IN THE LABOUR COURT OF SOUTH AFRICA (HELD IN BRAAMFONTEIN)

Transcription

1 Page 1 of 20 IN THE LABOUR COURT OF SOUTH AFRICA (HELD IN BRAAMFONTEIN) CASE NUMBER: JR 1852/05 In the matter between: LM WULFSOHN MOTORS (PTY) LTD T/A LIONEL MOTORS Applicant v DISPUTE RESOLUTION CENTRE First Respondent HEIN GERBER N.O Second Respondent NELITTA NEL Third Respondent JUDGEMENT BASSON, J BACKGROUND TO THE APPLICATION 1) The Third Respondent (Ms Nel hereinafter referred to as Nel ) claimed that she was constructively dismissed by the Applicant in that it had made continued employment intolerable. Her claim in respect of

2 Page 2 of 20 constructive dismissal arose mainly from an incident that occurred at her place of work on 11 November 2007 when she demanded to have access to, and to be permitted to review some 24 months of clock cards as she had a query as to her overtime payment. In support of the allegation of constructive dismissal, Nel also relied on other incidents that had occurred in November when Mr. Wulfsohn (the dealer principal hereinafter referred to as Wulfsohn ) shouted at her and an incident where she was accused by the Applicant s financial manager Mr. De Waal (hereinafter referred to as De Waal ) of having made mistakes with warranties to the extent that other staff could not take leave. She alleged that Wulfsohn also dragged her by her armed and asked her whether or not she could count properly. 2) It is, however, clear from Nel s letter of resignation that it was mainly the incident of 11 November 2004 that prompted her to resign. This much is clear from her letter of resignation in which she stated as follows: Ek gee kennis, ek werk nie n maand kennis nie weens omstandighede wat met Jan de Waal bespreek is op die 11de

3 Page 3 of 20 Noveber oor my oortyd wat nie korrek uitbetaal is nie. Ek het probeer om met meneer De Waat uit te sorteer, maar hy wou nie na my luister nie, want hy was te besig. 3) It is also common cause and should be noted at the outset that Nel has never raised any grievances with regards to the manner in which she was treated by the Applicant s management despite the fact that it was common cause that the Applicant had a grievance procedure in place that would have entitled Nel to lodge grievances. Nel also admitted that she had not read copies of the disciplinary code despite the fact that she had signed an acknowledgement that she will acquaint herself with the contents thereof. More in particular, Nel had never raised any grievances with her direct head a one Ferdi. She merely explained that she kept quiet because there was no one to talk to. It was put to her in cross examination that a reasonable person would have raised a grievance to which she merely responded that it was her perception that one could not talk to anyone: Ek het net gevoel, daar, dit was hoe ek gevoel het, n mens kon nie met iemand daar praat nie. It should, however, be pointed out that it was not Nel s evidence that she had problems with her direct head nor was it her

4 Page 4 of 20 evidence that she had elected not to use the grievance procedure because it was inefficient. 4) It was also not in dispute that there was a rule in place in the workplace that regulated the process that had to be followed when salary queries are made. In this regard employees had received a memo which specifically stated that, because employees are wasting admin staff time by requesting what their salaries will be at the end of the month, during the month, or they want to know what their bonus or commission will be.. there will be a window period of two working days after salaries have been paid into your bank account to enquire about your salaries and at any questions you might have in that regard after, that you request will not be considered [sic]. Nel admitted that she knew about the rule and that she had signed receipt of the document. It is common cause that Nel had, notwithstanding this rule, approached De Waal at a very inopportune time with a request that she wanted the clockcards for the past 24 months. When Nel approached De Waal with the request he (according to her) responded by asking her: waarom soek ek [Nel] f n 24 maande se klok kaarte. De Waal was candid in his evidence before the

5 Page 5 of 20 arbitration and readily admitted that he was irritable when Nel had approached him with the request because she (Nel) knew that there was a rule in place which was put into place precisely to prevent circumstances such as this. De Waal explained that he was on his way to a statutory audit and that he was under pressure. He admitted that he had used the f word. His evidence that this was an isolated incident, was not disputed. He further testified that he had called Nel later and requested her to reconsider her resignation but that she had refused to do so. When he was asked if he would have accepted the withdrawal of her resignation, he responded that he would have: ek sou dit so aanvaar het. Want ek dink dit was in n oomblik van ongelukkigheid of woede of iets, seker gewees [that she had resigned]. De Waal explained that grievances were raised with management in terms of the grievance procedure and that it was attended to. It is important to point out that this evidence of De Waal was not disputed by Nel in cross examination. 5) The Second Respondent (hereinafter referred to as the Arbitrator ) found that the termination of the employment relationship was the only reasonable option available to the Employee in the

