Generally speaking, if an

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1 Vol. 22 No. 11 June 2013 What facts must an applicant for employment disclose at the interview? The need to give answers to questions that are not asked by P.A.K. le Roux Managing Editor: P.A.K. Le Roux Hon.Consulting Editor: A.A.Landman Published by Gavin Brown & Associates Box Tokai 7966 Tel: Generally speaking, if an employee fails to provide accurate information in response to a material question put to him during the course of the process that leads to his employment, this may justify the termination of his employment on the grounds of misconduct. What is more difficult to determine is to what extent, if at all, the same applies where the employee fails to disclose material information to the employer in the situation where the information was not requested by the employer. Although the facts in Eskom Holdings Ltd v Fipaza & Others (2013) 34 ILJ 549 (LAC) are fairly unique, the Labour Appeal Court s (LAC) views in in this regard are important and provide some insight to the Court's approach to such matters. The Also facts in this issue.. Ms Fipaza was employed by Eskom in January During 2003 she and Eskom signed a leave of absence agreement in terms of which she was permitted to undertake post-graduate studies in the United Kingdom. In terms of this agreement she was supposed to return to work on 5 July For reasons that are not apparent from the decision, she did not report for duty on this date. Eskom extended the deadline for her reporting for duty to 6 September 2006 but she also failed to meet this deadline. She was then served with a notice to attend a disciplinary hearing to face a charge of being absent from work. She failed to attend the hearing and she was dismissed in absentia. She lodged an appeal but this was unsuccessful. In the letter informing her of her unsuccessful appeal she was informed that all Eskom vacancies are advertised on its website and that Also in this issue.. Collective agreements and the regulation of strike action. p104 Testing the fairness of promotions p46 Page 101

2 Should you come across any vacancy which you feel that you are suitably qualified for, kindly follow the application process. During the course of 2008 Fipaza applied for a job at Eskom. She completed and submitted the necessary forms and was interviewed for the job. On 25 April 2008 she was offered a position with Eskom. She accepted this offer on 29 April 2008 and submitted her resignation to her employer on 1 May 2008 with the intention of taking up employment with Eskom on 1 June On 27 May 2008 Eskom informed Fipaza in a letter of its intention to withdraw the offer of employment. The reason for this was stated to be the fact that she had not disclosed to Eskom that she had been previously dismissed by it for misconduct. She was given an opportunity to make representations as to why the offer should not be withdrawn. In her representations Fipaza made the following points - she had mentioned in her CV submitted to Eskom that she had been employed by it and had provided details in this regard; Eskom had never stated that there had been a breakdown in the relationship between herself and itself; the letter informing her of the outcome of her appeal (referred to above) had indicated that she could apply for a job despite the termination of her employment; she had answered all the questions put to her during the employment process honestly; and her dismissal had not been because of her poor work performance or because she had acted fraudulently. She reported for duty on 2 June 2008, but whilst attending the orientation course on that day she was told to leave Eskom s premises and to await its response to her representations. On 4 June 2008 she was informed that the offer of employment had been withdrawn. The CCMA award Fipaza then referred an unfair dismissal dispute to the Commission for Conciliation, Mediation and Arbitration (CCMA). The commissioner upheld the substantive fairness of her dismissal on the ground that she was guilty of fraudulent non-disclosure. He also found that Eskom would not have employed her if it had known that she had been previously dismissed. The fact that she was not asked to explain her earlier dismissal -.. did not mitigate against the materiality of the facts misrepresented in the present instance. The commissioner did find that the dismissal was procedurally unfair and compensation was awarded. Fipaza then sought to review the award in the Labour Court. The Labour Court s decision The Labour Court found that the award was reviewable and set it aside on the basis that the commissioner had not given proper consideration to the legal principles that applied in this type of case. The Court found that the dismissal was fair but referred the matter back to the CCMA to determine what remedy should be granted. It argued that a finding of a misrepresentation could only be made if Fipaza had been under a legal duty to disclose this information. Although the Court agreed that the failure to disclose had been intentional it found that Fipaza had not been under an obligation to disclose the fact that she had been dismissed. In coming to this conclusion the Court referred to the decision in ABSA Bank Ltd v Fouche (2003) 1 SA 176 SCA, in which the following as stated - The policy considerations appertaining to the unlawfulness of a failure to speak in a contractual context a non-disclosure have been synthesised into a general test for liability. The test takes account of the fact that it is not the norm that one contracting party need tell the other all he knows about anything that may be material (Speight v Glass and Another 1961 (1) SA 778 (D) at 781H- 783B). That accords with the general rule that where conduct takes the form of an omission, such conduct is prima facie lawful (BOE Bank Ltd v Ries 2002 (2) SA 39 (SCA) at 46G-H). A party is expected to speak when the information he has to impart falls within his exclusive knowledge (so that in a practical business sense the other party has him as his only source) and the information, moreover, is such that the right to have it communicated to him would be mutually recognised by Page 102

