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 on 'Reassessing the review test'. The article looks at several court decisions which deal with the correct standard of review. We also discuss three other new judgments: In the first case the Constitutional Court interprets the meaning of a common phrase used in calculating time periods. The second case considers whether an agreement is invalid where one party lacks the authority to contract. The third case looks at the consequence of an employer not accepting a resignation "with immediate effect".
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RECENT CASES
The Constitutional Court rules on the meaning of "30 days"
In Mamasedi v Chief of South African Defence Force and Others (CCT 359/22) [2024] ZACC 17 (21 August 2024) the Constitutional Court had to decide whether the phrase "a period exceeding 30 days" is properly interpreted to mean 30 calendar days or 30 working days - a question we get asked by subscribers on Worklaw's helpline.
This case involves the consequences of a Defence Force employee being absent from duty for a period of time, and whether this period qualified as "a period exceeding 30 days". On 29 November 2011 the employee did not turn up for duty. He did not have the permission of his commanding officer to absent himself from duty. He never returned to duty until 3 January 2012, which was a period of more than 30 calendar days. Section 59(3) of the National Defence Act provides that, if a member of the Regular Force absented himself from official duty without his or her commanding officer's permission for a period exceeding 30 days, he or she must be regarded as having been dismissed if he or she is an officer, or, discharged if he or she is of any other rank.
A Board of Inquiry was established in terms of the Defence Act to establish the circumstances surrounding the employee's absence from work. (This was the first Board of Inquiry). The employee's explanation for his absence from duty was that he was kidnapped and taken to initiation school and kept there against his will. However, his father's version did not support or corroborate his version.
The first Board of Inquiry supported the discharge of the employee and the Chief of Defence Force and the Chief of Army accepted the recommendations of the first Board of Inquiry.
The employee successfully challenged the findings and recommendations of the first Board in a review application in the High Court.found that the Board had failed to afford the employee procedural fairness and ordered his reinstatement. The SANDF appealed to the Supreme Court of Appeal which upheld the appeal against the order of reinstatement but dismissed the appeal in respect of the finding that the first Board of Inquiry had failed to afford the employee procedural fairness.
Subsequent to the SCA's judgment, the SANDF set up a second Board of Inquiry in 2018. That Board made certain findings against the employee including that he had been absent from official duty without leave. The second Board of Inquiry made the same recommendations that the first Board had made. Effectively those were that the discharge from duty in terms of section 59(3) should continue and he should be paid all his pension contributions.
After the second Board of Inquiry, the employee approached the High Court again to challenge his discharge and to seek his reinstatement. In his application the employee pointed out that he only worked five days in a week, namely, Monday to Friday and did not work on Saturdays, Sundays and on public holidays. He said that, if those days on which he was not obliged to work were excluded from the 30 days contemplated by section 59(3) of the Defence Act, he had not absented himself from official duty for more than 30 days. If this contention was correct, then section 59(3) had not been triggered and, therefore, the employee should not have been regarded as discharged.
The High Court once again found that the second Board had treated the employee procedurally unfairly but refused to order his reinstatement. The employee applied to the SCA for leave to appeal against the High Court judgment but this was refused. The employee then applied to the Constitutional Court for leave to appeal against a High Court judgment that 0refused to order his reinstatement.
Read more (Worklaw subscriber access only)
Is an agreement invalid where one party lacks the authority to contract?
In Nzimande and Another v Newcastle Municipality (DA1/2022) [2024] ZALAC 34 (10 July 2024) the Labour Appeal Court had to deal with the extension of contracts of employment where the municipal official had no authority to do so.
On 11 October 2017, the Newcastle Municipal Council resolved that all fixed-term contracts that were due to expire in 2018 and 2019 for managers and directors would indeed terminate at the end of their fixed term. The resolution added that the affected positions were to be re-advertised on a permanent basis at least three months prior to the expiry of the contracts.
The two employees in this case both received correspondence confirming the termination of their contracts in accordance with the resolution. Mr Nzimande's last day of service was 31 October 2018. On that day, the municipal manager at the time (Mr Mswane) decided to extend Mr Nzimande's contract for a period of six months, ostensibly because there were two vacant positions in that particular unit, and to enable the department to prepare for the recruitment process. Mr Mswane later withdrew that decision by way of a memorandum dated 30 November 2018 and informed Mr Nzimande that his previous fixed-term contract had been extended for a further period of five years. Mr Mswane and Mr Nzimande both signed an addendum giving effect to this arrangement.
The second employee (Mr Shozi) was treated similarly and also entered into a written agreement with the Municipality, represented by Mr Mswane, purporting to extend his fixed-term contract of employment for a five-year period.