6 Page 6 of 20 circumstances. The fact that there was a detailed grievance procedure in place does not assist the Employer. Mr. Badenhorst on behalf of the Applicant did not take issue with the fact that it was unacceptable for an employer (in this case De Waal) to have used a swear word. The main point asserted in argument was that there was a grievance procedure and that Nel therefore had an alternative other than to resign. THE REVIEW APPLICATION 6) The Applicant brought an application in terms of section 145 of the Labour Relations Act 66 of 1995 (hereinafter referred to as the LRA ) to review and set aside the Second Respondent s award (hereinafter referred to as the Arbitrator ). On behalf of the Applicant it was argued that the Arbitrator committed a reviewable irregularity in misconstruing the evidence before him and placing undue weight to the conduct of the Applicant s management and insufficient weight to Nels alternative to invoke the grievance procedure in light of the evidence that was properly placed before the arbitration. Before I turn to an evaluation of the merits, a few brief remarks in respect of

7 Page 7 of 20 constructive dismissals need to be made. 7) A constructive dismissal occur in terms of section 186(1)(e) of the LRA where the employee rather than the employer ends the contract with or without notice because the work situation has become intolerable as a result of conduct on the part of the employer.1 There are three requirements for constructive dismissal to be established: (i) whether the employee brought the contract to an end; and (ii) whether the reason for the employee s action was that the employer had rendered the prospect of continued employment intolerable ; and iii) whether the employee had no reasonable alternative other than to terminate the contract.2 8) The onus to prove these requirements rests on the employee.3 If one of these requirements is not present, a constructive dismissal would not have been established.4 1 CEPPAWU & another v Glass & Aluminium 2000 CC (2002) 23 ILJ 695 (LAC) at paragraph [30]: Constructive dismissal involves a resignation because the work environment has become intolerable for the employee as a result of conduct on the part of the employer (see s 186(1)(c). 2 See Solid Doors (Pty) Ltd v Commissioner Theron & Others (2004) 25 ILJ 2337 (LAC) at paragraph See section 192(1) of the LRA 4 See Solid Doors supra

8 Page 8 of 20 9) In most cases it is the second requirement that makes the enquiry into the question whether or not the resignation of an employee constitutes a constructive dismissal difficult. The test for establishing a constructive dismissal has been formulated in the following terms by the Labour Appeal Court in Pretoria Society for the Care of the Retarded v Loots (1997) 18 ILJ 981 (LAC): When an employee resigns or terminates the contract as a result of constructive dismissal such employee is in fact indicating that the situation has become so unbearable that the employee cannot fulfill what is the employee's most important function, namely to work. The employee is in effect saying that he or she would have carried on working indefinitely had the unbearable situation not been created. She does so on the basis that she does not believe that the employer will ever reform or abandon the pattern of creating an unbearable work environment. If she is wrong in this assumption and the employer proves that her fears were unfounded then she has not been constructively dismissed and her conduct proves that she has in fact resigned. 5 5 At 984E F.

9 Page 9 of 20 10) The Court in Smithkline Beecham (Pty) Ltd v CCMA & Others [2000] 3 BLLR 344 (LC) had the following to say about the decision in Pretoria Society: [38] What is clear from the aforesaid decision of the Labour Appeal Court is that the test for determining whether or not the termination of employment constituted a constructive dismissal is an objective one. The subjective apprehensions of an employee can therefore not be a final determinant of this issue. The conduct of the employer must therefore be judged objectively. It would be unfair to an employer to allow the subjective perceptions of an employee of its conduct, particularly when these perceptions turn out to be incorrect, to be the determining factor in penalizing the employer with the penalties imposed by the Act. [39] Grogan, in his Workplace Law 4 ed at 105, states that: The requirement that the prospect of continued employment be intolerable suggest that this form of dismissal should be confined to situations in which the employer behaved in a deliberately oppressive

