Reported on: 24 March 2010
The national Assembly's labour portfolio committee has stopped short of seeking to ban labour broking but it looks set to tighten the relationship between primary companies that win contracts and secondary companies that are subcontracted to do work to ensure that basic conditions of employment are guaranteed by all parties involved.
This is the compromise reached by the government and the opposition after the committee considered a report by a sub-committee chaired by opposition DA MP Ian Ollis, who for a long period has warned against an outright ban on labour broking.
His report focused on bringing an end to "abusive practices" - including different pay for similar work - in labour-employer relations rather than an outright ban on labour broking. For months the committee's chairwoman, Lumka Yengeni, an ANC MP, has declared labour broking to be an evil practice.
While the decision appears to be a bit of a compromise to the business lobby, Yengeni declined to refer to labour broking yesterday. "We don't want to use the term labour broking. We are talking about outsourcing and contracting."
Ultimately, both outsourcers and the contracting companies would be "jointly and severally" liable for ensuring that the basic conditions of employment and workers' rights were adhered to.
The committee, after months of debate on labour broking, recommended that the Labour Department should amend the Labour Relations Act and examine all legislation pertaining to concerns about abusive practices in the workplace. Yengeni said the workplace and the employer had to be carefully defined.
Cosatu's Western Cape provincial secretary Tony Ehrenreich said that the debate had become "somewhat complicated" and the unions had opposed abusive practices. He added that the new proposal appeared to be moving "in the right direction".
He noted that some workers who were employed by an agency to do a job ended up working for another employer but did not enjoy the basic rights of employment.
John Botha, the chairman of the Confederation of Associations in the Private Employment Sector, which represents labour brokers, said provision had already been made in the law and bargaining chamber agreements for "joint and several liability" between the labour broker and a user organisation, which contracts the labour broker to source labour.
However, this did not necessarily make sense for all workers, said Botha, who represents Business Unity SA on the National Economic Development and Labour Council. As examples, he mentioned well-paid information technology specialists who worked for a company for a year and workers who did stocktaking for a limited period.
Wednesday, March 31, 2010
Demands for big wage hikes could stop job creation
Reported on: 25 March 2010
Wage demands this year could be tempered by lower inflation and the heavy job losses of last year, but if unrealistic wage hikes are pursued it could damage the job market further.
This comes as unions project demands of wage increases of up to 17 percent, which they attribute to high electricity prices and petrol price hikes.
Lesiba Seshoka, the spokesman for the Cosatu- affiliated National Union of Mineworkers (NUM), said with high energy prices, inflation for workers was very high. "I don't foresee wage demands below 15 percent," he said.
Loane Sharp, a labour market analyst at staffing company Adcorp, said yesterday: "It took us 10 years to create 2.2 million jobs and nine months last year to lose 45 percent of them. We now have a five-year slog to create these jobs."
Sharp said the reason there were such heavy jobs losses last year - in what was a mild recession and based on historical trends should have only resulted in about 285 000 jobs lost - was the unreasonable wage demands in the middle of a downturn and intense pressure
for a huge conversion of the workforce from temporary to permanent staff.
The average wage increase last year was 9.3 percent, compared with average annual consumer inflation of 7.1 percent. In 2008 the average settlement was 9.8 percent as inflation touched double digits.
Sharp said wages used to track inflation very closely, but in the last five years there had been a complete break with this trend. Wages now ran between 1.5 and 2 percentage points above inflation.
"That is why we lost almost a million jobs. The higher the cost of labour, the lower the employment. Companies in all sectors find ways to substitute labour if the cost becomes unrealistic," Sharp said.
Patrick Craven, the spokesman for Cosatu, could not be reached for comment yesterday, but earlier this week he said the heavy job losses explained why Cosatu was campaigning against casualisation as it was far easier to lay off temporary staff.
But Sharp said companies that employed permanent staff had little flexibility if business conditions deteriorated, such as putting staff on short time, and the only option was to retrench. With temporary staff there was more flexibility.
Sharp said the number of temporary, atypical and contract workers grew 4.3 percent to 3.3 million last year, based on National Skills Fund data.
Despite the risks to jobs, unions seem to be gearing up for high wage demands. The Federation of Unions of SA has advised its affiliated unions to ask for hikes of 17 percent.
Last year wage settlements negotiated by NUM were between 8 percent and 10 percent. Construction workers, who embarked on a massive strike, secured 12 percent. Negotiations in this sector begin in May.
Some settlements so far this year have been more moderate as consumer inflation, which fell to 5.7 percent last month, heads lower. The Food and Allied Workers Union recently settled for a 7.8 percent hike. Solidarity recently reached an agreement with Netcare for an 8.5 percent wage increase and with Necsa for 7 percent. The Grain Bargaining Council wage deals are between 7.5 percent and 8 percent.
Wage demands this year could be tempered by lower inflation and the heavy job losses of last year, but if unrealistic wage hikes are pursued it could damage the job market further.
This comes as unions project demands of wage increases of up to 17 percent, which they attribute to high electricity prices and petrol price hikes.
Lesiba Seshoka, the spokesman for the Cosatu- affiliated National Union of Mineworkers (NUM), said with high energy prices, inflation for workers was very high. "I don't foresee wage demands below 15 percent," he said.
Loane Sharp, a labour market analyst at staffing company Adcorp, said yesterday: "It took us 10 years to create 2.2 million jobs and nine months last year to lose 45 percent of them. We now have a five-year slog to create these jobs."
Sharp said the reason there were such heavy jobs losses last year - in what was a mild recession and based on historical trends should have only resulted in about 285 000 jobs lost - was the unreasonable wage demands in the middle of a downturn and intense pressure
for a huge conversion of the workforce from temporary to permanent staff.
The average wage increase last year was 9.3 percent, compared with average annual consumer inflation of 7.1 percent. In 2008 the average settlement was 9.8 percent as inflation touched double digits.
Sharp said wages used to track inflation very closely, but in the last five years there had been a complete break with this trend. Wages now ran between 1.5 and 2 percentage points above inflation.
"That is why we lost almost a million jobs. The higher the cost of labour, the lower the employment. Companies in all sectors find ways to substitute labour if the cost becomes unrealistic," Sharp said.
Patrick Craven, the spokesman for Cosatu, could not be reached for comment yesterday, but earlier this week he said the heavy job losses explained why Cosatu was campaigning against casualisation as it was far easier to lay off temporary staff.
But Sharp said companies that employed permanent staff had little flexibility if business conditions deteriorated, such as putting staff on short time, and the only option was to retrench. With temporary staff there was more flexibility.
Sharp said the number of temporary, atypical and contract workers grew 4.3 percent to 3.3 million last year, based on National Skills Fund data.
Despite the risks to jobs, unions seem to be gearing up for high wage demands. The Federation of Unions of SA has advised its affiliated unions to ask for hikes of 17 percent.
Last year wage settlements negotiated by NUM were between 8 percent and 10 percent. Construction workers, who embarked on a massive strike, secured 12 percent. Negotiations in this sector begin in May.
Some settlements so far this year have been more moderate as consumer inflation, which fell to 5.7 percent last month, heads lower. The Food and Allied Workers Union recently settled for a 7.8 percent hike. Solidarity recently reached an agreement with Netcare for an 8.5 percent wage increase and with Necsa for 7 percent. The Grain Bargaining Council wage deals are between 7.5 percent and 8 percent.
Monday, March 29, 2010
Labour: CCMA receives R32m lifeline
Reported on: 25 March 2010
The Commission for Conciliation, Mediation and Arbitration (CCMA) is out of the red after it received R32 million from the National Treasury.
The CCMA said it had experienced a caseload increase during the current financial year due to the effect of the global economic climate.
On Tuesday the organisation said if it did not receive additional money from the Treasury this week it would not be able to pay its bills at the end of the month.
"We are pleased to assure all CCMA users that there will be no interruption to CCMA service and business continues," the agency said
The Commission for Conciliation, Mediation and Arbitration (CCMA) is out of the red after it received R32 million from the National Treasury.
The CCMA said it had experienced a caseload increase during the current financial year due to the effect of the global economic climate.
On Tuesday the organisation said if it did not receive additional money from the Treasury this week it would not be able to pay its bills at the end of the month.
"We are pleased to assure all CCMA users that there will be no interruption to CCMA service and business continues," the agency said
When is there an agreement?
What does it mean if parties have reached agreement in principle? Does it mean that they have agreed on something, or does it mean that there are still some issues that need to be settled before the agreement is finalised? If an employer and a trade union reach agreement in principle, does that agreement constitute a binding collective agreement, or is this merely an agreement on the main points of the agreement, with finer details still to be worked out?
In SA Post Office Ltd v CWU & others (2009) 18 LC 4.2.2 the employer, tried to interdict the union from continuing with its strike action. The union represented more than 75% of the employees in the bargaining unit. The union had referred a mutual interest dispute about “salary anomalies” to the CCMA. Conciliation failed and the commissioner issues a certificate of outcome. After this, the CCMA offered to further assist with the matter and to mediate the dispute. The offer of mediation was accepted by the parties, and, in addition, it was agreed that the process would include the substantive wage negotiations for 2009/2010 (even though this was not part of the dispute originally referred to the CCMA).
In the course of the CCMA’s mediation, the parties produced a draft settlement agreement. It appears that when the parties left the CCMA offices they planned to sign the agreement a few days later. The union then proposed certain amendments which the employer accepted.
But there was a dispute over what the state of play was when the parties left the CCMA offices. The employer’s version was that an agreement had been reached on the substantive issues that were subject to the mediation (and that the strike would be called off). The union disputed that an agreement had been reached and that it undertook to call off the strike. Both parties issued communications to the effect that a settlement had been reached and that the strike was essentially over.
The crux of the matter, said the Labour Court, was whether or not the parties had reached an agreement in terms of which the dispute relating to the salary anomalies had been resolved. The Court concluded that the objective facts supported the view that an agreement was indeed reached. This is a strange conclusion, on the face of it, because section 213 of the Labour Relations Act requires a collective agreement to be a written agreement (even though the definition is silent on the question as to whether that document must be signed).
The Court concluded that the probabilities supported the conclusion that an oral agreement had been reached, an oral agreement whose terms were contained in a written document drafted by the parties. This agreement put to rest the dispute about the salary anomalies. It transpired that there were no outstanding issues when the parties left the CCMA, and that the union had suggested limited amendments to the agreement (these were accepted by the employer) – for all intents and purposes, the negotiations had reached an end. The communication issued by the union itself clearly gave the impression that agreement had been reached and that the agreement would be signed. At no stage was it said that the settlement agreement was conditional on the approval of the majority of the union’s members, and, finally, most of the union’s members returned to work after the consensus was announced.
But as is so often the case, one branch of the union had problems with the agreement. However, in this context, the majoritarian principle applied: the Gauteng branch was bound by the decision of the negotiating team and the other branches of the union (none of the other branches had any problems with the agreement). There was an agreement, in other words, and the dispute had been settled: the Court held that the parties had concluded an agreement that resolved the dispute that gave rise to the dispute. The interdict against the union was confirmed.
In SA Post Office Ltd v CWU & others (2009) 18 LC 4.2.2 the employer, tried to interdict the union from continuing with its strike action. The union represented more than 75% of the employees in the bargaining unit. The union had referred a mutual interest dispute about “salary anomalies” to the CCMA. Conciliation failed and the commissioner issues a certificate of outcome. After this, the CCMA offered to further assist with the matter and to mediate the dispute. The offer of mediation was accepted by the parties, and, in addition, it was agreed that the process would include the substantive wage negotiations for 2009/2010 (even though this was not part of the dispute originally referred to the CCMA).
In the course of the CCMA’s mediation, the parties produced a draft settlement agreement. It appears that when the parties left the CCMA offices they planned to sign the agreement a few days later. The union then proposed certain amendments which the employer accepted.
But there was a dispute over what the state of play was when the parties left the CCMA offices. The employer’s version was that an agreement had been reached on the substantive issues that were subject to the mediation (and that the strike would be called off). The union disputed that an agreement had been reached and that it undertook to call off the strike. Both parties issued communications to the effect that a settlement had been reached and that the strike was essentially over.
The crux of the matter, said the Labour Court, was whether or not the parties had reached an agreement in terms of which the dispute relating to the salary anomalies had been resolved. The Court concluded that the objective facts supported the view that an agreement was indeed reached. This is a strange conclusion, on the face of it, because section 213 of the Labour Relations Act requires a collective agreement to be a written agreement (even though the definition is silent on the question as to whether that document must be signed).
The Court concluded that the probabilities supported the conclusion that an oral agreement had been reached, an oral agreement whose terms were contained in a written document drafted by the parties. This agreement put to rest the dispute about the salary anomalies. It transpired that there were no outstanding issues when the parties left the CCMA, and that the union had suggested limited amendments to the agreement (these were accepted by the employer) – for all intents and purposes, the negotiations had reached an end. The communication issued by the union itself clearly gave the impression that agreement had been reached and that the agreement would be signed. At no stage was it said that the settlement agreement was conditional on the approval of the majority of the union’s members, and, finally, most of the union’s members returned to work after the consensus was announced.
But as is so often the case, one branch of the union had problems with the agreement. However, in this context, the majoritarian principle applied: the Gauteng branch was bound by the decision of the negotiating team and the other branches of the union (none of the other branches had any problems with the agreement). There was an agreement, in other words, and the dispute had been settled: the Court held that the parties had concluded an agreement that resolved the dispute that gave rise to the dispute. The interdict against the union was confirmed.
Monday, March 22, 2010
Dismissal, Administrative Action and the Supreme Court of Appeal
Some difficult cases arise from difficult facts. Over the years we’ve come across many of these: cases where facts are in dispute or where it is sometimes difficult to figure out just what is what and where the real issues lie. Automatically unfair dismissals are good examples: did the dismissal relate to an automatically unfair reason, or was the dismissal based on a valid and fair reason relating to, for instance, misconduct. The facts are decisive in answering this question.
When it comes to the decision of the Supreme Court of Appeal in Transnet Ltd & others v Chirwa (2006) 15 SAC 1.11.1 the facts are not that problematic. An employee was dismissed for incapacity: poor work performance on 22 November 2002. An incapacity hearing was held and was chaired by the employee’s supervisor. She was employed as a human resources executive manager of the employer’s pension fund business the hearing was held to give her an opportunity to respond to allegations of poor performance, incompetence and poor employee relations. In the letter the employee’s manager also indicated that her future would be decided at the enquiry.
But at the hearing the employee refused to participate — largely because she objected to her manager serving as chairperson of the hearing. Her argument was that he could not act as the complainant, witness and presiding officer all at the same time. The hearing went ahead anyway, and she was subsequently dismissed. The High Court set aside the dismissal and ordered that the employee be reinstated — and that its order would operate retrospectively for a period of 9 months (calculated as from the date of the High Court’s order which was 25 February 2004).
From a labour law point of view, of course, one would say that the employee could have made out a case that her dismissal for poor work performance was procedurally flawed and that she should receive compensation — if it was only a case of procedural unfairness as regards the conduct of the incapacity hearing. But this is not the way the employee framed her case: she had chosen to argue that her constitutional right to administrative justice had been infringed and that she had remedies in terms of the Promotion of Administrative Justice Act 3 of 2000 (PAJA).
Divided opinions
The Supreme Court of Appeal’s decision in this case was a split decision: The matter was heard before 5 judges, and three different judgments were handed down. The fact that this Court, the highest court we have (excepting, of course, the Constitutional Court for constitutional matters) is so divided on this issue again underscores the fact that the questions raised, while they may appear easy, are not at all easy to answer.
On the contrary: this decision of the Supreme Court of Appeal, with respect, does not provide us with the short-and-sweet answers we’ve been waiting and hoping for. Some judges take a longer, historical view of the development of our legal system and find that decisions dating from the early 1990s are still relevant. Others take the view that our current legal system, based on the Constitution of 1996, is different: that there has been a very fundamental change to the very foundations of our legal system. Yet another judge finds a solution to the question by examining the systems of remedies provided by the Labour Relations Act of 1995 (the LRA) and the remedies provided by PAJA.
Dismissal is not administrative action
Two judges (Mthiyane & Jafta JJA) of the Supreme Court of Appeal held that Ms Chirwa’s dismissal did not constitute administrative action for the purposes of PAJA. There could be no doubt that Transnet is a statutory body and that PAJA applies to Transnet, but PAJA did not change the nature of the employment relationship between Chirwa and Transnet to a public law relationship. The employment contract between Transnet and Chirwa remains an employment contract like any other and Transnet’s power to dismiss her was not based on legislation. The power to dismiss came from the employment contract itself and, when terminating her employment, Transnet was simply acting like any other employer.
Things had changed since the early 1990s, said these judges. Back then the Supreme Court of Appeal had held that there is a public law aspect to employment relationships, and that this public law (or administrative law) aspect entitled an employee of a public body to a hearing. Bear in mind that in the early 1990s public service employees were not covered by the LRA. These two judges of the Supreme Court of Appeal concluded that Ms Chirwa’s dismissal was not administrative action as defined in PAJA; nor had she shown that any of her rights in terms of section 33 of the Constitution had been violated.
In PSA obo Haschke v MEC for Agriculture & others (2004) 13 LC 1.16.3, for instance, the Labour Court succinctly said that labour law and administrative law different things. And the view that the employment relationship between a public body and its employees is in effect no different from the employment relationships between private employers and employees (outside the public sector) has also been repeatedly stated by the Labour Court. It was clear to the Labour Court in SAPU & another v National Commissioner, SAPS & another (2005) 15 LC 1.1.2 that the decisions from the early 1990s had to be re-considered in the light of the Constitution.
Also central to the Labour Court’s approach is focusing on the distinction between employment relationships (which, in the view of the Labour Court, is a private-law relationship between an employer and an employee) and other relationships that are of a public nature (for instance, the making of a decision by a public official) — where, undoubtedly, PAJA would apply. Not everything a public body does, said the Labour Court, constitutes administrative action.
