Nyambi and Others v H C Shaik Investment CC and Another (J1471/17) [2017] ZALCJHB 260 (5 July 2017)

Principle:

Where there is a suitable alternative remedy a court will not grant an urgent interdict. It is not necessary to wait for a pending arbitration award as to who is the legally correct employer in order to effectively exercise the right to strike in support of demands made under section 64(4) of the LRA.

Facts:

There are 5 obstacles to persuading a court that it should grant an interdict:

  1. The matter is sufficiently urgent.
  2. There is a prima facie right derived from contract, statute or the common law (A mere interest doesn't constitute a right).
  3. A reasonable apprehension of irreparable harm exists, if the interdict is not granted.
  4. There is no alternative satisfactory remedy available to the applicant.
  5. The balance of convenience is in favour of granting the relief - this is in the court's discretion, often taking into account the applicant's prospects of success on whether or not it is likely that the applicant will ultimately be able to show a clear right; as well as any potential prejudice to third parties.

Courts are obliged to check all these factors. In this case, the applicants were employees who brought an urgent application to prevent the unilateral alteration of their terms and conditions of employment, pending the outcome of a dispute about their employment status which had been referred to arbitration (at the time of the application, an arbitration award was pending). At the heart of this dispute was whether the employees of a service provider (the first respondent) had become employees of Nampak (the second respondent). The respondents denied this and said the commercial relationship between them was simply governed by a "service level agreement" ('SLA') and not by a 'TES' (labour broking) agreement.

The employees were engaged in various tasks checking the quality of bottles produced by Nampak, work intimately connected with Nampak's operations. The service provider that employed the applicants denied that it was providing labour broking services to Nampak. The service provider had given notice to the employees of proposed changes to their hours of work and other working conditions with effect from 1 July 2017, which led to the urgent interdict proceedings being launched on 27 June 2017.

The purpose of the interdict application was to preserve the employees' ability to engage in protected strike action against their true employer (or employers) in terms of sections 64 (4) and (5) of the LRA, over the proposed changes to their working conditions. Until they learned the outcome of those arbitration proceedings about who their employer was, they were unsure whether they could exercise the right to engage in a protected strike in which other employees of Nampak could participate. By obtaining the interdict, the applicants would be able to prevent the respondents from implementing any of the changes until they were in a position to know what the ambit of potential primary strike action under section 64 (4) was.

The Labour Court, in considering the requirements for an interdict, was satisfied that there was a right to be protected, but did not agree that there was no alternative satisfactory remedy. The court did not see why a primary strike could not proceed against the first respondent (the service provider who was on paper the employer) and a secondary strike against Nampak. In recognising this other option, the LC was emphasising that where there is a suitable alternative remedy, a court will not grant an urgent interdict. It was not necessary to wait for the pending arbitration award on who the legal employer was, in order to exercise the right to strike under section 64(4) of the LRA.

Extract from the judgment:

Lagrange J:

Urgency

[3]   The application was launched on Thursday 27 June, and the applicants gave the respondents very short notice of approximately one day to file answering affidavits. The notification of the alleged changes to terms and conditions of employment due to be implemented on 1 July 2017 was conveyed to the individual applicants on 14 June 2017 and a letter of demand calling of the first respondent not to implement the changes was conveyed by the applicants' attorney of record on 22 June 2017. By 24th June, the applicants had responses from both respondents which made it clear that the demand not to implement changes to working hours and other aspects of the applicants' employment would not be acceded to. The application was then launched three days later. As matters turned out, answering affidavits were filed on 30 June. The applicants filed a replying affidavit on the morning of the urgent application hearing.

[4]   The respondents contend that the urgency was self-created because the application was brought on very short notice when the applicants waited 10 days to bring the application. I accept that in dealing with a large number of unionised employees, there might have been some delay before proper instructions could be obtained in order to submit the letter of demand on 22 June. Similarly, the applicants could not have been expected to launch the application before waiting a reasonable time for the respondents to answer the letter of demand. The additional delay of a couple of days in launching the application is not material in my view. Had the respondents not been able to respond adequately in the time available before the hearing on 4 July, the matter might well have been dismissed for lack of urgency justifying the drastic curtailment of normal time periods for filing answering affidavits. However, since they were able to respond before the matter was heard, I am prepared to accept that the application should be considered on an urgent basis.

Existence of a prima facie right

[5]   The object of the application is to preserve the ability of the applicants to engage in protected strike action against true employer or employers in terms of sections 64 (4) and (5) of the LRA, which provides:

  1. Any employee who or any trade union that refers a dispute about a unilateral change to terms and conditions of employment to a council or the Commission in terms of subsection (1)(a) may, in the referral, and for the period referred to in subsection (1)(a)-

    1. require the employer not to implement unilaterally the change to terms and conditions of employment; or
    2. if the employer has already implemented the change unilaterally, require the employer to restore the terms and conditions of employment that applied before the change.