Mr Mswane was suspended on 13 December 2018 pending an investigation into his conduct. The acting municipal manager informed the two employees that their appointments were unauthorised and that they were to vacate their positions immediately, which resulted in them referring an unfair dismissal dispute to the South African Local Government Bargaining Council. Before this dispute could be finalized, the Municipality instituted a legality review in terms of s 158(1)(h) of the LRA.
The Labour Court reviewed and set aside Mr Mswane's decision to extend both fixed-term contracts. The contracts entered into with the appellants on 30 November 2018 were declared invalid and void ab initio.
The matter was referred on appeal to the Labour Appeal Court.
Read more (Worklaw subscriber access only)
Resignation "with immediate effect"
In Lewis Stores (Pty) Ltd v SACCAWU obo Ngcaku and Others (PR267/22) [2024] ZALCPE 14 (26 April 2024) the court considered the effect of an employer not accepting an employee's resignation "with immediate effect".
The employee who was facing disciplinary charges for dishonesty, theft and fraud relating to the invoicing of a customer for furniture he had never purchased, and who had experienced difficulties with one of the managers, elected to resign. The employee tendered her unconditional resignation in writing on 25 September 2020. In the notice she tendered her immediate resignation and made no mention of her 4 week notice period.
The employer, Lewis Stores, wished to finalize the disciplinary process and sent her a letter in which it stated that because of the disciplinary proceedings, it did not accept her immediate resignation. Thereafter, later that same day, a more detailed letter was sent to the employee explaining the terms and conditions of her suspension. These letters advised the employee that she would remain on paid suspension pending her disciplinary hearing. The employee remained on paid suspension during October 2020, and she was paid her full salary for the month.
On 25 October 2020, exactly one month after the employee resigned, Lewis issued an exit form to the employee. On 24 November 2020 Lewis' Branch Manager addressed a letter to the employee advising that the employer had accepted her resignation. A further letter to the employee confusingly indicated that the reason for her termination of her service was misconduct / theft / dishonesty. At the bottom of the letter was a handwritten note in which the employer recorded: "Resigned because of misconduct and also I called Lihle several times and later promise to come and sign termination but never came." Lewis paid the employee her salary for November 2020.
There was no contact between Lewis and the employer between December 2020 and 11 April 2021, and the employee was not remunerated during this period. On 11 April 2021, the employee addressed a letter to Lewis enquiring when her disciplinary hearing would be convened, and when she could expect her salary from the end of November 2020 until April 2021. Lewis replied to the employee advising her that the reason the employer did not initially accept her resignation was because it wished to finalise the disciplinary process. However, thereafter, the employer decided to accept the resignation and abandon the disciplinary process. In the circumstances, there would be no disciplinary hearing and she would receive no further remuneration.
The employee referred an unfair dismissal dispute to the CCMA.
Read more (Worklaw subscriber access only)
ARTICLE: Reassessing the review test?
By Prof Alan Rycroft
When either an employer or employee loses at arbitration, the natural reaction is that the arbitrator got it wrong. It is often felt (or hoped) that a judge will think differently about the matter.The drafters of the LRA anticipated this and so deliberately did not provide for an appeal, but allowed a review. To explain the difference: in a review the applicant must establish a reviewable irregularity by the arbitrator as a basis for overturning the award. An appeal, on the other hand, is a challenge to the findings on the merits of fact or law. The court in an appeal considers whether the decision-maker was mistaken in its assessment of the facts.
When the LRA was drafted, narrow grounds of review were provided under section 145 and more broadly under section 158(1)(g). Section 145(2) empowers the Labour Court to review an arbitration award if there is a "defect" in the arbitration proceedings. A defect means-
-
that the commissioner-
- committed misconduct in relation to the duties of the commissioner as an arbitrator;
- committed a gross irregularity in the conduct of the arbitration proceedings; or
- exceeded the commissioner's powers; or
- that an award has been improperly obtained.
In giving its decision in Sidumo (in somewhat clumsy wording in our view), the Constitutional Court recognised that a decision based on reasonableness introduces a substantive ingredient into review proceedings (it becomes inevitable that the reviewing judge often has to look at the substantive issues to assess if there is an irregularity). There is also the danger of "judicial overzealousness in setting aside administrative decisions that do not coincide with the judge's own opinions". In other words, it can be too easy for a judge to decide that the arbitrator's decision is not one a reasonable arbitrator could reach.
These concerns have been borne out over the subsequent years - what is reasonable to one judge is unreasonable to another. This has led to a consistent pattern of judges nudging towards a more stringent standard than unreasonableness. This becomes clear in the recent LAC case of AJ Charnaud and Company v SACTWU obo Members and Others (DA 9/23) [2024] ZALAC 33 (17 July 2024).
Read more (note - only available to Worklaw subscribers)
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Bruce Robertson
September 2024
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