“The mere fact that Transnet is an organ of State does not impart a public law character to its employment contract with the applicant. The power to dismiss is found, not in legislation, but in the employment contract between Transnet and the applicant. When it dismissed the applicant, Transnet did not act as a public authority but simply in its capacity as employer. The factual matrix in which Zenzile, Sibiya and Mangena [the decisions from the early 1990s] were decided has changed. Furthermore at the time, public sector employees were expressly excluded from the Labour Relations Act 28 of 1956 by virtue of which employees were entitled to be heard. At the time of her dismissal by Transnet the applicant, like public sector employees, enjoyed protection under the LRA, which is the statutory embodiment of the constitutional right to fair labour practices. Although section 23(2) of the Constitution imports into the employment contract a reciprocal duty to act fairly it does not deprive the employment contract of its legal effect …
For the above reasons it has not been shown that the dismissal of the applicant by Transnet was an administrative action as defined in PAJA or that any of her rights under section 33 of the Constitution were violated.”
Dismissal is administrative action
Not so, held two other judges of the Supreme Court of Appeal (Cameron JA and Mpati DP). By its very nature as a statutory body, everything Transnet does (including its relationships with its employees) has a public-law or administrative law aspect. When dismissing an employee, a public body such as Transnet, is exercising a public power — a power conferred on Transnet by legislation. Without the legislation, Transnet would not exist: all of its powers are derived, in the final analysis, from the legislation which establishes it.
This means that there is a considerable difference in the employment relationships between a public body and its employees. It is not a contract between two individuals or between a company and an employee — instead, it is a special form of employment. The statute injects an element of public service into the employment relationship and this means that employees enjoy the protection of the principles of natural justice (such as the audi alteram partem principle or the principle that no-one may be the judge in his own case).
These judges are in effect applying the principles of the Supreme Court of Appeal decisions handed down in 1990-1992. Neither the Constitution of 1996 nor PAJA supersede these two decisions — on the contrary, the principles laid down in these older decisions are effectively confirmed by the Constitution and PAJA.
When it comes to dismissal, the implication is that the public dimension of the employment relationship between a public body and an employee renders that dismissal subject to administrative law control. The employer’s decision to dismiss had an immediate and direct external legal effect (the language of PAJA — see section 1 under the definition of “administrative action”) and therefore PAJA applies.
The exclusion of PAJA dismissal remedies
There is one other judgment in this case, namely the judgment of Conradie JA. This judge takes a completely different approach. His approach is to focus on the difficulties of interpreting the provisions of PAJA and the LRA. The real enquiry, he held, is not whether Transnet’s decision to dismiss Ms Chirwa constituted administrative action (he accepts that it did). Any proper dismissal enquiry in the public sector necessarily has the attributes to administrative action — and administrative action falls under the scope of PAJA.
The essence of Conradie JA’s approach is that it is not so much about the nature of the decision to dismiss but about the remedies and procedures that are at the disposal of an employee who has been dismissed. Clearly, the LRA provides a comprehensive scheme of labour laws and dispute resolution procedures. The purpose behind the LRA, he finds, is to subject an unfair dismissal dispute to the procedures set out in the LRA. What the LRA in effect does, is to remove unfair dismissal disputes from the scope of PAJA (even though they may still be administrative acts in nature). The LRA removes public-sector dismissal disputes from administrative law rules. A dismissal (in this case, a dismissal for poor work performance) is, in its very essence, a matter that should be dealt with in terms of the LRA. The following passage gives some insight into the Judge’s reasoning:
“[31] The Bill of Rights creates to distinct sources of power. Natural justice is a cornerstone of both but they are nevertheless distinct. The one, in s 23 of the Constitution, feeds the procedure of the labour law, the other, in s 33, those of the administrative law. Administrative power over the subject has one source, and employer’s power over its employees another. The statutes enacted to give effect to each of the constitutional provisions, PARA and the LRA, differ fundamentally in the substantive remedies they provide. If an application for the review of administrative action succeeds, the applicant is usually entitled to no more than a setting aside of the impugned decision and its remittal to the decision-maker to apply his mind afresh. Except where unreasonableness is an issue the reviewing court does not concern itself with the substance of the applicant’s case and only in rare cases substitutes its decision for that of its decision-maker. The guiding principle is that the subject is entitled to a procedurally fair and lawful decision, not to a correct one. Under the LRA the procedure to have a dismissal overturned or adjusted involves a re-hearing with evidence by the parties and a substitution of a correct decision for an incorrect one. The scope of relief consequent upon such an order is extensive. It is quite unlike that afforded by an administrative law review.”
No answer as yet …
For those who had hoped that the Supreme Court of Appeal would firmly and unambiguously decide, one way or another, that a dismissal is (or is not) administrative action, this case, with its three judgments, will no doubt be a considerable disappointment. The answer to the easy-looking question is still to come. Perhaps the time has come for PAJA to be amended, so that we can get some certainty on this point. That would, no doubt, be the easiest and cleanest solution to this issue.
The other issue is that of remedy. As the passage quoted above shows, the issue of remedy is a real one. If a dismissal is found to be unfair in terms of the LRA, an employee may be entitled to reinstatement or compensation. If the dismissal is only procedurally unfair, the employee is only entitled to compensation — but, depending on the nature of the unfairness, this compensation can be significant. The remedy under administrative law is a relatively poor one — the only remedy here is that the decision is referred back to whoever made the decision for a new process and a new decision. In other words, the matter simply goes back to where it came from in the first place, and, if the employer then follows a correct procedure the second time around, the dismissal (even if it is seen as an administrative act) may not be subject to review. Perhaps employees may be better advise to take their chances with the CCMA or a bargaining council instead of taking the High Court route.
When it comes to the decision of the Supreme Court of Appeal in Transnet Ltd & others v Chirwa (2006) 15 SAC 1.11.1 the facts are not that problematic. An employee was dismissed for incapacity: poor work performance on 22 November 2002. An incapacity hearing was held and was chaired by the employee’s supervisor. She was employed as a human resources executive manager of the employer’s pension fund business the hearing was held to give her an opportunity to respond to allegations of poor performance, incompetence and poor employee relations. In the letter the employee’s manager also indicated that her future would be decided at the enquiry.
But at the hearing the employee refused to participate — largely because she objected to her manager serving as chairperson of the hearing. Her argument was that he could not act as the complainant, witness and presiding officer all at the same time. The hearing went ahead anyway, and she was subsequently dismissed. The High Court set aside the dismissal and ordered that the employee be reinstated — and that its order would operate retrospectively for a period of 9 months (calculated as from the date of the High Court’s order which was 25 February 2004).
From a labour law point of view, of course, one would say that the employee could have made out a case that her dismissal for poor work performance was procedurally flawed and that she should receive compensation — if it was only a case of procedural unfairness as regards the conduct of the incapacity hearing. But this is not the way the employee framed her case: she had chosen to argue that her constitutional right to administrative justice had been infringed and that she had remedies in terms of the Promotion of Administrative Justice Act 3 of 2000 (PAJA).
Divided opinions
The Supreme Court of Appeal’s decision in this case was a split decision: The matter was heard before 5 judges, and three different judgments were handed down. The fact that this Court, the highest court we have (excepting, of course, the Constitutional Court for constitutional matters) is so divided on this issue again underscores the fact that the questions raised, while they may appear easy, are not at all easy to answer.
On the contrary: this decision of the Supreme Court of Appeal, with respect, does not provide us with the short-and-sweet answers we’ve been waiting and hoping for. Some judges take a longer, historical view of the development of our legal system and find that decisions dating from the early 1990s are still relevant. Others take the view that our current legal system, based on the Constitution of 1996, is different: that there has been a very fundamental change to the very foundations of our legal system. Yet another judge finds a solution to the question by examining the systems of remedies provided by the Labour Relations Act of 1995 (the LRA) and the remedies provided by PAJA.
Dismissal is not administrative action
Two judges (Mthiyane & Jafta JJA) of the Supreme Court of Appeal held that Ms Chirwa’s dismissal did not constitute administrative action for the purposes of PAJA. There could be no doubt that Transnet is a statutory body and that PAJA applies to Transnet, but PAJA did not change the nature of the employment relationship between Chirwa and Transnet to a public law relationship. The employment contract between Transnet and Chirwa remains an employment contract like any other and Transnet’s power to dismiss her was not based on legislation. The power to dismiss came from the employment contract itself and, when terminating her employment, Transnet was simply acting like any other employer.
Things had changed since the early 1990s, said these judges. Back then the Supreme Court of Appeal had held that there is a public law aspect to employment relationships, and that this public law (or administrative law) aspect entitled an employee of a public body to a hearing. Bear in mind that in the early 1990s public service employees were not covered by the LRA. These two judges of the Supreme Court of Appeal concluded that Ms Chirwa’s dismissal was not administrative action as defined in PAJA; nor had she shown that any of her rights in terms of section 33 of the Constitution had been violated.
In PSA obo Haschke v MEC for Agriculture & others (2004) 13 LC 1.16.3, for instance, the Labour Court succinctly said that labour law and administrative law different things. And the view that the employment relationship between a public body and its employees is in effect no different from the employment relationships between private employers and employees (outside the public sector) has also been repeatedly stated by the Labour Court. It was clear to the Labour Court in SAPU & another v National Commissioner, SAPS & another (2005) 15 LC 1.1.2 that the decisions from the early 1990s had to be re-considered in the light of the Constitution.
Also central to the Labour Court’s approach is focusing on the distinction between employment relationships (which, in the view of the Labour Court, is a private-law relationship between an employer and an employee) and other relationships that are of a public nature (for instance, the making of a decision by a public official) — where, undoubtedly, PAJA would apply. Not everything a public body does, said the Labour Court, constitutes administrative action.
“The mere fact that Transnet is an organ of State does not impart a public law character to its employment contract with the applicant. The power to dismiss is found, not in legislation, but in the employment contract between Transnet and the applicant. When it dismissed the applicant, Transnet did not act as a public authority but simply in its capacity as employer. The factual matrix in which Zenzile, Sibiya and Mangena [the decisions from the early 1990s] were decided has changed. Furthermore at the time, public sector employees were expressly excluded from the Labour Relations Act 28 of 1956 by virtue of which employees were entitled to be heard. At the time of her dismissal by Transnet the applicant, like public sector employees, enjoyed protection under the LRA, which is the statutory embodiment of the constitutional right to fair labour practices. Although section 23(2) of the Constitution imports into the employment contract a reciprocal duty to act fairly it does not deprive the employment contract of its legal effect …
For the above reasons it has not been shown that the dismissal of the applicant by Transnet was an administrative action as defined in PAJA or that any of her rights under section 33 of the Constitution were violated.”
Dismissal is administrative action
Not so, held two other judges of the Supreme Court of Appeal (Cameron JA and Mpati DP). By its very nature as a statutory body, everything Transnet does (including its relationships with its employees) has a public-law or administrative law aspect. When dismissing an employee, a public body such as Transnet, is exercising a public power — a power conferred on Transnet by legislation. Without the legislation, Transnet would not exist: all of its powers are derived, in the final analysis, from the legislation which establishes it.
This means that there is a considerable difference in the employment relationships between a public body and its employees. It is not a contract between two individuals or between a company and an employee — instead, it is a special form of employment. The statute injects an element of public service into the employment relationship and this means that employees enjoy the protection of the principles of natural justice (such as the audi alteram partem principle or the principle that no-one may be the judge in his own case).
These judges are in effect applying the principles of the Supreme Court of Appeal decisions handed down in 1990-1992. Neither the Constitution of 1996 nor PAJA supersede these two decisions — on the contrary, the principles laid down in these older decisions are effectively confirmed by the Constitution and PAJA.
When it comes to dismissal, the implication is that the public dimension of the employment relationship between a public body and an employee renders that dismissal subject to administrative law control. The employer’s decision to dismiss had an immediate and direct external legal effect (the language of PAJA — see section 1 under the definition of “administrative action”) and therefore PAJA applies.
The exclusion of PAJA dismissal remedies
There is one other judgment in this case, namely the judgment of Conradie JA. This judge takes a completely different approach. His approach is to focus on the difficulties of interpreting the provisions of PAJA and the LRA. The real enquiry, he held, is not whether Transnet’s decision to dismiss Ms Chirwa constituted administrative action (he accepts that it did). Any proper dismissal enquiry in the public sector necessarily has the attributes to administrative action — and administrative action falls under the scope of PAJA.
The essence of Conradie JA’s approach is that it is not so much about the nature of the decision to dismiss but about the remedies and procedures that are at the disposal of an employee who has been dismissed. Clearly, the LRA provides a comprehensive scheme of labour laws and dispute resolution procedures. The purpose behind the LRA, he finds, is to subject an unfair dismissal dispute to the procedures set out in the LRA. What the LRA in effect does, is to remove unfair dismissal disputes from the scope of PAJA (even though they may still be administrative acts in nature). The LRA removes public-sector dismissal disputes from administrative law rules. A dismissal (in this case, a dismissal for poor work performance) is, in its very essence, a matter that should be dealt with in terms of the LRA. The following passage gives some insight into the Judge’s reasoning:
“[31] The Bill of Rights creates to distinct sources of power. Natural justice is a cornerstone of both but they are nevertheless distinct. The one, in s 23 of the Constitution, feeds the procedure of the labour law, the other, in s 33, those of the administrative law. Administrative power over the subject has one source, and employer’s power over its employees another. The statutes enacted to give effect to each of the constitutional provisions, PARA and the LRA, differ fundamentally in the substantive remedies they provide. If an application for the review of administrative action succeeds, the applicant is usually entitled to no more than a setting aside of the impugned decision and its remittal to the decision-maker to apply his mind afresh. Except where unreasonableness is an issue the reviewing court does not concern itself with the substance of the applicant’s case and only in rare cases substitutes its decision for that of its decision-maker. The guiding principle is that the subject is entitled to a procedurally fair and lawful decision, not to a correct one. Under the LRA the procedure to have a dismissal overturned or adjusted involves a re-hearing with evidence by the parties and a substitution of a correct decision for an incorrect one. The scope of relief consequent upon such an order is extensive. It is quite unlike that afforded by an administrative law review.”
No answer as yet …
For those who had hoped that the Supreme Court of Appeal would firmly and unambiguously decide, one way or another, that a dismissal is (or is not) administrative action, this case, with its three judgments, will no doubt be a considerable disappointment. The answer to the easy-looking question is still to come. Perhaps the time has come for PAJA to be amended, so that we can get some certainty on this point. That would, no doubt, be the easiest and cleanest solution to this issue.
The other issue is that of remedy. As the passage quoted above shows, the issue of remedy is a real one. If a dismissal is found to be unfair in terms of the LRA, an employee may be entitled to reinstatement or compensation. If the dismissal is only procedurally unfair, the employee is only entitled to compensation — but, depending on the nature of the unfairness, this compensation can be significant. The remedy under administrative law is a relatively poor one — the only remedy here is that the decision is referred back to whoever made the decision for a new process and a new decision. In other words, the matter simply goes back to where it came from in the first place, and, if the employer then follows a correct procedure the second time around, the dismissal (even if it is seen as an administrative act) may not be subject to review. Perhaps employees may be better advise to take their chances with the CCMA or a bargaining council instead of taking the High Court route.
Friday, March 19, 2010
Discrimination, Promotion and Employment Equity
Section 6(2)(a) of the Employment Equity Act (EEA) provides that it does not constitute unfair discrimination if the employer takes affirmative action measures consistent with the purposes of the EEA. This means that the employer may discriminate against employees when it comes to making appointments or promoting employees, as long as this discrimination is aligned with the employer’s affirmative action plan or its employment equity policy.
But this also means that the employer must get its ducks in a row — there must be a clear link between the discrimination and the employer’s employment equity concerns. The recent decision of the Labour Court in Baxter v National Commissioner, Correctional Services & another (2006) 15 LC 6.9.3 illustrates a potential pitfall for the employer. The employee, a “Coloured” male, alleged that he was unfairly discriminated against when the employer failed to appoint him to a certain post at Director level and he sought an order from the Labour Court directing the employer to appoint him to the post retrospectively. The employee had been with the Department of Correctional Services since 1986.
In 2000 the Department put in place an employment equity plan in line with the EEA. The Department saw this as an opportunity to re-examine its employment policies and practices and determining where the Department was, at that point in time, where it needed to be, and the actions it would need to take to achieve equality in employment. The focus of the Department’s measures was to improve the situation for individual employees who, because they fell within a particular group, found themselves unfairly affected by certain organisational practices and procedures. By eliminating discriminatory barriers, the Department took the view that it was not granting certain categories of employees an advantage, but that it was removing a bias in favour of some groups. In essence, the Department’s employment equity plan complied with all the principles of a fair and sound plan.
In 2001, the employer advertised various posts, including the specific post in question (Director: Area Manager). Two hundred applications were received for this post, and the employee was one of the nine applicants who were short-listed — he was interviewed in September 2001. After all the interviews had been conducted, the interview panel recommended that the employee be appointed to the post.
The recommendation made by the interview panel was forwarded to the Director: Equity for her consideration, and she also recommended the appointment of the employee. The recommendation was then bounced up to a higher level of management, stating that the employee had the necessary skills and expertise to perform the job and that these could not be compromised for the sake of getting the targets right. But that is where the process foundered: the recommendation was declined and it was stated that the issue of equity should be addressed properly. The reasons for the deviation from the employment equity plan were not seen as being convincing enough.
After having waited in vain for the results of the interview, the employee went through the internal processes to find out why he was not appointed. He still received no response, but saw the position re-advertised (the instruction to re-advertise had come from the National Commissioner). He applied again, but this time around did not even make it to the shortlist. Someone else was appointed to the post (this person was subsequently transferred and a third employee was transferred to the post in question).
Because the Department was not forthcoming in providing the disappointed employee with the reasons for his non-appointment, he made a written request for the record of the interview process in terms of the Promotion of Access to Information Act 2 of 2000. Only in February 2004 did the employee receive the reasons for his non-appointment — these included that the employee did not possess suitable qualifications and experience in comparison with the other candidates and that the recommendations made by the selection committee did not address the Departmental employment equity target.
This gave rise to a dispute concerning allegedly unfair discrimination and the employee referred the matter to the CCMA for conciliation. A certificate of outcome was issued by the CCMA after conciliation failed and the employee then referred the matter to the Labour Court.
Crunching the wrong numbers
The employee gave evidence (not disputed by the employer) that in the Free State Province, the appointment of a Coloured male was favoured and this is where the problem lay: a confusion between national employment equity targets and provincial targets. When asked to motivate the appointment of the employee, the Director: Equity concentrated on the national, instead of the provincial, statistical records. The Director: Equity should have realised that there was no need for such deviation as the appointment of a Coloured male in the Free State fell within the Department’s provincial targets. Had the correct statistical records for the Free State Province been used, the employee’s appointment to the post would most likely have been approved.