  2. The employer must comply with a requirement in terms of subsection (4) within 48 hours of service of the referral on the employer."

[6]   The applicants argue that even though there is no dispute that the first respondent is their employer, until the outcome of the arbitration, it is uncertain whether the second respondent is also their employer. Consequently, until they learn the outcome of those arbitration proceedings, they are unsure whether they can exercise the right to engage in a protected strike in which other employees of the second respondent could participate. By obtaining the interdict, the applicants would be able to prevent the respondents from implementing any of the changes until they are in a position to know what the ambit of potential primary strike action under section 64 (4) is.

[7]   In essence, the applicants wish to be able to exercise their rights under section 64 (4) only when there is certainty about whether or not the second respondent is also their employer. In the meantime, they wish to prevent any changes to their working conditions being made. At this juncture, it is important to emphasise that this application is based on protecting the applicants' ability to embark on a primary strike against both respondents under section 64 (4). The applicants did not seek to assert their right to specific performance of their existing contractual obligations, which was also available to them as an alternative cause of action.

[8]   Undoubtedly, if the second respondent is also the applicants' employer, they would have a clear right to embark on primary strike action against it utilising the procedure under section 64 (4) if the changes intended by the first respondent amount to changes to their terms and conditions of employment. In passing, the alleged changes to terms and conditions of employment concern the following, at least some of which appear to amount to entail material alterations of working conditions, viz:

8.1   Relocation of the workplace to Alrode from the existing Germiston location, which is not disputed.
8.2   Reduction of working hours by half, which the respondents' claim is simply short-time.
8.3   Reduction in staff per shift and a less than proportionate cut in minimum target rates, which also appears to common cause.
8.4   The allocation of some staff per shift to perform lower paid functions.

However, for the purposes of this judgment it is not necessary to determine if they amount to a variation of the applicant's contractual entitlements.

[9]   A primary strike against the second respondent would allow employees of the second respondent who are not applicants to also participate in the strike in support of the applicants' demands, it being well established that it is not only the employees who are directly affected by strike demands made on an employer who may participate in a protected strike in support of those demands.

[10]   It is trite that the object of a strike is to bring economic pressure to bear on an employer to accede to the demands of the striking employees. The question which arises is whether the only way the applicants can ensure that they and all employees of the second respondent can engage in protected strike action is by preserving the prevailing circumstances of their employment until such time as it is established that the second respondent is also their employer. The respondents argued that nothing prevents the applicants from initiating a primary strike against the first respondent, provided they follow the procedural requirements of section 64 (4) and then giving the second respondent seven days' notice of a secondary strike in accordance with the requirements of section 66 (2)(b) of the LRA. Provided those procedural requirements and the requirements of s 66(2)(c) are also satisfied, other employees of the second respondent would be entitled to participate in the strike action in support of the applicants' demands even if the applicants are not employees of the second respondent.

[11]   Having regard to the inextricably close connection between the work performed by the applicants as employees of the first respondent and the operations of the second respondent, there can be little doubt that such strike action would be reasonable having regard to the direct and material impact on the operations of the second respondent and would fulfil the requirements of s 66(2)(c). The economic pressure that such a strike would bring to bear the second respondent would be indistinguishable from the economic effect of a primary strike by the same employees in support of the same demands. The applicants advanced no grounds why this was not a reasonably suitable alternative to a primary strike against the second respondent. In short, I am not satisfied that in order to effectively exercise the right to strike in support of demands made pursuant to a referral made under section 64 (4) and in order to afford employees of the second respondent the right to participate in a strike in support of those demands, it is necessary for the applicants to await the outcome of the pending arbitration award, given the facts of this application. It follows therefore that the applicants have a suitable alternative remedy they can pursue without having to await that event.

[12]   For the sake of completeness, mention must be made of the judgment in De Klerk v Project Freight Group CC cited by the applicants in support of their argument that they are entitled to an interdict to preserve the dispute resolution processes of the LRA. That case concerned an employee engaged in retrenchment consultations who obtained an interdict preventing his employer from retrenching him prior to giving him access to relevant information needed for the consultation process as the court found he was entitled to under s 16 of the LRA. The analogy the applicants seek to draw with their case is inappropriate in my view. In that case the provision of information was ancillary to exercising the right to be able to engage in meaningful consultation. The applicants are not prevented from utilising strike action which could include employees of the applicant provided they fulfil the statutory requirements for a primary and secondary strike. Obtaining the interdict is not a pre-requisite for them to do so.

[13]   Consequently, the application should be refused on account of the existence of a suitable alternative remedy.

Costs

[14]   As the matter entails a reasonable degree of complexity and as there is no reason to believe that the application was brought in bad faith, an adverse cost order would not be appropriate.

Order

[1]   The application is heard as a matter of urgency and non-compliance of Court Rules pertaining to service and time periods is condoned.

[2]   The application is dismissed.