10 Page 10 of 20 manner and left the employee with no option but to resign in order to protect his or her interests. [40] In Aldendorf v Outspan International Ltd (1997) 18 ILJ 810 (CCMA), 6 it was held that: [W]here employees could reasonably have lodge a grievance regarding the course of the unhappiness, and failed to do so before resigning, they may be hard put to persuade the court or arbitrator the they had no option but to resign 11) It appears from the aforegoing that it is not sufficient for an employee to allege that she genuinely believed that the employment relationship had become intolerable, the employee must satisfy the commissioner that her subjective mindset was (objectively) reasonable in the circumstances. The subjective mindset of an employee alleging constructive dismissal cannot therefore be disassociated from the circumstances surrounding the resignation. John Grogan in Dismissal Discrimination & Unfair Labour Practices6 is of the view that 6 (2005) at 159. The test for establishing whether a constructive dismissal has

11 Page 11 of 20 taken place is therefore party subjective and partly objective ie regard must be had to the perceptions of the employee at the time of the termination of the contract, as well as to the circumstances in which the termination took place. 12) In some cases the Courts have asked the question whether or not the decision to resign was an action of last resort. Where an employee could reasonably be expected to invoke a grievance procedure, the resignation will not be regarded as a constructive dismissal. See in this regard Lubbe v ABSA Bank Bpk [1998] 12 BLLR 1224 (LAC) where it was held that, because the employee had the opportunity to take up the dispute with other levels of management, the resignation was therefore not an action of the last resort. I agree with the sentiments expressed by Grogan7 that this test should not be applied too stringently but that it does protect employers from unscrupulous employees from resigning from their employment without informing the employer about their grievances in order to claim compensation from them.8 Where it appears from the circumstances of a particular case that an employee could or should reasonably have channeled the 7 Supra at Ibid.

12 Page 12 of 20 dispute or cause of unhappiness through the grievance channels available in the workplace, one would generally expect an employee to do so. Where, however, it appears that objectively speaking such channels are ineffective or that the employer is so prejudged against the employee that it would be futile to use these channels, then it may well be concluded that it was not a reasonable option in the circumstances. 13) Turning to the facts of this case. It is common cause that De Waal used a swear word when Nel approached him with her request. It is indeed so that swearing in the workplace may result in a constructive dismissal. The obvious example that springs to mind is where an employer swears at an employee. It is, however, equally true, that although foul language in the workplace should not be condoned, not all cases of foul language will necessarily result in the workplace being rendered intolerable to such an extent that an employee will have no other option to resign.9 As pointed out, whilst swearing at an 9 Although the circumstances in the case of Miladys (A division of Mr Price Group Ltd) v Naidoo & Others (2002) 23 ILJ 1234 (LAC) differed from the present case in that it was held by the Court that the employee in that matter was a mature woman and that she ought to have been able to handle the situation properly, the principles set out in this case are, in my view, relevant to the present case. The Court held as follows. [26] The second respondent found that Roy spoke to first respondent in a 'rude and disrespectful manner and that she gained the impression that he wanted her to leave'. If he had spoken 'nicely' to her she would never have wanted to resign. That abuse of a serious nature can result in constructive dismissal is evidenced by the English

13 Page 13 of 20 employee can never be condoned, it is still incumbent upon the commissioner to carefully analyse the circumstances in which it took place in order to decide whether it rendered the employment relationship intolerable to such an extent that continued employment was no longer possible. 14) In the present case it was not in dispute that the swearing was an isolated incident: De Waal was frank and admitted that he had used the f word but explained that it was an isolated incident. He explained that he was under severe pressure and that he was irritated with Nel because she had acted outside of the rules in the workplace by requested 24 month s clockcards whilst fully knowing what the procedures were for processing such queries. It is not relevant in review proceedings whether another court would have come to a case of Palmanor Ltd v Cedron [1978] IRLR 303. In that case the applicant, who was employed at a night club and had previously arranged to attend later than usual, was wrongly accused by the night club manager of being late. The manager then became abusive saying 'You are a big bastard, a big cunt, you are pig headed, you think you are always right.' When Cedron (the employee) objected the manager responded, 'I can talk to you any way I like, you big cunt' and 'if you leave me now, don't bother to collect your money, papers and anything else. I'll make sure you don't get a job anywhere in London'. Not surprisingly Cedron resigned and his claim, that he had been constructively dismissed, by reason of the behaviour in question, including the abuse, was upheld by the Employment Appeal Tribunal. [27] In giving judgment in that matter Slynn J acknowledged that many cases involving foul and abusive language did not constitute constructive dismissal. That particular case was exacerbated by the threats relevant to the employee (Cedron) leaving, ie 'don't bother to collect your money, papers and anything else' and to prohibit him finding other work, ie 'I'll make sure you don't get a job anywhere in London'. (Emphasis supplied.)

