Eagles Pride Hatchery (Pty) Ltd v South African Clothing and Textile Workers Union and Others (2024/092607) [2024] ZALCJHB 531 (18 November 2024)

THE LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG

Not Reportable

Case No: 2024-092607

In the matter between:

EAGLES PRIDE HATCHERY(PTY) LTD First Applicant

and

SOUTH AFRICAN CLOTHING AND TEXTILE

WORKERS’UNION First Respondent

GENERAL PUBLIC SERVICE SECTORAL

BARGAINING COUNCIL Second Respondent

ADV. ITUMELENG KGATLA N.O. Third Respondent

MEMBERS OF THE FIRST RESPONDENT

LISTED IN ANNEXURE “A” TO THE

NOTICE OF MOTION Fourth Respondent

Heard: 29 August 2024

Delivered: 18 November 2024

JUDGMENT

PHEHANE, J

Introduction

[1] This is an urgent application launched in June 2024 by the applicant for final relief to interdict strike action by the respondents and for ancillary relief.

[2] The application was enrolled for hearing in June 2024 and was removed from the Court roll as the first respondent (the union) gave an undertaking not to proceed with strike action. The applicant reserved its right to re-enrol the application if the respondents at a later stage, demonstrates an intention to embark on strike action.

[3] Pursuant to further developments in the dispute between the parties, the applicant has re-enrolled the application and seeks leave to file a supplementary affidavit and to amend its notice of motion.

[4] The application is opposed by the respondents.

Leave to file supplementary affidavit and amend notice of motion

[5] The events following the launch of this application in June 2024 and its removal from the roll are common cause. What is in dispute is whether the respondents gave an unconditional undertaking that they would not pursue industrial action as alleged by the applicant.

[6] The applicant launched this application in anticipation of a strike notice by the respondents. The respondents held the view that the application was premature as no strike notice had been served by them and they demanded that the application be withdrawn as they intended to apply to the Commission for Conciliation, Mediation and Arbitration (CCMA) for facilitation of the dispute in terms of the provisions of section 150(1) of the Labour Relations Act[1] (LRA) and as contemplated in clause 16.4.4 of the Recognition Agreement concluded between the parties in July 2023.

[7] It is pertinent at this juncture, for proper context, as it is relevant to the determination of this dispute, to set out the entirety of the provisions of clause 16.4 of the Recognition Agreement. It reads thus:

‘16.4 Disputes of Interest

16.4.1 Unless an alternative process is specifically provided for in this dispute procedure, or has been agreed upon by the parties, all other disputes shall be processed in terms of this Clause.

16.4.2 After notification has been received by the other party in terms of clause 16.2[2] above, a dispute meeting shall be convened in an endeavour to resolve the dispute in a mutually acceptable manner. The parties will meet on at least three (3) occasions in order to resolve the dispute, and consideration shall be given to the use of alternative resolving mechanisms.

16.4.3 If meetings in terms of 16.4.2 fail to resolve the dispute, either party shall have the right to refer such dispute to the CCMA for conciliation.

16.4.4 If conciliation in terms of 16.4.3 fail to resolve the dispute, parties agree to apply to the CCMA for facilitation/ intervention in terms of Section 150(1) of the Labour Relations Act.’

[8] The respondents thus aver that they did not give a unconditional undertaking not to to engage in strike action, but rather, they gave an undertaking not to engage in strike action pending the finalisation of the conciliation process as contemplated in section 150(1) of the LRA.

[9] The process before the CCMA in terms of section 150(1) of the LRA took place on 5 August 2024. The dispute remained unresolved and a settlement agreement was concluded by the parties at the CCMA which simply recorded what had transpired in the dispute and that each party reserved its rights. The settlement agreement reads:

‘1. A section 64(1) referral was lodged in terms of the Labour Relations Act 66 of 1995 (Hereinafter referred to as “the LRA”) under case number GATW6282-24.

2. The matter remained unresolved.

3. The union subsequently referred a section 69(4) referral in terms of the LRA for picketing rules under case number GATW7572-24.

4. Picketing rules were subsequently agreed upon.

5. The employer approached the Labour Court and issued a [cease] and desist letter to the union's representatives.

6. The union's representatives agreed to comply with the contents of paragraph 5, on the basis of the employer withdrawing the matter at the Labour Court.

7. The employer withdrew the matter and reserved its right to re-enroll the matter.

8. The union subsequently approached the CCMA in order to comply with clause 16.4 of their recognition agreement.

9. The union will exercise its right in determining whether to engage in industrial action and the employer reserve[s] its right to take appropriate recourse in that regard.’

