Alpha Pharm (EC) (Pty) Ltd v Commission for Conciliation, Mediation and Arbitration and Others (PR12/16) [2019] ZALCPE 7 (10 April 2019)

in the labour court of South Africa, PORT ELIZABETH

Not Reportable

case no: PR12/16

In the matter between:

ALPHA PHARM (EC) (PTY) LTD Applicant

and

COMMISSION FOR CONCILIATION,

MEDIATION AND ARBITRATION First

Respondent

COMMISSIONER AMON NYONDO N.O. Second

Respondent

CEPPWAWU obo BOOYSEN, I

AND 6 OTHERS Third

Respondent

Heard: 19 March 2019

Delivered: 10 April 2019

JUDGMENT

MAHOSI.J

Introduction

[1] This is an application brought by the Applicant in terms of section 145 of the Labour Relations Act (LRA)[1] to review and set aside the arbitration award issued by the second respondent (commissioner) acting under the auspices of the first respondent, Commission for Conciliation, Mediation and Arbitration (CCMA) under case no. ECPE – 5077-14 dated 11 December 2015.

[2] The third respondent, filed a notice of intention to oppose, however it took no further steps as it contended that the review application had been “deemed withdrawn” in terms of clause 11.2.3 of the Practice Manual of the Labour Court.[2] However, on 28 April 2018, the Court, per Lallie, J ruled to the contrary. On the day of the hearing of the matter, the third respondent’s representative appeared in court and submitted that the third respondent is not opposing the application but that he was only present to observe the proceedings. The matter proceeded unopposed.

Material background facts

[3] The Applicant is a distribution enterprise in the pharmaceutical industry. It had long been plagued by theft of it’s products, including scheduled medicines, and suspected that many of the thefts were perpetrated by its employees. It also suspected the workings of a ‘group’ syndicate which other employees were aware of. Around September 2014, an employee, Nathan Kieviets (Kieviets) was caught by police selling Bioplus belonging to the Applicant and was subsequently dismissed.

Following a visit and an interviewing of the other employees by the police, Lee-Anne Blignaut (Blignaut), informed her manager, Bongi Simon (Simon) of her involvement in the theft of the Bioplus which Kieviets was found selling. She implicated Kieviets as playing a leading role in removing the stolen products from the Applicant’s premises. She further implicated other employees, Charne Ownhouse (Ownhouse), Charlene Deveroux (Deveroux) Ilse Booysen (Booysen) and Zenette Williams (Williams), whom Blignaut said she had observed placing products in baskets and giving them to Kieviets who would remove these products from the premises. According to Blignaut, in addition to being part of the syndicate, Deveroux ran a business of money lending at the Applicant’s premises. A practice which was prohibited in terms of the Applicant’s rules.

[4] Blignaut described the modus operandi used by herself, Booysen, Williams, Deveroux and Ownhouse to have products removed without authorisation from the Applicant’s premises, which was essentially to notify Kieviets by SMS the last three digits of the container in which the stolen goods were placed. Kieviets would later remove those goods and arrangements would be made to retrieve the products from Kieviets outside of the workplace. She stated that the syndicate had a WhatsApp group wherein the syndicate communicated about the thefts.

[5] Armed with this information, the Applicant subjected its employees to polygraph tests. Ownhouse refused to undergo the polygraph test. Booysen, Williams and another employee Ruwayda Vaaltyn took the test and were found to be deceptive. Subsequently, Ownhouse, Booysen, Deveroux and Williams were charged with “participating in the unauthorized removal of company property” and dishonesty. Deveroux was charged with running a business of lending money to her fellow employees within the Applicant’s

premises. She was found not guilty on the charge of colluding in the theft, but received a final written warning for money lending.

Ownhouse, Booysen, Williams and Vaaltyn were all dismissed on 2 December 2014 after being found guilty of the offences they were charged with.

[6] For the sake of clarity, I deal individually with the cases of each employee hereunder.

