on certain limited grounds such as where there is a
misdirection.
In the absence of one or more of those limited
grounds, such an order must stand. There is no discussion in
the judgment
of the Labour Appeal Court as to why that order was set
aside nor did the Labour Appeal Court give any reasons for
setting
that order aside and replacing it with a different order.
Costs
[241]
In my view, this is an appropriate case in which the Court
should order Regenesys to pay the employees’ costs. The
reasons
are the same as those given earlier in this judgment in
regard to the dismissal of the appeal.
Order
[242]
In the result the following order is made:
1.
Leave to appeal and to cross-appeal is granted.
2.
The appeal is dismissed with costs including the costs of two
Counsel
where two Counsel were employed.
3.
The cross-appeal is upheld with costs including the costs consequent
upon the employment of two Counsel where two Counsel were employed.
4.
Save in respect of the sixth and ninth respondents in the
Labour Appeal Court
(Ms Wendy Mary Malleson and
Ms Ariadne David):
(a)
the decision of the Labour Appeal Court that the Labour Court
had
no jurisdiction to adjudicate disputes about the procedural
fairness of dismissals for operational requirements is set aside.
(b)
the order of the Labour Appeal Court on costs in that Court is hereby
set aside
and replaced with the following:
“
The
appellant is to pay the costs of the appeal including the costs of
two Counsel where two Counsel were employed.”
(c)
the order of the Labour Appeal Court setting aside the order of the
Labour
Court on costs is hereby set aside.
(d)
the order of the Labour Court is reinstated.
ROGERS J:
Introduction
[243]
I have had the pleasure of reading the Chief Justice’s
judgment (first judgment). I agree with the first judgment’s
proposed disposition of the case. I write separately because
there are aspects of the first judgment with which I do not
agree.
I accept that our jurisdiction is engaged and that leave to appeal
and cross-appeal should be granted. There
is nothing I wish to
add to the first judgment’s reasons for rejecting Regenesys’
appeal on the substantive unfairness
of the retrenchments of
Ms Ilunga, Dr Dos Santos, Ms Nkodi and
Ms Mahlangu.
[244]
The cross-appeal raises the question whether the Labour Court
was right to award compensation to Ms Nortjé, Ms Mann and Ms
Chalklen in terms of section 189A(13)(d) because their
retrenchments were procedurally unfair. Although in principle
the same issue arises in relation to the four persons mentioned in
the preceding paragraph, it is academic in their case because
of the
finding that their retrenchments were substantively unfair.
Compensation
under section 189A(13)(d) as stand-alone relief
[245]
Paragraphs 72 to 97 of the first judgment deal with the
question whether compensation in terms of section 189A(13)(d) may be
claimed
as stand-alone relief. That question does not strictly
arise in this case. The retrenched employees sought
reinstatement
in terms of subsection (13)(c), with compensation in
terms of subsection (13)(d) as an alternative. Although
the subsection
(13) application was brought slightly late, it was
launched at a time when – as the first judgment rightly
holds – reinstatement
in order to get consultation
back on track was feasible. The Labour Court condoned the
delay in launching the subsection
(13) application, but evidently
considered that reinstatement in terms of subsection (13)(c) was no
longer appropriate.
[246]
In
those circumstances there was no urgency in adjudicating the
alternative claim for compensation in terms of subsection (13)(d).
The Labour Court could thus competently adjudicate the claim on a
more leisurely basis, simultaneously with the claim based on
substantive unfairness. The case is on all fours with
SA
Five Engineering
.
[97]
I agree with the first judgment that
SA
Five Engineering
was correctly decided.
[247]
We thus do not have to decide whether the retrenched employees
could have brought a claim for compensation under subsection (13)(d)
as their primary relief. Nevertheless, and although what we say
on that question may be an
obiter dictum
(a non binding
observation made in passing), I agree with the first judgment that
there may be circumstances in which a claim
for compensation alone
under subsection (13)(d) will be permissible. If the
circumstances are such that an order in
terms of subsection (13)(a),
(b) or (c) is very unlikely to be granted, the affected employees
should not be forced to seek such
an order as their primary relief,
just so as to be able to make a subsection (13)(d) claim for
compensation in the alternative.
