Bootes v Eagle Ink Systems KZ Natal (Pty) Ltd (2007) 16 LC 8.29.7; [2007] JOL 20651 (LC)

Principle:

  1. Dismissal of employees because of their HIV status is widely acknowledged as discrimination unless the employer can show that being free of HIV is an inherent requirement of the job.

  2. People in South Africa have the advantage of a constitutionally entrenched right not to be discriminated on the grounds of their HIV positive status. Furthermore, legislation facilitates proof of discrimination firstly by defining discrimination to include HIV as a prohibited ground of differentiation. Secondly, dismissal of the employee on account of his HIV status is, by definition, an automatically unfair dismissal. These three measures together impose an enormous burden on anyone who discriminates against an HIV positive person.

  3. Camouflaging discrimination under the cloak of misconduct is one of the most insidious forms of unfair labour practices. Employees struggle to prove it.

  4. Where an employer denies that the reason for dismissing the employee was his HIV positive status, it bears the onus of proving the true reason for dismissing the employee to justify its fairness.

Facts:

The employee challenged his dismissal by the employer, stating that the true reason for the dismissal was his HIV status. The employer alleged that it had dismissed the employee for misconduct. The Labour Court held that the misconduct on which the employer relied was not one which threatened the employment relationship to the extent that dismissal was justified. Although the employee was not credible on all issues, the court found the witness for the employer to be more unsatisfactory. He was found to be attempting to mislead the court on certain aspects. Assessing the evidence before it, the court found that the employer's real reason for dismissing the applicant was his HIV status. This amounted to an automatically unfair dismissal. The employee was awarded 16 months' remuneration as compensation.

Extract from the judgment:

[1]   Was the dismissal of the employee for misconduct, his HIV status, or both? That is the question for this Court to answer after a three-day trial.

[4]   Central to determining the true reason(s) for the employee's dismissal is the credibility of the witnesses for each party. In this context the circumstances of the termination of the employee's services from his previous employment become relevant. Determining the credibility of the parties on that issue is a curtain-raiser to the main issues.

[20]   Eagle charged the employee on 5 May 2005 as follows:

"2.1.   Gross dishonesty in that you misused the company petrol card in November 2004 by utilising it for a motor vehicle other than yours.

2.2.   Buying and selling in the first quarter of 2005 used printing blankets during company hours to clients of the company without prior permission or agreement with management.

2.3.   Due to the above, causing a serious breach of the trust relationship with your employer and leading to the irreparable break-down of the employment relationship."

[21]   The hearing proceeded on 10 May 2005. On 16 May 2005 Eagle dismissed the employee on the second and third charges. On the second charge Eagle proceeded almost exclusively on the version tendered by the employee.

[22]   The employee testified that he noticed that Eagle's customers were not using some of their printing machines. He learnt that they were waiting for used printing blankets from Taiwan. He offered to supply them with the blankets so that by operating their machines they would buy more ink from Eagle. So it happened that for six years the employee supplied Eagle's customers with used printing blankets as a "value added service". Eagle's customer, Divpac, was eventually his exclusive source for these blankets. When they became a product in demand and difficult to get, he started buying and selling them to Eagle's customers for the same price at which he had bought them. Dan Naidoo, the coating manager at Divpac, charged him R80 for each blanket. The blankets from Taiwan cost the customers R120 each. Naidoo offered the employee 50% of the price of the blankets as "an act of appreciation". Altogether the employee received R600 from the sale of the blankets.

[23]   Eagle contended that the transactions were not legitimate because:

23.1.   Nampak, as the holding company of Divpac, would not have allowed its production staff to give waste products away. It had contracts for waste removal.

23.2.   Naidoo's job would have been on the line if Divpac found out about the deal.

23.3.   4.   There was no audit paper trail. If Eagle wanted blankets from Nampak there would be an official purchase order and invoice reflecting zero or a nominal value and a gate release.

23.4 Even if Eagle employees were involved in the transaction for used blankets without the audit paper trail, it was wrong to receive money for waste that was acquired free of charge.

23.5.   The employee received money in his private capacity. He was moonlighting. Hamman described "moonlighting" as "buying and selling blankets without permission and getting money for that".

23.6.   7.   The employee was dishonest because he received money about which no one else knew. He made a secret profit.