If an employer seeks to justify discrimination by referring to its equity plan and affirmative action, the employer was still obliged to show that they acted fairly. But the evidence produced before the Labour Court showed arbitrariness in the implementation of the equity plan. The statistical records relied on by the employer were arbitrary and they were no coordinated with those in the office of the National Commissioner. The Labour Court concluded that the Department’s decision not to appoint the employee to the post was based on unfair discrimination.
The Labour Court ordered the Department to ensure that the employee receives the same salary and benefits (backdated to January 2002, with interest at 11% per year) which he would have received had he been appointed to the post he had applied for.
Striking a balance
Some similar issues arose in Coetzer & Others v The Minister of Safety and Security & Another (2002) 11 LC 6.9.2. In this case the employer also argued that its discrimination on the basis of race was justified by reference to its employment equity plan. Advertisements for vacant posts indicated that the posts were intended for members of designed groups (Africans, Coloureds and Indians) only; some police officers argued that setting aside the posts for members of designated groups constituted unfair discrimination on the basis of race (in contravention of the EEA).
The SA Police Service conceded that it discriminated on the grounds of race, but it argued that this was not unfair discrimination, because it was in accordance with affirmative action measures ― these affirmative action measures themselves being consistent with the purposes of the Employment Equity Act. Whilst the SA Police Service had formulated a general Employment Equity Plan, the Forensic Science Laboratory (under which the explosives unit resorts) did not have its own plan.
The essential question before the Labour Court was whether the SAPS had justified its discrimination against the applicant policemen on the grounds of its affirmative action plan. In answering this question, the Labour Court held that it was necessary to examine the SA Police Service's Employment Equity Plan in the greater context of the Constitution Act 108 of 1996.
What the Labour Court found was that the SAPS, in refusing to promote or to allow the applications of the white police officers, had leaned too far in considering only the representation of people from designated groups in the police service as a whole. But what set this older decision of the Labour Court apart is the fact that the Court attached considerable importance to section 205 of the Constitution of 1996. Section 205 of the Constitution provides for the manner in which the police service is structured (national, provincial and local spheres of government) and that national legislation must establish the powers and functions of the police service and must enable the police service to discharge its responsibilities effectively, taking into account the requirements of the provinces.
The High Court has also looked at equity plans and affirmative action measures. In Stoman v Minister of Safety & Security & Others (2002) 11 HC 6.15.1 acknowleged that there may be a tension between ideals of efficiency and representation and, in such cases, a balance needs to be struck. But efficiency and equality are not necessarily separate, competing or even opposing aims. While the advancement of equity and equality in the workplace is and remains an integral part of the process of deciding appointments and promotions, there is a remaining requirement of rationality and, the High Court said, the appointment of people who are wholly unqualified, or less than suitably qualified or even incapable, in responsible positions cannot be justified.
The application of the employment equity plan
The fact that an employer has an employment equity plan, programme or policy is not the end of the matter. The question is also whether the equity plan has been agreed to, where necessary, or whether it has been implemented. Even if there is a working equity plan, the employer must still ensure that no arbitrator or unfair practices occur under the guise of affirmative action. There must be accountability and transparency in the application of the equity plan and the employer must act with a considerable degree of consistency.
When faced with an allegation that it is discriminating on the basis of race, an employer may well seek to rely on section 6(2) of the Employment Equity Act as a justification — that its discrimination is not unfair because it constitutes affirmative action. But it is clear from the cases that a mechanistic, unfair, arbitrary or even mistaken application of an employment equity plan will not survive the scrutiny of the Court. The mere existence of an employment equity plan is not enough — the application of the plan must also be fair.
But this also means that the employer must get its ducks in a row — there must be a clear link between the discrimination and the employer’s employment equity concerns. The recent decision of the Labour Court in Baxter v National Commissioner, Correctional Services & another (2006) 15 LC 6.9.3 illustrates a potential pitfall for the employer. The employee, a “Coloured” male, alleged that he was unfairly discriminated against when the employer failed to appoint him to a certain post at Director level and he sought an order from the Labour Court directing the employer to appoint him to the post retrospectively. The employee had been with the Department of Correctional Services since 1986.
In 2000 the Department put in place an employment equity plan in line with the EEA. The Department saw this as an opportunity to re-examine its employment policies and practices and determining where the Department was, at that point in time, where it needed to be, and the actions it would need to take to achieve equality in employment. The focus of the Department’s measures was to improve the situation for individual employees who, because they fell within a particular group, found themselves unfairly affected by certain organisational practices and procedures. By eliminating discriminatory barriers, the Department took the view that it was not granting certain categories of employees an advantage, but that it was removing a bias in favour of some groups. In essence, the Department’s employment equity plan complied with all the principles of a fair and sound plan.
In 2001, the employer advertised various posts, including the specific post in question (Director: Area Manager). Two hundred applications were received for this post, and the employee was one of the nine applicants who were short-listed — he was interviewed in September 2001. After all the interviews had been conducted, the interview panel recommended that the employee be appointed to the post.
The recommendation made by the interview panel was forwarded to the Director: Equity for her consideration, and she also recommended the appointment of the employee. The recommendation was then bounced up to a higher level of management, stating that the employee had the necessary skills and expertise to perform the job and that these could not be compromised for the sake of getting the targets right. But that is where the process foundered: the recommendation was declined and it was stated that the issue of equity should be addressed properly. The reasons for the deviation from the employment equity plan were not seen as being convincing enough.
After having waited in vain for the results of the interview, the employee went through the internal processes to find out why he was not appointed. He still received no response, but saw the position re-advertised (the instruction to re-advertise had come from the National Commissioner). He applied again, but this time around did not even make it to the shortlist. Someone else was appointed to the post (this person was subsequently transferred and a third employee was transferred to the post in question).
Because the Department was not forthcoming in providing the disappointed employee with the reasons for his non-appointment, he made a written request for the record of the interview process in terms of the Promotion of Access to Information Act 2 of 2000. Only in February 2004 did the employee receive the reasons for his non-appointment — these included that the employee did not possess suitable qualifications and experience in comparison with the other candidates and that the recommendations made by the selection committee did not address the Departmental employment equity target.
This gave rise to a dispute concerning allegedly unfair discrimination and the employee referred the matter to the CCMA for conciliation. A certificate of outcome was issued by the CCMA after conciliation failed and the employee then referred the matter to the Labour Court.
Crunching the wrong numbers
The employee gave evidence (not disputed by the employer) that in the Free State Province, the appointment of a Coloured male was favoured and this is where the problem lay: a confusion between national employment equity targets and provincial targets. When asked to motivate the appointment of the employee, the Director: Equity concentrated on the national, instead of the provincial, statistical records. The Director: Equity should have realised that there was no need for such deviation as the appointment of a Coloured male in the Free State fell within the Department’s provincial targets. Had the correct statistical records for the Free State Province been used, the employee’s appointment to the post would most likely have been approved.
If an employer seeks to justify discrimination by referring to its equity plan and affirmative action, the employer was still obliged to show that they acted fairly. But the evidence produced before the Labour Court showed arbitrariness in the implementation of the equity plan. The statistical records relied on by the employer were arbitrary and they were no coordinated with those in the office of the National Commissioner. The Labour Court concluded that the Department’s decision not to appoint the employee to the post was based on unfair discrimination.
The Labour Court ordered the Department to ensure that the employee receives the same salary and benefits (backdated to January 2002, with interest at 11% per year) which he would have received had he been appointed to the post he had applied for.
Striking a balance
Some similar issues arose in Coetzer & Others v The Minister of Safety and Security & Another (2002) 11 LC 6.9.2. In this case the employer also argued that its discrimination on the basis of race was justified by reference to its employment equity plan. Advertisements for vacant posts indicated that the posts were intended for members of designed groups (Africans, Coloureds and Indians) only; some police officers argued that setting aside the posts for members of designated groups constituted unfair discrimination on the basis of race (in contravention of the EEA).
The SA Police Service conceded that it discriminated on the grounds of race, but it argued that this was not unfair discrimination, because it was in accordance with affirmative action measures ― these affirmative action measures themselves being consistent with the purposes of the Employment Equity Act. Whilst the SA Police Service had formulated a general Employment Equity Plan, the Forensic Science Laboratory (under which the explosives unit resorts) did not have its own plan.
The essential question before the Labour Court was whether the SAPS had justified its discrimination against the applicant policemen on the grounds of its affirmative action plan. In answering this question, the Labour Court held that it was necessary to examine the SA Police Service's Employment Equity Plan in the greater context of the Constitution Act 108 of 1996.
What the Labour Court found was that the SAPS, in refusing to promote or to allow the applications of the white police officers, had leaned too far in considering only the representation of people from designated groups in the police service as a whole. But what set this older decision of the Labour Court apart is the fact that the Court attached considerable importance to section 205 of the Constitution of 1996. Section 205 of the Constitution provides for the manner in which the police service is structured (national, provincial and local spheres of government) and that national legislation must establish the powers and functions of the police service and must enable the police service to discharge its responsibilities effectively, taking into account the requirements of the provinces.
The High Court has also looked at equity plans and affirmative action measures. In Stoman v Minister of Safety & Security & Others (2002) 11 HC 6.15.1 acknowleged that there may be a tension between ideals of efficiency and representation and, in such cases, a balance needs to be struck. But efficiency and equality are not necessarily separate, competing or even opposing aims. While the advancement of equity and equality in the workplace is and remains an integral part of the process of deciding appointments and promotions, there is a remaining requirement of rationality and, the High Court said, the appointment of people who are wholly unqualified, or less than suitably qualified or even incapable, in responsible positions cannot be justified.
The application of the employment equity plan
The fact that an employer has an employment equity plan, programme or policy is not the end of the matter. The question is also whether the equity plan has been agreed to, where necessary, or whether it has been implemented. Even if there is a working equity plan, the employer must still ensure that no arbitrator or unfair practices occur under the guise of affirmative action. There must be accountability and transparency in the application of the equity plan and the employer must act with a considerable degree of consistency.
When faced with an allegation that it is discriminating on the basis of race, an employer may well seek to rely on section 6(2) of the Employment Equity Act as a justification — that its discrimination is not unfair because it constitutes affirmative action. But it is clear from the cases that a mechanistic, unfair, arbitrary or even mistaken application of an employment equity plan will not survive the scrutiny of the Court. The mere existence of an employment equity plan is not enough — the application of the plan must also be fair.
Thursday, March 18, 2010
Disciplinary Enquiries, the CCMA and the Right to Legal Representation (An Update)*
INTRODUCTION
The issue of legal representation at disciplinary enquiries and at the CCMA is a vexed one. Notwithstanding amendments to the LRA1 and changes to the Rules for the Conduct of Proceedings before the CCMA,2 the law relating to legal representation3 in labour disputes remains unchanged: there is no absolute right to legal representation4 at any stage of the proceedings5 arising from incapacity and misconduct dismissals.6
The law can be summarised as follows:
1.
Legal representation at disciplinary enquiries is allowed at the discretion of the chairperson;7
2.
Legal representation is generally not allowed at Conciliation stage;8
3.
Legal representation is generally allowed at Arbitration stage (except at incapacity / misconduct dismissals).
In an article titled ‘The Right to Legal Representation under the LRA’9 I discussed the law (until end-2002) on legal representation in employment disputes and argues for a change to the rules which would allow for legal representation at all CCMA arbitrations.10 This article revisits the argument for change, traces developments subsequent to the publication of the prior article11 and documents and discusses the results of an empirical survey12 of the opinions of arbitrators, legal practitioners, employees, employers, trade unions and academics on the right to legal representation.
THE ARGUMENT FOR CHANGE
The argument for change is grounded in practical as well as public policy concerns. From a practical point of view, a change to the rules would bring consistency13 to the law which currently, arbitrarily,14 differentiates between misconduct and incapacity arbitrations and all other arbitrations.15
The argument against change is that lawyers make the process legalistic and expensive16 and that ‘a high degree of legal representation … would both undermine endeavours to resolve these disputes expeditiously and tilt the balance unfairly in the favour of employers’.17
Among those18 who support a change to allow for legal representation at all arbitrations is the Law Society of South Africa (LSSA).19 On the issue of legal representation, the LSSA committee on labour law recently became involved, as amicus curiae, in the matter of Norman Tsie Taxis20 in the Labour Court. The position of the LSSA’s labour law committee will be discussed more completely at the 17th Annual Labour Law Conference.21
RECENT DEVELOPMENTS
The LRA and the CCMA Rules
Prior to amendments in 2002, legal representation at the CCMA was regulated by ss 135(4),22 138(4)23 and 140(1)24 of the LRA. These sections were repealed by the 2002 Labour Relations Amendment Act.25 The LRA was amended by the Amendment Act to read that the CCMA ‘may make rules regulating the right of any person or category of persons to represent any party in any conciliation or arbitration proceedings;26… and all other matters incidental to performing the functions of the Commission.’27
One of the stated purposes of the 2002 amendments was to provide for the making of regulations by the Minister concerning representation at the commission.28 Until such time as the CCMA Rules were amended, legal representation was regulated by the transitional arrangements29 of the LRA which provided that:
‘27(1) Until such time as rules made by the Commission in terms of section 115(2A)(m) of the Act come into force –
(a)
sections 135(4), 138(4) and 140(1) of the Act remain in force as if they had not been repealed …’
The commission released new rules in July 2002. Rule 25 deals with objections to a representative appearing before the CCMA. A footnote to Rule 25(1) states that ‘representation of parties in the Commission is dealt with in sections 135(4), 136(4) and 140(1),’ however these sections had been repealed, with effect from 1 August 2002, by the LRA Amendment Act, hence creating a lacuna in the law with regard to the rules for legal representation at the CCMA.
Although it could be argued that in the absence of appropriate wording in the CCMA Rules, that the transitional arrangements should apply, or that the relevant footnote should be interpreted to give effect to the clear intention of the legislature,30 this lacuna was also interpreted as a right to legal representation in misconduct and incapacity proceedings.
The former position was supported by Commissioner Brand in Chemical Energy Paper Printing Wood & Allied Workers Union obo Nyanga and Mondipak31 who was of the view that:
‘… the footnote to rule 25 is not substantive law, but the footnote together with the wording of rule 25 certainly reflects the intention of the governing body of the commission, when drafting the “New Rules”, to retain the provisions of ss 135(4), 138(4) and 140(1) for the purposes of regulating representation before the CCMA.
… If the rules are ultra vires for whatever reason … there is even more reason to say that the status quo remains, because then the “New Rules” have no legal effect and, consequently, it cannot be argued that the suspensive conditions contained in iterm 27(1) of schedule 7 have been fulfilled.’32
Commissioner Brand therefore ruled that the representation of parties at arbitration proceedings before the CCMA must be determined in terms of rule 25 of the CCMA Rules read with ss 138(4) and 140(1) of the LRA, as if they have been retained.33
On the other hand, Commissioner Niehaus in CEPPWAWU obo Prince v Shatterprufe34 reasoned that the CCMA Rules did not exclude legal representation on the basis that the CCMA had failed to adequately deal with the issue of legal representation in the new Rules. The commissioner was of the view that ‘[t]here can be no question that in the absence of any other statutory provision regulating the issue of representation, the consequence of the repeal of the aforesaid sections of the Act is that parties are entitled to be legally represented in CCMA proceedings…’35 The employer was therefore entitled to be legally represented. ‘The commissioner expressed the view that the new Rules for the Conduct of Proceedings before the CCMA may be null and void, since they were brought into effect before the 2002 Amendment Act itself became operative.36
In any event, the CCMA appears to have closed this gap when it re-issued the CCMA Rules in October 2003. The Rules now specifically contain, in the text of Rule 25, rules identical to the previously repealed ss 135(4), 138(4) and 140(1).
Are the CCMA rules relating to legal representation constitutional?
The constitutionality of the rules relating to legal representation at the CCMA is comprehensively dealt with by Landman J, in the Labour Court, in Netherburn Engineering CC t/a Netherburn Ceramics v Robert Mudau & Others.37
Following the dismissal of an employee, who challenged the dismissal at the CCMA, the managing member of Netherburn Engineering CC had appeared at the CCMA arbitration, accompanied by his attorney. The labour attorney duly applied for permission to represent his client on the grounds that the matter was complex, the member had little experience in labour matters and that the employee was represented by an experienced union official.38 The commissioner refused the attorney’s request and ultimately found in favour of the employee.
Netherburn Engineering CC took the matter on review, where he challenged the commissioner’s decision to exclude the lawyer; his refusal to postpone the matter; and the award itself.39
Specifically, the decision to exclude the employer’s legal representative was challenged on the following grounds:
i)
The right to equality
Section 9(1) of the Constitution40 provides that everyone is equal before the law and has the right to equal protection and benefit of the law; and section 9(3) goes on to prohibit unfair discrimination:
‘The state may not unfairly discriminate directly or indirectly against anyone on one or more grounds, including race, gender, sex, pregnancy, marital status, ethnic or social origin, colour, sexual orientation, age, disability, religion, conscience, belief, culture, language and birth.’
In Netherburn the court considered whether there was an actionable differentiation of treatment;41 ie whether the parties where treated differently, in a manner that could be considered unlawful. Although it acknowledged that the law relating to legal representation at misconduct and incapacity dismissal disputes was inconsistent with legal representation at arbitration proceedings generally, it was of the view there is no differentiation as regards the qualified right of legal representation between the employer and its former employee. As both employer and employee are on the same footing, the court reasoned, there is no inequality.
i)
The right to fair labour practices
Section 23(1) of the Constitution42 provides that everyone has the right to fair labour practices. ‘Fair labour practices’ is not defined in the constitution but, as Landman J points out, it embraces the right to job security which should not be terminated unlawfully or unfairly.43 Although not deciding the matter Landman J assumes that an employer’s rights vis-Ã -vis his or her employees are embraced in s 23(1)44 but finds that the court not need decide the appropriate institutions or procedures to enforce them.
ii)
The right to fair and lawful administrative action
Section 33(1) of the Constitution provides that everyone has the right to administrative action that is lawful, reasonable and procedurally fair. Administrative action attracts the principles of natural justice.45 In addition, the Promotion of Administrative Justice Act46 (PAJA) has been enacted to give effect to the right to fair and lawful administrative action. Administrative action is required to be procedurally fair and in this regard PAJA provides that legal representation should be allowed in serious and complex cases.47
While the CCMA does perform functions of an administrative nature,48 opinion on whether CCMA arbitration amounts to administrative action is divided. In Carephone (Pty) Ltd v Marcus NO & others49 it was held that the making of an arbitration award by the CCMA commissioner does constitute an administrative action; and an obiter remark50 in Shoprite Checkers (Pty) Ltd v Ramdaw NO & others51 is similarly to the effect that the PAJA definition of ‘administration action’52 may be wide enough to include an arbitration award by a CCMA commissioner.
