ATC South Africa Wireless Infrastructure v Masakale and Others (JR387/2019) [2022] ZALCJHB 266 (13 September 2022)

THE LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG

Not Reportable

Case Number: JR387/2019

In the matter between:

ATC SOUTH AFRICA WIRELESS INFRASTRUCTURE

(PTY) LTD

Applicant

and

TEBOGO MASAKALE

First Respondent

COMMISSION FOR CONCILIATION

MEDIATION AND ARBITRATION

Second Respondent

COMMISSIONER: THOKOZANI XULU N. O

Third Respondent

Heard: 06 July 2022

Delivered: 13 September 2022

Summary: Review of arbitration award in terms of section 145 of the Labour Relations Act as amended. Commissioner ignored material evidence- decision not reasonable- award set aside and substituted

JUDGMENT

MATYOLO, AJ

Introduction

[1] The applicant seeks an order to have the arbitration award issued by the third respondent, the commissioner, under case number GABJ 22771/2018 on 14 February 2019 reviewed and set aside and other ancillary relief. The application is opposed by the first respondent.

[2] The third respondent, the commissioner, found inter alia that the dismissal of the first respondent was both substantively and procedurally unfair and issued an award directing the applicant to reinstate the first respondent retrospectively and to pay him back pay in the amount of R323 149.20 (three hundred and twenty-three thousand one hundred and forty-nine rands and twenty cents).

[3] Before I deal with the merits of the application, I find it necessary to provide a brief background exposition of the salient facts of this dispute.

Background

[4] The first respondent joined the applicant in April 2012 when he was appointed to the position of Systems Service Manager and his services were terminated when he was dismissed in October 2018.

[5] The applicant proffered charges of misconduct relating to allegations of failure to follow a reasonable instruction and another relating to gross negligence for failing to check invoices that were issued by one of the suppliers, Maboho Consulting.

[6] The first charge relating to the failure to follow a reasonable instruction arose after Mr Tony Christodoulou, the applicant’s IT Executive for Europe, Middle East, and Africa took issues with the amount the applicant was charged in an invoice that was received from Maboho consulting.

[7] The second charge relates to allegations of gross negligence in relation to allegations of failure to verify invoices that were received and approved for payment by the applicant. In one of the invoices, Maboho Consulting charged 15% vat in circumstances when they in fact were not registered as VAT vendors.

The allegation regarding failure to follow a reasonable instruction

[8] It is common cause between the parties that Mr Christodoulou took issue with one of the invoices that were issued by Maboho Consulting and said that the applicant would not pay it unless they got a reasonable invoice.

[9] It is also common cause that in an email addressed to Ms Lisa Matsheke and copied to Mr Tebogo Masakale, the first respondent herein, Mr Christodoulou wrote: “We will not use them again”.

[10] It is also not disputed that sometime after this incident, the first respondent instructed Ms Matsheke to use Maboho Consulting and Ms Matsheke reminded the first respondent that Mr Christodoulou had instructed them not to use Maboho Consulting again. The first respondent insisted that they use Maboho Consulting notwithstanding the reminder.

The allegation of gross negligence regarding the submission of invoices for approval and payment

[11] The allegation against the first respondent was that the first respondent failed to exercise due care and diligence by not checking the invoices received from Maboho Consulting prior to approving them in circumstances when there were previous incidents in which Maboho Consulting had inflated its invoices.

[12] The evidence was that about some months later Ms Matsheke came across an invoice for an amount of R80 000 which she did not know what it was for. When she phoned and enquired from the supplier, the supplier told her that it (the supplier) had loaded that invoice on behalf of another supplier after it had been told to do so by the first respondent.

[13] Further investigations revealed that there were other discrepancies including duplication of invoices and an invoice in which there was a mark-up charge of 15% invoices. The first respondent conceded that he did not accurately check the invoices.

The arbitration award

[14] In his analysis of the evidence the Commissioner amongst other things, had this to say:

“[54] …of cause the instruction should be lawful and reasonable. However, the big question that has to be answered is whether there was an instruction or not”. (sic)

[55] In terms of section 192(2) of the LRA, the onus is on the employer to prove that the dismissal was fair. And certainly, if an employee is found guilty of serious misconduct, the employer has a discretion to impose a sanction of dismissal. As stated above I have taken careful consideration of all the relevant evidence led before me. For instance, there is an email that was sent to the Applicant’s junior, and the Applicant was copied, the content of the email is found on the bundles and on paragraph 34 of this award. There is no dispute about the intended recipient, moreover meetings were held to address the content of the email, and of cause based on the evidence led before me opinions differ on the real purpose of the email. The applicant maintained that it was about an invoice. On the other hand, the Respondent’s argument is that it was about an instruction. (Sic).

[57] The purpose of this award is not solely to determine if there was an instruction or not. In the event that there was an instruction; then again, the questions will keep evolving. For instance, the appropriateness of the sanction, and the consistency applied by the respondent. (sic)

[58] I am in agreement with the applicant’s version (third respondent herein) that the email in question contains 95% of which deals with the overpricing but when it comes to the instruction in question, it‘s only one sentence. Therefore, even if this was an instruction, my logical inference is that the sanction of dismissal was too harsh....” (sic)

[15] After identifying that the issue was whether there was an instruction or not, the Commissioner seems to have found that there was no instruction because he says even if there was an instruction, his logical inference is that the sanction of dismissal was too harsh.