Zenette Williams (Williams)

[7] Williams was implicated by Blignaut in her statement as having put company property including toiletries into containers which would be removed from the Applicant’s premises by Kieviets. She also stated that Williams had taken pregnancy shakes without authorization. According to Blignaut, Williams had also told her that she had gone out on a trip with Kieviets and Enoch who was employed as a driver, with the stolen goods and that they had removed the products from the Applicant’s premises. On this day, according to Blignaut, Williams had shown her products she wanted to remove from the premises. At the internal disciplinary enquiry, under

cross-examination, Williams challenged Blignaut’s evidence and caused an adjournment in the proceedings, she wanted to call Kieviets to refute Blignaut’s claims. However, Kieviets never came to testify as he had already been dismissed. The chairperson found that the evidence against Williams was uncontested and issued a sanction of dismissal against her.

Ilse Booysen (Booysen)

[8] Booysen was charged with dishonesty. She was implicated as being part of the syndicate and Blignault also stated that on one occasion, Booysen had placed the stolen products in containers to be removed by Kieviets. Booysen denied any knowledge of the workings of a syndicate or Kieviets for that matter. She was implicated by Blignaut as being part of the WhatsApp group working with Kieviets, which she denied. She also denied having Kieviets’ phone numbers, however under cross-examination, she admitted to chatting with him on several occasions but that this was not about the thefts.

Charne Ownhouse

[9] Ownhouse, like the others was charged with participating in the unauthorised removal of company products without authorisation, dishonesty and breach of good faith. She refused to undergo the polygraph test. She was however implicated in the Blignaut statement as having taken part in the unauthorised removal of company products. She denied her involvement in the thefts but admitted to witnessing other employees doing so. She stated that she knew about the thefts and who the culprits were but did not come forward and was not willing to reveal the identities of the culprits for fear of retribution. She indicated that she was not aware of the policy in place within the Applicant that protects whistle blowers. She didn’t come forward to report the thefts as she ‘feared for her life’. She admitted to being friends with Kieviets but denied having any illegal dealings with him

or Blignaut.

Ruwayda Vaaltyn

[10] Vaaltyn was employed as a pharmacist assistant until her dismissal in 2014. She was charged with participating in the unauthorised removal of company property. Although she was not readily willing to undergo the polygraph test due to her pregnancy, she did take the test. She admitted to the polygraph examiner that she took a schedule 1 tablet without first seeking permission from the pharmacist as she suffered from a migraine and that the pain was unbearable on that particular day. She admitted that she was aware that she needed permission from the pharmacist to consume company products and she had not obtained same. This incident had occurred some years prior. She denied having any involvement in the unauthorised removal of company products.

[11] Although Blignaut had not implicated Vaaltyn in the statement as being a part of the syndicate, she stated at the disciplinary hearing that she had observed Vaaltyn placing pills and milk products into a container without authorisation. According to Blignaut, Vaaltyn had on the day in question asked her about which formula would best suit her (Vaaltyn’s) baby, a claim Vaaltyn denied. This allegation did not form part of Blignaut’s initial statement to Simon and only came up at the disciplinary hearing.

The Arbitration

[12] The arbitration was held on 10 and 30 November 2015 and the commissioner issued an award on 11 December 2015.

[13] It is common cause that Blignaut did not testify at the arbitration. The arbitrator however decided to admit her statement as part of the evidence and to test its evidentiary weight against the evidence as a whole.

[14] In support of its case, the Applicant called Kobus Van Heerden and Anita Freemantle, both polygraph examiners who conducted the polygraph tests. Both their testimonies were to a large extent that Booysen, Williams and Vaaltyn had shown deception in their answers, whilst Blignaut came out as being truthful. Simon, the Operations Manager, testified and relayed the statement given to her by Blignaut. She testified that it was the Applicant’s policy to dismiss employees found guilty of charges such as those faced by the dismissed employees. She listed the names of other employees who had been dismissed in the past for unauthorized removal of company products.