On the other hand the Labour Court in Shoprite Checkers (Pty) Ltd v Ramdaw NO & others53 was of the view that arbitration is not administrative action.54 This is the view preferred by Landman J in the Netherburn matter.55
The classification of CCMA arbitration as administrative action would require, inter alia, that it adhere to PAJA, which provides that legal representation should be allowed in serious and complex cases. However, the importance of the classification of CCMA arbitration as administrative action, or not, losses some of its significance given the argument that the CCMA Rules56 are in any event compliant with PAJA in that the rules allow for legal representation in complex matters.57
iii)
The right to a fair public hearing
Section 34 of the Constitution58 provides that 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.
The employer in Netherburn argued that implicit in the right to a fair public hearing is the right to legal representation.
Landman J was prepared to concede that the CCMA is an appropriate neutral tribunal as contemplated by s 34 but replied in the negative to the question ‘[d]oes it flow from this that a party in similar circumstances to Netherburn has a right to legal representation?’59
Netherburn’s submission that ‘a fair public hearing’ entails that legal representation is a constitutional right of litigants participating in civil litigation was not accepted by the court. Landman J emphasised the distinction between courts and tribunals and, in so far as tribunals are concerned, was of the view that:
‘Legal representation may be appropriate in some situations and in a specific tribunal and not in other cases or on [sic] other tribunals. One cannot read a right of legal representation vis-Ã -vis a tribunal as being implicit in s 34.’60
iv)
The right to a fair trial
Section 35 of the Constitution61 provides that every accused person has a right to a fair trial which includes the right to choose, and be represented by a legal practitioner.
The s 35 right to a fair trial which includes the right to legal representation is applicable to persons accused of offences in a court of law and has no application in other tribunals. The CCMA, a tribunal for deciding labour disputes, is an organ of state and not a court of law62 63 and therefore the notion that s 35 is not applicable to disciplinary enquiries64 or at CCMA arbitrations is gaining in acceptance.65
Disciplinary Enquiries and Legal Representation
‘The overwhelming weight of authority in the Labour Court has been against granting legal representation at disciplinary enquiries.’66 However, regardless of whether the employer is a public entity or a private entity, both case law and the LRA appear to require, irrespective of the agreement between the parties, that an employer at least apply its mind to an application from an employee to allow legal representation.
This was the position in Cuppan v Cape Display Supply Chain Services.67 The applicant in Cuppan applied to the High Court for an order granting leave to be represented by a legal practitioner at a disciplinary inquiry on the grounds that he was entitled to legal representation in terms of s 2568 of the (Interim) Constitution.69 In addition, the employers’ disciplinary code provided that inquiries had to be conducted in accordance with natural justice. Page J disposed of the argument for a constitutional right to legal representation at disciplinary enquiries and held that s 25(3) is clearly concerned only with persons who are accused of offences in a court of law and has no application to domestic disciplinary tribunals.70
Page J, with regard to the disciplinary code provision that inquiries had be conducted in accordance with the principles of natural justice, refers to substantial authority to the effect that there is no general right to legal representation flowing from the requirements of natural justice71 although in complex cases natural justice may require legal representation.72 The judge is of the view that ‘where a hearing takes place before a tribunal other than a court of law, there is no general right to legal representation.’73 The time may well come however when public policy demands the recognition of such a right.74
In Hamata and Another v Chairperson, Peninsula Technikon Internal Disciplinary Committee and Others75 the Supreme Court of Appeal was of the view that a student disciplinary enquiry at the Peninsula Technikon amounts to administrative action.76 This, it was held, does not necessarily infer the right to legal representation; but that the disciplinary committee must at least apply its mind and exercise its discretion to the application for a legal representative.
Hamata, a student at the Peninsula Technikon argued for a right to legal representation at a disciplinary enquiry. He was refused legal representation on the basis that the representation rule in the code for disciplinary proceedings reads that ‘[t]he student may conduct his/her own defence or may be assisted by any student or a member of staff of the technikon.’77 Hamata appealed against the refusal to allow legal representation to the Cape High Court who upheld the refusal but granted the applicant a right of appeal to the Supreme Court of Appeal.
The judges of the Supreme Court of Appeal concurred that there was no constitutional right to legal representation in administrative proceedings, but that the Constitution was flexible enough to permit legal representation where it was required to attain procedural fairness; and that the disciplinary committee had failed to exercise its discretion in this regard. The appeal was upheld and the decisions of the disciplinary committee and the court a quo were set aside.
Legal representation at disciplinary enquiries came before the labour court in the more recent case of Majola v MEC, Department of Public Works, Northern Province and Others.78 The employer sought to rely on the contract between the parties in order to exclude legal representation. In this instance the contract took the form of a collective agreement, an instrument afforded primacy in the LRA. The court however was of the view that, notwithstanding the primacy of collective agreements,79 ‘if a collective agreement prohibits or restricts the granting of legal representation, an adjudicator may allow such representation provided just cause exists not to apply the terms of the collective agreement’.80 The adjudicator must be slow to disregard the terms of the collective agreement, but is required to balance the tension between the constitutional right of access to a court or tribunal, the primacy of collective agreements and the freedom to contract.81 In Majola’s case the Labour Court found that the chairperson had exercised his discretion adequately and therefore the application was dismissed.
As stated above, regardless of whether the employer is a public entity or a private entity, or of the agreement between the parties, it is more than prudent that an employer at least apply its mind to an application to allow legal representation at a disciplinary enquiry.
A SURVEY ON LEGAL REPRESENTATION AT DISCIPLINARY ENQUIRIES AND AT PROCEEDINGS BEFORE THE CCMA / BARGAINING COUNCILS
A survey on legal representation at disciplinary enquiries and at proceedings before the CCMA was distributed to CCMA commissioners, trade unions, employees, employers, legal practitioners and academics.
Participants in the survey were given the option to remain anonymous and were asked to select an appropriate description82 from the categories of: employee; employer; arbitrator / commissioner; legal representative; union representative; labour consultant or other. The participants were asked to consider the three questions set out below and to indicate their opinion on the status quo relating to legal representation at disciplinary enquiries and at CCMA proceedings.
QUESTION 1
Legal representation at disciplinary enquiries is allowed at the discretion of the chairperson.
On review: ‘The overwhelming weight of authority in the LC has been against granting legal representation at disciplinary enquiries’ Majola v MEC, Department of Public Works, Northern Province and Others
INDICATE YOUR OPINION WITH AN ‘X’ NEXT TO YOUR CHOICE
q I agree, legal representation should be at the discretion of the chairperson
q I disagree, legal representation should never be allowed at a disciplinary enquiry
q I disagree, legal representation should always be allowed at a disciplinary enquiry
q Other, please explain in the space provide below
Please explain your choice (optional):
QUESTION 2
Legal representation is generally not allowed at Conciliation stage.
INDICATE YOUR OPINION WITH AN ‘X’ NEXT TO YOUR CHOICE
q I agree, legal representation should not be allowed at Conciliation
q I disagree, legal representation should be allowed at Conciliation
q Other, please explain in the space provide below
Please explain your choice (optional):
QUESTION 3
Legal representation is generally allowed at Arbitration stage (except at incapacity / misconduct dismissals).
INDICATE YOUR OPINION WITH AN ‘X’ NEXT TO YOUR CHOICE
q I agree, legal representation should be allowed at Arbitration (except incapacity / misconduct dismissals)
q I disagree, legal representation should be allowed at ALL Arbitrations
q I disagree, legal representation should not be allowed at ANY Arbitration
q Other, please explain in the space provide below
Please explain your choice (optional):
Results of the survey
The results of the survey are currently being collated and will be presented at the Annual Labour Law Conference.83
CONCLUSION
The importance of dismissal law is recognised:
‘Dismissals relating to conduct hold serious social, financial and personal implications for employees and for employers. The concept of preserving job security is one of the paramount aims of the LRA. So protection against the invalid and unfair termination of an employment relationship has a special significance. Employers too have a real and legitimate interest in maintaining a workforce that is not prone to misconduct … The importance and prominence of dismissal and its consequences suggest that legal assistance at the stage of the determination of whether the dismissal is valid and fair is desirable.’84
It is also recognised that dismissal law is too important to leave to the parties to regulate.85 However, an aspect of dismissal law, the right to legal representation, particularly at CCMA arbitrations in respect of misconduct and incapacity dismissals, remains to be satisfactorily resolved. Notwithstanding policy issues86 against the imposition of such a right, there is growing support, in the interest of fairness and equity, for the law to expand the right to legal representation at the CCMA to disputes arising from misconduct and incapacity dismissals.
‘No doubt the debate will continue to rage …’.87
Footnotes
*
BA LLB LLM (UCT); Lecturer, Department of Commercial Law, University of Cape Town.
1
Act 12 of 2002.
2
Recent amendments to the ‘Rules for the Conduct of Proceedings before the CCMA’ (the ‘CCMA Rules’) introduced in terms of s 115 of the LRA include: GN961 Gazette 23611 of 25 July 2002; which Rules were amended and re-issued on 10 October 2003) (GN R1448 Gazette 25515 of 10 October 2003) (as corrected by GN R1512 Gazette 25607 of 17 October 2003).
3
D Collier ‘The right to legal representation under the LRA’ (2003) 24 ILJ 753.
4
N Smythe ‘Legal representation at the CCMA – Latest developments’ (2003) 24 ILJ 1875.
5
That is, at disciplinary enquiries and at CCMA proceedings. Legal representation is of course permitted in labour court and labour appeal court proceedings that involve misconduct and incapacity dismissal disputes, such as the application for review of an arbitration award. In most instances misconduct and incapacity dismissal disputes are finalised at the CCMA.
6
Unfair dismissal disputes constitute 82% of the disputes referred to the CCMA. (Percentage for the period 1 April – 31 December 2003).
7
Majola v MEC, Department of Public Works, Northern Province and Others (2004) 25 ILJ 131 (LC).
8
Rule 25(1)(a) of the new CCMA Rules provides that a party may be represented at conciliation only by a director or employee or a member, office bearer or official of a trade union or employers’ organisation. A legal representative who is also one of the above-mentioned persons may therefore represent a party at conciliation.
9
(2003) 24 ILJ 753.
10
Legal representation is still excluded at incapacity and misconduct dismissal arbitrations.
11
(2003) 24 ILJ 753.
12
A Survey on Legal Representation at Disciplinary Enquiries and at proceedings before the CCMA / Bargaining Councils.
13
It is also argued that candidate attorneys who have right of appearance should be allowed to appear before the CCMA – currently ‘a legal practitioner’ means any person admitted to practise as an advocate or an attorney in the Republic (s 213 LRA) and accordingly a candidate attorney is not entitled to represent a party in the CCMA.
14
There is no rational reason why the LRA should provide a right to legal representation in arbitrations about dismissals as a result of operational requirements but disallow it where the dismissal concerns the conduct or capacity of the employee. ‘There is in particular no rationality in permitting a right of legal representation in disputes about discipline falling short of dismissal (where job security is not in jeopardy) and [not] in conduct and capacity dismissals. In these [conduct and capacity dismissal] cases the stakes are so much higher …’ Landman J in Netherburn Engineering CC t/a Netherburn Ceramics v Robert Mudau & Others (2003) 23 ILJ 1712 at 1725.
15
Rule 25 of the CCMA Rules.
16
Explanatory Memorandum of the draft 1995 LRA Bill at 142. Quoted in Brassey Employment and Labour Law (2000) Vol III at A7:59 and in P Buirski ‘The Draft Labour Relations Bill 1995 – The Case for Legal Representation at its Proposed Fora for Dispute Resolution’ (1995) 16 ILJ 529.
17
P Benjamin ‘ Legal Representation in Labour Courts’ (1994) 15 ILJ 250 at 260.
18
See the results of the Survey on Legal Representation at Disciplinary Enquiries and at proceedings before the CCMA / Bargaining Councils set out in the text below.
19
See Collier (2003) 24 ILJ 753 at 763 – 764.
20
Norman Tsie Taxis v Pooe, M N.O. (LC) March 2004.
21
LexisNexis Butterworths Annual Labour Law Conference, 30 June – 2 July 2004 (Sandton Convention Centre). The author awaits further details from the LSSA.
22
‘135 Resolution of disputes through conciliation … (4) In the conciliation proceedings a party to the dispute may appear in person or be represented only by – (a) a director or employee of that party; or (b) any member, office-bearer or official of that party’s registered trade union or registered employers’ organisation.’
23
‘138 General provisions for arbitration proceedings … (4) In any arbitration proceedings, a party to the dispute may appear in person or be represented only by – (a) a legal practitioner; (b) a director or employee of the party; or (c) any member, office-bearer or official of that party’s registered trade union or registered employer’s organisation.’
24
‘140 Special provisions for arbitration about dismissals for reasons related to conduct or capacity … (1) If the dispute being arbitrated is about the fairness of a dismissal and a party has alleged that the reason for the dismissal related to the employee’s conduct or capacity, the parties, despite section 138(4), are not entitled to be represented by a legal practitioner in the arbitration proceedings unless – (a) the commissioner and all the other parties consent; or (b) the commissioner concludes that it is unreasonable to expect a party to deal with the dispute without legal representation, after considering – (i) the nature of the questions of law raised by the dispute; (ii) the complexity of the dispute; (iii) the public interest; and the comparative ability of the opposing parties or their representatives to deal with the arbitration of the dispute.’
25
Sections 26, 27 and 28 Act 12 of 2002.
26
Section 115(2A)(k).
27
Section 115(2A)(m).
28
Preamble, Act 12 of 2002.
29
Schedule 7, item 27.
30
Chemical Energy Paper Printing Wood & Allied Workers Union obo Nyanga and Mondipak (2003) 24 ILJ 1743 (CCMA); S Albertyn ‘The new CCMA Rules’ (2002) 23 ILJ 1715.
31
Chemical Energy Paper Printing Wood & Allied Workers Union obo Nyanga and Mondipak (2003) 24 ILJ 1743 (CCMA).
32
Supra at 1747.
33
Supra at 1748.
34
CEPPWAWU obo Prince v Shatterprufe (2003) 24 ILJ 1161 (CCMA).
35
Supra at 1162 – 1163.
36
Supra at 1163 – 1164.
37
(2003) 23 ILJ 1712 (LC).
38
Grogan ‘Not unconstitutional’ Labour Law Sibergramme 9/2003 at 4.
39
Grogan supra.
40
Act 108 of 1996.
41
The first enquiry in determining a complaint about inequality or discrimination is whether there has been a differentiation; and thereafter whether the differentiation is lawful. (Harksen v Lane & others 1998 (1) SA 300 [CC]). Netherburn supra at 1729.
42
Act 108 of 1996.
43
Netherburn supra at 1726.
44
This is still an unsettled area of law, see also NEHAWU v UCT & others (2003) 24 ILJ 95 (CC).
45
The principles of natural justice are the fundamental principles of procedural fairness and justice which require that a party who will be affected by an administrative decision receives a fair and unbiased hearing before the administrative tribunal reaches its decision. See Administrator, Transvaal and Others v Traub and Others 1989 (4) SA 731 A.
46
Act 3 of 2000.
47
Section 33(3).
48
Landman J in Netherburn supra at 1726.
49
(1998) 19 ILJ 1425 (LAC).
50
By Zondo JP in Shoprite Checkers (Pty) Ltd v Ramdaw NO & others (2001) 22 ILJ 1603 (LAC).
51
(2001) 22 ILJ 1603 (LAC).
52
Section 1 of PAJA provides that administrative action means any decision taken, or any failure to take a decision, by- (a) an organ of state, when- (i) exercising a power in terms of the Constitution or a provincial constitution; or (ii) exercising a public power or performing a public function in terms of any legislation; or (b) a natural or juristic person, other than an organ of state, when exercising a public power or performing a public function in terms of an empowering provision, which adversely affects the rights of any person and which has a direct, external legal effect.’ Section 1 goes on to exclude a number of actions but does not expressly exclude CCMA arbitration.
53
(2000) 21 ILJ 1232 (LC)
54
Wallis AJ supra at par 90.
55
Netherburn supra at 1727.
56
The repealed s 140[1] of the 1995 LRA, now contained in Rule 25.
57
N Smythe ‘Legal Representation at the CCMA – Latest Developments’ (2003) 24 ILJ 1875.
58
Act 108 of 1996.
59
Netherburn supra at 1727.
60
Landman J at 1728.
61
Act 108 of 1996.
62
1995 LRA; Netherburn supra at 1723.
63
Buirski advises that ‘[t]he prejudice that flows from a dismissal, which has often been described as the economic equivalent of the death penalty, is such that a criminal trial and a hearing designated to pronounce finally upon the fairness of a dismissal are not dissimilar proceedings’. P Buirski (1995) ILJ 529 at 542.
64
Cuppan v Cape Display Supply Chain Services (1995) 16 ILJ 846 (D).
65
Notwithstanding a formidable constitutional challenge raised by the employer in the Netherburn matter, it does not appear, from the written judgment, that the employer endeavoured to rely upon the provisions of s35.
66
Majola v MEC, Department of Public Works, Northern Province and Others (2004) 25 ILJ 131 (LC)
67
(1995) 16 ILJ 846 (D).
68
Section 25(3)(e) of the interim Constitution Act 200 of 2003 provides that every accused person shall have the right to a fair trial, which shall include the right to be represented by a legal practitioner of his or her choice or, where substantial injustice would otherwise result, to be provided with legal representation at state expense, and to be informed of these rights. This right is now reflected in s 35(2) of Act 108 of 1996.
69
Act 200 of 1993.
70
Cuppan v Cape Display Supply Chain Services supra at 850.
71
Cuppan v Cape Display Supply Chain Services supra at 853.
72
Baxter Administrative Law at 251 and 555 – 6.
73
Cuppan v Cape Display Supply Chain Services supra at 851.
74
Van Zyl J in Lace v Diack & others (1992) 13 ILJ 860 (W).
75
Hamata and Another v Chairperson, Peninsula Technikon Internal Disciplinary Committee and Others 2002 (5) SA 449 (SCA).
76
The Peninsula Technikon serves a public function.