3 honest men in the circumstances (Pretorius and Another v Natal South Sea Investment Trust Ltd(under Judicial Management) SA 410 (W) at 418E-F). In this case the fact that Fipaza had been dismissed was not within her exclusive knowledge. Although the interview panel may not have known about her dismissal they were in a position to ascertain the circumstances in which Fipaza s employment had been terminated. [58.] In this instance, the commissioner adopted the view that an obligation to disclose a previous dismissal arises where the applicant would not have been employed if that fact was known. He adopted this view without considering if it was also necessary that the information fell within the applicant s exclusive knowledge for the obligation to arise. Consequently the commissioner failed to consider Eskom s own ability to ascertain the reason for the applicant s previous termination from its records. The facts of the matter show Eskom did just that, demonstrating that it was able to ascertain the information without having to rely on the applicant. Applying the correct test to the facts would have led to the unavoidable conclusion that the applicant in this instance was not obliged to disclose her previous dismissal to Eskom. Accordingly, the applicant s nondisclosure of her previous dismissal could not have been a fair ground for her dismissal. The LAC decision On appeal, Eskom s legal representative accepted that the application form completed by Fipaza did not contain any false information. He nevertheless argued that Fipaza had had a contractual obligation to disclose the fact that she had been dismissed. This was sourced in two documents. The first was the application for employment form that she completed and signed which, it was argued, constituted a pre-employment agreement. This contained a statement to the effect that all the information provided by her in the form was true and accurate and an acknowledgement that the provision of false or incomplete information could constitute a ground for dismissal. The second was the contract of employment itself. It contained a clause to the effect that the agreement was being entered into on the basis of the information provided by Fipaza, and that should any information provided prove to be materially incorrect Eskom reserved the right to withdraw from the agreement and to summarily terminate employment. Both clauses also indicated that Eskom reserved the right to investigate Fipaza s integrity and suitability for employment. It was also argued that these contractual obligations meant that the question as to whether there was a more general duty to disclose the information did not arise. The LAC rejected the argument that the preemployment agreement founded a duty to disclose the dismissal. The LAC rejected this contention in the following terms - and, [49] According to the dictionary meaning, a resume or curriculum vitae (the CV) refers to a brief account of one s life or career', esp. as required in an application for employment. In other words, it is generally not a requirement that a CV should provide reasons for leaving previous employment. It is a sort of document whereby a job seeker aims to advertise or market himself or herself concisely and succinctly to potential or prospective employers. In short, it is a personal advertisement for purposes of seeking employment. On this simple definition it would appear that the information provided by Fipaza in her CV was more than adequate for its purpose. [51] It seems to me that, in relation to the conclusion of the recruitment form, what would constitute the grounds of Fipaza s dismissal related only to the truthfulness, completeness and accuracy of the information that she furnished on the form. In terms thereof she, firstly, certified that the information was true and correct and, secondly, declared that she understood that if the said information was false or incomplete it would constitute a ground for her dismissal. The form does not extend the grounds of dismissal to anything beyond the false or incomplete information furnished and certified true and correct by Fipaza. It was common cause that, to the extent that the form required of Fipaza, all the information that she furnished was true, complete and accurate. Page 103