[15] In respect of Vaaltyn, Simon testified that she was not allowed to consume company products without authorization. This rule was in place to ensure that no employees’ life was at risk as the Applicant ran the risk of losing its trading license, which could lead to job losses. She further testified that the Applicant had a zero tolerance approach to unauthorized consumption of company products. Her evidence was further that employees were warned about the shrinkage that the applicant was experiencing.

[16] Under cross-examination, when asked whether Blignaut was part of the group of the dismissed employees, Simon responded that Blignaut was not and that she was only connected to Kieviets. When asked whether she knew that Blignaut was part of the WhatsApp group involving the culprits, she was steadfast in saying that Blignaut worked with Kieviets only and not the group.

[17] When questioned as to why Blignaut was sparred of disciplinary charges and dismissal, Simon stated that Blignaut ‘did not give the company time to dismiss her’. However, she stated that Blignaut came forward with the information hence she was not charged or dismissed.

[18] According to Simon, the dismissed employees’ conduct had led to a breakdown in the trust relationship and she was not willing to work with them.

[19] Patrick Flood, the chairperson of the disciplinary hearing testified and stated that Ownhouse did not challenge the allegations that Blignaut made against her. He stated further that Ownhouse’s refusal to undergo the polygraph test and the charges against her led to him finding her guilty.

[20] In respect of Booysen, Flood took into account Blignaut’s evidence implicating Booysen and the fact that Booysen could not explain why she had failed the polygraph test. These factors led him to impose a sanction of dismissal against Booysen.

[21] As for Williams, Flood stated that she too had been implicated by Blignaut as having taken company products without authorization and placing them into containers to be removed by Kieviets. Furthermore, he took into account Blignaut’s evidence that Williams had earlier on confessed to her about having removed toiletries without authorization. Williams had also gone on a trip with Kieviets and Enoch (the driver). According to Flood, the evidence against Williams was uncontested hence he imposed a sanction of dismissal.

[22] The evidence of Flood against Vaaltyn was that Vaaltyn had admitted to taking a pill without authorization despite the fact that she was a pharmacist assistant, which according to Simon, was a position of trust. Furthermore, Flood stated that he had taken into account the evidence of Blignaut against Vaaltyn, in that she had been asked by Vaaltyn what type of milk formula was suitable for her baby and then observed Vaaltyn putting pills and milk formula in a container.

[23] Last to testify for the Applicant was Clive Johnson. His evidence centered and challenged the claim of inconsistent application of discipline by the Applicant as contended by the dismissed employees. He stated that although Deveroux had been implicated by Blignaut as running a money lending business in the Applicant’s premises (she was lending huge amounts of money and receiving interest therefrom), which according to Flood was against company policy and a contravention of the Usury Act[3], he nonetheless decided to issue her with a final written warning instead of a sanction of dismissal.

[24] All the employees testified at the arbitration. Booysen, Williams and Ownhouse essentially denied each and every allegation made against them by Blignaut, as they did in their disciplinary inquiries.

[25] Booysen denied that she had been part of the syndicate, that she had sent WhatsApp messages to Kieviets, and that she had been to Kieviets’ home to collect stolen company products. She testified that she did not use her cell phone at work as they were not allowed to. She stated that there could have been no opportunity to use a cellphone as Simon usually walked around the warehouse and would have observed such usage. She stated that she placed products into containers as per the invoices.

[26] Williams denied Blignaut’s claim that she had stolen toiletries from the Applicant. Her evidence was that she had bought the toiletries on her staff account. She denied having stolen from the Applicant or that she had observed anyone stealing from the Applicant. She denied having gone on a trip with Kieviets and Enoch and testified that the allegations against her had driven her to a point where she did not want to work for the Applicant as she felt ill-treated, however she had not been willing to resign and wanted to wait for the Applicant to dismiss her.