77
Hamata supra at 1533.
78
Majola v MEC, Department of Public Works, Northern Province and Others (2004) 25 ILJ 131 (LC).
79
Section 1 1995 LRA.
80
Pillay J in Majola supra at 133 C.
81
Pillay J in Majola supra at 133 C - D.
82
With hindsight, parties should have been invited to select more than one category.
83
LexisNexis Butterworths Annual Labour Law Conference, 30 June – 2 July 2004 (Sandton Convention Centre).
84
Landman J in Netherburn Engineering CC t/a Netherburn Ceramics v Robert Mudau & Others (2003) 23 ILJ 1712 at 1726.
85
Hence the provisions of the 1995 LRA and the right to fair labour practices contained in the Constitution Act 108 of 1996.
86
Policy issues include escalated costs and inconvenience to employers which, it is argued, may act as a deterrent to employment and job creation. N Smythe (2003) 24 ILJ 1875 at 1878.
87
N Smythe (2003) 24 ILJ 1875 at 1878.
The issue of legal representation at disciplinary enquiries and at the CCMA is a vexed one. Notwithstanding amendments to the LRA1 and changes to the Rules for the Conduct of Proceedings before the CCMA,2 the law relating to legal representation3 in labour disputes remains unchanged: there is no absolute right to legal representation4 at any stage of the proceedings5 arising from incapacity and misconduct dismissals.6
The law can be summarised as follows:
1.
Legal representation at disciplinary enquiries is allowed at the discretion of the chairperson;7
2.
Legal representation is generally not allowed at Conciliation stage;8
3.
Legal representation is generally allowed at Arbitration stage (except at incapacity / misconduct dismissals).
In an article titled ‘The Right to Legal Representation under the LRA’9 I discussed the law (until end-2002) on legal representation in employment disputes and argues for a change to the rules which would allow for legal representation at all CCMA arbitrations.10 This article revisits the argument for change, traces developments subsequent to the publication of the prior article11 and documents and discusses the results of an empirical survey12 of the opinions of arbitrators, legal practitioners, employees, employers, trade unions and academics on the right to legal representation.
THE ARGUMENT FOR CHANGE
The argument for change is grounded in practical as well as public policy concerns. From a practical point of view, a change to the rules would bring consistency13 to the law which currently, arbitrarily,14 differentiates between misconduct and incapacity arbitrations and all other arbitrations.15
The argument against change is that lawyers make the process legalistic and expensive16 and that ‘a high degree of legal representation … would both undermine endeavours to resolve these disputes expeditiously and tilt the balance unfairly in the favour of employers’.17
Among those18 who support a change to allow for legal representation at all arbitrations is the Law Society of South Africa (LSSA).19 On the issue of legal representation, the LSSA committee on labour law recently became involved, as amicus curiae, in the matter of Norman Tsie Taxis20 in the Labour Court. The position of the LSSA’s labour law committee will be discussed more completely at the 17th Annual Labour Law Conference.21
RECENT DEVELOPMENTS
The LRA and the CCMA Rules
Prior to amendments in 2002, legal representation at the CCMA was regulated by ss 135(4),22 138(4)23 and 140(1)24 of the LRA. These sections were repealed by the 2002 Labour Relations Amendment Act.25 The LRA was amended by the Amendment Act to read that the CCMA ‘may make rules regulating the right of any person or category of persons to represent any party in any conciliation or arbitration proceedings;26… and all other matters incidental to performing the functions of the Commission.’27
One of the stated purposes of the 2002 amendments was to provide for the making of regulations by the Minister concerning representation at the commission.28 Until such time as the CCMA Rules were amended, legal representation was regulated by the transitional arrangements29 of the LRA which provided that:
‘27(1) Until such time as rules made by the Commission in terms of section 115(2A)(m) of the Act come into force –
(a)
sections 135(4), 138(4) and 140(1) of the Act remain in force as if they had not been repealed …’
The commission released new rules in July 2002. Rule 25 deals with objections to a representative appearing before the CCMA. A footnote to Rule 25(1) states that ‘representation of parties in the Commission is dealt with in sections 135(4), 136(4) and 140(1),’ however these sections had been repealed, with effect from 1 August 2002, by the LRA Amendment Act, hence creating a lacuna in the law with regard to the rules for legal representation at the CCMA.
Although it could be argued that in the absence of appropriate wording in the CCMA Rules, that the transitional arrangements should apply, or that the relevant footnote should be interpreted to give effect to the clear intention of the legislature,30 this lacuna was also interpreted as a right to legal representation in misconduct and incapacity proceedings.
The former position was supported by Commissioner Brand in Chemical Energy Paper Printing Wood & Allied Workers Union obo Nyanga and Mondipak31 who was of the view that:
‘… the footnote to rule 25 is not substantive law, but the footnote together with the wording of rule 25 certainly reflects the intention of the governing body of the commission, when drafting the “New Rules”, to retain the provisions of ss 135(4), 138(4) and 140(1) for the purposes of regulating representation before the CCMA.
… If the rules are ultra vires for whatever reason … there is even more reason to say that the status quo remains, because then the “New Rules” have no legal effect and, consequently, it cannot be argued that the suspensive conditions contained in iterm 27(1) of schedule 7 have been fulfilled.’32
Commissioner Brand therefore ruled that the representation of parties at arbitration proceedings before the CCMA must be determined in terms of rule 25 of the CCMA Rules read with ss 138(4) and 140(1) of the LRA, as if they have been retained.33
On the other hand, Commissioner Niehaus in CEPPWAWU obo Prince v Shatterprufe34 reasoned that the CCMA Rules did not exclude legal representation on the basis that the CCMA had failed to adequately deal with the issue of legal representation in the new Rules. The commissioner was of the view that ‘[t]here can be no question that in the absence of any other statutory provision regulating the issue of representation, the consequence of the repeal of the aforesaid sections of the Act is that parties are entitled to be legally represented in CCMA proceedings…’35 The employer was therefore entitled to be legally represented. ‘The commissioner expressed the view that the new Rules for the Conduct of Proceedings before the CCMA may be null and void, since they were brought into effect before the 2002 Amendment Act itself became operative.36
In any event, the CCMA appears to have closed this gap when it re-issued the CCMA Rules in October 2003. The Rules now specifically contain, in the text of Rule 25, rules identical to the previously repealed ss 135(4), 138(4) and 140(1).
Are the CCMA rules relating to legal representation constitutional?
The constitutionality of the rules relating to legal representation at the CCMA is comprehensively dealt with by Landman J, in the Labour Court, in Netherburn Engineering CC t/a Netherburn Ceramics v Robert Mudau & Others.37
Following the dismissal of an employee, who challenged the dismissal at the CCMA, the managing member of Netherburn Engineering CC had appeared at the CCMA arbitration, accompanied by his attorney. The labour attorney duly applied for permission to represent his client on the grounds that the matter was complex, the member had little experience in labour matters and that the employee was represented by an experienced union official.38 The commissioner refused the attorney’s request and ultimately found in favour of the employee.
Netherburn Engineering CC took the matter on review, where he challenged the commissioner’s decision to exclude the lawyer; his refusal to postpone the matter; and the award itself.39
Specifically, the decision to exclude the employer’s legal representative was challenged on the following grounds:
i)
The right to equality
Section 9(1) of the Constitution40 provides that everyone is equal before the law and has the right to equal protection and benefit of the law; and section 9(3) goes on to prohibit unfair discrimination:
‘The state may not unfairly discriminate directly or indirectly against anyone on one or more grounds, including race, gender, sex, pregnancy, marital status, ethnic or social origin, colour, sexual orientation, age, disability, religion, conscience, belief, culture, language and birth.’
In Netherburn the court considered whether there was an actionable differentiation of treatment;41 ie whether the parties where treated differently, in a manner that could be considered unlawful. Although it acknowledged that the law relating to legal representation at misconduct and incapacity dismissal disputes was inconsistent with legal representation at arbitration proceedings generally, it was of the view there is no differentiation as regards the qualified right of legal representation between the employer and its former employee. As both employer and employee are on the same footing, the court reasoned, there is no inequality.
i)
The right to fair labour practices
Section 23(1) of the Constitution42 provides that everyone has the right to fair labour practices. ‘Fair labour practices’ is not defined in the constitution but, as Landman J points out, it embraces the right to job security which should not be terminated unlawfully or unfairly.43 Although not deciding the matter Landman J assumes that an employer’s rights vis-Ã -vis his or her employees are embraced in s 23(1)44 but finds that the court not need decide the appropriate institutions or procedures to enforce them.
ii)
The right to fair and lawful administrative action
Section 33(1) of the Constitution provides that everyone has the right to administrative action that is lawful, reasonable and procedurally fair. Administrative action attracts the principles of natural justice.45 In addition, the Promotion of Administrative Justice Act46 (PAJA) has been enacted to give effect to the right to fair and lawful administrative action. Administrative action is required to be procedurally fair and in this regard PAJA provides that legal representation should be allowed in serious and complex cases.47
While the CCMA does perform functions of an administrative nature,48 opinion on whether CCMA arbitration amounts to administrative action is divided. In Carephone (Pty) Ltd v Marcus NO & others49 it was held that the making of an arbitration award by the CCMA commissioner does constitute an administrative action; and an obiter remark50 in Shoprite Checkers (Pty) Ltd v Ramdaw NO & others51 is similarly to the effect that the PAJA definition of ‘administration action’52 may be wide enough to include an arbitration award by a CCMA commissioner.
On the other hand the Labour Court in Shoprite Checkers (Pty) Ltd v Ramdaw NO & others53 was of the view that arbitration is not administrative action.54 This is the view preferred by Landman J in the Netherburn matter.55
The classification of CCMA arbitration as administrative action would require, inter alia, that it adhere to PAJA, which provides that legal representation should be allowed in serious and complex cases. However, the importance of the classification of CCMA arbitration as administrative action, or not, losses some of its significance given the argument that the CCMA Rules56 are in any event compliant with PAJA in that the rules allow for legal representation in complex matters.57
iii)
The right to a fair public hearing
Section 34 of the Constitution58 provides that 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.
The employer in Netherburn argued that implicit in the right to a fair public hearing is the right to legal representation.
Landman J was prepared to concede that the CCMA is an appropriate neutral tribunal as contemplated by s 34 but replied in the negative to the question ‘[d]oes it flow from this that a party in similar circumstances to Netherburn has a right to legal representation?’59
Netherburn’s submission that ‘a fair public hearing’ entails that legal representation is a constitutional right of litigants participating in civil litigation was not accepted by the court. Landman J emphasised the distinction between courts and tribunals and, in so far as tribunals are concerned, was of the view that:
‘Legal representation may be appropriate in some situations and in a specific tribunal and not in other cases or on [sic] other tribunals. One cannot read a right of legal representation vis-Ã -vis a tribunal as being implicit in s 34.’60
iv)
The right to a fair trial
Section 35 of the Constitution61 provides that every accused person has a right to a fair trial which includes the right to choose, and be represented by a legal practitioner.
The s 35 right to a fair trial which includes the right to legal representation is applicable to persons accused of offences in a court of law and has no application in other tribunals. The CCMA, a tribunal for deciding labour disputes, is an organ of state and not a court of law62 63 and therefore the notion that s 35 is not applicable to disciplinary enquiries64 or at CCMA arbitrations is gaining in acceptance.65
Disciplinary Enquiries and Legal Representation
‘The overwhelming weight of authority in the Labour Court has been against granting legal representation at disciplinary enquiries.’66 However, regardless of whether the employer is a public entity or a private entity, both case law and the LRA appear to require, irrespective of the agreement between the parties, that an employer at least apply its mind to an application from an employee to allow legal representation.
This was the position in Cuppan v Cape Display Supply Chain Services.67 The applicant in Cuppan applied to the High Court for an order granting leave to be represented by a legal practitioner at a disciplinary inquiry on the grounds that he was entitled to legal representation in terms of s 2568 of the (Interim) Constitution.69 In addition, the employers’ disciplinary code provided that inquiries had to be conducted in accordance with natural justice. Page J disposed of the argument for a constitutional right to legal representation at disciplinary enquiries and held that s 25(3) is clearly concerned only with persons who are accused of offences in a court of law and has no application to domestic disciplinary tribunals.70
Page J, with regard to the disciplinary code provision that inquiries had be conducted in accordance with the principles of natural justice, refers to substantial authority to the effect that there is no general right to legal representation flowing from the requirements of natural justice71 although in complex cases natural justice may require legal representation.72 The judge is of the view that ‘where a hearing takes place before a tribunal other than a court of law, there is no general right to legal representation.’73 The time may well come however when public policy demands the recognition of such a right.74
In Hamata and Another v Chairperson, Peninsula Technikon Internal Disciplinary Committee and Others75 the Supreme Court of Appeal was of the view that a student disciplinary enquiry at the Peninsula Technikon amounts to administrative action.76 This, it was held, does not necessarily infer the right to legal representation; but that the disciplinary committee must at least apply its mind and exercise its discretion to the application for a legal representative.
Hamata, a student at the Peninsula Technikon argued for a right to legal representation at a disciplinary enquiry. He was refused legal representation on the basis that the representation rule in the code for disciplinary proceedings reads that ‘[t]he student may conduct his/her own defence or may be assisted by any student or a member of staff of the technikon.’77 Hamata appealed against the refusal to allow legal representation to the Cape High Court who upheld the refusal but granted the applicant a right of appeal to the Supreme Court of Appeal.
The judges of the Supreme Court of Appeal concurred that there was no constitutional right to legal representation in administrative proceedings, but that the Constitution was flexible enough to permit legal representation where it was required to attain procedural fairness; and that the disciplinary committee had failed to exercise its discretion in this regard. The appeal was upheld and the decisions of the disciplinary committee and the court a quo were set aside.
Legal representation at disciplinary enquiries came before the labour court in the more recent case of Majola v MEC, Department of Public Works, Northern Province and Others.78 The employer sought to rely on the contract between the parties in order to exclude legal representation. In this instance the contract took the form of a collective agreement, an instrument afforded primacy in the LRA. The court however was of the view that, notwithstanding the primacy of collective agreements,79 ‘if a collective agreement prohibits or restricts the granting of legal representation, an adjudicator may allow such representation provided just cause exists not to apply the terms of the collective agreement’.80 The adjudicator must be slow to disregard the terms of the collective agreement, but is required to balance the tension between the constitutional right of access to a court or tribunal, the primacy of collective agreements and the freedom to contract.81 In Majola’s case the Labour Court found that the chairperson had exercised his discretion adequately and therefore the application was dismissed.
As stated above, regardless of whether the employer is a public entity or a private entity, or of the agreement between the parties, it is more than prudent that an employer at least apply its mind to an application to allow legal representation at a disciplinary enquiry.
A SURVEY ON LEGAL REPRESENTATION AT DISCIPLINARY ENQUIRIES AND AT PROCEEDINGS BEFORE THE CCMA / BARGAINING COUNCILS
A survey on legal representation at disciplinary enquiries and at proceedings before the CCMA was distributed to CCMA commissioners, trade unions, employees, employers, legal practitioners and academics.
Participants in the survey were given the option to remain anonymous and were asked to select an appropriate description82 from the categories of: employee; employer; arbitrator / commissioner; legal representative; union representative; labour consultant or other. The participants were asked to consider the three questions set out below and to indicate their opinion on the status quo relating to legal representation at disciplinary enquiries and at CCMA proceedings.
QUESTION 1
Legal representation at disciplinary enquiries is allowed at the discretion of the chairperson.
On review: ‘The overwhelming weight of authority in the LC has been against granting legal representation at disciplinary enquiries’ Majola v MEC, Department of Public Works, Northern Province and Others
INDICATE YOUR OPINION WITH AN ‘X’ NEXT TO YOUR CHOICE
q I agree, legal representation should be at the discretion of the chairperson
q I disagree, legal representation should never be allowed at a disciplinary enquiry
q I disagree, legal representation should always be allowed at a disciplinary enquiry
q Other, please explain in the space provide below
Please explain your choice (optional):
QUESTION 2
Legal representation is generally not allowed at Conciliation stage.
INDICATE YOUR OPINION WITH AN ‘X’ NEXT TO YOUR CHOICE
q I agree, legal representation should not be allowed at Conciliation
q I disagree, legal representation should be allowed at Conciliation
q Other, please explain in the space provide below
Please explain your choice (optional):
QUESTION 3
Legal representation is generally allowed at Arbitration stage (except at incapacity / misconduct dismissals).
INDICATE YOUR OPINION WITH AN ‘X’ NEXT TO YOUR CHOICE
q I agree, legal representation should be allowed at Arbitration (except incapacity / misconduct dismissals)
q I disagree, legal representation should be allowed at ALL Arbitrations
q I disagree, legal representation should not be allowed at ANY Arbitration
q Other, please explain in the space provide below
Please explain your choice (optional):
Results of the survey
The results of the survey are currently being collated and will be presented at the Annual Labour Law Conference.83
CONCLUSION
The importance of dismissal law is recognised:
‘Dismissals relating to conduct hold serious social, financial and personal implications for employees and for employers. The concept of preserving job security is one of the paramount aims of the LRA. So protection against the invalid and unfair termination of an employment relationship has a special significance. Employers too have a real and legitimate interest in maintaining a workforce that is not prone to misconduct … The importance and prominence of dismissal and its consequences suggest that legal assistance at the stage of the determination of whether the dismissal is valid and fair is desirable.’84
It is also recognised that dismissal law is too important to leave to the parties to regulate.85 However, an aspect of dismissal law, the right to legal representation, particularly at CCMA arbitrations in respect of misconduct and incapacity dismissals, remains to be satisfactorily resolved. Notwithstanding policy issues86 against the imposition of such a right, there is growing support, in the interest of fairness and equity, for the law to expand the right to legal representation at the CCMA to disputes arising from misconduct and incapacity dismissals.
‘No doubt the debate will continue to rage …’.87
Footnotes
*
BA LLB LLM (UCT); Lecturer, Department of Commercial Law, University of Cape Town.
1
Act 12 of 2002.
2
Recent amendments to the ‘Rules for the Conduct of Proceedings before the CCMA’ (the ‘CCMA Rules’) introduced in terms of s 115 of the LRA include: GN961 Gazette 23611 of 25 July 2002; which Rules were amended and re-issued on 10 October 2003) (GN R1448 Gazette 25515 of 10 October 2003) (as corrected by GN R1512 Gazette 25607 of 17 October 2003).
