African Exploration Mining and Finance Corporation v National Union of Mineworkers and Others (J 29/2021) [2021] ZALCJHB 4 (25 January 2021)

The Labour Court of South Africa

(Held at Johannesburg)

Judgment

Not reportable

CASE NO: J 29/2021

In the matter between:

AFRICAN EXPLORATION MINING AND

FINANCE CORPORATION

Applicant

and

NATIONAL UNION OF MINEWORKERS

First Respondent

COMMISSION FOR CONCILIATION

MEDIATION AND ARBITRATION

Second Respondent

THABE LAZARUS NKADIMENG N.O.

Third Respondent

Date of hearing: 21 January 2021

Date of judgment: 25 January 2021. Judgment distributed by email.

JUDGMENT

VAN NIEKERK J

[1] The applicant seeks an order staying an arbitration hearing set down to proceed on 27 January 2021, pending the determination of an application in which the validity of a collective agreement concluded between the applicant and the first respondent (the union). In essence, the union had approached the second respondent, the CCMA, to seek the enforcement of the collective agreement; the applicant contends that the agreement is invalid.

[2] The dispute referred to the CCMA is one in terms of section 24 of the LRA, specifically a dispute concerning the application and interpretation of the collective agreement concluded between the parties on 15 April 2020. In broad terms, the collective agreement pertains to the payment of a risk allowance of R450 per employee per shift to employees who worked during the lockdown occasioned by the Covid-19 pandemic. The applicant contends that the person who signed the collective agreement on its behalf was not authorised by the applicant’s board to do so, as the requisite approvals had not been obtained. In effect, the union seeks the payment of approximately R2.6 million per month for the period 1 May 2020 to date, and any further period during which the lockdown persists, regardless of the level.

[3] The present application was filed on 19 January 2021. The union disputes that the application is urgent and submits that any urgency is self-created since the applicant has been aware for some months, and certainly as at the date that a jurisdictional ruling issued by the CCMA on 5 November 2020. In that ruling, issued in response to a point in limine raised by the applicant at the commencement of the arbitration hearing, the CCMA held that it had no jurisdiction to determine the validity or unlawfulness of the collective agreement, and that ‘as long as there is no Court judgment directing otherwise, the CCMA shall schedule this matter for an arbitration hearing.’

[4] The set down notice that triggered the present application was issued by the CCMA on 23 December 2020, and forwarded to the applicant’s legal representatives only on 4 January 2021, after the holiday period.

[5] The present application was filed only on 19 January 2021. As I have indicated, the union contends that any urgency is thus self-created, the applicant having known at least since 5 November 2020, when the jurisdictional ruling was issued, that it was incumbent on the applicant to seek an order form this court staying the arbitration proceedings. The applicant avers that the notice of set down was issued two days prior to Christmas Day, and that its legal representatives became aware of it only after the holiday season, and that urgency should be determined by reference to the notice of set down, and not the jurisdictional ruling. While the applicant can be criticised for not responding to the terms of the jurisdictional ruling at an earlier stage (the ruling clearly indicates that to stay the proceedings a court ruling was necessary), I am satisfied that once the applicant’s legal representatives were instructed, they acted with sufficient alacrity.

[6] As a general rule, a court will stay arbitration proceedings only in exceptional circumstances. Ordinarily, the court would have to be satisfied that the stay is not part of a stratagem to delay the resolution of a dispute, and that in circumstances such as the present, where a preliminary point has been taken that has the potential to dispose of the dispute in its entirety, that there is at least some merit in the point. In the present instance, the essence of the dispute is whether Mathebula, the applicant’s erstwhile general manager: corporate services, was authorised to conclude the collective agreement. The agreement provides for an allowance of R450 per employee per shift for the ‘total duration of the lockdown,