4 As far as the clause in the contract of employment was concerned, Fipaza had not furnished any materially incorrect information and had complied with her obligations in this regard. The employee s integrity could also not be challenged. The mere fact that Fipaza had been dismissed for misconduct did not justify a carte blanche conclusion that her integrity level was not up to scratch. Although she had been guilty of misconduct this did not mean that she had been dishonest. The circumstances surrounding her failure to report for work were somewhat unique. In any event, the LAC found, the integrity check had already been completed prior to her being offered the job. The LAC also found that Eskom was not entitled to rely on its alleged lack of knowledge as to the fact that Fipaza had previously been dismissed by it. This knowledge was available in Eskom s own records and should have been checked. The LAC concluded that - [64] In my conclusion, Fipaza sufficiently complied with what was reasonably expected or required of her to do in terms of the contract and the law. She owed no further duty, either ex contractu or ex lege, to disclose to the interviewing panel that she was dismissed by the appellant for misconduct in 2006 because, as already stated, this information was not within her exclusive knowledge, but also within the knowledge of the appellant. To sum up, her failure to mention to the appellant (as represented by the interviewing panel) anything about her 2006 dismissal did not, strictly speaking, amount to a material nondisclosure, as alleged by the appellant, but rather to a simple and immaterial omission on her part to remind the appellant of that fact, which, after all, was not necessary or compulsory of her to do. The word disclose means make secret or new information known As I have alluded to earlier, in this instance there was simply no secret or new information pertinent to Fipaza s previous employment with the appellant which was to the appellant unknown and which, therefore, warranted Fipaza to disclose. (Footnotes omitted) The LAC therefore found that the commissioner had committed various irregularities and the decision of the Labour Court setting aside the award was confirmed. Comment It is submitted that the finding that the dismissal was unfair is justified on the facts of this case. However, it seems that both the Labour Court and the LAC were significantly influenced by the argument that knowledge of Fipaza s dismissal could be attributed to Eskom. But does this mean that employees will never have duty to disclose information not requested of them? This decision is not authority for such a wide proposition. Both the LAC and the Labour Court referred with approval to the ABSA Bank decision which clearly indicated that such a duty may exist where the information is in the exclusive possession of the prospective employee, and the information is of such a nature that the right to have it communicated to the employer would be mutually recognised by honest men in the circumstances. That is, it is submitted, a test akin to reasonableness. PAK le Roux Collective agreements and the regulation of strike action Their relationship with the LRA: Some recent Court decisions by PAK le Roux Collective agreements are usually seen as an important source of rights for trade unions and their members. They can provide trade unions with valuable organisational rights and their members with terms and conditions of employment that they would not be able to negotiate as individuals. From another perspective they also constitute an important limitation on the right of employer organisations and trade unions, and their members,to embark on protected strike or lockout action. This is primarily because Page 104

5 section 65(1) (a) of the Labour Relations Act, 66 of 1995 (LRA) prohibits strikes and lock-outs in the situation where the employees or employers concerned are bound by a collective agreement that prohibits a strike or lock-out in respect of the issue that is in conditions of employment that they would not be able to negotiate as individuals. section 65(1)(b) of the LRA prohibits employers and employees from embarking on a strike or a lockout if they are bound by an agreement, including a collective agreement, that requires the issue in dispute be referred to arbitration; section 65 (3)(a) prohibits strikes and lock-outs by employees and employers if they are bound by a collective agreement that regulates the issue in dispute. There are numerous decisions where strikes have been found to be unprotected because of non-compliance with the above provisions. Courts have also, from time to time, been called upon to settle the interpretation of particular aspects of these agreements. In this contribution, four recent decisions which involve more unusual factual situations are discussed. SAFCEC & Others v National Union of Metalworkers of South Africa & Others (Unreported J2847/12 19 December 2012) In an attempt to minimise labour disputes that may lead to delays in the completion of the Medupi Power Station in Limpopo Province the various employers and unions involved in construction work entered into a collective agreement known as the Project Labour Agreement (PLA). The PLA contained a complicated peace clause that sought to regulate dispute resolution and to prevent industrial action in certain circumstances. It is apparent from the judgement that the clause sought to limit the right of employees employed by contractors operating at the construction site to strike, but it is not clear from the decision what the extent of this limitation was. One important limitation was that strikes could not take place with regard to "site related issues ". What is clear, however, is that the National Uni.on of Metalworkers of South Africa (NUMSA) had second thoughts about the agreement it had entered into and the limitations that it imposed on strike action. It therefore attempted to terminate the PLA. It did so in a letter which stated that We confirm that we have cancelled the PLA and/or withdrawn from the Medupi Project. We will utilize the MEIBC agreements and expect you to do so too. This prompted