3
D Collier ‘The right to legal representation under the LRA’ (2003) 24 ILJ 753.
4
N Smythe ‘Legal representation at the CCMA – Latest developments’ (2003) 24 ILJ 1875.
5
That is, at disciplinary enquiries and at CCMA proceedings. Legal representation is of course permitted in labour court and labour appeal court proceedings that involve misconduct and incapacity dismissal disputes, such as the application for review of an arbitration award. In most instances misconduct and incapacity dismissal disputes are finalised at the CCMA.
6
Unfair dismissal disputes constitute 82% of the disputes referred to the CCMA. (Percentage for the period 1 April – 31 December 2003).
7
Majola v MEC, Department of Public Works, Northern Province and Others (2004) 25 ILJ 131 (LC).
8
Rule 25(1)(a) of the new CCMA Rules provides that a party may be represented at conciliation only by a director or employee or a member, office bearer or official of a trade union or employers’ organisation. A legal representative who is also one of the above-mentioned persons may therefore represent a party at conciliation.
9
(2003) 24 ILJ 753.
10
Legal representation is still excluded at incapacity and misconduct dismissal arbitrations.
11
(2003) 24 ILJ 753.
12
A Survey on Legal Representation at Disciplinary Enquiries and at proceedings before the CCMA / Bargaining Councils.
13
It is also argued that candidate attorneys who have right of appearance should be allowed to appear before the CCMA – currently ‘a legal practitioner’ means any person admitted to practise as an advocate or an attorney in the Republic (s 213 LRA) and accordingly a candidate attorney is not entitled to represent a party in the CCMA.
14
There is no rational reason why the LRA should provide a right to legal representation in arbitrations about dismissals as a result of operational requirements but disallow it where the dismissal concerns the conduct or capacity of the employee. ‘There is in particular no rationality in permitting a right of legal representation in disputes about discipline falling short of dismissal (where job security is not in jeopardy) and [not] in conduct and capacity dismissals. In these [conduct and capacity dismissal] cases the stakes are so much higher …’ Landman J in Netherburn Engineering CC t/a Netherburn Ceramics v Robert Mudau & Others (2003) 23 ILJ 1712 at 1725.
15
Rule 25 of the CCMA Rules.
16
Explanatory Memorandum of the draft 1995 LRA Bill at 142. Quoted in Brassey Employment and Labour Law (2000) Vol III at A7:59 and in P Buirski ‘The Draft Labour Relations Bill 1995 – The Case for Legal Representation at its Proposed Fora for Dispute Resolution’ (1995) 16 ILJ 529.
17
P Benjamin ‘ Legal Representation in Labour Courts’ (1994) 15 ILJ 250 at 260.
18
See the results of the Survey on Legal Representation at Disciplinary Enquiries and at proceedings before the CCMA / Bargaining Councils set out in the text below.
19
See Collier (2003) 24 ILJ 753 at 763 – 764.
20
Norman Tsie Taxis v Pooe, M N.O. (LC) March 2004.
21
LexisNexis Butterworths Annual Labour Law Conference, 30 June – 2 July 2004 (Sandton Convention Centre). The author awaits further details from the LSSA.
22
‘135 Resolution of disputes through conciliation … (4) In the conciliation proceedings a party to the dispute may appear in person or be represented only by – (a) a director or employee of that party; or (b) any member, office-bearer or official of that party’s registered trade union or registered employers’ organisation.’
23
‘138 General provisions for arbitration proceedings … (4) In any arbitration proceedings, a party to the dispute may appear in person or be represented only by – (a) a legal practitioner; (b) a director or employee of the party; or (c) any member, office-bearer or official of that party’s registered trade union or registered employer’s organisation.’
24
‘140 Special provisions for arbitration about dismissals for reasons related to conduct or capacity … (1) If the dispute being arbitrated is about the fairness of a dismissal and a party has alleged that the reason for the dismissal related to the employee’s conduct or capacity, the parties, despite section 138(4), are not entitled to be represented by a legal practitioner in the arbitration proceedings unless – (a) the commissioner and all the other parties consent; or (b) the commissioner concludes that it is unreasonable to expect a party to deal with the dispute without legal representation, after considering – (i) the nature of the questions of law raised by the dispute; (ii) the complexity of the dispute; (iii) the public interest; and the comparative ability of the opposing parties or their representatives to deal with the arbitration of the dispute.’
25
Sections 26, 27 and 28 Act 12 of 2002.
26
Section 115(2A)(k).
27
Section 115(2A)(m).
28
Preamble, Act 12 of 2002.
29
Schedule 7, item 27.
30
Chemical Energy Paper Printing Wood & Allied Workers Union obo Nyanga and Mondipak (2003) 24 ILJ 1743 (CCMA); S Albertyn ‘The new CCMA Rules’ (2002) 23 ILJ 1715.
31
Chemical Energy Paper Printing Wood & Allied Workers Union obo Nyanga and Mondipak (2003) 24 ILJ 1743 (CCMA).
32
Supra at 1747.
33
Supra at 1748.
34
CEPPWAWU obo Prince v Shatterprufe (2003) 24 ILJ 1161 (CCMA).
35
Supra at 1162 – 1163.
36
Supra at 1163 – 1164.
37
(2003) 23 ILJ 1712 (LC).
38
Grogan ‘Not unconstitutional’ Labour Law Sibergramme 9/2003 at 4.
39
Grogan supra.
40
Act 108 of 1996.
41
The first enquiry in determining a complaint about inequality or discrimination is whether there has been a differentiation; and thereafter whether the differentiation is lawful. (Harksen v Lane & others 1998 (1) SA 300 [CC]). Netherburn supra at 1729.
42
Act 108 of 1996.
43
Netherburn supra at 1726.
44
This is still an unsettled area of law, see also NEHAWU v UCT & others (2003) 24 ILJ 95 (CC).
45
The principles of natural justice are the fundamental principles of procedural fairness and justice which require that a party who will be affected by an administrative decision receives a fair and unbiased hearing before the administrative tribunal reaches its decision. See Administrator, Transvaal and Others v Traub and Others 1989 (4) SA 731 A.
46
Act 3 of 2000.
47
Section 33(3).
48
Landman J in Netherburn supra at 1726.
49
(1998) 19 ILJ 1425 (LAC).
50
By Zondo JP in Shoprite Checkers (Pty) Ltd v Ramdaw NO & others (2001) 22 ILJ 1603 (LAC).
51
(2001) 22 ILJ 1603 (LAC).
52
Section 1 of PAJA provides that administrative action means any decision taken, or any failure to take a decision, by- (a) an organ of state, when- (i) exercising a power in terms of the Constitution or a provincial constitution; or (ii) exercising a public power or performing a public function in terms of any legislation; or (b) a natural or juristic person, other than an organ of state, when exercising a public power or performing a public function in terms of an empowering provision, which adversely affects the rights of any person and which has a direct, external legal effect.’ Section 1 goes on to exclude a number of actions but does not expressly exclude CCMA arbitration.
53
(2000) 21 ILJ 1232 (LC)
54
Wallis AJ supra at par 90.
55
Netherburn supra at 1727.
56
The repealed s 140[1] of the 1995 LRA, now contained in Rule 25.
57
N Smythe ‘Legal Representation at the CCMA – Latest Developments’ (2003) 24 ILJ 1875.
58
Act 108 of 1996.
59
Netherburn supra at 1727.
60
Landman J at 1728.
61
Act 108 of 1996.
62
1995 LRA; Netherburn supra at 1723.
63
Buirski advises that ‘[t]he prejudice that flows from a dismissal, which has often been described as the economic equivalent of the death penalty, is such that a criminal trial and a hearing designated to pronounce finally upon the fairness of a dismissal are not dissimilar proceedings’. P Buirski (1995) ILJ 529 at 542.
64
Cuppan v Cape Display Supply Chain Services (1995) 16 ILJ 846 (D).
65
Notwithstanding a formidable constitutional challenge raised by the employer in the Netherburn matter, it does not appear, from the written judgment, that the employer endeavoured to rely upon the provisions of s35.
66
Majola v MEC, Department of Public Works, Northern Province and Others (2004) 25 ILJ 131 (LC)
67
(1995) 16 ILJ 846 (D).
68
Section 25(3)(e) of the interim Constitution Act 200 of 2003 provides that every accused person shall have the right to a fair trial, which shall include the right to be represented by a legal practitioner of his or her choice or, where substantial injustice would otherwise result, to be provided with legal representation at state expense, and to be informed of these rights. This right is now reflected in s 35(2) of Act 108 of 1996.
69
Act 200 of 1993.
70
Cuppan v Cape Display Supply Chain Services supra at 850.
71
Cuppan v Cape Display Supply Chain Services supra at 853.
72
Baxter Administrative Law at 251 and 555 – 6.
73
Cuppan v Cape Display Supply Chain Services supra at 851.
74
Van Zyl J in Lace v Diack & others (1992) 13 ILJ 860 (W).
75
Hamata and Another v Chairperson, Peninsula Technikon Internal Disciplinary Committee and Others 2002 (5) SA 449 (SCA).
76
The Peninsula Technikon serves a public function.
77
Hamata supra at 1533.
78
Majola v MEC, Department of Public Works, Northern Province and Others (2004) 25 ILJ 131 (LC).
79
Section 1 1995 LRA.
80
Pillay J in Majola supra at 133 C.
81
Pillay J in Majola supra at 133 C - D.
82
With hindsight, parties should have been invited to select more than one category.
83
LexisNexis Butterworths Annual Labour Law Conference, 30 June – 2 July 2004 (Sandton Convention Centre).
84
Landman J in Netherburn Engineering CC t/a Netherburn Ceramics v Robert Mudau & Others (2003) 23 ILJ 1712 at 1726.
85
Hence the provisions of the 1995 LRA and the right to fair labour practices contained in the Constitution Act 108 of 1996.
86
Policy issues include escalated costs and inconvenience to employers which, it is argued, may act as a deterrent to employment and job creation. N Smythe (2003) 24 ILJ 1875 at 1878.
87
N Smythe (2003) 24 ILJ 1875 at 1878.
Wednesday, March 17, 2010
Depression and Dismissal for Incapacity
Once properly diagnosed, depression constitutes a disease — one much like any other chronic and, at times, debilitating disease. There is no instant cure for depression, but there are a variety of treatments that can go some length in addressing an employee’s depression. Major depression comes in a number of forms and guises, but the bottom line is that an employer cannot be expected to keep a severely depressed (in other words, a severely ill) person in service indefinitely. The normal rules in respect of dismissal for incapacity (ill health) will apply in such cases.
One of the most difficult questions in this context would be whether the depression can be seen as a permanent disability or whether the employee, with proper medical treatment, can be expected to return to work at some stage in the future. Is it possible to change the employee’s working conditions or job so as to make it possible for him or her to continue working? These sorts of issues become even more difficult if the employee alleges that his or her depression has been caused, either entirely or in part, by difficulties experienced at work.
Questions arising from a dismissal relating to an employee’s depression are often clouded by a number of other issues. In Mphoreng / Connex Travel (2001) 10 CCMA 8.15.6 for instance, the issue in dispute related to the employee’s absence from work. Unauthorised absence was also the issue in Adams / Impala Platinum Mine (2004) 13 CCMA 8.17.7. The question in cases such as these is usually whether the employee has informed the employer of his or her absence in advance or contacted the employer to inform it that he or she would be absence. The question may also arise as to whether or not the employee’s leave was authorised.
An employee may also try to use depression as a tactic to delay a disciplinary hearing (see Dunn / Telkom SA Ltd & Others (2003) 12 CCMA 8.18.6)
An employee’s absence can reach an extreme, of course. In Johnson / Department of Justice (2003) 12 GPSBC 7.2.1 the employee was absent from work for about four months due to depression. Eventually the employer stopped paying him and only then did the employee re-appear, armed with medical certificates stating that he was unfit for duty. The employer argued that everything possible had been done to contact the employee during his absence, but that the employee had only returned to work once the flow of money had been shut off. Because the employee had failed in his duty to contact his employer and to inform his employer as to where he was, the dismissal was found to be substantively fair.
SAMWU obo Van Wyngaardt / City of Cape Town (Tygerberg Administration) (2001) 10 CCMA 8.1.8 does deal with dismissal for incapacity, but in this case the employee’s depression was only part of his health problems — he also experienced problems with his knee, shoulder and tuberculosis in addition to the depression.
There appear to be no reported arbitration awards that deal solely with depression as a ground for an ill health dismissal. Almost invariably, it seems, an employee is charged with misconduct in some form or another (absenteeism, for example) or the employee’s ill health is eclipsed by his or her poor performance (in this case the employer will probably choose to dismiss the employee on the basis of the employee’s failing to meet performance standards) — see Shabani / Thales Geosolutions SA (Pty) Ltd (2001) 10 CCMA 8.1.11.
Employers, it seems, do not dismiss employees solely on the basis of their ill health when they suffer from depression and they normally rely on other grounds for dismissal. Because of some remaining stigma attached to depression, there may be some residual difficulties in dealing with this illness appropriately and sympathetically. But an employee who suffers from diagnosed major depression should be treated the same way as any other ill employee, and there should be no differentiation in respect of sick leave, for instance. Abuse of leave or taking unauthorised leave or simply staying away are forms of misconduct, and many feel more comfortable using these as the basis for a dismissal.
One of the most difficult questions in this context would be whether the depression can be seen as a permanent disability or whether the employee, with proper medical treatment, can be expected to return to work at some stage in the future. Is it possible to change the employee’s working conditions or job so as to make it possible for him or her to continue working? These sorts of issues become even more difficult if the employee alleges that his or her depression has been caused, either entirely or in part, by difficulties experienced at work.
Questions arising from a dismissal relating to an employee’s depression are often clouded by a number of other issues. In Mphoreng / Connex Travel (2001) 10 CCMA 8.15.6 for instance, the issue in dispute related to the employee’s absence from work. Unauthorised absence was also the issue in Adams / Impala Platinum Mine (2004) 13 CCMA 8.17.7. The question in cases such as these is usually whether the employee has informed the employer of his or her absence in advance or contacted the employer to inform it that he or she would be absence. The question may also arise as to whether or not the employee’s leave was authorised.
An employee may also try to use depression as a tactic to delay a disciplinary hearing (see Dunn / Telkom SA Ltd & Others (2003) 12 CCMA 8.18.6)
An employee’s absence can reach an extreme, of course. In Johnson / Department of Justice (2003) 12 GPSBC 7.2.1 the employee was absent from work for about four months due to depression. Eventually the employer stopped paying him and only then did the employee re-appear, armed with medical certificates stating that he was unfit for duty. The employer argued that everything possible had been done to contact the employee during his absence, but that the employee had only returned to work once the flow of money had been shut off. Because the employee had failed in his duty to contact his employer and to inform his employer as to where he was, the dismissal was found to be substantively fair.
SAMWU obo Van Wyngaardt / City of Cape Town (Tygerberg Administration) (2001) 10 CCMA 8.1.8 does deal with dismissal for incapacity, but in this case the employee’s depression was only part of his health problems — he also experienced problems with his knee, shoulder and tuberculosis in addition to the depression.
There appear to be no reported arbitration awards that deal solely with depression as a ground for an ill health dismissal. Almost invariably, it seems, an employee is charged with misconduct in some form or another (absenteeism, for example) or the employee’s ill health is eclipsed by his or her poor performance (in this case the employer will probably choose to dismiss the employee on the basis of the employee’s failing to meet performance standards) — see Shabani / Thales Geosolutions SA (Pty) Ltd (2001) 10 CCMA 8.1.11.
Employers, it seems, do not dismiss employees solely on the basis of their ill health when they suffer from depression and they normally rely on other grounds for dismissal. Because of some remaining stigma attached to depression, there may be some residual difficulties in dealing with this illness appropriately and sympathetically. But an employee who suffers from diagnosed major depression should be treated the same way as any other ill employee, and there should be no differentiation in respect of sick leave, for instance. Abuse of leave or taking unauthorised leave or simply staying away are forms of misconduct, and many feel more comfortable using these as the basis for a dismissal.
Conducting Arbitration Proceedings
Arbitration is not easy — not for the arbitrator or commissioner (who often faces considerable time pressures) or for the parties, who know that there is a lot at stake and the success or failure of their case depends on how well they present the evidence. But certain principles remain: the arbitrator must see to it that all the relevant issues are canvassed and that the matter is properly heard; that each party is given a fair opportunity to present its case and that he or she retains his or her objectivity and neutrality.
The way the arbitrator conducted the arbitration proceedings was the main point of contention in Vodacom Service Provider Company (Pty) Ltd v Phala & others (2007) 16 LC 1.11.6. The matter related to sexual harassment — some male employees claimed that a woman had sexually harassed them for more than six months. The employee concerned was charged, found guilty and she was dismissed. The CCMA commissioner found that dismissal was not an appropriate sanction, that the employer had failed to lead sufficient evidence to show that dismissal was an appropriate sanction and he ordered the employee’s reinstatement.
Clearly, said the Labour Court, sections 138(1) and (2) of the Labour Relations Act give the arbitrator or the commissioner considerable discretion as to how the arbitration should be conducted. The commissioner may conduct the arbitration in a manner he or she considers appropriate in order for him or her to decide the dispute fairly and quickly. The commissioner must, however, deal with the substantial merits of the dispute, but do so with the minimum of legal formalities.
A commissioner can choose to adopt either an adversarial approach or an inquisitorial approach. In the case of adversarial approach, the parties are in control of the process and the role of the arbitrator is more limited. It is up to the parties to decide what evidence is going to be presented and how this evidence will be led. The arbitrator or commissioner is more like an umpire — he or she must manage the process and ensure that the laws of evidence are complied with. The commissioner may intervene where irrelevant questions are asked, hearsay evidence is being led or where the parties are not dealing with the issues the need to deal with.
Things are different in the case of an inquisitorial approach: here the commissioner or the arbitrator is in control of the process and plays a much more active role in the process. It is the commissioner or arbitrator who calls witnesses and asks them questions to ascertain the truth. This approach remains the exception rather than the rule in South Africa. Despite his involvement in the process, said the Labour Court, the commissioner or arbitrator cannot simply ignore the well-established rules of natural justice and he or she must take considerable care not to create a suspicion of bias.
A commissioner must conduct the proceedings in a fair, consistent and even-handed manner. He or she cannot assist (or be seen to assist) one party to the detriment of the other. A commissioner may not put to witnesses his propositions, he/she should not interrupt the witnesses’ answers, challenge the consistency of a witness, indicate that he doubted a witness’s credibility or say how the evidence should be interpreted.