14 Page 14 of 20 different conclusion on whether or not this isolated incident objectively viewed, rendered the employment relationship so intolerable that the employee had no other than to resign. What is, however, at issue is whether or not the arbitrator had applied his mind seriously to the issues at hand and came to a reasoned and justifiable conclusion in light of the evidence and material that was properly placed before him The test of review is set out in Shoprite Checkers (Pty) Ltd v Ramdaw NO & Others (2001) 22 ILJ 1603 (LAC) where the Labour Appeal Court held as follows: In considering whether or not the first respondent s award falls to be set aside on the ground that it is not justifiable in relation to the reasons given for it, I consider that one must have regard to the material that was properly available to the first respondent, the decision he took and the reasons that he gave for such decision. As one does this, one must bear in mind what Chaskelson P said in the Pharmaceutical Manufacturers case namely hat a decision that is objectively irrational is likely to be made only rarely. Of course, I am saying this insofar as it seems that there is much communality between justifiability and rationality. One must also bear in mind the importance of maintaining the distinction between appeals and reviews, It must also be none in mind that the Act contemplates that the disputes that it requires to be referred to arbitration and that the dispute resolution dispensation of the Act which is meant to be expeditious would collapse if every arbitration award could be taken on review and set aside. In the light of what has been said above in regard to Carephone and the Pharmaceutical Manufacturers case and what was said by the Constitutional Court in the latter case, and in the light of the possibility that the PAJA may well be applicable to arbitration awards issued by the CCMA, I am of the view that it would not serve much purpose for this court to consider whether or not its decision in Carephone was correct and whether or not such decision should be departed from. In those circumstances Carephone stays. This appeal can therefore, be considered on the basis that, as was decided by this court in Carephone, CCMA awards can be reviewed and set aside if they are not justifiable in relation to the reasons given for them. 11 See Rustenburg Platinum Mines Ltd (Rustenburg Section) v Commission for Conciliation, Mediation and Arbitration 2007 (1) SA 576 (SCA): The test for review of CCMA arbitrations [18] Section 145(1) of the LRA provides for 'review of arbitration awards' by the Labour Court on the ground of 'a defect'. Subject to the Court's power to grant condonation (s 145(1A)), the application must be brought within six weeks of the award (or, in cases of corruption, six weeks from discovery of the offence). In terms of s 145(2), 'defect' means '(a) that the commissioner (i) committed misconduct in relation to the duties of the commissioner as an arbitrator; (ii) committed a gross irregularity in the conduct of the arbitration proceedings; or (iii) exceeded the commissioner's powers; or (b) that an award has been improperly obtained'. Until 2002 s