23.7.   He acted against Eagle's interests. If Nampak had discovered the deal, it could have jeopardised the R180 million contract that Eagle was in the process of negotiating with Nampak at the time.

23.8.   All in all, the employee broke the parties' trust relationship.

[29]   The allegations against the employee constitute an offence that resulted in a breach of trust. He is therefore guilty of the misconduct for which he was charged in the second and third paragraphs of the disciplinary notice.

[30]   There was no need to discipline any of the other employees involved with the blankets as they merely acted as "runners" for the employee. They did not receive any personal benefit from the deal.

The employee's HIV-positive status

[31]   The employee was hospitalised on 10 January 2005. On 21 January 2005 he was diagnosed with full-blown AIDS. Gandy and Rose visited him in hospital. He had informed Gandy of his status. Gandy was concerned about the customers that the employee served. The employee testified that if, as Gandy surmised, his status was likely to impair the deal being negotiated with Nampak, Gandy should disclose his status to Nampak. On Gandy's version, even though the employee requested him to disclose his status to all the customers he served, Gandy informed only a few customers who needed to know.

[32]   He returned to work on 14 February 2005. He sought and was granted permission to address the staff about his status.

[33]   The employee pleaded the facts on which he relied to support his submission that Eagle breached his confidence and privacy by disclosing his status to all its customers without his authority. However, he did not plead the legal issues arising from the facts nor did he claim any relief arising specifically from the alleged unauthorised disclosure. One can get past this technical hurdle as Ms Naidoo did not raise any objection on this ground.

[36]   On the afternoon of his first day back at work after his hospitalisation, Gandy offered the employee an internal position at the same package he was receiving in his capacity as a technical sales representative. Gandy was unsure of the way forward as it was the first case he had to deal with of a white person with AIDS. He informed the employee that he and the directors of Eagle felt that Nampak, amongst other customers of Eagle, would be uncomfortable working with a sales representative who had AIDS. Hence Gandy placed him in a desk-bound position. The employee was not happy about being desk-bound.

[37]   On 19 February 2005 he was hospitalised again. Upon his return to work on 28 February he received a letter dated 24 February 2005. It read:

"Dear Brian,

In light of the fact that your job requires a lot of driving and as the company insures your car, the company and insurance company require written confirmation from your doctor stating that the medication you are currently taking will not impair your ability to drive. I have telephoned your doctor twice requesting this information but he does not return my call. The receptionist advised me he will only give this information to us with your consent. Based on your information given to us that some of the medication you are taking makes you drowsy, we did offer you an internal sales co-ordination/liaison post with no change to your package. This offer was not acceptable to you as you indicated that you did not want to be desk-bound and needed to be out of the office.

I believe the company has been very generous to you in the situation but need to advise that we as a company cannot and will not be held responsible for any situation that you find yourself in as we are in no way forcing you or requiring you to undertake strenuous driving in your current state of health. Should you not be able to obtain a clearance certificate from your doctor stating that you are capable of performing your normal duties as defined in your job description, all risks and responsibilities lie with yourself. I believe that the company has and will continue to assist you where possible but requires a commitment from yourself."

[41]   Whether the employee was well enough to do his normal job was disputed. Eagle's witnesses alleged that he looked and said that he was weak. He did not work a full day. They had the impression that he would not live long. The employee insisted that he was well enough to work normally. He denied going home early on account of his health.

[42]   In the opinion of the court the employee was not fit immediately after he returned to work on 28 February 2005 to do his normal work. On this issue the corroborated evidence of Eagle's witnesses outweighs his evidence as a single witness. The fact that he had to be readmitted to hospital four days after returning to work on 14 February also points to him not being well enough for normal work. At that stage, he needed an accommodation. A desk-bound job was an appropriate temporary accommodation.

[43]   Subsequently, his health improved. Eagle subjected him to a disciplinary enquiry without any doubts about his fitness to defend himself. The transcript shows that he represented himself ably. In court, he manifested no sign of the infection. He attempted to persuade Eagle that he was well enough to drive and retain his position as a technical sales representative, but Eagle was not interested in knowing about his condition. At no stage did Eagle get a prognosis from a doctor about the employee's health status. Despite this omission, Eagle proceeded to act against the employee in the manner described below.