In this case the commissioner decided to adopt the adversarial approach, but instead of remaining an umpire, he began to play an active part in the proceedings. He questioned the employer’s witnesses, so much so, said the Court, that it essentially amounted to cross-examination. The commissioner also questioned a witness in a manner which was improper and inappropriate and which suggested that the witness had been told what to say.
The Labour Court did not hesitate to find that the commissioner had overstepped the boundaries of fair procedure in the conduct of the arbitration proceedings. He did not remain the umpire but became involved on the field as well. This led to a “reasonable apprehension” on the part of the employer that the commissioner was not impartial. This constituted a gross irregularity and the partied had not had a fair hearing before the commissioner. On this ground alone, said the Court, the arbitration award was to be reviewed and set aside. There were other grounds of review too, including the manner in which the commissioner dealt with the evidence and the fact that the commissioner had failed to deal with the issue of procedural fairness.
This Labour Court decision is essential reading for all commissioners and arbitrators. Remaining an impartial umpire is not always easy, but once an arbitrator or commissioner starts running after the ball, he or she may just lose sight of his/her real function.
The way the arbitrator conducted the arbitration proceedings was the main point of contention in Vodacom Service Provider Company (Pty) Ltd v Phala & others (2007) 16 LC 1.11.6. The matter related to sexual harassment — some male employees claimed that a woman had sexually harassed them for more than six months. The employee concerned was charged, found guilty and she was dismissed. The CCMA commissioner found that dismissal was not an appropriate sanction, that the employer had failed to lead sufficient evidence to show that dismissal was an appropriate sanction and he ordered the employee’s reinstatement.
Clearly, said the Labour Court, sections 138(1) and (2) of the Labour Relations Act give the arbitrator or the commissioner considerable discretion as to how the arbitration should be conducted. The commissioner may conduct the arbitration in a manner he or she considers appropriate in order for him or her to decide the dispute fairly and quickly. The commissioner must, however, deal with the substantial merits of the dispute, but do so with the minimum of legal formalities.
A commissioner can choose to adopt either an adversarial approach or an inquisitorial approach. In the case of adversarial approach, the parties are in control of the process and the role of the arbitrator is more limited. It is up to the parties to decide what evidence is going to be presented and how this evidence will be led. The arbitrator or commissioner is more like an umpire — he or she must manage the process and ensure that the laws of evidence are complied with. The commissioner may intervene where irrelevant questions are asked, hearsay evidence is being led or where the parties are not dealing with the issues the need to deal with.
Things are different in the case of an inquisitorial approach: here the commissioner or the arbitrator is in control of the process and plays a much more active role in the process. It is the commissioner or arbitrator who calls witnesses and asks them questions to ascertain the truth. This approach remains the exception rather than the rule in South Africa. Despite his involvement in the process, said the Labour Court, the commissioner or arbitrator cannot simply ignore the well-established rules of natural justice and he or she must take considerable care not to create a suspicion of bias.
A commissioner must conduct the proceedings in a fair, consistent and even-handed manner. He or she cannot assist (or be seen to assist) one party to the detriment of the other. A commissioner may not put to witnesses his propositions, he/she should not interrupt the witnesses’ answers, challenge the consistency of a witness, indicate that he doubted a witness’s credibility or say how the evidence should be interpreted.
In this case the commissioner decided to adopt the adversarial approach, but instead of remaining an umpire, he began to play an active part in the proceedings. He questioned the employer’s witnesses, so much so, said the Court, that it essentially amounted to cross-examination. The commissioner also questioned a witness in a manner which was improper and inappropriate and which suggested that the witness had been told what to say.
The Labour Court did not hesitate to find that the commissioner had overstepped the boundaries of fair procedure in the conduct of the arbitration proceedings. He did not remain the umpire but became involved on the field as well. This led to a “reasonable apprehension” on the part of the employer that the commissioner was not impartial. This constituted a gross irregularity and the partied had not had a fair hearing before the commissioner. On this ground alone, said the Court, the arbitration award was to be reviewed and set aside. There were other grounds of review too, including the manner in which the commissioner dealt with the evidence and the fact that the commissioner had failed to deal with the issue of procedural fairness.
This Labour Court decision is essential reading for all commissioners and arbitrators. Remaining an impartial umpire is not always easy, but once an arbitrator or commissioner starts running after the ball, he or she may just lose sight of his/her real function.
Tuesday, March 16, 2010
CCMA Red Tape Costs SA Billions
By Ethel Hazelhurst
Johannesburg - Flaws in labour practices were costing the country billions of rands in direct costs each year, labour consultant Andrew Levy said yesterday. And, although the practices were intended to protect workers, they were in fact marginalising them, he said.
While employers tended to blame the 1995 Labour Relations Act, Levy argued that the problem did not lie with the law but with the way in which it was being implemented. And the Commission for Conciliation, Mediation and Arbitration (CCMA) was largely responsible.
The CCMA is an independent statutory body, set up in 1996 to resolve workplace conflicts. While the concept is generally praised, Levy and others - including the main architect of the Labour Relations Act, Halton Cheadle - say the CCMA overemphasises procedure.
"Over time, the CCMA's requirements have created a situation where companies have been obliged to institute a mini judicial process," said Vic van Vuuren, the chief operating officer of Business Unity SA.
Cheadle said the CCMA and the labour courts had "misunderstood what they were meant to do". He criticised the "over-proceduralisaton of disciplinary hearings, where commissioners now think they are judges and want their awards printed in law reports, when what they are meant to do is produce a simple set of reasons and get on with it".
Largely because of the CCMA's emphasis on procedures, internal company proceedings are draining at least R14.7 billion from employers each year, according to research by Levy between 2003 and 2005.
In a report on labour dispute resolution just released, he said: "[Commissioners] apply the wrong standards of proof, make material errors in assessing evidence and reach conclusions that seem to have no relationship to the facts before them. This is borne out by the comments made by the labour court in review applications." It was also borne out as "when employers take CCMA decisions to the labour court for review, two out of three are overturned".
The cumbersome procedures have created a huge grey market of unmonitored employment. Because the procedures add so much to the normal cost of employment, employers are taking avoiding action. Workers are being casualised and are more vulnerable than before.
"People are being taken from the core of full-time permanent employment in the labour market and are being displaced into a peripheral nether world of quasi work where labour law doesn't apply," said Levy. For example, eight years ago there were about 430 000 people employed in the metal industry. There are still 430 000 workers but there are now only 230 employees.
A review process is under way. Research was commissioned by the presidency in July 2005 and according to CCMA director Nerine Kahn, a series of research initiatives are in the pipeline. So it will be a while before changes are made.
Changes are not necessarily opposed by Cosatu. Rudi Dicks, the federation's labour market policy co-ordinator, said he was not against informal hearings. "But less onerous procedures doesn't mean employers can circumvent procedures. The dismissal must be fair."
Meanwhile, a third consequence of the obsession with procedure, said Levy, was that perceptions of an unfavourable labour environment deterred foreign investors. "The irony is that the Labour Relations Act doesn't require these procedures."
Johannesburg - Flaws in labour practices were costing the country billions of rands in direct costs each year, labour consultant Andrew Levy said yesterday. And, although the practices were intended to protect workers, they were in fact marginalising them, he said.
While employers tended to blame the 1995 Labour Relations Act, Levy argued that the problem did not lie with the law but with the way in which it was being implemented. And the Commission for Conciliation, Mediation and Arbitration (CCMA) was largely responsible.
The CCMA is an independent statutory body, set up in 1996 to resolve workplace conflicts. While the concept is generally praised, Levy and others - including the main architect of the Labour Relations Act, Halton Cheadle - say the CCMA overemphasises procedure.
"Over time, the CCMA's requirements have created a situation where companies have been obliged to institute a mini judicial process," said Vic van Vuuren, the chief operating officer of Business Unity SA.
Cheadle said the CCMA and the labour courts had "misunderstood what they were meant to do". He criticised the "over-proceduralisaton of disciplinary hearings, where commissioners now think they are judges and want their awards printed in law reports, when what they are meant to do is produce a simple set of reasons and get on with it".
Largely because of the CCMA's emphasis on procedures, internal company proceedings are draining at least R14.7 billion from employers each year, according to research by Levy between 2003 and 2005.
In a report on labour dispute resolution just released, he said: "[Commissioners] apply the wrong standards of proof, make material errors in assessing evidence and reach conclusions that seem to have no relationship to the facts before them. This is borne out by the comments made by the labour court in review applications." It was also borne out as "when employers take CCMA decisions to the labour court for review, two out of three are overturned".
The cumbersome procedures have created a huge grey market of unmonitored employment. Because the procedures add so much to the normal cost of employment, employers are taking avoiding action. Workers are being casualised and are more vulnerable than before.
"People are being taken from the core of full-time permanent employment in the labour market and are being displaced into a peripheral nether world of quasi work where labour law doesn't apply," said Levy. For example, eight years ago there were about 430 000 people employed in the metal industry. There are still 430 000 workers but there are now only 230 employees.
A review process is under way. Research was commissioned by the presidency in July 2005 and according to CCMA director Nerine Kahn, a series of research initiatives are in the pipeline. So it will be a while before changes are made.
Changes are not necessarily opposed by Cosatu. Rudi Dicks, the federation's labour market policy co-ordinator, said he was not against informal hearings. "But less onerous procedures doesn't mean employers can circumvent procedures. The dismissal must be fair."
Meanwhile, a third consequence of the obsession with procedure, said Levy, was that perceptions of an unfavourable labour environment deterred foreign investors. "The irony is that the Labour Relations Act doesn't require these procedures."
CCMA Exceeded its Power with Reinstatement
Reported on: 27 September 2006
In a strongly-worded judgment the Supreme Court of Appeal on Tuesday reined in the Commission for Conciliation, Mediation and Arbitration (CCMA), saying that a decision to dismiss is in the first place that of an employer.
Judge Edwin Cameron, on behalf of a full bench of the Supreme Court of Appeal, gave this judgment in an appeal brought by Rustenburg Platinum Mines Ltd against the CCMA.
The judges overturned a ruling by the Labour Appeal Court, which had refused to intervene in a decision by the CCMA to reinstate a patrolman, Zingisile Sidumo, who had been dismissed by the mine.
He took his case to the CCMA, where one of the commissioners decided that he should be reinstated with three months' compensation and a written warning that would be valid for six months.
Both the Labour Court and the Labour Appeal Court refused to interfere with this decision.
The case ended up in the Supreme Court of Appeal, which gave its ruling on Tuesday.
Sidumo was dismissed because he continuously failed to search people properly at one of the mine's plants at a time when the facility was suffering extensive losses.
The Supreme Court of Appeal said in its judgment that the labour courts must not forget that they must oversee the dismissal decisions of the CCMA. The judges added that the Labour Appeal Court seemed to have forgotten that the discretion to dismiss an employee lay with the employer and not with the CCMA.
"The CCMA enjoys no discretion in relation to sanction, but bears the duty of determining whether the employer's sanction is fair."
The court said the Labour Appeal Court should remind commissioners firmly of the limits of their power to intervene.
The judges said the CCMA must exercise a measure of deference to the employer.
The court warned the CCMA that decisions which could be described as "severe but fair" should not summarily be found to be unfair.
"Though the sanction of dismissal is undoubtedly severe, especially in its effects on the employee, it is in my view impossible to say that it is not a fair sanction.
"It certainly seems to me to fall within the range of sanctions that the employer was fairly permitted to impose. The employee should therefore have been refused the relief he sought," Judge Cameron said, confirming that the mine was right in dismissing Sidumo.
In a strongly-worded judgment the Supreme Court of Appeal on Tuesday reined in the Commission for Conciliation, Mediation and Arbitration (CCMA), saying that a decision to dismiss is in the first place that of an employer.
Judge Edwin Cameron, on behalf of a full bench of the Supreme Court of Appeal, gave this judgment in an appeal brought by Rustenburg Platinum Mines Ltd against the CCMA.
The judges overturned a ruling by the Labour Appeal Court, which had refused to intervene in a decision by the CCMA to reinstate a patrolman, Zingisile Sidumo, who had been dismissed by the mine.
He took his case to the CCMA, where one of the commissioners decided that he should be reinstated with three months' compensation and a written warning that would be valid for six months.
Both the Labour Court and the Labour Appeal Court refused to interfere with this decision.
The case ended up in the Supreme Court of Appeal, which gave its ruling on Tuesday.
Sidumo was dismissed because he continuously failed to search people properly at one of the mine's plants at a time when the facility was suffering extensive losses.
The Supreme Court of Appeal said in its judgment that the labour courts must not forget that they must oversee the dismissal decisions of the CCMA. The judges added that the Labour Appeal Court seemed to have forgotten that the discretion to dismiss an employee lay with the employer and not with the CCMA.
"The CCMA enjoys no discretion in relation to sanction, but bears the duty of determining whether the employer's sanction is fair."
The court said the Labour Appeal Court should remind commissioners firmly of the limits of their power to intervene.
The judges said the CCMA must exercise a measure of deference to the employer.
The court warned the CCMA that decisions which could be described as "severe but fair" should not summarily be found to be unfair.
"Though the sanction of dismissal is undoubtedly severe, especially in its effects on the employee, it is in my view impossible to say that it is not a fair sanction.
"It certainly seems to me to fall within the range of sanctions that the employer was fairly permitted to impose. The employee should therefore have been refused the relief he sought," Judge Cameron said, confirming that the mine was right in dismissing Sidumo.
Monday, March 15, 2010
Bias and Race
Allegations of bias usually arise because a chairperson is seen as having a vested interest in the outcome of a case or if she or he has been involved, in some way or another, in the investigation of the disciplinary charges and events. While it is inevitable that a manager, chairing a disciplinary hearing, will have some “institutional bias” (in favour of the employer), this does not mean that she or he will not be able to decide on guilt and sanction objectively and with the necessary neutral state of mind.
Arbitrators may also, of course, be biased and a party appearing before an arbitrator may argue that he or she will not receive a fair hearing by the arbitrator and then request the arbitrator to recuse herself or himself. This happened, for example, in Marley FloorWorx and MEWUSA (2005) 14 MEIBC 1.22.1 where an application for recusal was made because of a perceived bias on the part of the bargaining council arbitrator against both the union and the employee personally. The arbitrator did not yield to this pressure, stating that an arbitrator should not give in to the unfounded and ill-informed fears of bias expressed by parties who either want a presiding officer of their choice to hear the matter, or if the party concerned is trying to bully the arbitrator into accepting a point of view or argument. This does happen, unfortunately — that an arbitrator is seen as biased because he or she made a ruling (often a ruling of a procedural nature) against the employee or the employee’s representative.
The facts of the Labour Court decision in Cell C (Pty) Ltd v Finger & others (2006) 15 LC 1.22.1 go a step further: the employee (self-described as a black man) objected to the arbitrator on the basis of race — the arbitrator was Indian. The employer’s two representatives were also Indian. The black employee took the view that the situation was “racially imbalanced” against him. The arbitrator recused himself, and the employer (Cell C) went to the Labour Court in order to review the arbitrator’s decision to recuse himself — essentially the employer challenged the arbitrator’s decision to recuse himself and wanted him to do what he was supposed to do.
The arbitrator, in recusing himself, stated that the affront to his dignity could lead to the seeds of bias being planted. After recusing himself, while in fact no longer having to do so, the arbitrator made a punitive cost order against the employee’s labour attorney.
As could be expected, the Labour Court did not approve of the employee’s actions: an objection to his or her race can never be a reason for a presiding officer to recuse himself or herself. An objection by a party, on such grounds, is not only reprehensible, but it would make litigation in a multi-racial country such as ours impossible. It should not be tolerated, added the Court for good measure.
Did this mean that the arbitrator’s decision to recuse himself was reviewable? Usually, of course, it works the other way around — an arbitrator’s refusal to recuse himself may be subject to review. Even so, it would not be a good idea to force an arbitrator who has recused himself from a matter, to continue with that same matter. Especially in a case such as this, where the arbitrator was provoked into recusing himself. The Labour Court did not set aside the arbitrator’s decision to recuse himself.
But the Court was scathing in respect of the conduct of the employee and his representative. At the time the Court heard the matter, the matter had been postponed by the CCMA and it was to be heard by another commissioner (African). Bizarre, though: the employee placed on record that he would object to even that arbitrator. Hopefully, the Court said, the African commissioner who was scheduled to hear the matter, was made of stronger stuff, and would deal with the employee’s objection in a decisive manner.
‘Till next week, and please don’t provoke your arbitrators. The job is tough enough as it is! And don’t bully them either — you may just find that they bully you right back!
Arbitrators may also, of course, be biased and a party appearing before an arbitrator may argue that he or she will not receive a fair hearing by the arbitrator and then request the arbitrator to recuse herself or himself. This happened, for example, in Marley FloorWorx and MEWUSA (2005) 14 MEIBC 1.22.1 where an application for recusal was made because of a perceived bias on the part of the bargaining council arbitrator against both the union and the employee personally. The arbitrator did not yield to this pressure, stating that an arbitrator should not give in to the unfounded and ill-informed fears of bias expressed by parties who either want a presiding officer of their choice to hear the matter, or if the party concerned is trying to bully the arbitrator into accepting a point of view or argument. This does happen, unfortunately — that an arbitrator is seen as biased because he or she made a ruling (often a ruling of a procedural nature) against the employee or the employee’s representative.
The facts of the Labour Court decision in Cell C (Pty) Ltd v Finger & others (2006) 15 LC 1.22.1 go a step further: the employee (self-described as a black man) objected to the arbitrator on the basis of race — the arbitrator was Indian. The employer’s two representatives were also Indian. The black employee took the view that the situation was “racially imbalanced” against him. The arbitrator recused himself, and the employer (Cell C) went to the Labour Court in order to review the arbitrator’s decision to recuse himself — essentially the employer challenged the arbitrator’s decision to recuse himself and wanted him to do what he was supposed to do.
The arbitrator, in recusing himself, stated that the affront to his dignity could lead to the seeds of bias being planted. After recusing himself, while in fact no longer having to do so, the arbitrator made a punitive cost order against the employee’s labour attorney.
As could be expected, the Labour Court did not approve of the employee’s actions: an objection to his or her race can never be a reason for a presiding officer to recuse himself or herself. An objection by a party, on such grounds, is not only reprehensible, but it would make litigation in a multi-racial country such as ours impossible. It should not be tolerated, added the Court for good measure.