[10] On 6 August 2024, the union placed on record that it had complied with the procedural requirements as set out in the recognition agreement and confirmed that as the conciliation in terms of section 150(1) of the LRA was unsucessful, it reserved its right to embark on strike action as contemplated in section 64 of the LRA. In response to this letter, the applicant sent correspondence to the union recording that the union had indicated that it would carry out a ballot with its members on whether or not to proceed with strike action and warned the union that continuing with the balloting process would be in breach of its earlier undertaking not to engage in industrial action and that any strike action would be unprotected. The applicant accordingly warned the union that should it persist with the strike action, it would re-enroll the urgent application.

[11] The union communicated to the applicant its proposed plan to conduct general meetings for the purposes of balloting. The applicant granted permission for meetings to be held outside working hours and reiterated that any balloting would be in breach of the union's undertaking and that any strike action would be unprotected. In response, the union reiterated that the conciliation in terms of section 150(1) LRA was unsucessful and that a 48-hour strike notice would be issued in due course.

[12] The applicant avers that the balloting is a farce as the union had already taken a decision to embark on strike action. The applicant avers that the strike action will cause irreparable harm to its operations, will put its employees in jeopardy, will enganger its livestock and put the production of food at serious risk. Consequently, the applicant avers that the application is still urgent and on this basis, it appears, the application was re-enrolled.

[13] The respondents deny that the balloting is a farce – they assert that they have complied with procedures in terms of the Recognition Agreement relating to their bonus demand, are entitled to embark on strike action; further, that the applicant has not been designated a maintenance service as contemplated in section 75 of the LRA as the applicant suggests and accordingly, the application ought to be dismissed as it is unmeritorious.

[14] The respondents take no issue with the filing of the supplementary affidavit. However, they take issue with the amended notice of motion on the grounds that the applicant has not made out a case for the amendment of the notice of motion nor has it demonstrated that it is in the interests of justice that this Court grant leave to amend the notice of motion.[3] The respondents aver that the amendments to the notice of motion are to intimidate it and to threaten it into submission in circumstances

where no strike notice has been issued by it and no justification is made for an order fining the union R1 million should it fail to communicate to its members to not engage in strike action should the strike action be interdicted.

[15] The supplementary affidavit places before this Court the developments that transpired since the application was removed from the roll in June 2024 and the reason that the matter is re-enrolled. These developments are necessary in determining this matter. The respondents have placed their version in answer to the supplementary affidavit befor this Court. In the circumstances, leave is granted to file the supplementary affidavit.

[16] The respondents’ submission that no case is made by the applicant for the grant of leave to file an amended notice of motion is valid. There is no explanation by the applicant why it is in the interests of justice to amend the notice of motion. The amendments that appear in the notice of motion include prayers that strike action in pursuance of a demand for bonus payment be interdicted; that any strike action by the respondents is in breach of the collective agreement, alternatively, the undertaking to not engage in strike action; and the steps the union is to take in communicating with its members, failing which, it is to be fined R1 million. There is no justification for this substantial fine and no case is made out for the amended relief sought.

[17] In the premises, leave is not granted to amend the notice of motion.

Urgency

[18] Rule 38 (1) and (2) of the Labour Court Rules[4] provide as follows in respect of urgent applications:

‘(1) A party that applies for urgent relief must file an application that complies with the requirements of the rules relating to applications generally.

(2) The affidavit in support of the application must also contain:

(a) the reasons for urgency and why urgent relief is necessary;

(b) the reasons why the requirements of the rules were not complied with, if that is the case; and

(c) if a party brings an application in a shorter period than that provided for in terms of section (68)(2) of the Act, the reasons why a shorter period of notice should be permitted.’

[19] Urgency is premised on an anticipated strike notice. The applicant avers that the respondents are precluded in terms of the provisions of section 65 of the LRA, from striking over an issue that is the subject of a collective agreement and as the respondents are contemplating strike action, this application is urgent. Although no strike notice has been issued, the applicant avers that a 48-hours strike notice is insufficient. The applicant avers that should this Court not grant the interdict on an urgent basis, the operations of the applicant will be harmed and redress in the normal course would be inadequate.

[20] Urgency is not seriously disputed by the respondents, other than to deny that if the 48-hours strike notice were it to be issued is insufficient, as the recognition agreement does not state that 48 hours is insufficient. The recognition agreement makes provision for the issuance of a 48-hours strike notice. The respondents also take issue with any suggestion by the applicant that it is a maintenance service as contemplated in section 75 of the LRA.

[21] I have considered the averments by the applicant. On the premise that the strike action is immiment and that substantial redress would not be achieved if the matter is heard in the ordinary course, the matter is heard as urgent.