[248]
However,
it is important that the existence of this possibility should not be
misunderstood. As the first judgment states,
the lawmaker’s
preferred remedy is to ensure procedural fairness through proper
consultation.
[98]
Relief in terms of subsection (13)(a), (b) or (c) is thus the
lawmaker’s preferred outcome. Although compensation
in
terms of subsection (13)(d) exists as a fallback possibility, it
cannot be divorced from subsection (13) as a whole read with
subsections (17) and (18).
[249]
If, in the case of large employers to whom section 189A
applies, the lawmaker had intended there to be what I may call an
ordinary
claim for compensation for procedurally unfair retrenchment,
the lawmaker would not have needed to include compensation as part
of
subsection (13) or to have made a claim for compensation under
subsection (13) subject to the 30-day time-limit set in
subsection (17) or to have enacted the exclusion in subsection (18).
Claims for compensation for procedurally unfair retrenchments
could
have been left to the ordinary unfair-dismissal machinery of the Act.
[250]
What this shows is that employees to whom section 189A applies
are expected to move promptly with a view to achieving the primary
object of subsection (13). If they fail to do so, and then
bring a leisurely claim for compensation under subsection (13)(d)
on the basis that such a claim, unlike the relief in
subsections (13)(a), (b) and (c), is not inherently urgent, a
request
for condonation for non-compliance with the 30 day
time-limit is unlikely to be granted. Affected employees must
strive
to achieve the primary object of subsection (13).
Similarly, if employees bring a prompt application but seek only
compensation
under subsection (13)(d), the Labour Court may
interrogate why the preferred relief under subsection (13) is not
being claimed.
It must be borne in mind that compensation for a
large number of employees – the typical scenario in which
section 189A applies
– may be ruinous for the employer.
[251]
Nevertheless, there may be circumstances where even vigilant
employees could not plausibly be expected to claim relief under
subsection
(13)(a), (b) or (c). I prefer not to speculate about
what those circumstances might be, since we do not have a concrete
case
before us. In principle, however, I accept that in such
cases the employees may claim compensation as stand-alone relief,
subject to satisfying the Labour Court that the primary relief
contemplated in subsection (13) is not appropriate. Even
if the
employees have claimed compensation only in the alternative, the
granting of compensation instead of the primary relief
may be
justified, including by changed circumstances as a result of a delay
in adjudicating a timeous or near timeous application.
[252]
The
failure of the retrenched employees’ applications in
Parkinson
[99]
and
Clinix
[100]
was almost certainly justified. The applications were brought
between seven and nine months late, at a time when achieving
the
primary object of subsection (13) had long since passed.
The Labour Court in both cases refused condonation.
In doing
so, the Labour Court could properly have taken into account the
special features of section 189A that I have
mentioned.
These special features are superimposed on the more conventional
aspects of an explanation for failure to meet
a time-limit.
[253]
In
Steenkamp
II
[101]
the application for compensation in terms of subsection (13) was
two years late. The decision of the Labour Appeal Court,
confirmed in this Court, that the delay could not be condoned was
undoubtedly right. It is true that the Labour Appeal Court
and
this Court made statements to the effect that compensation could not
be claimed as stand-alone relief. I think those
judgments can
be read, however, as meaning no more than that compensation in terms
of subsection (13) is not the primary relief
contemplated by the
lawmaker and that this has to loom large in any application for
condonation.
[254]
As
this Court said in
Steenkamp
II
, the
remedy provided for in subsection (13)(d) cannot be “divorced
from the remainder of this section and given self standing
meaning”.