Did this mean that the arbitrator’s decision to recuse himself was reviewable? Usually, of course, it works the other way around — an arbitrator’s refusal to recuse himself may be subject to review. Even so, it would not be a good idea to force an arbitrator who has recused himself from a matter, to continue with that same matter. Especially in a case such as this, where the arbitrator was provoked into recusing himself. The Labour Court did not set aside the arbitrator’s decision to recuse himself.
But the Court was scathing in respect of the conduct of the employee and his representative. At the time the Court heard the matter, the matter had been postponed by the CCMA and it was to be heard by another commissioner (African). Bizarre, though: the employee placed on record that he would object to even that arbitrator. Hopefully, the Court said, the African commissioner who was scheduled to hear the matter, was made of stronger stuff, and would deal with the employee’s objection in a decisive manner.
‘Till next week, and please don’t provoke your arbitrators. The job is tough enough as it is! And don’t bully them either — you may just find that they bully you right back!
Being Childless as a Condition of Employment
Just as an employer may argue that its discriminating against an employee is justified by its affirmative action measures and its aim to achieve equitable representation in the workplace, the employer could also argue that discrimination is justified by the inherent requirements of the job. But could it be argued that an employee’s not being pregnant constitutes an inherent requirement of the job? This is the argument the employer presented to the Labour Court in Wallace v Du Toit (2006) 15 LC 6.12.2. The parents, two busy professionals, engaged a child minder (an au pair) to assist with looking after their three-year old. The parents and the child minder got along well and a few years later another child was born; the employee’s duties were extended. She no longer worked only weekday afternoons, but also some mornings. She had a good relationship with both the parents and the children in her care.
At the time she began working for the couple, the employee was single and she had no immediate intention of having her own children. The issue was raised during her initial job interview — the employer (an attorney) held the view that a child minder who was helping bringing up his children should not have children of her own because this would affect (in essence diminish) the attention and devotion to his children. He felt that a child minder who had children would not put his children first. Nor would she be as flexible as an employee who had no parenting responsibilities of her own. Well, you can guess what happened next. When she informed her employer that she was expecting her own child, she was told that the employment relationship had come to an end. The employer congratulated her on her pregnancy but at the same time told her that her services were no longer required.
The employer argued that there was a resolutive condition in the employment contract (the condition being that the employee not fall pregnant) and when this happened, the contract terminated. The employee flatly denied that there was such a term in the (verbal) contract of employment — that her pregnancy would also mean the end of the employment relationship. But she admitted that the employer had asked questions during the interview relating to her marital status and whether she planned having a family of her own. At the time, of course, she was single and did not intend having children. She stated that she had never agreed that her employment would come to an end if she fell pregnant; nor could she see any reason why her pregnancy or motherhood would detrimentally affect her ability to do her job well.
The employee argued, first, that her dismissal was automatically unfair in terms of the Labour Relations Act, and, second, that she was entitled to damages in terms of section 50(1)(e) of the Employment Equity Act. The employer’s counter-argument was that there had been no dismissal and that the employment relationship had been ended by agreement between the parties. The employer also argued that the dismissal was justified because it was an inherent requirement of the job that the employee not have her own children.
As is to be expected, the Labour Court would have none of this and it did not hesitate to find that the dismissal, related as it was to the employee’s pregnancy, was an automatically unfair dismissal in terms of section 187 of the Labour Relations Act. Nor does it come as any surprise that the Labour Court found the employer in breach of section 6 of the Employment Equity Act (prohibiting unfair discrimination). It was certainly unfair of the employer not to consider whether the employee would be able to continue to do her job as a child minder and do it well — instead, the employer simply presumed that she would no longer be able to fulfill her job function effectively.
The Labour Court structured the employee’s relief on two grounds. Firstly, there was R25 000 — as damages for the impairment of the employee’s dignity and self-esteem flowing from the discrimination on the grounds of her pregnancy (the employee was earning R4500 a month at the time of her dismissal). This figure also had a punitive element, underscoring the dim view the Court took of the employer’s approach in relation to the dismissal. Secondly, the Court also awarded the employee compensation for the financial losses she had suffered as a result of the employer’s discrimination. In total, the employee was awarded R71 500 in damages.
Perhaps the facts are exceptional and no doubt it is exceptional for an employer to take the view that an employee can be dismissed for any reason relating to her pregnancy. The informal and loose approach of the employer to the employment relationship (there was no written contract, for instance) may have lulled the employer into a false sense of security that the employee would not seek to challenge what amounted to a dismissal (even though the employer, as a labour attorney, sought to rely on contractual grounds for the termination of the contract). And, as this case again shows, discrimination may well carry a hefty price tag.
At the time she began working for the couple, the employee was single and she had no immediate intention of having her own children. The issue was raised during her initial job interview — the employer (an attorney) held the view that a child minder who was helping bringing up his children should not have children of her own because this would affect (in essence diminish) the attention and devotion to his children. He felt that a child minder who had children would not put his children first. Nor would she be as flexible as an employee who had no parenting responsibilities of her own. Well, you can guess what happened next. When she informed her employer that she was expecting her own child, she was told that the employment relationship had come to an end. The employer congratulated her on her pregnancy but at the same time told her that her services were no longer required.
The employer argued that there was a resolutive condition in the employment contract (the condition being that the employee not fall pregnant) and when this happened, the contract terminated. The employee flatly denied that there was such a term in the (verbal) contract of employment — that her pregnancy would also mean the end of the employment relationship. But she admitted that the employer had asked questions during the interview relating to her marital status and whether she planned having a family of her own. At the time, of course, she was single and did not intend having children. She stated that she had never agreed that her employment would come to an end if she fell pregnant; nor could she see any reason why her pregnancy or motherhood would detrimentally affect her ability to do her job well.
The employee argued, first, that her dismissal was automatically unfair in terms of the Labour Relations Act, and, second, that she was entitled to damages in terms of section 50(1)(e) of the Employment Equity Act. The employer’s counter-argument was that there had been no dismissal and that the employment relationship had been ended by agreement between the parties. The employer also argued that the dismissal was justified because it was an inherent requirement of the job that the employee not have her own children.
As is to be expected, the Labour Court would have none of this and it did not hesitate to find that the dismissal, related as it was to the employee’s pregnancy, was an automatically unfair dismissal in terms of section 187 of the Labour Relations Act. Nor does it come as any surprise that the Labour Court found the employer in breach of section 6 of the Employment Equity Act (prohibiting unfair discrimination). It was certainly unfair of the employer not to consider whether the employee would be able to continue to do her job as a child minder and do it well — instead, the employer simply presumed that she would no longer be able to fulfill her job function effectively.
The Labour Court structured the employee’s relief on two grounds. Firstly, there was R25 000 — as damages for the impairment of the employee’s dignity and self-esteem flowing from the discrimination on the grounds of her pregnancy (the employee was earning R4500 a month at the time of her dismissal). This figure also had a punitive element, underscoring the dim view the Court took of the employer’s approach in relation to the dismissal. Secondly, the Court also awarded the employee compensation for the financial losses she had suffered as a result of the employer’s discrimination. In total, the employee was awarded R71 500 in damages.
Perhaps the facts are exceptional and no doubt it is exceptional for an employer to take the view that an employee can be dismissed for any reason relating to her pregnancy. The informal and loose approach of the employer to the employment relationship (there was no written contract, for instance) may have lulled the employer into a false sense of security that the employee would not seek to challenge what amounted to a dismissal (even though the employer, as a labour attorney, sought to rely on contractual grounds for the termination of the contract). And, as this case again shows, discrimination may well carry a hefty price tag.
Thursday, March 11, 2010
Appointment, Transfer and Promotion on Probation
(1) The appointment of a person and the transfer or promotion of an officer in the A or B division shall be made on probation—
(a)
unless, in the case of an appointment the person having the power to approve such an appointment, directs otherwise; or
(b)
if, in the case of a promotion or a transfer the person having the power to approve such a transfer or promotion, so directs.
(2) (a) Subject to the provisions of paragraphs (b) and (c), the period of probation shall not be less than 12 calendar months.
(b) If an officer who is serving on probation is transferred or promoted to another post, a lesser period of service on probation may be directed in the new post which, together with the period of probation served in the former post, shall total at least 12 calendar months.
(c) The period of probation of an officer shall be extended by the number of days leave taken by him or her during the period of probation or any extension thereof.
(3) If the head of the office, branch, subdepartment, institution or department certifies that, during the period of probation or extended period of probation, the officer concerned has been diligent and his or her conduct has been uniformly satisfactory and that he or she is in all respects suitable for the post which he or she holds, and if the officer has complied with all the conditions to which his or her appointment, transfer or promotion was subject, the person having the power to make the appointment, transfer or promotion concerned, may confirm that appointment, transfer or promotion, but if the probationary appointment, transfer or promotion is not so confirmed the person having the power to make the appointment, transfer or promotion concerned may extend the period of probation or act in accordance with the provisions of subsection (5).
(4) . . . . . .
(5) Notwithstanding anything to the contrary contained in subsection (2) or in any collective agreement contemplated in section 18 (b) of the Public Service Laws Amendment Act, 1998, but subject to the provisions of subsection (6), an officer who is serving on probation may be discharged from the public service by the person having the power of discharge, whether during or at or after the expiry of the period of probation—
(a)
by the giving of one month’s written notice to such officer; or
(b)
forthwith, but subject to the provisions of the Labour Relations Act, 1995 (Act No. 66 of 1995), if his or her conduct or performance is unsatisfactory.
[Sub-s. (5) amended by s. 7 of Act No. 86 of 1998.]
(6) Notwithstanding anything to the contrary contained in sections 14 and 34, a person whose transfer or promotion on probation is not confirmed and who immediately prior to that transfer or promotion on probation was an officer, other than an officer on probation, shall be transferred to the post formerly held by him or her, or to a post of equivalent grading, and shall receive such salary as he or she would have received in the said former post if he or she had not been transferred or promoted on probation.
[S. 13 substituted by s. 10 of Act No. 47 of 1997.]
(a)
unless, in the case of an appointment the person having the power to approve such an appointment, directs otherwise; or
(b)
if, in the case of a promotion or a transfer the person having the power to approve such a transfer or promotion, so directs.
(2) (a) Subject to the provisions of paragraphs (b) and (c), the period of probation shall not be less than 12 calendar months.
(b) If an officer who is serving on probation is transferred or promoted to another post, a lesser period of service on probation may be directed in the new post which, together with the period of probation served in the former post, shall total at least 12 calendar months.
(c) The period of probation of an officer shall be extended by the number of days leave taken by him or her during the period of probation or any extension thereof.
(3) If the head of the office, branch, subdepartment, institution or department certifies that, during the period of probation or extended period of probation, the officer concerned has been diligent and his or her conduct has been uniformly satisfactory and that he or she is in all respects suitable for the post which he or she holds, and if the officer has complied with all the conditions to which his or her appointment, transfer or promotion was subject, the person having the power to make the appointment, transfer or promotion concerned, may confirm that appointment, transfer or promotion, but if the probationary appointment, transfer or promotion is not so confirmed the person having the power to make the appointment, transfer or promotion concerned may extend the period of probation or act in accordance with the provisions of subsection (5).
(4) . . . . . .
(5) Notwithstanding anything to the contrary contained in subsection (2) or in any collective agreement contemplated in section 18 (b) of the Public Service Laws Amendment Act, 1998, but subject to the provisions of subsection (6), an officer who is serving on probation may be discharged from the public service by the person having the power of discharge, whether during or at or after the expiry of the period of probation—
(a)
by the giving of one month’s written notice to such officer; or
(b)
forthwith, but subject to the provisions of the Labour Relations Act, 1995 (Act No. 66 of 1995), if his or her conduct or performance is unsatisfactory.
[Sub-s. (5) amended by s. 7 of Act No. 86 of 1998.]
(6) Notwithstanding anything to the contrary contained in sections 14 and 34, a person whose transfer or promotion on probation is not confirmed and who immediately prior to that transfer or promotion on probation was an officer, other than an officer on probation, shall be transferred to the post formerly held by him or her, or to a post of equivalent grading, and shall receive such salary as he or she would have received in the said former post if he or she had not been transferred or promoted on probation.
[S. 13 substituted by s. 10 of Act No. 47 of 1997.]
Applying the Dominant Impression Test
The test for determining whether someone is an employee or an independent contractor is the dominant impression test — even if the parties to the contract state that their relationship is one of an independent contractor, the true nature of the relationship may in fact be one of employment. Our Courts have always been prepared to look beyond the written description of the nature of the relationship to ascertain what the true and underlying nature of the contract is.
This test and its application again arose in the recent decision of the Labour Court in Linda Erasmus Properties Enterprise (Pty) Ltd v Mholongo & others (2007) 16 LC 1.11.5. The respondent was employed as an independent contractor and her responsibility was to obtain houses for sale. She was initially assisted by being given two houses to sell — from that point on it was now up to her to secure the houses she was to sell. A written contract had been concluded between the parties, in terms of which the respondent was an independent contractor, appointed in terms of the Estate Agents Affairs Act 112 of 1967 — the contract made it clear that she was not an employee.
She was paid on a commission basis and she could determine her own working hours. The only fixed rule in this regard was that she had to attend one meeting every Monday. No evidence was led as to the length of this meeting, but it was argued that the purpose of the meeting was to encourage her to sell as many houses as possible. No Unemployment Insurance Fund contributions were deducted from her commission; nor was Pay-As-You-Earn (PAYE). Like the other 50 “agents” she was not entitled to join the provident fund and she was not obliged to present medical certificates if she was off sick.
Invariably, in cases such as these, the challenge is to evaluate all the factors and especially the provisions of the contract in order to obtain a dominant impression. One of the clauses in the contract stated that there remained some areas where the estate agency needed to maintain control and/or supervision over the agent’s activities. Certain limitations were also placed on what the agent could, and could not do. She could not, for instance, divide the commission with another estate agency or any other person unless this was approved by the agency. She was also obliged to comply with all the agency’s office rules. Other clauses in the agreement also shed some light on the true relationship: the agent was required to keep all correspondence she received or wrote in the agency office; a restraint of trade was imposed, and provision had been made for an exit interview (a practice common in employment).
It was also significant, said the Court, that the agent was given a timetable or roster which regulated all aspects of her activities. The agency said that this roster was purely for the purpose of assisting the agent to sell houses. Not so, said the CCMA commissioner (and the Labour Court agreed): the roster showed the extent of control the agency had over the agent. She even had to run errands for one of the managers and she had to report any absence from work to this manager. The agency emphasised the fact that UIF and PAYE were not deducted. This, said the Court, does not tilt the balance of probabilities in this case towards a finding that the agent was indeed an independent contractor.
The Labour Court concluded that the agent was not an independent contractor, but was in fact an employee of the estate agency at the time she was dismissed. The objection raised by the agency — that the CCMA did not have jurisdiction because the agent was not an employee — was dismissed and the Labour Court remitted the matter back to the CCMA for arbitration.
New appointments to the Labour Court and the Labour Appeal Court
The following Judges have been appointed to the Labour Appeal Court:
• Judge Achmat Maaim Jappie
• Judge Hendrik Mmolii Thekeso Musi
• Judge Chimanial Narotam Patel
• Judge Basheer Waglay
The following two Judges have been appointed to the Labour Court:
• Professor Annali Christelle Basson
• Mr Edwin Mogomotsi Molahleli
Congratulations to all — especially to the two appointees to the Labour Court: erstwhile colleagues.
This test and its application again arose in the recent decision of the Labour Court in Linda Erasmus Properties Enterprise (Pty) Ltd v Mholongo & others (2007) 16 LC 1.11.5. The respondent was employed as an independent contractor and her responsibility was to obtain houses for sale. She was initially assisted by being given two houses to sell — from that point on it was now up to her to secure the houses she was to sell. A written contract had been concluded between the parties, in terms of which the respondent was an independent contractor, appointed in terms of the Estate Agents Affairs Act 112 of 1967 — the contract made it clear that she was not an employee.
She was paid on a commission basis and she could determine her own working hours. The only fixed rule in this regard was that she had to attend one meeting every Monday. No evidence was led as to the length of this meeting, but it was argued that the purpose of the meeting was to encourage her to sell as many houses as possible. No Unemployment Insurance Fund contributions were deducted from her commission; nor was Pay-As-You-Earn (PAYE). Like the other 50 “agents” she was not entitled to join the provident fund and she was not obliged to present medical certificates if she was off sick.
Invariably, in cases such as these, the challenge is to evaluate all the factors and especially the provisions of the contract in order to obtain a dominant impression. One of the clauses in the contract stated that there remained some areas where the estate agency needed to maintain control and/or supervision over the agent’s activities. Certain limitations were also placed on what the agent could, and could not do. She could not, for instance, divide the commission with another estate agency or any other person unless this was approved by the agency. She was also obliged to comply with all the agency’s office rules. Other clauses in the agreement also shed some light on the true relationship: the agent was required to keep all correspondence she received or wrote in the agency office; a restraint of trade was imposed, and provision had been made for an exit interview (a practice common in employment).
It was also significant, said the Court, that the agent was given a timetable or roster which regulated all aspects of her activities. The agency said that this roster was purely for the purpose of assisting the agent to sell houses. Not so, said the CCMA commissioner (and the Labour Court agreed): the roster showed the extent of control the agency had over the agent. She even had to run errands for one of the managers and she had to report any absence from work to this manager. The agency emphasised the fact that UIF and PAYE were not deducted. This, said the Court, does not tilt the balance of probabilities in this case towards a finding that the agent was indeed an independent contractor.
The Labour Court concluded that the agent was not an independent contractor, but was in fact an employee of the estate agency at the time she was dismissed. The objection raised by the agency — that the CCMA did not have jurisdiction because the agent was not an employee — was dismissed and the Labour Court remitted the matter back to the CCMA for arbitration.
New appointments to the Labour Court and the Labour Appeal Court
The following Judges have been appointed to the Labour Appeal Court:
• Judge Achmat Maaim Jappie
• Judge Hendrik Mmolii Thekeso Musi
• Judge Chimanial Narotam Patel
• Judge Basheer Waglay
The following two Judges have been appointed to the Labour Court:
• Professor Annali Christelle Basson
• Mr Edwin Mogomotsi Molahleli
Congratulations to all — especially to the two appointees to the Labour Court: erstwhile colleagues.
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