[44]   On 14 March 2005 Hamman and the employee met. There is a dispute as to whether Hamman or the employee requested the meeting. Hamman testified that he received a call from Gandy, informing him that the employee wanted to see him. In his evidence-in-chief Hamman testified that he did not know what the meeting was about until it emerged during the discussions that the employee was unhappy with the letters that he received from Gandy.16

[45]   Under cross-examination, Hamman reflected that Gandy would have informed him that the purpose of the meeting was to discuss the employee's illness. Hamman prepared extensively for the meeting by getting information from Old Mutual about medically boarding the employee.

[46]   Eagle admitted in its pleadings that Rose required the employee to meet Hamman.

[47]   The court finds that Eagle initiated the meeting of 14 March 2005 with the employee. This finding is fortified by Hamman's evidence on the content of the discussion. Hamman began the meeting. He started discussing the employee's health and urged him to apply for medical boarding. He drew the employee's attention to Eagle's group life benefits and urged him to apply for them.

[48]   On the employee's version, Hamman insisted on getting the name and number of his attorney, Mr Rob Casasola, and called him immediately to discuss the disability claim as an option. On Hamman's version, the employee simply gave him Casasola's number and he, Hamman, left a voice message for Casasola.

[49]   The employee then informed him about Gandy's letter offering him the desk-bound job and his unhappiness with that offer. Hamman did not know about the letter and the offer. He continued to tell the employee that Eagle wanted him to do his job diligently, that, for Eagle to succeed, its employees must give "above average results and (they) must move the average performance upwards. Alternatively, (they) are dead." Hamman re-emphasised the need for "above average results" and likened it to playing rugby or soccer with sick people. Sales people, Hamman said, had to go out and see people from 9am in the morning to 8pm in the evening. They should not be sitting in the office taking calls. Eagle could "get a girl for that", he said. On that basis, he initially testified, he retracted the offer of the desk job. Later he watered it down to say that he did not retract it but merely did not agree with it. He left the medical boarding application forms with the employee. On his version, the meeting ended on the note that the employee would consider medical boarding. For the employee, medical boarding was not an option. It was common cause that nothing was agreed at that meeting.

[50]   On 22 March 2005 Gandy told the employee to take leave until 1 April 2005. On Gandy's version, he did so on Hamman's instruction. On Hamman's version, he was merely agreeing to Gandy's request to pay the employee during his leave. In any event, after the employee returned to work on 1 April he was again told to go on involuntary paid leave "until it was all over".

[51]   The probabilities favour Gandy's version because he was willing to accommodate the employee in a desk job and would not have chosen to impose involuntary leave on the employee. Hamman did not agree with the accommodation and retracted it by instructing Gandy to put the employee on paid leave.

[52]   In the meantime, Hamman held discussions with Casasola. On Hamman's version, Casasola had proposed on behalf of the employee that Eagle pay him the equivalent of three years' remuneration which Eagle could reclaim when the employee's death benefits were paid. Hamman rejected the proposal. The employee denied instructing Casasola along those lines.

[53]   Annexure G2 to the employee's amended statement of claim records at paragraph 32 that there was a meeting between Hamman and Casasola to settle the matter but that their attempts were unsuccessful.

[54]   The court accepts that Casasola had asked Eagle to advance the employee's death benefits. The tenor of Hamman's evidence as regards this proposal has a ring of truth. Furthermore, as such discussions took place between Casasola and Hamman in the absence of the employee, the latter could not rebut Hamman's evidence unless he called Casasola to testify. The employee had terminated Casasola's mandate on unfriendly terms and could not secure his co-operation for the trial.

[55]   The proposal could have been with the employee's instructions. Alternatively, in the nature of discussions of this kind it could have emerged as an option. If the employee did give such a mandate, he either did not recall it or selectively chose to forget it as it was not in his interest to advance a case that he was prepared to accept the termination of his service on some basis.

[56]   Hamman testified that the employee had said in February that he would not last another two months and that he wanted to retire to the Berg. From that Hamman gathered that the employee had a limited time to live and that he wanted to "die in quiet". Hamman's perception persisted during the meeting of 14 March 2005.

[57]   However, the employee maintained that he always tendered to work his normal job and that he did not want to be medically boarded. Sensing that his job security was threatened, he instructed his attorney to write to Eagle. An advocate drafted a letter which recorded the events up to 4 April 2005, pointed out that the employee was not disabled, that his medication did not make him drowsy during the day and that his ability to drive was not impaired, that he was opposed to being medically boarded and that Eagle was discriminating against him on the grounds of his HIV status. The employee demanded that he be allowed to continue working normally, failing which his dismissal would be challenged as being automatically unfair.