[102]
It is a fallback remedy only available when the primary remedy is not
appropriate, and condonation has to be assessed on
the basis that
employees are expected to bring their application in sufficient time
to make the granting of the primary remedy
feasible. If,
however, the Labour Court concludes that the granting of the primary
relief is not appropriate, it may defer
a claim for compensation for
later adjudication.
[103]
[255]
However, if anything said by the Labour Appeal Court or this
Court in
Steenkamp II
were to be understood as meaning
that under no circumstances can affected employees claim compensation
under subsection (13)(d)
without co-joining it to a primary claim for
relief under subsections (13)(a), (b) or (c), that statement would be
wrong, even
if the circumstances under which that would be
permissible might be unusual, even rare.
Exclusion
of jurisdiction in all cases of procedurally unfair retrenchment
[256]
Paragraphs 149 to 219 of the first judgment address and
criticise cases in which, according to the first judgment, the Labour
Court,
Labour Appeal Court and this Court have held or implied that
subsection (18) excludes the jurisdiction of the Labour Court
to
adjudicate claims for compensation for procedurally unfair
retrenchments, whether or not the retrenchments fall within the scope
of section 189A and whether or not the claim is brought in terms of
section 189A(13).
[257]
Since it is common cause that the present case falls within
the scope of section 189A, the question whether section 189A(18)
applies to other retrenchments as well does not arise.
Unsurprisingly, in the circumstances, it was not the subject of any
argument, and anything we say on that subject is again
obiter
.
Nevertheless, since the matter is discussed at length in the first
judgment, I have no difficulty saying, in agreement with
the first
judgment, that the exclusion in section 189A(18) clearly applies only
to retrenchments falling within the scope of section
189A. This
is clear from the opening words of section 189A(1): “This
section applies to employers employing more
than 50 employees if—”.
[258]
However,
and unlike the first judgment, I do not believe that any of the cases
discussed therein, all of which were cases governed
by section 189A,
reflect an understanding by any of the courts concerned that
subsection (18) ousts the Labour Court’s
jurisdiction in
cases of procedurally unfair retrenchments falling outside the scope
of section 189A. I do not think that
one should attribute such
a fundamental error to those courts. The context of cases
dealing with the exclusion in subsection (18)
have been cases
governed by section 189A. The Labour Court and the Labour
Appeal Court (including the three Judges of Appeal
who sat in the
present case) have without question adjudicated cases involving
procedurally unfair retrenchments falling outside
the scope of
section 189A.
[104]
[259]
Statements
in judgments, perhaps even more so than the provisions of contracts
and statutes, must be read with due regard to the
context of the
judgment as a whole. Where the courts have spoken of an
exclusion of jurisdiction under subsection (18),
they have been
talking about retrenchments by large employers falling under
section 189A. Often this is explicit.
In
Steenkamp
II
,
[105]
for example, this Court began its discussion of subsection (13) by
highlighting that section 189A applies to retrenchments involving
a
“large number of employees”.
[106]
The Court said that the exclusion of jurisdiction in subsection (18)
had to be viewed in the broader context and purpose
of section 189A
as a whole – namely “large-scale retrenchments” and
getting the consultation process back on
track.
[107]
[260]
In
Barloworld
[108]
this Court concluded its discussion of the scope of subsection (13)
by stating, among other things, that the relevant provisions
of
section 189A, including subsection (13), were enacted to serve
the interests of expediency and efficiency in cases of “large-scale
retrenchment” and to avoid the courts having to adjudicate
alleged procedural unfairness “in the aftermath of mass
retrenchments”.
[109]
[261]
Likewise, I do not read any of the cases reviewed in the first
judgment as holding that, in the case of retrenchments by large
employers
to which section 189A applies, the Labour Court cannot
assess procedural fairness in a claim brought under subsection (13).
Subsection (13) expressly states that the Labour Court can do so, and
the Labour Court has often done so.
[262]
In my respectful view, therefore, paragraphs 149 to 219 set up
and knock down a proposition which has not been adopted in past
cases.
