Algoa Bus Company (Pty) Limited v Transport Action Retail And General Workers Union (Thor Targwu) and Others (P368/13)  ZALCPE 31 (7 May 2015)
The fact that an award of compensation against the union might cause it further financial damage is not of itself a reason for not granting relief. Whilst an important question that has to be considered is whether the effect of a particular award of compensation against a union is likely to seriously compromise its ability to function, this does not mean a union can expect to remain immune from the financial consequences of reckless conduct by its members or office bearers.
This LC judgment deals with a trade union's liability for an employer's damages suffered as a result of an unprotected strike. The LC awarded the employer R1,4 million damages, payable by the Union and its members employed by the Company. The Court ordered that these damages should be paid by the Union in instalments of at least R5,280.00 per month, coupled with each affected employee having R214,50.00 deducted from their salaries per month, until the debt was paid off. They were also ordered to pay the employer's legal costs.
The Union's members were employed as Company drivers and participated in an unprotected strike for 7 days in response to disciplinary action pending against certain members who were subsequently dismissed. The evidence available showed, on a balance of probabilities, that the union did little if anything to discourage its members from participating in the strike or to distance itself from the strike.
The employer obtained an interdict in its attempts to end the strike, which was not adhered to, and warned the Union and its members that it may lodge a damages claim for financial losses sustained during the strike. The strike was not a spontaneous event and there was no effort by the Union to restore labour peace, except on the basis that the strikers' demands in relation to the suspended members should be conceded to. The LC expressed the view that the strike was not in response to unjustified conduct by the applicant and served no collective bargaining purpose - the employer's disciplinary action was legitimate and that process should have run its course without the pressure of industrial action.
The Union provided unconfirmed financial statements as evidence of its poor financial condition, but the LC commented that the fact that an award of compensation against the Union might cause it further financial damage was not in itself a reason for not granting relief. Whilst the LC considered whether the effect of the compensation award against the Union was likely to seriously compromise its ability to function, bearing in mind that it had responsibilities to members in other workplaces, this did not mean that the Union could expect to remain immune from the financial consequences of reckless conduct by its members or office bearers.
The Court felt that the negative effect of the damages award could be ameliorated by making it repayable over an extended period, and commented that there was nothing to suggest the Union could not raise a special temporary levy from all members to cover the extra expenditure. Considering their members' actions such as their failure to follow any procedures, their persistence with the strike and failure to heed the Court's order, the financial burden of the installment payments was not unduly burdensome.
The Court also recognized that the nature of the employer's business meant that the financial impact of the strike on it was direct: it lost fares and subsidies for the duration of the action. There was no way these could be recovered by, for example, working additional hours after the strike. The demand for transport for those days was not one that would accumulate and could be satisfied on a deferred basis later.
This judgment provides a very useful example of how the factors listed in section 68(1)(b) of the LRA are considered and applied. It should provide a yardstick for parties considering launching or defending similar action, showing how the diverse basket of factors such as the extent to which the strike was premeditated, whether the action was in response to unjustified conduct by another party, the interests of orderly collective bargaining and the financial positions of the parties involved, are weighed up and applied.
Extract from the judgment:
(R LAGRANGE, J.)
 The evidence available also showed, on a balance of probabilities, that the union did little if anything to discourage its members from participating in the strike or to distance itself from the strike. Broad allegations of attempts to persuade strikers to return to work were made but are so lacking in any specificity as to be of no evidentiary value at all. More particularly, even if I accept that initially, the union might not have been fully aware of the strike, there can be no doubt that it was fully apprised of the situation by 24 January 2013. By 25 January 2013 when the interdict was granted, there could have been no more doubt in the mind of the union officials that the strike was in progress and was unprotected. Immediately after the interdict was obtained, the applicant also pointedly drew the respondents' attention to the fact that a damages claim for losses sustained during the strike could be made. That ought to have limited any one reading that letter to the fact that the applicant would not necessarily confine itself simply to having the strike declared unprotected or taking disciplinary action, but that it might seek to recover any financial losses.
 The strike was not a spontaneous event which just began in response to some action by the applicant on 23 January 2013. In essence, it was a response to disciplinary action pending against certain members who were subsequently dismissed. In any event, even if it had been spontaneous, there was no effort by the union to restore labour peace except on the basis that the strikers' demands in relation to the suspended members should be conceded to. The disciplinary action in the circumstances was legitimate and that process should have run its course without the pressure of industrial action. Consequently, I do not think there is a case to be made that the strike was in response to unjustified conduct by the applicant. The strike also served no collective bargaining purpose.
 Importantly, once the Court order was obtained interdicting the strike, it was not adhered to. All in all, the strike endured for seven and a half days, a significant period within which the respondents had an opportunity to reflect on their actions. After the interdict was handed down on 25 January 2013, there could have been no doubt left about the status of the strike and the interdict ought to have made it easier for the union to persuade members to end the strike, especially when it was coupled with the applicant notifying the union of its intention to claim damages.
 The union provided unconfirmed financial statements for 2011 and 2012, marked "for discussion purposes only" as evidence of its poor financial condition. Undoubtedly, if those unofficial documents were an accurate reflection of the union's financial position at that time, the union was barely scraping by. Although it is not part of the evidence presented by the union in these proceedings, the comments of the general secretary from the bar when she was explaining her attendance at the proceedings, suggest the situation is even worse presently. However, the fact that an award of compensation against the union might cause it further financial damage is not in and of itself a reason for not granting relief. In my mind, an important question that has to be considered is whether the effect of a particular award of compensation against a union is likely to seriously compromise its ability to function, bearing in mind that it will usually have responsibilities to members in other workplaces, whose right to effective representation by, and participation in the affairs of, a functioning union ought not to be seriously compromised by the unlawful conduct of a section of the membership or of a local organiser. However, this does not mean a union can expect to remain immune from the financial consequences of reckless conduct by its members or office bearers.
 In this instance, even on the union's version, it is apparent that it was already in a financially perilous situation and that an order of compensation against it, though adding to its financial woes, would just be one more additional burden. There was also no credible evidence of how the order of compensation would affect its collective bargaining capability. A related factor to consider in this regard is whether the imposition of an award of compensation can be ameliorated by making it repayable on extended terms, which is what I have done in this case. Notwithstanding the unconfirmed financial reports it produced, the union did not dispute the applicant's contention that it had a membership that ought to have yielded subscription income of just over approximately R 100,000 - 00 per month. Further, there is nothing to suggest the union could not raise a small special temporary levy from all members to cover the extraordinary expenditure.