March 2011

Dear Industrial Law Journal subscriber,

Introduction text

WE WELCOME YOUR FEEDBACK

Please forward any comments and suggestions regarding the Industrial Law Journal preview to lawmarketing@juta.co.za

Kind regards

Juta General Law

Hightlights to the Industrial Law Reports

Compensation for Occupational Injuries and Diseases

The Constitutional Court in Mankayi v AngloGold Ashanti Ltd has now overruled the  judgment of the Supreme Court of Appeal in Mankayi v AngloGold Ashanti Ltd (2010) 31 ILJ 1065 (SCA), in which that court held that where employees qualify for compensation for occupational injuries or diseases, either in terms of the Compensation for Occupational Injuries and Diseases Act  130 of 1993 or in terms of the Occupational Diseases in Mines and Works Act 78 of 1973, their common-law right of recourse against their employers is in both cases extinguished by virtue of s 35(1) of COIDA.  The court reviewed the legislative history of both acts, noted that compensation under ODIMWA is far less generous and comprehensive than that afforded under COIDA, and concluded that the exclusion of common-law liability in s 35(1) is limited to those employees entitled to compensation under COIDA.  To hold otherwise would strain the plain meaning of the language in s 35(1).  Mineworkers who have contracted compensatable diseases under ODIMWA therefore retain their common-law right to claim against their employers.

The Powers of Municipal Councils and Municipal Managers

The Supreme Court of Appeal has held in Manana v King Sabata Dalindyebo Municipality  that, since the Constitution 1996 vests all executive authority, including the power to appoint staff, on municipal councils, the fact that a council may delegate that power to its municipal manager does not thereby divest the council of its executive authority.  A council resolution to appoint an employee to a particular position therefore remained valid unless and until rescinded by the council or set aside on review, and municipal officials were bound to execute it, whatever view they might have regarding its merits and validity.

The Labour Court's Jurisdiction in Delictual Matters

The Labour Court held in Ndlovu & others v SA Commercial Catering & Allied Workers Union  that it had no jurisdiction to entertain a delictual claim brought by the members of a trade union against their union for damages for a breach of its duty of care to them when negotiating with their employer on their behalf.  The court rejected the applicants' argument that s 157(2) of the LRA conferred jurisdiction on it in all matters arising from employment and labour relations, and took the view that the court had no jurisdiction in a delictual claim.

Restraint of Trade

The Labour Court surveyed the various approaches adopted by the courts regarding the enforcement of restraint of trade agreements, both before and after the Constitution 1996, in Esquire System Technology (Pty) Ltd t/a Esquire Technologies v Cronje & another  and set out the principles to be applied when considering their enforcement.  In determining the reasonableness of a restraint the court must exercise a value judgment, balancing the public interest that requires that parties should comply with their contractual obligations and the right of all persons to engage freely in trade or commerce or the professions.  In the case before it the court found that the restraint was unreasonably broad and therefore not in the public interest.  In Henred Freuhauf (Pty) Ltd v Davel & another  the Labour Court found that although the employee was in breach of the restraint agreement the employer had no legitimate protectable interest that could properly be enforced.  The court further rejected the employer's offer to modify the restraint to reduce its impact on the employee.  The practice of cutting and trimming an overbroad restraint at the behest of the party which drafted it was not a practice the court would encourage. 

Public Service - Dismissal by Operation of Law

The Labour Court found in Member of the Executive Council for Health v Khoetha & others that a public servant who had failed to report for duty where he was instructed to do so, but had instead reported at another location, had not been discharged by operation of law in terms of s 17(5)(a) of the Public Service Act (Proc 103 of 1994).  Section s 17(5)(a) envisaged desertion or abscondment.  The bargaining council arbitrator appointed to consider the fairness of his dismissal had therefore correctly found that the council had jurisdiction to arbitrate the matter.

Private Arbitration Agreements

Mmethi v DNM Investments CC t/a Bloemfontein Celtics Football Club the Labour Court was required to consider whether a private arbitration clause in the employment contract of a professional football player, read with the constitution of the National Soccer League, ousted its jurisdiction to consider an application brought in terms of s 77 of the Basic Conditions of Employment Act 75 of 1997.  The court found that it retained jurisdiction to hear the matter, but exercised its discretion to stay the proceedings pending the determination of the dispute through private arbitration.   The court would retain its supervisory role, and could be approached by either party if the need arose.

Settlement Agreement

In Hlongwane v Cisco Systems SA & another  the Labour Court found that an oral settlement agreement terminating an employee's employment, which had been entered into between his legal representatives and his employer's and later confirmed in writing, was valid and binding on the employee.  The court found it generally accepted that counsel or an attorney has authority to compromise a client's claim unless the client has instructed otherwise.  The representative had implied authority, and the employee was estopped from denying his authority to conclude the agreement on his behalf.

Strikes in Essential Services

The applicant employer in Sonqoba Security Services MP (Pty) Ltd v Motor transport Workers Union, which provided security services for the payment of social pensions, applied to the essential services committee for its undertaking to be designated an essential service, and thereafter applied for an urgent interdict to prevent its employees from striking.  The Labour Court found that it would be inappropriate for the court to pronounce on the application pending before the ESC, and that the employer had no right to interdict strike action pending that decision.