There has been no uncertainty in our jurisprudence on
these matters. There is no case of which I am aware where the
Labour Court
or Labour Appeal Court has refused to consider the
procedural fairness of an ordinary retrenchment falling outside the
scope of
section 189A. And for these reasons, I cannot
associate myself with the criticisms made in the first judgment of
the Labour
Appeal Court in the present case. In regard to the
first major topic of the first judgment, namely the legitimacy of a
claim
for compensation under subsection (13)(d) as “stand-alone”
relief, I agree with the first judgment that the Labour
Appeal Court
erred. It was perhaps led astray by statements made in
Steenkamp II
, either because the Labour Appeal Court
misunderstood the import of
Steenkamp II
(as I think) or
because
Steenkamp II
was wrong, albeit
obiter
(as
the first judgment holds). But the Labour Appeal Court merely
erred – no more, no less.
[263]
In
regard to the second major topic of the first judgment, namely the
scope of the exclusion in subsection (18), the criticism of
the
Labour Appeal Court in the first judgment is simply not justified, in
my view. The Labour Appeal Court did not find that
the
exclusion in section 189A(18) applied to retrenchments falling
outside the scope of section 189A or that the Labour Court
could
not adjudicate claims for procedural unfairness brought in terms of
section 189A(13). The Labour Appeal Court expressly
recognised
that subsection (18) applied only to retrenchments by large employers
falling within the scope of section 189A.
[110]
The Labour Appeal Court’s sole error was to hold that a claim
for compensation under subsection (13)(d) could
not competently
have been adjudicated by the Labour Court as stand-alone relief.
That is the error forming the subject of
the first major topic of the
first judgment.
For
the Applicants in the application for leave to appeal and the
Respondent in the application for leave to cross-appeal:
G
Fourie SC (with D Groenewald) Instructed by Higgs Attorneys
Incorporated
For
the Respondents in the application for leave to appeal and the
Applicants in the application for leave to cross-appeal:
C
Watt-Pringle SC (with L Erasmus) Instructed by Du Randt Du Toit
Pleser Attorneys
[1]
Section
189A(18) of the Labour Relations Act reads:
“
(18)
The Labour Court may not adjudicate a dispute about the procedural
fairness of a dismissal
based on the employer’s operational
requirements in any dispute referred to it in terms of
section 191(5)(b)(ii).”
[2]
66 of 1995.
[3]
Section
189A(13) of the LRA reads:
“
(13)
If an employer does not comply with a fair procedure, a
consulting party may approach the Labour Court by way of an
application
for an order–
(a)
compelling the employer to comply with a fair procedure;
(b)
interdicting or restraining the employer from dismissing an employee
prior to complying with a fair procedure;
(c)
directing the employer to reinstate an employee until it has
complied
with a fair procedure;
(d)
make an award of compensation, if an order in terms of
paragraphs (a)
to (c) is not appropriate.”
[4]
Section
189(3) reads:
“
(3)
The employer must issue a written notice inviting the other
consulting party
to consult with it and disclose in writing all
relevant information, including, but not limited to–
(a)
the reasons for the proposed dismissals;
(b)
the alternatives that the employer considered before proposing the
dismissals, and the reasons for rejecting each of those
alternatives;
(c)
the number of employees likely to be affected and the job categories
in which they are employed;
(d)
the proposed method for selecting which employees to dismiss;
(e)
the time when, or the period during which, the dismissals are likely
to take effect; the severance pay proposed;
(g)
any assistance that the employer proposes to offer to the employees
likely to be dismissed;
(h)
the possibility of the future re-employment of the employees who
are
dismissed;
(i)
the number of employees employed by the employer; and
(j)
the number of employees that the employer has dismissed for
reasons
based on its operation requirements in the preceding 12 months.”
[5]
South
African Breweries (Pty) Ltd v Louw
[2017] ZALAC 63
;
[2018] 1 BLLR 26
(LAC); (2018) 39 ILJ 189 (LAC).
