Public Newsletter


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Worklaw subscribers receive a monthly newsletter containing commentary on the latest labour law cases and trends. This newsletter contains an article which looks at 'changing the culture of union-management meetings'. We also discuss three new cases: The first case - a Constitutional Court case - reconsiders the prerequisite of conciliation before the Labour Court can hear a matter. The second case considers whether a whistle-blower has to show that the disclosed information is factually accurate. The third case confirms a 3-stage process before discrimination on arbitrary grounds can be proved.

This public newsletter is a free edited version of the subscriber newsletter.


The prerequisite of conciliation before adjudication

Three coloured employees left their jobs as a result of alleged racial discrimination which manifested itself in physical, verbal and mental abuse. In October 2011, they referred an 'unfair discrimination' dispute to the CCMA for conciliation, but it remained unresolved. They then instituted proceedings in the Labour Court, seeking an order that their resignations amounted to 'automatically unfair dismissals' based on racial discrimination.

The Labour Court found in their favour and said they had been constructively dismissed based on their race. The Labour Court ordered the company to pay the employees 24 months' remuneration, the maximum permitted by the LRA.

The employer then appealed to the Labour Appeal Court, which held that the Labour Court did not have jurisdiction to adjudicate a dismissal dispute if that dispute had not been referred to conciliation. In other words, from both the referral form and the Commissioner's certificate, the dispute which appeared to have been conciliated was an unfair discrimination complaint and not a dismissal dispute. Section 191(4) of the LRA requires the CCMA to conciliate the dispute which was referred to it. In this case the categorisation of the dispute referred to the CCMA differed from that referred to the Labour Court.

The Constitutional Court in September and Others v CMI Business Enterprise CC (CCT279/16) [2018] ZACC 4 (27 February 2018) found the Labour Appeal Court had erred. By relying only on the referral form and the certificate of outcome, the Labour Appeal Court essentially had held that no evidence from the conciliation proceedings may be led as evidence in subsequent proceedings.

The CC confirmed that in terms of CCMA Rule 15 a CCMA commissioner is not bound by a party's categorisation of the nature of the dispute and has the right and power to investigate and identify the true nature of the dispute. The CCMA referral form and certificate of outcome constitute prima facie evidence of the nature of the dispute conciliated but if it is alleged that the nature of the dispute is different from that reflected on such documents, the parties may adduce evidence as to the nature of the dispute.

In a lone dissenting judgment, DCJ Zondo said the Labour Appeal Court's decision was correct and in accordance with established precedent. He said the Labour Court had no jurisdiction to adjudicate a constructive dismissal dispute even if that dispute was referred to conciliation because 157(5) of the LRA provides that the Labour Court has no jurisdiction to adjudicate a dispute which in terms of the LRA is required to be arbitrated.

Must a protected disclosure be factually accurate?

An employee was summarily dismissed because of 'incompatibility with colleagues'. Unhappy with her dismissal, she referred a dispute to conciliation at the bargaining council, alleging an automatically unfair dismissal because the real reason for her dismissal was that she had made a protected disclosure in terms of the Protected Disclosures Act (PDA).

The matter was then referred to the Labour Court where her case was that the re-grading of positions, without consultation, negatively impacted on the future salary increase of the affected employees and also distorted the accuracy of the employment equity report submitted to the Department of Labour. She showed that her belief in the inaccurate grading was reasonable, but did not show that it was factually accurate. The Court took the view that a belief must be based on facts in order to enjoy the protection of the PDA.

On appeal to the Labour Appeal Court, the Court in John v Afrox Oxygen Limited (JA90/15) [2018] ZALAC 4 (29 January 2018) confirmed that the enquiry is not about the reasonableness of the information, but about the reasonableness of the belief. This is so because the requirement of 'reasonable belief' does not entail demonstrating the correctness of the information, because a belief can still be reasonable even if the information turns out to be inaccurate. Because the employee had demonstrated a reasonable belief, her dismissal was held to constitute an automatically unfair dismissal and the employer was ordered to compensate the applicant in a sum equal to 18 months' salary.

This judgment will make most employers uneasy. Whistle-blowing usually results in reputational damage and if the disclosure is not factually correct, employers may be justified in wanting to discipline the employee. But the PDA includes disciplinary action within its definition of 'occupational detriment' - a consequence which may not follow a protected disclosure.