Delayed Reinstatement

In Equity Aviation Services (Pty) Ltd v Commission for Conciliation, Mediation & Arbitration & others the employer party sought to rescind and thereafter to review an award by a CCMA commissioner.   The matter was referred back for a rehearing.  The second CCMA commissioner ordered the reinstatement of the employee party four years and four months after his dismissal and awarded backpay for 38 months of that period.  On review for the second time the Labour Court did not accept the employer's contention that reinstatement was not 'reasonably practicable' after such a period of time, and pointed out that much of the delay was attributable to the employer's attempts to rescind and subsequently to review the original award.  The employer had finally conceded that the original dismissal was unfair, and the second commissioner was obliged to take all these circumstances into account in arriving at an award that would be fair to both parties.

Functions and Duties of Commissioners

Sasol Mining (Pty) Ltd v Nggeleni NO & others  the Labour Court considered the correct approach to be adopted by commissioners to the resolution of disputes of fact.  The court criticized the apparent inability of some commissioners to assess the credibility of witnesses and the inherent probability of the versions of those witnesses when resolving disputes of fact, and held that in the case before it the commissioner's failure to do so had rendered the award reviewable on account of a gross irregularity in the conduct of the proceedings.

Residual Unfair Labour Practice

The CCMA commissioner in Esterhuizen and Jet Demolition considered the requirements to ensure that a suspension pending disciplinary action would be fair, and found that in the case before her the requirement that the employee be given a chance to make representations before the suspension was imposed would have defeated the whole object of the suspension by enabling him to tamper with the evidence.  His immediate removal and suspension was therefore not unfair.

Dismissal - Fair and Unfair

The respondent employee in Member of the Executive Council for Education, Gauteng v Mgijima & others applied for a senior position in the applicant council, but did not disclose that she had at the time been placed on suspension by her current employer pending disciplinary proceedings, which proceedings were subsequently dropped.  When these facts came to light the employee was dismissed.  At arbitration the arbitrator, relying on the presumption that 'a person remains innocent until proven guilty', found her dismissal to have been unfair.  On review the Labour Court held that the arbitrator had not applied his mind to the true issues.  He was required to consider not the employee's guilt or innocence but her failure to disclose at her interview that she was on suspension.   The award was set aside. 

In SA Police Service v Safety & Security Sectional Bargaining Council & others  a police officer had been dismissed for failing to report the loss of a firearm. At arbitration the arbitrator upheld his claim that his dismissal was unfair, it being common cause that members of the SAPS were not routinely dismissed for similar misconduct.  In review proceedings the SAPS argued that there was no evidence before the arbitrator that it had acted inconsistently, and that he had simply assumed that was the case.  The Labour Court upheld the award, finding that once the employee had placed the issue of consistent treatment in issue the onus was on the employer to rebut the allegations, and that it had failed to do so.  In Manzini and Metropolitan Health Group  a team leader who was confrontational and aggressive and unable to work harmoniously with his team was finally dismissed for misconduct.  At arbitration his dismissal was found to have been unfair as the charges against him were vague and embarrassing, and did not convey the nature of his team mates' complaints. The employer should rather have continued with remedial measures to assist him in improving his relationships, failing which he should have been dismissed for incapacity.  In SA Transport & Allied Workers Union on behalf of Mahlathi and Transnet Port Terminals, Cape Town  an employee was dismissed for insubordination and neglect of her duties while suffering from a mental illness.  At arbitration the arbitrator found that on the evidence available to the employer at the time dismissal was warranted, but that arbitration was a hearing de novo and that on the evidence of mental illness then presented dismissal was not appropriate, and that the employee should be reinstated subject to monitoring.

Dismissal - Bringing the Employer into Disrepute

In both Sedick & another and Krisray (Pty) Ltd and in National Union of Metalworkers of SA on behalf of Kgatla and ABB SA (Pty) Ltd  employees were dismissed for bringing their employers into disrepute, and in both cases at arbitration the dismissals were found to have been fair.  In Krisray the employees had made scurrilous comments to one another on Facebook concerning their employer's management.  Issues of breach of privacy were raised, as the employees claimed that their conversations were private.  Having found that the employees had not restricted access to their Facebook pages, the commissioner found that their comments were in the public domain, and that they warranted dismissal.  In ABB SA the employee had sent e-mails to a wide variety of recipients alleging that his employer was not complying with the Employment Equity Act 55 of 1998, and that black employees had no opportunities to grow and develop.  The arbitrator noted that the EEA was very specific regarding the persons and institutions to whom complaints of non-compliance could be made, and that these limits had been exceeded.  The trust relationship had been irreparably damaged.

Demarcation Disputes

The arbitrating commissioner in Richard Rental (Pty) Ltd and National Bargaining Council for the Road Freight Industry (2009) 30 ILJ 229 (CCMA) had ruled in demarcation proceedings that the hiring out of tipper trucks to clients at a fixed rental, for use at their own discretion, did not amount to 'the transportation of goods for hire or reward by means of motor transport' within the registered scope of the road freight industry.  The bargaining council sought to review and set aside that ruling  in National Bargaining Council for the Road Freight Industry v Marcus NO & others  on the ground that the commissioner had misconceived certain aspects of the industry definition.  The Labour Court considered the approach to be adopted to the interpretation of an industry definition and found that a commissioner should have regard to all relevant facts and circumstances when seeking to identify the nature of an enterprise in which employees and their employer were engaged for a common purpose.  Demarcation involved considerations of fact, law and social policy, and due deference should be given to the expertise of the commissioner making the award.  The court found that the commissioner had been acutely aware of the true nature of the enquiry before him, and dismissed the application.

Interference in Uncompleted Arbitration Proceedings