[6]
Steenkamp
v Edcon Limited
[2019] ZACC 17
;
2019 (7) BCLR 826
(CC);
[2019] 11 BLLR 1189
(CC);
(2019) 40 ILJ 1731 (CC).
[7]
National
Education Health & Allied Workers Union (NEHAWU) v University of
Cape Town
[2002] ZACC 27
;
2003 (2) BCLR 154
(CC);
2003 (3) SA 1
(CC).
[8]
Section 23(1) of the Constitution reads:
“
(1)
Everyone has the right to fair labour practices.”
[9]
Section 34 reads:
“
Everyone
has the right to have any dispute that can be resolved by the
application of law decided in a fair public hearing before
a court
or, where appropriate, another independent and impartial tribunal or
forum.”
[10]
Section 38 of the Constitution reads:
“
Anyone
listed in this section has the right to approach a competent court,
alleging that a right in the Bill of Rights has been
infringed or
threatened, and the court may grant appropriate relief, including a
declaration of rights. The persons who
may approach a court
are—
(a)
anyone acting in their own interest;
(b)
anyone acting on behalf of another person who cannot act in their
own name;
(c)
anyone acting as a member of, or in the interest of, a group or
class of persons;
(d)
anyone acting in the public interest; and
(e)
an association acting in the interest of its members.”
[11]
Steenkamp
v Edcon Ltd
[2016] ZACC 1
;
2016 (3) SA 251
(CC);
2016 (3) BCLR 311
(CC);
[2016]
4 BLLR 335
(CC); (2016) 37 ILJ 564 (CC) at paras 15-8;
Edcon
Ltd v Steenkamp
[2017] ZALAC 81
;
[2018] 3 BLLR 230
(LAC); (2018) 39 ILJ 531 (LAC) at
para 19
;
CC
Steenkamp II
above n 6 at paras 48 and 70;
Solidarity
obo Members v Barloworld Equipment Southern Africa
,
unreported judgment of the Labour Court, Case No J950 and 913/20 (2
October 2020) at paras 7-13;
Solidarity
obo Members v Barloworld Equipment Southern Africa
[2022] ZACC 15;
[2022] 9 BLLR 779
(CC); (2022) 43 ILJ 1757
(CC);
2023 (1) BCLR 51
(CC) at paras 65-8
;
Regenesys
Management (Pty) Ltd t/a Regenesys v Nortje
[2022] ZALAC 96
; (2022) 43 ILJ 2745 (LAC) at paras 15 and 17.
[12]
South
African Revenue Services v Commission for Conciliation, Mediation
and Arbitration
[2016] ZACC 38
;
[2017] 1 BLLR 8
(CC);
2017 (1) SA 549
(CC); (2017)
38 ILJ 97 (CC) at para 38.
[13]
Mediterranean
Textile Mills (Pty) Ltd v SA Clothing & Textile Workers Union
[2011]
JOL 28117
(LAC);
[2012] 2 BLLR 142
(LAC); (2012) 33 ILJ 160
(LAC) at para 30.
[14]
Section
189A(13) of the LRA.
[15]
Section
39(2) of the Constitution.
[16]
Investigating
Directorate: Serious Economic Offences v Hyundai Motor Distributors
(Pty) Ltd: In re Hyundai Motor Distributors
(Pty) Ltd v Smit N.O.
[2000] ZACC 12; 2000 (10) BCLR 1079 (CC); 2001 (1) SA 545 (CC).
[17]
Id at para 22.
[18]
Section
1 of the LRA.
[19]
28 of 1956.
[20]
Some
of those cases are:
Parkinson
v Edcon Ltd
[2016] ZALCJHB 540
;
Ramiyal
v Clinix Selby Park Hospital (Pty) Ltd
[2016] ZALCJHB 485
;
CC
Steenkamp II
above n 6 and
CC
Barloworld
above
n 11.