[27] Kieviets also testified during the arbitration. His evidence was that he had been framed with the Bioplus he was caught with. He stated that Blignaut was the one who would SMS him the number of the crate that had the stolen goods which he wanted for his ‘side business’. He admitted to working with Blignaut and other employees whom he referred to as ‘the bad guys’, had removed the Applicant’s products without authorisation but that none of the dismissed employees were part of that syndicate. He refused to name who the other employees were but was adamant that none of the dismissed employees had worked with him in the thefts. Kieviets refuted Blignaut’s claim that the dismissed employees would call at his home to collect the stolen products. According to his evidence, the vehicles they used to make deliveries were monitored by surveillance including which streets they drove to, therefore it would have been impossible for the Applicant not to have data of the alleged trips to his home.

[28] Kieviets admitted to being friends with Ownhouse, Booysen and Willliams on social media and that they exchanged messages with them.

The Award

[29] In his analysis of the evidence and arguments, the commissioner noted that Blignaut’s written statement, implicating the other employees in the theft, formed the basis of the Applicant’s case. Blignaut did not testify at the arbitration proceedings despite being subpoenaed by the Applicant.

[30] The commissioner opined that the Applicant’s failure to secure the testimony of Blignaut was unexplained and from the reading of the award, he treated Blignaut’s statement as hearsay evidence.

[31] In the view of the commissioner, Ownhouse could not escape her dismissal on the basis that she had breached her duty of good faith towards the Applicant by not reporting the thefts which caused the Applicant shrinkage. Her contention that she was afraid of her life was not sustainable as she had admitted to being friends with Kieviets and yet ‘feared’ for her life. Furthermore, she had failed to prove her innocence. I am of the view that the commissioner’s reasoning and finding in respect of Ownhouse is reasonable, based on the evidence before him. His confirmation of Ownhouse’s dismissal cannot be faulted. I now turn to deal with the remaining employees, viz, Vaaltyn, Williams and Booysen.

[32] The commissioner found that Blignaut’s statement, which formed the basis for the respondent employee’s dismissal, was fatally contradicted by Simon. He found that Kieviets on the other hand corroborated the employees’ version that they were not part of the syndicate which caused the Applicant shrinkage.

[33] The commissioner found Kieviets’ testimony, that the delivery vehicles were under constant surveillance, in support of the contention that the alleged stolen products were never delivered to Kieviets’ home as contended by Blignaut. Furthermore, the commissioner noted that although Blignaut had stated that Williams had mentioned to her that she had gone on a trip with Kieviets and Enoch, with stolen company products, the evidence before him showed that Williams was not on the trip sheet on that day.

[34] As regards to Vaaltyn, the commissioner was of the mind that although she volunteered the confession and admitted to consuming a pill without authorisation, she was not without guilt on this charge. As opposed to Simon and Flood’s view, such conduct by Vaaltyn was a show of good faith. However, the commissioner found that the statement by Blignaut as to Vaaltyn placing pills and milk formula in a container without authorisation, was not sustainable as it could not be proven. He found the evidence against Vaaltyn in this respect to be hearsay.

[35] In assessing the fairness of the sanction of dismissal against Vaaltyn, the commissioner sought guidance from item 3 (4) of Schedule 8 of the Code of Good Practice: Dismissal and found that, given the fact that Vaaltyn was a first offender, dismissal was not an appropriate sanction. Another guiding factor considered by the commissioner was that the Applicant did not serve the same sanction to Deveroux, whose misconduct was found inter alia, to be against legislation, but was only given a final written warning. According to the commissioner, the same sanction was befitting to Vaaltyn as the Applicant could not justify the disparity in dealing with the two employees.

[36] To the extent that the dismissed employees failed the polygraph tests which to a large extent, informed their dismissals, the commissioner

was of the view that the Applicant bore an evidentiary burden over and above mere reliance on the polygraph tests, to prove on a balance of probabilities, the guilt of the employees. Placing reliance on DHL Supply Chain (Pty) Ltd v De Beer NO and Others[4], the commissioner held that the employees could not be dismissed merely on the basis that they failed the polygraph tests when their guilt was not proven.