the two employers organisations whose members performed construction activities at Medupi to approach the Labour Court for an order to the effect that the PLA was lawful, valid and binding and that NUMSA s purported withdrawal from the PLA was invalid and/or unlawful and in breach of the PLA itself. They also sought an order requiring NUMSA to comply with the PLA. NUMSA raised four defences in this regard. These were that the PLA diluted the constitutional rights of the parties to the agreement and the rights provided for in the LRA and was thus contrary to public policy and unlawful; that the agreement was void because the parties to it had laboured under a mutual error that ;.. they were permitted to compromise the fundamental rights of workers in permitting the curtailment of the dispute resolution processes under the LRA. that there was an implicit or alternatively a tacit term to the effect that the PLA could be cancelled for good cause ; and that NUMSA was entitled to cancel the agreement in terms of s23(4) of the LRA. The Court considered the argument based on s 23(4) of the LRA first. This approach was based on the principle formulated by the Constitutional Court in Zantsi v Council of State, Ciskei & Others 1995(4) SA 615 (CC) that where it is possible to decide any case, civil or criminal, without having to deal with a constitutional issue that is the course which should be followed. Section 23(4) reads as follows (4) Unless the collective agreement provides otherwise, any party to a collective agreement that is concluded for an indefinite period may terminate the agreement by giving reasonable notice in writing to the other parties. Page 105

6 The two applicant employers organisations argued that s 23(4) did not apply in this case. They argued that the PLA was not a collective agreement entered into for an indefinite period of time. Reliance was placed on clause 6 which stated that This Agreement shall came into operation on the date of execution hereof and shall remain in effect for the duration of the construction and commissioning phase of the Project which shall mean the period in which all testing and final quality controls shall take place ensuring that the final product Medupi Power Station is handed over to the client. The argument appears to have been that the contract would not continue indefinitely but had an end date i.e when the construction of the Medupi Power was finalised. This meant that the contract could not be terminated by giving reasonable notice in terms of s 23(4). The Labour Court rejected this argument and found that an agreement for an indeterminate period of time such as the PLA (i.e. an agreement that would come to an end on the occurrence of a particular event, the precise date of which was uncertain) should be regarded as falling within the concept of a contract for an indefinite period of time and therefore capable of termination by the giving of reasonable notice. In coming to this decision the Court accepted the view expressed in Vansa Vanadium SA Ltd v Registrar of Deeds & Others 1997(2) SA 784(TPD that the meaning of the word indefinite must be determined from the context in which it is used. It then argued that the context in which this word as utilised in s 23(4) CONTEMPORARY LABOUR LAW is published monthly from August to July of each year. Visit our website at www. workplace.co.za for information and subscription details. Subscription Enquiries : Gavin Brown & Associates INDUSTRIAL RELATIONS Tel : (021) Fax : (021) workplace.co.za ISSN X Copyright held by the authors. No part of this publication may be reproduced in any form without the prior written consent of the publishers. must be interpreted included the fact that A collective agreement is a contract sui generis in that it can be extended to bind persons who are not members of the trade unions and employers organisations that entered into the agreement. The context within which a collective agreement operates under the LRA is vastly different from that of an ordinary commercial contract. The trade unions and employers organizations that enter into a collective agreement are accountable to their members for their decision making, and are bound to act in terms of their constitutions which are regulated in terms of section 95 of the LRA. The principle of voluntarism applies in the sense that the LRA does not prescribe to employers, employers organisations and trade unions with whom they should bargain, what they should bargain about or indeed whether they should bargain at all. This led the Court to conclude that the PLA could be terminated by the giving of reasonable notice - [20] In my judgment, taking into consideration the contextual issues I have referred to, indefinite period in section 23(4) of the LRA cannot simply mean in perpetuity, but its meaning must include a period of a fixed term, the actual duration of which is unknown. This matter is a clear example of why such a reading is apposite. The PLA has already been in existence since From the papers, it is evident that it is envisaged to continue for some years to come. Where the duration of a collective agreement is tied to an indeterminate period of time, i.e. the time that it takes to complete certain works or a particular project, it would amount to interference in the collective bargaining relationship to deprive a party of the right to withdraw from it in terms of section 23(4). It therefore followed that NUMSA was entitled to terminate the PLA by the giving of reasonable notice. However, NUMSA had sought to terminate the agreement without notice. The Court therefore found Page 106