[16] The problem is that the basis for the finding that sanction is too harsh is not explained and it is not clear why if the email containing the instruction contained other issues like over pricing does that lead to a conclusion that dismissal was too harsh.

[17] Regarding the second charge, the Commissioner finds that from the evidence led before him the issue is about the invoices that were issued by Maboho Consulting and that the applicant was charged for not checking those invoices. Without making a finding on the evidence, the commissioner finds that the issue goes to consistency and the harshness of the sanction.

[18] The Commissioner having failed to make a determination on the charges both the charges on the evidence found that it is in the interests of justice to reinstate the first respondent and issued an award in which he ordered that the first respondent should be re-instated with back pay.

The Legal Framework

[19] Arbitration awards issued by arbitrators are reviewed on the grounds set out in section 145 of the Labour Relations Act[1]. These grounds are suffused into the Constitutional standard of reasonableness that requires a commissioner to present a decision

having had regard to the material properly available before him or her.[2]

[20] A Commissioner is not given the power to consider afresh what he or she would have done but simply to decide whether what the employer did was fair.[3]

[21] In Herholdt v Nedbank Limited[4] the Supreme Court of Appeal held that:

“In summary, the position regarding review of CCMA awards is this: a review of a CCMA award is permissible if the defect in the proceedings falls within one of the grounds in section 145(2)(a)(ii), the arbitrator must have misconceived the nature of the enquiry or arrived at an unreasonable result. A result will only be unreasonable if it is one a reasonable arbitrator could not reach on all the material that was before the arbitrator. Material errors of fact, as well as weight and relevance to be attached to particular facts, are not and of themselves sufficient for an award to be set aside but are only of any consequence if their effect is to render the outcome unreasonable.”

[22] In Gold Fields Mining South Africa (Pty) Ltd (Kloof Mine) v CCMA and Others[5], the Labour Appeal Court held inter alia as follows:

“What is required is first to consider the gross irregularity that the arbitrator is said to have committed and then to apply the

reasonableness test established by Sidumo. The gross irregularity is not a self–standing ground insulated from or standing

independent of the Sidumo Test. That being the case, it serves no purpose for the reviewing court to consider and analyse every issue raised at the arbitration and regard failure by the arbitrator to consider all or some of the issues albeit material as rendering the award liable to be set aside on the grounds –related review.”

[23] At paragraph 21 the LAC concluded that:

“Where the arbitrator fails to have regard to the material facts it is unlikely that he or she will arrive at a reasonable decision. Where the arbitrator fails to follow a proper process, he or she may produce an unreasonable outcome (See Minister of Health and Another v New Clicks South Africa (Pty) Ltd and Others 2006 (2) SA 311(CC). But again, this is considered on the totality of the evidence, not on a fragmented, piecemeal analysis. As soon as it is done in a piecemeal fashion, the evaluation of the decision arrived at by the arbitrator assumes the form of an Appeal …. Failure to have regard to material facts must actually defeat the constitutional imperative that the award must be rational and be reasonable –there is no room for conjecture and guesswork.”

[24] In his award, the Commissioner ignored the fact that a senior manager had issued an instruction for Maboho Consulting not to be used again. The first respondent was reminded of this instruction but went ahead and instructed a subordinate to use Maboho Consulting on the face of a reminder. The Commissioner altogether failed to deal with this evidence in his award. It was submitted on behalf of the applicant that this constituted a deliberate act of insubordination.

[25] The Commissioner also ignored the evidence to the fact that the first respondent admitted failing to properly check the invoices.

[26] I have looked and considered the fact that the first respondent received the email containing the instruction not to use Maboho Consulting again and that the first respondent was in fact reminded of the instruction. Instead, first respondent instructed a subordinate to use Maboho Consulting despite being reminded of the instruction.

[27] Secondly, the first respondent also admitted that he did not thoroughly check the invoices. As already stated, this evidence was also ignored by the Commissioner.

[28] I find that the award returned by the Commissioner is unreasonable when regard is had to the evidence before him. Accordingly, the following order is made:

Order

1. The review application is granted

2. The arbitration award is reviewed and set aside and is substituted with an order that the dismissal of the first respondent was procedurally and substantively fair.

3. There is no order as to costs.

Matyolo AJ

Acting Judge of the Labour Court of South Africa

Appearances:

For the Applicant:

Adv A. Cook

Instructed by:

Baker McKenzie Inc

For the Respondents:

Adv H. Bucksteg

Instructed by:

Carel J Schoeman Incorporated

[1] No. 66 of 1995, as amended.

[2] See: Sidumo and Another v Rustenburg Platinum mines [2007] 12 BLLR 1097 (CC) at paragraph 110.

[3] Sidumo (Ibid at para 79).

[4] Herholdt v Nedbank Limited [2013] 11 BLLR 1074 (SCA).

[5] (2014) 36 ILJ 943 (LAC).