[37] The basis of the arbitrator’s findings appear in his award as follows:

‘53. At the arbitration Bongi’s evidence was to the effect that “Lee-Anne was caught with her hands in the cookie jar. Lee-Anne came forward with information. Lee-Anne was not part of the group. She was connected to one person. She was involved with Nathan Kievits and not a group.” When Bongi was asked why Lee-Anne was treated differently in that she was not charged for the theft she confessed to, Bongi replied that Lee-Anne was not dismissed; she did not give the company enough time to dismiss her. Bongi’s evidence was in stark contrast to the statement of Lee-Anne Blignaut which had roped in dismissed applicants. The representative of the respondent did nothing in relation to this testimony of Bongi. His re-examination did not address this apparent reversal.

54. Nathan Kievits testified that he was working with Lee-Anne to take stock out of the respondent for his side orders. He said that the way using whatsapp with Lee-Anne for this as laid out under his testimony. Nathan was dismissed from respondent after the discovery of his theft of Bioplus. He testified that he was not working in cahoots with the dismissed applicant. He testified that the applicants were not involved in the way that he was with Lee-Anne. The testimony of Nathan Kieviets and that of Bongi cemented a version that the dismissed applicants were not working with Lee-Ann Blignaut and Nathan Kieviets in the perpetration of the unauthorized removal of company property, unauthorized possession of property from Alpha Pharm and the seeing of other people do that. The reason is that the basis for these charges was the statement by Lee-Anne Blignaut which was fatally contradicted by the Operations Manager Bongi and that contradiction corroborated Nathan Kieviets. The version of Bongi and Nathan Kieviets was supported by the Applicants who denied the alleged involvement as contained in the statement of Lee-Anne. Lee-Anne was not there to defend her statement when it was opposed in the manner it was by the applicants and Bongi and Nathan’s testimonies were the final nail in the hearsay statement of Lee-Anne Blignaut. I will set forth to unearth the specific differences in the different cases of the applicants in relation to their specific individual charges,

55. Zenette Williams and Ilse Booysen and Chame Ownhouse where never found with any unauthorized property and did not participate in any such unauthorized removal seeing that this was based on the evidence of Lee-Anne Blignaut which they denied. The respondent failed to prove that the reasons for the dismissal were fair. I conclude that they were not guilty of charges 1 and 2 which were identical for both of them. For unauthorized possession of the goods of the employer to arise, evidence must be led and it must be sustainable on probabilities that the employer had lost control of the property in question and the employee had by contrast effectively gained control of the property. No evidence of this sort was brought out against any of the applicants, including Ruwayda Vaaltyn and Charne Ownhouse (or I'd suit specifically below because of the particular circumstances). The authority is established by the case Rainbow Farms (Pty) Ltd v CCMA [2011] 5 BLLR 451 (LAC) at para 26 H. In the premise, unauthorized removal or possession did not arise. In that regard the respondent failed to prove that the applicants were guilty of the charges. In the absence of guilt binding dismissal of Charne Ownhouse (in relation to unauthorised removal or possession only), Zenette Williams, Ilse Booysen and Ruwayda Vaaltyn was substantively unfair. The authority for this is the case First Garment Rental (Pty) Ltd v CCMA [2015 11 BLLR 1094 (LAC) par 15 F’.

Grounds of review

[38] The basis on which the applicant challenged the commissioner’s award was that he misdirected himself by failing to assess the evidence properly or at all, which led to a conclusion that no reasonable commissioner would have reached on the same evidence.

[39] The commissioner misdirected himself by failing to assess the evidence and this led him to a conclusion that no reasonable commissioner could have reached on the same evidence.

[40] The commissioner failed to properly assess the evidence as required in Head of the Department of Education v Mofokeng and Others[5], which failure had a distorting effect on the outcome and denied the Applicant a fair trial.

[41] The commissioner failed to consider the real issue before him which was whether it was probable for Booysen and Williams not to have known about the activities of Kieviets and failed to appreciate that all the employees implicated were a ‘close-knit’ group. According to the Applicant, the commissioner ought to have found that the dismissed employees worked as a ‘group’ or ought to have known about the thefts.