7 that the termination was in breach of s 24(3) and therefore invalid. It indicated that a period of six months notice would have been reasonable. In the light of this finding the Court found it unnecessary to deal with the other justifications raised by NUMSA for giving notice of termination. Whether this is correct is perhaps arguable. In theory at least, it was possible that NUMSA could have justified its actions on one of the other grounds it raised. This being said, NUMSA may have found it difficult to do. As indicated above, s 65 does envisage the possibility that collective agreements can limit the right to strike and the right to bargain collectively (the outcome of which could be a limitation of the right to strike) is also a constitutionally protected right. South Africa Clothing & Textile Workers Union & Others v Yarntex (Pty) Ltd t/a the Bertrand Group (Unreported PA07/10 28 February 2013) The employer in this case fell within the scope of jurisdiction of the National Textile Bargaining Council ( the Council ). To cater for the differing types of textile operations falling within its jurisdiction the Council s constitution made provision for various subsectors of the textile industry. One of these sub-sectors was the Wool and Mohair and Worsted Products sub-sector. This in turn was sub-divided into the Wool and Mohair Section and the Worsted Section. Finally, such is the complexity of the Textile Sector, the Worsted Section was again subdivided into the Spinners and the Verticals sub-sectors. This decision concerned the Spinners sub-section. Two employers operated in this sub-section, namely YarntexPty) Ltd t/a Bertrand ( Bertrand ) and Derlon. Negotiations within the Worsted Section were usually conducted between the main union in the Textile Sector, the SA Clothing & Textile Workers Union (SACTWU) and an employers organisation called the National Association of Worsted Textile Manufacturers (NAWTM). During the course of the wage negotiations for the period 2008/2009, SACTWU submitted a draft collective agreement regulating terms and conditions of employment to both Bertrand and Derlon. Derlon signed the agreement. Although Bertrand was happy with the terms of the agreement, it refused to sign the agreement. The reason for the refusal was that it should have been entered into between SACTWU and NAWTM- the parties to the bargaining council. It argued that the fact that SACTWU had entered into a separate agreement with Derlon at plant level undermined centralised bargaining within the bargaining council structures. An unprotected strike then took place at Bertrand s factory in order to force Bertrand to enter into a collective agreement with SACTWU. No agreement was entered into. SACTWU then informed Bertrand that it would declare a dispute with it. It made a wage demand that, if met, would have meant that Bertrand would have paid substantially higher wages than Derlon. Bertrand objected to this on the basis that SACTWU was making a demand against it that had not been made against Derlon. It also argued that the dispute had to be declared against the NAWTM thus arguing for centralised bargaining within the bargaining council structures. SACTWU then withdrew this dispute and, instead, lodged a similar dispute against NATWM in respect of the Spinners Section in effect against Bertrand and Derlon. Conciliation failed to resolve the dispute and a certificate of non-resolution was issued. SACTWU then conducted a strike ballot at the Bertrand plant only. This was followed with a notice of proposed strike action being given. Although the notice referred to a strike in the Spinners sub-section and thus, in theory at least, covered both Bertrand and Derlon only the Bertrand employees went on strike. A violent strike then commenced at the Bertrand plant. After unsuccessful attempts had been made to get the strikers back to work an ultimatum was issued. The strikers did not comply with the ultimatum and they were dismissed. They challenged the fairness of their dismissals. The Labour Court found that the dismissals were fair. SACTWU appealed against this decision to the Labour Appeal Court (LAC). One of the issues that the LAC Page 107

8 had to decide was whether strike was protected. It was common cause that the procedural requirements of s 64 of the LRA had been complied with. The issue was whether the strike was prohibited by section 65 of the LRA, and in particular one of those subsections referred to above. The Court accepted that the constitution of the bargaining council was a collective agreement. The Court also accepted the submission of SACTWU s legal representative that the council s constitution did not prohibit the strike. The strike therefore did not fall foul of s 65(1)(a). Nevertheless, the Court rejected the argument that the strike was protected. It did so in the following terms [57] However, I do not agree with the further submission he made that the nonexistence of such a provision specifically prohibiting the strike in question renders the strike immune from being declared unlawful and therefore unprotected. If it were so, chaos would reign in the industry. The resultant effect of which would be the selective crippling of those plants which did not conduct their affairs with SACTWU in the fashion adopted by Derlon in this case, i.e. entering into negotiations and concluding private agreements with SACTWU on the determination of wage levels to the exclusion of other role players, such as Bertrand. [58] The