This case confirms that to qualify as a protected disclosure, an employee needs only have reason to believe that the information concerned shows or tends to show that the impropriety has been or is being or may be committed in the future. The employee does not have to show that the information is factually accurate. The focus is not primarily the reasonableness of the information, but the reasonableness of the employee's belief.

Discrimination on an arbitrary ground

The applicants, all environmental health practitioners (EHPs), complained that they were unfairly discriminated against because they were paid less than other employees employed by the municipality and by other municipalities who performed the same work. Their "comparators" were four pollution control officers (PCOs).

It is important to note that this dispute was first raised in 2013, a year before the Employment Equity Regulations come into force on 1 August 2014. These regulations (repeated in the Code of Good Practice on Equal Pay/ Remuneration for Work of Equal Value) explain how work performed by an employee is the same as the work of another employee if their work is identical, or interchangeable, or substantially the same, or sufficiently similar, or of the same value as the work of another employee of the same employer in a different job. As a consequence the Regulations and Code did not impact on the outcome, even though judgment was given in 2017.

The Labour Court in Sethole and Others v Dr Kenneth Kaunda District Municipality (JS576/13) [2017] ZALCJHB 484 (21 September 2017)[2018] 1 BLLR 74 (LC) raised the concern that the applicants had failed to identify in their pleadings the ground of alleged discrimination on which they relied. The Labour Court held that the applicants bore the onus of satisfying the Court that they had made out at least a prima facie case. Where the allegation is based on an "unlisted" ground, the onus rests on the applicant to prove some recognised basis for a discrimination claim.

The LC found that the applicants had simply relied on a "mystery" ground of discrimination and had failed to comprehend that the test for unfair discrimination entails a three-step inquiry. They had simply assumed that all they had to prove was differentiation, as opposed to discrimination. The Court held further that to constitute unfair discrimination there had to be a pleaded arbitrary ground which affects the complainant's dignity because it is based on some inherent characteristic. The applicants had failed to show that their dignity was affected by the fact that PCOs were on a higher grade then theirs. The essence of the applicants' complaint was simply that they were unhappy about the grading of their jobs. There was also no suggestion that the employer had acted in bad faith when grading the posts. In short, the applicants had failed to show on their own evidence that they would pass any leg of the test for unfair discrimination.

The court confirmed that there is a three level enquiry seeking to establish whether differentiation constitutes unfair discrimination. The first stage determines whether the differentiation that exists is of the kind that could give raise to a case of discrimination. The second stage decides whether such differentiation is discrimination, and if so, the third stage investigates whether that discrimination is unfair.

At the first stage only differentiation that is irrational, arbitrary and serves no legitimate purpose would be impermissible. Differentiation that does not fall within one of these categories would be permissible differentiation, the discrimination enquiry would be at an end there and then, and the discrimination claim must fail.

Where discrimination on an arbitrary ground is alleged, it has to be shown that dignitas or the right of equality of the complainant as a person, or that person's personal attributes and characteristics, have been impaired or prejudiced.

In previous Newsletters we have expressed the view that it makes no sense for the courts to require that even in arbitrary discrimination the employee has to declare the basis or grounds of discrimination. We hold this view because the employee often does not know why they are being paid differently to another employee doing a similar job. Being ignorant of the basis for differential treatment (especially where race and sex are not possible explanations) all the employee can say is "I just don't understand the basis for differentiation; I want the employer to explain".

But this case has confirmed a trend that requires employees to pin their claim on a particular ground of discrimination without any inside knowledge of the reasons for the differentiation. If they pick one and the employer can show that it is not the basis for differentiation, they will lose. The 2014 Regulations have however provided as broader basis for equal-pay claims and perhaps a case based on a post-2014 dispute will make the position clearer.

ARTICLE: Changing the culture of union-management meetings

By Prof Alan Rycroft

Recently we received a Worklaw Helpline query about coping with very rude and personal attacks by employees during a union-management meeting. We sense that this is not an isolated case and so we thought we should deal with this in this month's article, also drawing from the new draft Code of Good Practice on Collective Bargaining, which we think may change the face of collective bargaining in South Africa if employers and unions commit meaningfully to its implementation.

In this article, Prof Alan Rycroft discusses the cases dealing with collective bargaining relationships, the new draft Code, and ways to improve the effectiveness of union-management meetings.

Read more (note - only available to Worklaw subscribers)


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Bruce Robertson
March 2018
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