[58]   Eagle denied receiving this letter. As he had terminated Casasola's mandate, the employee could not prove that he had sent the letter. The draft letter is nevertheless relevant as a contemporaneous record of the employee's mindset.

[59]   On 5 May 2005 the employee was summoned to work and served with the notice to attend a disciplinary inquiry on 10 May 2005. The inquiry concluded with the dismissal of the employee.

What was the true reason for dismissing the employee?

[60]   About February 2005 Gandy discovered that the employee was receiving money from the sale of blankets to Eagle's customers. He investigated the matter by checking to whom Eagle supplied the blankets and how payments were made. He spoke to the dispatch staff who informed him that the blanket sales had been going on for some time. He did not say when he began doing the investigation. However, it could not have been immediately after his discovery in February as he was busy with more pressing issues that arose from Mimete's takeover of Eagle. He explained further that he alerted Hamman to the offence in April because he had only completed the investigation by then. He did not testify to taking any further steps to investigate the matter other than those mentioned above.

[61]   If Eagle had considered the offence to be so serious and one that could result in an irretrievable breakdown of the employment relationship, it would have investigated the matter sooner. If it viewed the offence as seriously as it subsequently claimed, it would have prioritised the investigation.

[62]   Objectively viewed, the nature of the offence was not one that involved any loss to Eagle, nor were large amounts of money involved. It impinged on the question of good faith and ethics. Dishonesty was not obvious. The position would have been different if Eagle had asked the employee for an explanation and he lied. The first and only occasion he was asked for an explanation was at the enquiry.

[63]   Another mitigating factor was that the employee had skills which Eagle needed. He testified that whilst he was at his desk-bound job he had to go to Nampak as he was the only one who could attend to that problem.

[64]   A sanction short of dismissal would have been appropriate. The misconduct could therefore not have caused the employee's dismissal. In so far as it did, it was unfair.

[65]   The court finds for the following reasons that Eagle dismissed the employee because it did not want to employ an HIV-positive technical sales representative:

65.1.   Hamman did not want to employ anyone who could not render above-average performance. That was the central theme and overriding message that he conveyed to the employee at the meeting of 14 March 2005. He had set a precedent by having an employee who had lost his arm medically boarded. Persons with disabilities were not his concern.

65.2.   3.   Eagle's management believed that its customers would be fearful and unwilling to be served by an HIV-positive person. Rose conceded this but Hamman and Gandy denied that this was a concern.

65.3.   Eagle tried to keep the employee away from his work for as long as possible. His leave from 22 March 2005 was not at his instance; it was imposed on him. Eagle was prepared to pay to keep him away. If Eagle wanted to employ him, it would have accommodated him in the desk-bound job, for then it would have been getting some value in return for paying him.

65.4.   Eagle would have made some effort to obtain a prognosis of his condition before acting against him if it had any intention of retaining his services.

65.5.   6.   By May the employee was still employed at his normal package. He had not died within two months, as Hamman had expected. He was not willing to apply for medical boarding and Eagle was not prepared to accommodate him in an alternative position. The only option left for Eagle to get rid of him was to dismiss him. Dismissal for incapacity would have been hard to prove as the employee was not incapacitated. Dismissal for misconduct then presented itself as the only option.

65.6.   Eagle embarked on the misconduct proceeding determined to dismiss the employee. It "threw the book" at him, so to say. The discrepancies which founded the first charge relating to the petrol expenses came to light during a due diligence which ended in March 2005. They could have been cleared quite easily, as Ms Naidoo conceded, by simply asking the employee for clarification. At the inquiry Eagle accepted the employee's explanation without question. In fact, it was only when the employee pointed out to Hamman, who chaired the inquiry as one of three panellists, that they had not dealt with the first charge, that Hamman elicited the employee's explanation. Equally, Eagle could have asked the employee for an explanation for the sale of blankets as soon as Gandy made the discovery. Obtaining a statement from the employee should have been done in the normal course of conducting his investigations. Eagle was set on holding the inquiry to justify the predetermined dismissal.