constitution is premised on centralised bargaining between NAWTM and ACTWU, the main purpose of which is to create and maintain uniformity in the determination of wage levels so as to ensure that all employers in a given sub-sector or section level in this industry are treated in an equitable fashion. Employers and employees in these sub-sectors should enjoy the same treatment to ensure that employers compete with their counterparts in a fair manner in order to sustain the industry and to prevent job losses. [59] Any contrary interpretation of the relevant provisions of the Act and the constitution would result in catastrophic circumstances which would be inimical to the operation of the industry in question. Clearly the overarching purpose of the constitution was to avoid fragmentation of the bargaining process. This interpretation of the constitution is in accord with the intentions of the drafters thereof to outlaw plant level bargaining. [60] My interpretation of the constitution therefore is that the strike in question is not protected by the provisions of the constitution. Neither is it protected by the LRA. What is interesting is that the LAC does not justify its decision with reference to any specific provision in the LRA. In particular no reference is made to s 65. Taken at face value this excerpt seems to indicate that the LAC decided to interdict the strike on the basis that not to do so would lead to chaos in the industry, would lead to some employers not being treated in an equitable fashion and would result in catastrophic circumstances. Cleary a novel approach and certainly not correct. However, a closer reading of the decision does seem to indicate that the reason for the Court being prepared to interdict the strike was that it was in breach of s 65(3)(a) i.e. the real issue in dispute was at what level or in what forum collective bargaining should take place and that his issue was regulated in a collective agreement in the form of the bargaining council s constitution. SA Clothing & Textile Workers Union & Another v Klein Karoo International Ltd (2013) 34 ILJ 478 (BCA) The arbitrator s award in this matter also dealt with the consequences of a system in terms of which the primary level of bargaining is industry level bargaining within a bargaining council in this case the National Bargaining Council of the Leather Industry (the Council). Where collective bargaining takes place at a centralised level it is not unusual for the parties to agree that this will be the sole forum for bargaining terms and conditions of employment and that no bargaining on these issues will take place at plant level unless specifically agreed otherwise. But what if the parties agree to plant level bargaining on an issue and fail to reach agreement on the issue during these negotiations? Can the union strike or can the employer lock out its employees? This was considered in the Klein Karoo decision. Page 108

9 Clause 15 of the collective agreement regulating terms and conditions of employment for the tanning sub-sector of the Council provided that plant level bargaining was prohibited unless the agreement itself provided otherwise. Certain clauses of the collective agreement did make provision for plant level negotiations. One of these was clause 7.1(5). It stated that - Payment of wages Wages will be paid in cash weekly during ordinary business hours and not later than Friday. An employer and his employees may negotiate at plant level to pay wages fortnightly, and/or to a different method of payment. Where employees are paid in cash, wages will be placed in a sealed envelope with the following details appearing on the outside in indelible writing.... In accordance with this clause the employer in this matter entered into negotiations with the South African Clothing & Textile Workers Union with the view to changing the payment interval from weekly to fortnightly. A majority of the employees agreed to change to the fortnightly pay interval but a few employees refused to agree to this. A dispute then arose as to whether the employer was entitled to lock-out the employees concerned in an attempt to force them to agree to the fortnightly payment interval, or whether the employer was required to retain them on the weekly payment interval. This dispute was referred to arbitration. The arbitrator found that a lock-out could take place in the following terms [41] The parties are in agreement that s 65 of the Act contains prohibitions or limitations on the right to strike (and recourse to a lockout). They are, however, in disagreement as to whether failed plant-level negotiations constitute a dispute of right or interest andare catered for in clause 7.1(5) is an issue regulated by a collective agreement to the extent that industrial action is prohibited. [42] Centralized bargaining resulted in the default position of weekly payments, as is found in clause 7.1(5). The weekly pay interval is therefore a right in terms of the collective agreement. Clause 7.1(5) then continues to the effect that parties may at plant-level negotiate to change the weekly pay interval - another right created by the collective agreement. If the parties participate in negotiations at plant level, they act in accordance with the collective agreement and there can be no dispute of right. If their negotiations do not achieve the objective they aimed for, for example, an increase in the Christmas bonus or, as in this case, a different pay interval, it is a dispute of interest. It is the plant level negotiation that is a right and