[21]
National
Union of Metalworkers of South Africa
(NUMSA)
v SA Five Engineering
[2004] ZALC 81
; (2004) 25 ILJ 2358 (LC); [2005] 1 BLLR 53 (LC).
[22]
Id
at para 10.
[23]
LAC
Steenkamp
II above n 11.
[24]
Parkinson
above
n 20 at para 4.
[25]
Clinix
above n 20.
[26]
Clinix
above
n 20 at para 5.
[27]
Id
at para 7.
[28]
CC
Steenkamp
I
above n 11. Referring to this case in this way is meant to
distinguish it from the judgment of the Labour Court and Labour
Appeal Court in
Steenkamp
I.
[29]
CC Steenkamp I
above
n 11 at paras 157-164.
[30]
Steenkamp
v Edcon Limited
[2017] ZALCJHB 487.
Referring
to this case in this way is meant to distinguish it from the
judgment of the Labour Court in
Regenesys
which
is referred to later as
LC Regenesys
.
[31]
LAC
Steenkamp II
above
n 11 at paras 28 and 75.
[32]
CC
Steenkamp II
above
n 6 at para 75.
[33]
LAC
Steenkamp II
above n 11.
Referring
to this case in this way is meant to distinguish it from the
judgment of the Labour Court and this Court in
Steenkamp
II
which
is referred to as
LC Steenkamp
II
and
CC Steenkamp II
.
[34]
Id
at para 2.
[35]
Id
at para 13.
[36]
Section
189A(17)(a) and (b) reads:
“
(a)
An application in terms of subsection (13) must be brought not later
than
30 days after the employer has given notice to terminate the
employee’s services or, if notice is not given, the date on
which the employees are dismissed.
(b)
The Labour Court may, on good cause shown condone a failure to
comply with the time limit mentioned in paragraph (a).”
[37]
LAC
Steenkamp II
above
n 11 at para 24.
[38]
Id
at paras 25-6.
[39]
Id
at para 2.
[40]
Insurance
and Banking Staff Association v Old Mutual Services and Technology
Administration
(2006)
27 ILJ 1026 (LC).
[41]
CC
Steenkamp II
above n 6 at para 52. Referring to this case in this way is
meant to distinguish it from the judgment of the Labour Court
and
the Labour Appeal Court in
Steenkamp
II
which is referred to as
LC Steenkamp II
and
LAC Steenkamp II
.
[42]
Insurance
and Banking Staff Association
above
n 40 at para 12.
[43]
Id
at
para 13.
[44]
CC
Steenkamp II
above n 6 at para 52.
[45]
Id at paras 58-64.
[46]
Id at para 66.
[47]
Id
at
para
18
.
[48]
CC
Steenkamp I
above n 11.
Referring
to this case in this way is meant to distinguish it from the
judgment of the Labour Court and the Labour Appeal Court
in
Steenkamp
I
.
[49]
Id
at
para 147.
[50]
Id
at paras 157-8.
[51]
Id
at para 164.
[52]
LC
Steenkamp II
above n 30.
Referring
to this case in this way is meant to distinguish it from the
judgment of the Labour Appeal Court and this Court in
Steenkamp
II
which
is referred to as
LAC Steenkamp II
and
CC Steenkamp II
.
[53]
LAC
Steenkamp
II
above n 11.
Referring
to this case in this way is meant to distinguish it from the
judgment of the Labour Court and this Court in
Steenkamp
II
which
is referred to as
LC Steenkamp II
and
CC Steenkamp II
.
[54]
Id at para 21.
[55]
LAC
Steenkamp II
above
n 23 at paras 18-9.
[56]
CC
Steenkamp II
above n 6.
Referring
to this case in this way is meant to distinguish it from the
judgment of the Labour Court and the Labour Appeal Court
in
Steenkamp
II
which
is referred to as
LC Steenkamp II
and
LAC Steenkamp II
.
[57]
Id at para 48.
[58]
Id
at paras 47-8.
[59]
Id at paras 49 and 51.
[60]
Id at paras 69-70.