15 Page 15 of 20 15) I cannot find fault with the arbitrator s reasoning that it is not acceptable to treat an employee rudely in the workplace. However, I do take issue with the finding that the fact that there was a detailed grievance procedure did not assist the employer in light of the uncontested evidence. I am in agreement with the submission on 158(1)(g) empowered the Labour Court 'despite s 145' to review the performance of any function provided for in the LRA 'on any grounds that are permissible in law'. In 2002 'despite' was replaced with 'subject to'.. [21] Despite some initial dissent the LAC accepted after the decision of the Constitutional Court in Pharmaceutical Manufacturers Association of SA and Another: In re Ex parte President of the Republic of South Africa and Others, and after the enactment of the Promotion of Administrative Justice Act 3 of 2000 (PAJA), that the Carephone test was applicable to the review of CCMA decisions. PAJA, which enacted grounds of review considerably more extensive than those set out in s 145(2) of the LRA, came into force on 30 November Of present moment is s 6(2)(f)(ii), which empowers a court to review an administrative action if the action itself is 'not rationally connected to' '(cc) the information before the administrator; or (dd) the reasons given for it by the A administrator'. [22] In Shoprite Checkers (Pty) Ltd v Ramdaw NO and Others 9 the LAC considered the possible effect of PAJA's enactment on s 145(2). The LAC accepted 'the possibility that the PAJA may well be applicable to arbitration awards issued by the CCMA' (para [33]), but found it unnecessary to decide the issue. [23] In my view PAJA by necessary implication extended the grounds of review available to parties to CCMA arbitrations. In interpreting the LRA, and the impact on it of the later enactment of PAJA, the Constitution of the Republic of South Africa, 1996 obliges us to promote the spirit, purport and objects of the Bill of C Rights. This means that, without losing sight of the specific constitutional objectives of the LRA, and the constitutional values it embodies, we must in interpreting it give appropriate recognition to the right to administrative justice under the final Constitution and the legislation that gives effect to it. [26] A slightly different path leads to the same conclusion. At the time the LRA was enacted the interim Constitution required that administrative action be 'justifiable in relation to the reasons given for it'. For the reasons set out in Carephone, this right suffused the interpretation of s 145(2). When the administrative justice provisions of the Constitution, as embodied in PAJA, superseded those of the interim Constitution, it could not have been intended that parties to CCMA arbitrations should enjoy a lesser right of administrative review than that afforded under the interim Constitution. The repeal of the interim Constitution and its replacement by the Constitution did, in other words, not diminish the review entitlement under s 145(2). Section 6(2) of PAJA is the legislative embodiment of the grounds of review to which arbitration parties became entitled under the Constitution.

16 Page 16 of 20 behalf of the Applicant that this conclusion is not rational and/or justifiable in light of the evidence that was properly placed before the arbitrator. I have already referred to the fact that it was not disputed by Nel that there was a grievance procedure in the workplace although, on her own evidence, she did not bother to acquaint herself with the contents thereof. It was also the uncontested evidence on behalf of the Applicant that this grievance procedure has been used and, from De Waal s evidence, it appears that it was used successfully. It was De Waal s uncontested evidence that grievances were attended to and resolved as far as possible. Nel merely testified that she was of the (subjective) view that n mens kon nie met iemand daar praat nie. It would appear that the Arbitrator had unqualifiedly accepted the subjective perception of Nel that she could not use the grievance procedure and that she therefore had no other option than to resign. This conclusion is unjustifiable in light of the uncontested evidence on behalf of the Applicant. I am of the view that this is one of those instances contemplated by the case in Aldendorf (supra) where Nel could reasonably have lodge a grievance regarding the cause of her unhappiness, but failed to do so. By failing to objectively evaluate the decision not to lodge a grievance in light of the uncontested evidence,

17 Page 17 of 20 the Arbitrator arrived at a decision which is not rationally connected to the evidence properly before him and accordingly the award is reviewable. 16) I am in agreement with the submission on behalf of both parties that this Court is in a position to substitute the Arbitrator s award with its own. In this regard I am of the view that the order should be that Nel did not proof the existence of a constructive dismissal. In respect of costs, I am of the view that it would be fair in the circumstances not to award costs against Nel although the Applicant was successful in the review application. 17) One issue remains to be decided. It is common cause that the answering affidavit was filed out of time. A condonation application was filed explaining the reason for the delay. The Court was, however, advised at the commencement of the hearing that the Applicant would no longer oppose the application for condonation. I have nonetheless perused the condonation application and, without going into detail, I am satisfied that a reasonable explanation is tendered for the delay. In the event the late filing of the answering affidavit is condoned.

18 Page 18 of 20 18) In the event the following order is made: 1. The condonation application for the late filing of the answering affidavit is granted. 2. The arbitration award handed down by the Second Respondent dated 16 June 2005 is reviewed and set aside. 3. The award by the Second Respondent is substituted with an order that the resignation of the Third Respondent does not constitute a constructive dismissal as contemplated by section 186(1)(e) of the Labour Relations Act 66 of BASSON, J DATE OF HEARING: 6 SEPTEMBER 2007 DATE OF JDUGEMENT: 7 SEPTEMBER 2007 FOR THE APPLICANT: WJJ BADENHORST OF LEPPAN BEECH INCORPORATED ATTORNEYS

19 Page 19 of 20 FOR THE RESPONDENT: ADV P GILLISSEN INSTRUCTING ATTORNEY: DIONNE LAMBRECH ATTORNEYS