that is regulated by agreement. The issue that is being negotiated remains in the realm of an interest dispute. It follows then that if consensus is not reached, the logical manner in which to resolve it is by way of power play. This must be so. In analogy, if the unions negotiate severance pay at plant level in terms of clause 9.2 to achieve more than the one week s default pay, do the unions honestly believe that they cannot strike to obtain more than one week s pay? Incidentally, the slight difference in wording between clauses 7.1(5) and 9.2, as pointed out by the applicants, is of no consequence. It is the right to bargain at plant level that is regulated by the collective agreement, not the outcome of those negotiations. The applicants are correct in saying the default position remains, but it remains only until it is changed through plant level bargaining or power play. The Court found that clause 7.5(1) could therefore not be interpreted to exclude a strike or a lock-out in the event that plant level negotiations failed. It is submitted that this conclusion is correct. However, it is perhaps unfortunate that reliance was, to some extent at least, placed on the distinction between a dispute of right and a dispute of interest. There are disputes of right that can be the subject of a strike or a lock-out. There are also circumstances where disputes of interest cannot be the subject of strike or a lock-out. The question is whether the dispute falls within the ambit of one of the limitations set out in s 65, not whether there is a dispute of right or a dispute of interest. Page 109

10 BMW South Africa (Pty) Ltd v NUMSA obo Members [2012] 3 BLLR 274 (LAC) This decision also deals with the situation as to what demands can be the subject of strike action in the situation where a collective agreement entered into at industry level also envisages collective bargaining at plant level in certain circumstances. The facts and disputes in this case, as well as the relevant clause in the industry level agreement, are complicated and most of them will not be discussed in detail here. The most interesting point raised in the decision relates to compliance with a dispute resolution procedure contained in the relevant clause. The employer in this case sought to interdict what it regarded as an unprotected strike. The Labour Court refused to grant the interdict. On appeal to the LAC the employer raised various arguments. One of these was based on s 64(3)(b), which provides that the parties to a dispute need not follow the procedure set out in s 64 of the LRA in order to render a strike protected if they follow a dispute resolution procedure that they have agreed to in a collective agreement. The employer argued that the strike was unprotected because the union concerned had not complied with the dispute resolution procedure contained in the industry level agreement. Landman AJA rejected this argument. In coming to this decision he relied on the earlier decision of the LAC in County Fair Foods (Pty) Ltd v FAWU & Others [2001] 5 BLLR 494 (LAC) where it was found that compliance with a private dispute resolution procedure was not necessary to render a strike or lock-out protected; employers and employees remained free to utilise the provisions set out in s 64 of the LRA. In this decision the Court found that what the legislature had sought to achieve with the enactment of s 64(3)(b) was to give the parties the choice of utilising the s 64 procedure or their own collectively agreed procedure. However, Waglay DJP took another view. He found that where there was such a collectively agreed dispute procedure this had to be complied with and compliance with s 64 was not sufficient. [8] It is not for me to interpret the above clause. It is common cause between parties that the clause sets out the procedure which the parties need to follow in dealing with the demand. The appellant, however, argued that, the procedure set out in clause A8.3 was but the only way that the respondent was entitled to proceed in addressing its demand. I agree. Parties by way of a collective agreement set out certain procedural steps which they will follow in dealing with their demands, grievances, concerns, etc. In this respect, appellant is correct to submit that the respondent was obliged to follow clause 8.3 in having its demand addressed. [9] The respondent, on the other hand, argues that it is not obliged to comply with the procedure set out in clause 8.3 because its demand is one of mutual interest and it is entitled to embark on a strike in support of its demand as long as it does so in compliance with the provisions of the Labour Relations Act 66 of 1995 (as amended) ( the Act). I disagree. Where parties have concluded an agreement which does not deny any of the parties to the agreement the rights and obligations provided in the Act, I see no reason why that agreement cannot be enforced. In fact the Act seeks to promote collective bargaining, particularly at the sectoral level and gives primacy to collective agreements. [10]A collective agreement concluded between the parties is binding between them. It is a contract that sets the agreed terms between them and as long as what is agreed upon is not in conflict with the applicable legislation or contra bonos mores it is binding and enforceable between them. (Footnotes omitted) However, because the employer had not co-operated in complying with the procedure Waglay DJP found that the union had been entitled to utilise the statutory process contained in s 64. P A K le Roux Page 110