[42] In respect of Vaaltyn, the Applicant submitted that the commissioner ought to have found that the sanction of dismissal was appropriate viewed against the evidence of Simon and given the fact that Vaaltyn showed no remorse.

The test for review

[43] The test laid down in Sidumo and Another v Rustenburg Platinum Mines Ltd and Others[6] is a test for the substantive reasonableness of the outcome or result of an arbitration award, which is an outcome based enquiry[7], entailing a stringent test aimed at ensuring that arbitration awards are not lightly interfered with.[8]

[44] In Bestel v Astral Operations Ltd and Others[9] the Court stated as follows:

‘It is important to emphasise, as is exemplified from Carephone, and in Schwartz, supra, that the ultimate principle upon which a review is based is justification for the decision as opposed to it being considered to be correct by the reviewing court; that is whatever this Court might consider to be a better decision is irrelevant to review proceedings as opposed to an appeal. Thus, great care must be taken to ensure that this distinction, however difficult it is to always maintain, is respected.’[10]

[45] For the applicant to succeed with the review application, it must be established that the commissioner’s decision fell outside the bands of reasonableness on all the material that was before the commissioner, including for the reasons not considered by the

commissioner.[11]

Analysis

[46] Arbitration proceedings are by their very nature de novo proceedings, starting on a clean slate. In this case, the main ingredient of the Applicant’s case was the statement by Blignaut, who for unknown reasons did not testify before the commissioner and who could not be tested under cross-examination. The Applicant had a duty to secure Blignaut at the arbitration to support its case against the dismissed employees. It failed to do so. To cry

foul of not being given a fair trial, at the review stage, is a fallacy. This aspect however does not render any fatality to this

case as the commissioner decided in his discretion, to accept the statement and to weigh its probability against the evidence tendered

at arbitration. The evidence before the commissioner did not support Blignaut’s statement. There was nothing before the commissioner

to support the charges against the employees, i.e. that they were guilty of stealing from the Applicant and thereby causing shrinkage.

The commissioner’s decision falls within the bounds of reasonableness and there is no basis to interfere with it on review.

[47] Furthermore, the Applicant’s reasons for not charging Blignaut and for the issuing of a sanction of a final written warning to Deveroux cannot be sustained. To the extent that Simon testified that Blignaut was not caught with her hands in the cookie jar, the same goes for the dismissed employees. There is nothing, from the record and the evidence before the commissioner to prove that any of them was responsible for the thefts except for Blignaut’s statement. The Applicant has failed to discharge the

onus of proving the fairness of the dismissal of Vaaltyn, Williams and Booysen and therefore, the commissioner’s decision must stand.

Costs

[48] Now turning to the issue of costs. This Court has a wide discretion in awarding costs, guided by the requirements of law and fairness. In this matter I find that law and fairness will be best served by making no order as to costs.

[49] In the circumstances, I make the following order:

Order

1. The application to review is dismissed.

2. There is no order as to costs.

__________________

D. Mahosi

Judge of the Labour Court of South Africa

[1] Act 66 of 1995 as amended.

[2] April, 2013.

[3] 73 of 1968.

[4] (2014) 35 ILJ 2379 (LAC).

[5] [2015] 1 BLLR 50 (LAC); (2015) 36 ILJ 2802 (LAC).

[6] [2007] 12 BLLR 1097 (CC).

[7] Ellerine Holdings Ltd v Commission for Conciliation, Mediation and Arbitration and others (2008) 29 ILJ 2899 (LAC) at 2906H-I.

[8] Fidelity Cash Management Services v CCMA and Others [2008] 3 BLLR 197 (LAC) at para 100; Herholdt v Nedbank Ltd (Congress of South African Trade Unions as amicus curiae) [2013] 11 BLLR 1074 (SCA) at para 13.

[9] [2011] 2 BLLR 129 (LAC)

[10] Id fn 5 at para 18.

[11] Fidelity Cash Management Services v CCMA and Others [2008] 3 BLLR 197 (LAC) at para 103.