Background

[22] The applicant conducts business in the poultry industry. The applicant has instituted this application to interdict the respondents’ contemplated strike action. The prayers in the notice of motion seek final interdictory relief.

[23] The first respondent is the South African Clothing and Textile Workers Union. The second to further respondents are its members employed at the applicant. The respondents are contemplating embarking on strike action in the near future. It is common cause that no notice to strike has yet been issued by the respondents.

[24] As is apparent from the applicant’s founding papers, it seeks to interdict the contemplated strike action on the following three bases:

24.1 first, that the subject of the strike is substantively regulated by a collective agreement in terms of the provisions of section 65(1)(a) of the LRA;

24.2 second, the respondents have failed to follow the dispute resolution procedure as set out in the recognition agreement concluded between the parties; and

24.3 third, the union has given an undertaking that it will not embark on strike action.

[25] The crux of the dispute turns on the applicant’s first ground for an interdict; that is, whether the subject of the contemplated strike, that is, the respondents’ bonus payment demand is substantively regulated by a collective agreement.

Legal Framework

[26] The locus classicus on strike interdicts is the case of SA Transport and Allied Workers Union and Others v Moloto NO and another[5] where the Constitutional Court held that Courts will not lightly interdict strike action and find it to be unprotected. In view of the constitutional significance of strike action, only where it is patently unlawful will a Court resort to an interdict. In general, Courts should rather adopt a restrictive approach to strike interdict applications. In this regard, the Constitutional Court stated as follows:

‘The relevance of a restrictive approach is to raise a cautionary flag against restricting the right [to strike] more than is expressly

provided for. Intrusion into the right [to strike] should only be as much as is necessary to achieve the purpose of the provision and this requires sensitivity to the constraints of the language used.’[6]

[27] The Constitutional Court further found that the correct interpretive approach, insofar as a strike interdict application turns on a matter of interpretation, is to prefer the interpretation that is “least restrictive of the right [to strike] if the text is reasonably capable of bearing that meaning”.[7] This is a long standing principle.

[28] In Johannesburg City Parks v SAMWU and others[8] (Johannesburg City Parks), the Labour Court eschewed tactic often adopted by employers to seek an interdict by relying on undue and overt technicalities. In Johannesburg City Parks, this Court held as follows:

‘[T]he right to strike is protected by the Constitution of the Republic of South Africa, 1996 and should not lightly be fettered by technicalities, particularly in circumstances where there has ostensibly been compliance with the requirements of section 64 (1)(a) of the Act.' (Emphasis added)

[29] The present application turns on an interpretive dispute between the parties. In pursuit of an interdict, the applicant, relies on an overly-technical approach which is generally wrong in law and especially wrong in law in the context of a strike interdict application as was stated by this Court in Johannesburg City Parks.

Relevant chronology

[30] The relevant chronology is set out below. It is largely common cause.

[31] In February 2023, the parties concluded a Recognition Agreement.

[32] In that same month, the first respondent communicated to the applicant its substantive demands for the years 2023 to 2025. One of these demands included a bonus payment recorded as “Bonus to be paid in full, plus extra week each year”.[9]

[33] The parties thereafter commenced with wage negotiations. The respondents retained the bonus payment demand. Following the rounds of negotiations, in June 2023, the union delivered the employees’ primary demands which remained, and one of these included the bonus payment, recorded as “A guaranteed 4 week bonus – payable in 2 instalments without any conditions”.[10]

[34] On 4 July 2023, the applicant sent the draft substantive wage agreement for the 2023 - 2025 period to the union. The union persisted with the bonus demand. The applicant’s consistent response was that it did not have a mandate to negotiate a guaranteed bonus and that the bonus was not guaranteed but discretionary.

[35] The union recorded in an email of 5 July 2023 that the parties were in dispute regarding the issue of the bonus and the dispute resolution menchanism in terms of the Recognition Agreement should be followed.

[36] A dispute on inter alia, the bonus was referred to the CCMA by the respondents in April 2024 in terms of the provisions of section 64 of the LRA.[11] The dispute was conciliated and a certificate of non-resoulution of the dispute was issued under case number GATW 6282-24 on 19 June 2024.[12]

[37] Conciliation on the bonus payment dispute was held in terms of the provisions of section 150(1) of the LRA on 5 August 2024, which dispute remianed unresolved.

Evaluation

Is the strike demand substantively regulated?

[38] The subject of the contemplated strike action is the respondents’ bonus payment demand. The demand was first presented to the applicant in February 2023, together with several other mutual interest demands.

[39] In the course of negotiations, the union and the applicant reached agreement on some of the mutual interest demands, but not all. Accordingly, in June 2023, the parties concluded a collective agreement (the substantive agreement) in respect of those issues on which they had agreed. There were, however, outstanding issues on which no agreement was reached.