[61]
Id at para 70.
[62]
Id at paras 49, 52 and 54.
[63]
LC
Barloworld
above n 11.
Referring
to this case in this way is meant to distinguish it from the
judgment of this Court in
Barloworld
which
is referred to as
CC
Barloworld
.
[64]
CC
Steenkamp I
above n 11 at para 126.
[65]
LC
Barloworld
above n 64 at para 7.
[66]
Id
at para 13.
[67]
CC
Barloworld
above
n 11. Referring to this case in this way is meant to
distinguish it from the judgment of the Labour Court in
Barloworld
which
is later referred to as
LC
Barloworld
.
[69]
Id
at paras 65 and 67-8.
[70]
Id at para 65.
[71]
Id
at para 68.
[72]
Id
at para 72.
[73]
LAC
Regenesys
above
n 11. Referring to this case in this way is meant to
distinguish it from the judgment of the Labour Court in
Regenesys
which
is referred to later as
LC Regenesys
.
[74]
Id
at
para 13.
[75]
Id
at
para 15
.
[76]
Id
at
para 17
.
[77]
Id at para 13.
[78]
Id
at para 15.
[79]
CC
Steenkamp II
above n 6 at para 70.
[80]
Id at para 71.
[81]
Id
at paras 49-50
.
[82]
Id
at para 52.
[83]
LAC
Steenkamp II
above
n 23 at para 2.
[84]
Id at para 15.
[85]
Id at para 46.
[86]
Id
at para 46.4.
[87]
CC
Barloworld
above n 11 at para 65.
[88]
Id at para 71.
[89]
Id.
[90]
Id at para 65.
[91]
Nortje
v Regenesys Management (Pty) LTD
(JS776/15
& D1824/2015) (27 February 2020) ZALCJHB at para 133.1.
Referring to this case in this way is meant to distinguish
it from
the judgment of the Labour Appeal Court in
Regenesys
which
is referred to as
LAC Regenesys
.
[92]
Gijima
AST (Pty) Ltd v Hopley
[2014] ZALAC 9
; (2014) 35 ILJ 2115 (LAC) at para 34.
[93]
LC
Regenesys
above
n 91 at para 104.
[94]
Id
at paras 149-152.
[95]
Id
at para 153.
[96]
Id
at para 155.
[97]
SA Five
Engineering
above n 21.
[98]
See the first judgment at [93].
[99]
Parkinson
above n 20.
[100]
Clinix
above n 20.
[101]
Steenkamp
II
above n 6.
[102]
Id at para 61.
[103]
Id at paras 63-4.
[104]
For a few recent examples of successful claims in the Labour Appeal
Court, see
Zeda
Car Leasing (Pty) Ltd t/a Avis Fleet v Van Dyk
[2020] ZALAC 4
;
[2020] 6 BLLR 549
(LAC); (2020) 41 ILJ 1360 (LAC),
Total
SA (Pty) Ltd v Meyer
[2021] ZALAC 12
;
[2021] 8 BLLR 795
(LAC); (2021) 42 ILJ 1696 (LAC),
Mbekela
v Airvantage
(Pty) Ltd
[2021] ZALAC 47
and
Reeflords
Property Development (Pty) Ltd v Almeida
[2022] ZALAC 8
;
[2022] 6 BLLR 530
(LAC); (2022) 43 ILJ 1648 (LAC).
[105]
Steenkamp
II
above n 6.
[106]
Id at para 46.
[107]
Id at paras 51-2.
[108]
Barloworld
above n 11.
[109]
Id at para 71. See also at para 69 with reference to
Association
of Mineworkers and Constructions Union v Piet Wes Civils CC
(2017) 38 ILJ 1128 (LC).
[110]
See
at para 15, where the reference to the exclusion of jurisdiction in
terms of subsection (18) in “such cases” is
a reference
to the cases mentioned in the earlier part of the same sentence,
namely retrenchments by employers who employ 50
or more people.
sino noindex
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