from 27 March 2020 until 30 April 2020.’ Further, it was agreed that ‘should the lockdown be extended post 30 April 2020, an amount of R350 per employee per day will be paid for the rest of the lockdown.’ The applicant avers that the first respondent was advised that the agreement would only come into force once the requisite approvals have been obtained and that he sought approval from the applicant’s CEO and CFO. The applicant states that neither recommended or approved the request submitted by Mathebula, but states that employees were paid on 2 May 2020 pursuant to an undertaking made by Mathebula to payroll administrators that he had reached an agreement with the first respondent and further that the payment was a once off payment with no formal approval. The applicant states further that Mathebula prepared a submission for a board meeting to be held on 27 May 2020, in which he requested the board to authorise with retrospective effect the payment of some R2.6 million on 2 May 2020 for the five weeks of the level V lockdown. The applicant’s case is that the EXCO was unaware of the negotiation and the conclusion of the agreement and was not aware that payment had already been made to employees. The applicant states that Mathebula created the impression to the board that the payment was a once off payment for the five-week period of the level V lockdown. In the result, employees were not paid on 31 May 2020 nor have they been paid any Covid-19 risk allowance to date. In essence, the case is that the management and Board of the applicant was not aware of the negotiations nor the conclusion of the collective agreement and that Mathebula did not advise the CEO or the board of the negotiations and subsequent conclusions of the agreement until after the payment of 2 May 2020 had been effected. Mathebula resigned on 17 July 2020 in the face of disciplinary charges being brought against him. The union disputes this version and points to the minutes of a special meeting of the EXCO held on 29 April 2020, the next stop to the replying affidavit the union submits that in terms of the minute, the history of the demand for a Covid-19 risk allowance is recorded, as is the fact of a negotiation between the applicant’s management and the union. After discussion, it was recorded that the meeting resolved that the request for approval for the payment of the risk allowance translating to a total amount of R2.3 million be approved, that the payment would apply only in respect of the five weeks of the initial lockdown (level V) and that the recommendation submitted to EXCO should be enhanced with the estimated figure of the actual amount and to indicate that the amount was unbudgeted.

[7] The union submits that the contention by the applicant that the board did not approve or was not aware of the collective agreement is thus unfounded and that by way of its resolution adopted on 29 April 2020, EXCO expressly approved payment of the amount of R2.3 million. In any event, the union contends that in terms of section 20 (7) and (8) of the Companies act, the union was entitled to presume that Mathebula is a member of the executive of the applicant and by virtue of his occupy the position of general manager: corporate service, had followed all of the relevant internal processes required of him to conclude the collective agreement.

[8] As I have indicated, it is not for the applicant at this stage to prove its case, or, in particular, to prove that Mathebula acted without the requisite authority. For the purposes of interim relief, the court must necessarily take a broad view of the respective averments made by the parties. It would appear from the papers before me that express approval was granted by EXCO for the payment of the first tranche of the risk allowance for the period ending 30 April 2020. That amount has been paid and there is no dispute regarding that amount. Insofar as the union’s claim relates to future

payments, it is not apparent to me from the papers that there was any unconditional undertaking by Mathebula for payments beyond 30 April 2020 without them necessary approval being granted, nor to the papers before me unequivocally establish that that approval was given by the relevant authority. These are matters best left to the court considering the relief sought in part B of the present application to assess and decide, together with the point relating to ostensible authority. For present purposes, the factual position, insofar as it can be ascertained from the papers, does not preclude intervention at this stage by way of exceptional circumstance. What ways with me particularly is the fact that the validity or otherwise of the agreement is dispositive of the dispute referred to arbitration. There would be little merit in the arbitration proceeding on the basis of a section 24 dispute in circumstances where the collective agreement may in future be declared invalid. If the arbitration were to proceed, the present proceedings would continue in any event in the normal course, with the consequence of dual proceedings and the associated costs. Although the union disputes that the potential costs of the arbitration proceedings is a relevant factor, I ought properly to bear in mind that the nature of the dispute is one in which the parties are entitled to legal representation.

[9] For the above reasons, I am persuaded that exceptional circumstances exist and that the interests of justice are best served by an order staying the arbitration hearing pending the outcome of part B of the present application.

[10] Insofar as costs are concerned, this court does not ordinarily make orders for costs in circumstances where collective bargaining partners are in dispute, and where a costs order stands to prejudice the relationship between them. The present case is quintessentially one where an order for costs, given the road ahead for both parties, and may well have that consequence and in my view, the requirements of the law and fairness are best served by each party bearing its own costs.

I make the following order:

1. The proceedings before the second respondent under case number MPEM 3588-20 are stayed, pending the finalisation of part B the application filed under case number J29/2021.

André van Niekerk

Judge of the Labour Court of South Africa

APPEARANCES

For the applicant: Mr S July, Werksmans Inc.

For the first respondent: Adv FI Baloyi, instructed by Mohale Inc.