65.7.   8.   The court's view is fortified by the belligerent attitude that Hamman maintained throughout the inquiry. He conceded during the trial that he should not have chaired the inquiry. His explanation for his behaviour was that he had only been involved in two hearings and was therefore inexperienced. Inexperience is no excuse for being abusive. Hamman had remarked at the beginning of his evidence at the trial that he took charge of the personnel function personally because his philosophy was that Eagle's most important asset was its people. These remarks ring hollow in the light of his behaviour at the inquiry and after he learnt of the employee's HIV status.

The law

[66]   Today many jurisdictions prohibit discrimination based on a person's HIV status. Dismissal of employees because of their HIV status is widely acknowledged as discrimination unless the employer can show that being free of HIV is an inherent requirement of the job. Some jurisdictions elevate the protection of persons with HIV to constitutional or statutory law, whilst for others it remains soft law in codes and policy. Disconcertingly, not a single international labour Convention or Recommendation specifically regulates HIV in the workplace. Hopefully, the momentum that is developing amongst member states of the ILO will cause its Governing Body to amend its Discrimination (Employment and Occupation) Convention, 1958 No. 111, amongst others, to list HIV as a prohibited ground of discrimination. In the meantime, the ILO's Code of Practice on HIV/AIDS and the World of Work will have to suffice.

[67]   Relative to people living with HIV in many other jurisdictions, people in South Africa have the advantage of a constitutionally entrenched right not to be discriminated on the grounds of their HIV positive status. Furthermore, legislation facilitates proof of discrimination firstly by defining discrimination to include HIV as a prohibited ground of differentiation. Secondly, dismissal of the employee on account of his HIV status is, by definition, an automatically unfair labour practice. These three measures together impose an enormous burden on anyone who discriminates against an HIV positive person. Justifying discrimination on the grounds of an employee's HIV positive status is a hard row to hoe. Not surprisingly, employers try to avoid basing a dismissal on an employee's HIV status.

[68]   Despite these formal advances in South Africa and internationally, in reality, dismissal remains a major side effect of HIV infection. The pressure to dismiss may be external, for example from customers or internal, for example when other employees in the enterprise demand the dismissal of an infected employee. Often these demands stem from fear that is either rational or irrational.

[69]   In 1995 the Tokyo District Court issued a landmark decision in a case which academics generally refer to as the Aids Dismissal Case. The court rejected the employer's attempt to justify the dismissal on the ground of the employee's "defiant" attitude and refusal to come into the office. It found that the underlying reason for the dismissal was the employee's HIV status. It declared the dismissal to be "feeble", totally divergent from any common societal expectations, illegal, and thus a tort.

Finding

[70]   Camouflaging discrimination under the cloak of misconduct is one of the most insidious forms of unfair labour practices. Quick to perceive the unfairness, employees struggle to prove it. As Eagle denied that the reason for dismissing the employee was his HIV positive status, it bore the onus of proving the true reason for dismissing the employee to justify its fairness. It failed to prove that misconduct was the real reason for dismissing the employee. Eagle's management created a pattern of conduct that leads to only one reasonable conclusion: Eagle dismissed the employee on account of his HIV status. As it denied that that was its reason for the dismissal, questions of rationality and justification do not arise. In the circumstances, Eagle failed to discharge the constitutional and statutory onus of proving that the dismissal was not discriminatory.

Compensation

[71]   In assessing the amount of compensation payable to the employee, the court takes into account the following:

71.1.   Eagle impaired the dignity of the employee by instructing him to take leave when he wanted to work, by subjecting him to an abusive disciplinary inquiry, by dismissing him and finally, by attempting to camouflage its unfairness, lack of compassion and insensitivity under the employee's misconduct.

71.2.   HIV remains a highly stigmatised infection that continues to marginalise its weak and vulnerable victims. Employers must be deterred from discriminating against employees on the basis of their HIV positive status.

71.3.   The employee has been found guilty of two counts of misconduct for which he was charged. The misconduct was not such that it did or could reasonably have caused a breakdown in the relationship.

71.4.   Both parties tailored their evidence when it suited them.

71.5.   The employee has found alternative employment.

[72]   The order the court grants is the following:

72.1.   The dismissal of the applicant was automatically unfair.

72.2.   The employee is awarded compensation being the equivalent amount of 16 months' remuneration at the rate of R20 772,80 per month.

72.3.   Eagle is ordered to pay the employee's costs.