[40] The outstanding issues were either reserved for future negotiations, or otherwise reserved for resolution through the mechanisms provided for in the Recognition Agreement. The bonus payment demand is of the latter category, as recorded in the union’s

email of 5 July 2023.

[41] Throughout the course of the negotiations, the applicant maintained that it could not accede to the bonus payment demand for the reason that it did not have the mandate to negotiate on this demand and further that it was of the view that the demand could not be raised at such a late stage in the negotiations where a substantive agreement had already been concluded. The applicant's case is that the bonus demand forms part of the substantive matters in terms of which they concluded in full and final settlement of the dispute before the parties.

[42] According to the applicant, the bonus issue forms part of the terms and conditions of employment that remains unchanged. The applicant avers that the union “dropped” the bonus demand payment when it concluded the substantive agreement. The union avers that it did no such thing and that this is apparent from the following circumstances surrounding the conclusion of the substantive agreement:

a. On 4 July 2023, the union returned to the applicant, the draft of a substantive agreement but explicitly recorded that notwithstanding its terms, the demand for the bonus payment, amongst other outstanding demands, remained live;

b. on 5 July 2023, following the re-confirmation by the applicant that it could not accede to the bonus demand, the union explicitly recorded that it regarded the issue as being in dispute and should be resolved in terms of the dispute resolution mechanisms contained in the Recognition Agreement.

[43] The applicant contends that clause 1 of the substantive agreement records that the agreement is concluded in ‘full and final settlement’ of the 2023 - 2025 substantive wage negotiations and therefore, because of the ‘full and final settlement’ phrase, all issues that were up for negotiation became settled, including the bonus payment demand.

[44] In the recent Constitutional Court decision of University of Johannesburg v Auckland Park Technological Seminary and another[13], the Constitutional Court clarified that the correct and now settled approach to contractual interpretation is the “unitary

approach”. In terms of the unitary approach, one cannot simply consider the words utilised in an agreement; one must have regarded the context and surrounding circumstances under which the agreement was concluded in order to ascertain the respective parties’ intentions.[14]

[45] The unitary approach to interpretation has been elucidated by the Supreme Court of Appeal (SCA).[15] In Novartis v Maphil[16], the SCA stated thus:

‘[27] I do not understand these judgments to mean that interpretation is a process that takes into account only the objective meaning of the words (if that is ascertainable), and does not have regard to the contract as a whole or the circumstances in which it was entered into. This court has consistently held, for many decades, that the interpretative process is one of ascertaining the intention of the parties – what they meant to achieve. And in doing that, the court must consider all the circumstances surrounding the contract to determine what their intention was in concluding it…

[28] … A court must examine all the facts – the context – in order to determine what the parties intended. And it must do that whether or not the words of the contract are ambiguous or lack clarity. Words without context mean nothing.’

[46] This Court must ultimately decide whether the union abandoned the bonus payment demand by concluding the substantive agreement with a ‘full and final settlement’ contained therein. Put differently, does the scope of the ‘full and final settlement’ clause extend to cover the bonus payment demand?

[47] When concluding the substantive agreement, the union explicitly indicated that, despite and notwithstanding the terms of the agreement, including the ‘full and final settlement’ clause, it reserved the bonus payment demand for further bargaining, and ulimately, it recorded that the parties were in dispute, to be resolved in terms of the provisions of the Recognition Agreement. The union’s intention was to exclude the bonus payment demand from the scope of the substantive agreement.

[48] If regard is had to the context, as the Constitutional Court and the SCA have held, then, it is clear that the bonus payment demand was not covered by the full and final settlement clause, Rather, it was reserved for further bargaining between the parties.

[49] That further bargaining culminated in an attempt to refer the matter to the CCMA to resolve the dispute between the parties in terms of the provisions of section 150 of the LRA, an agreed process. A settlement agreement was concluded between the parties that stated as follows: The intention of the parties by concluding this settlement agreement was to reserve either parties’ rights – for the first respondent to embark on industrial action on the one hand and for the appliant to take appropriate recourse on the other hand.

[50] The surrounding circumstances and intention of the parties demonstrates that the bonus demand was not settled in full and final settlement by the substantive wage agreement – it remained a live issue that is now subject to a power play between the parties. Having followed the prodecural requirement in the LRA and the provsions of section 64 of the LRA, I find that the strike is protected, as the bonus demand is not an issue that the first respondeent is precluded from striking on, as it does not form part of the collective agreement, the substantive agreement .

[51] The demand was for a guaranteed bonus. The applicant stated that it had no mandate to negotiate the bonus, which is discretionary. Having no mandate to negotiate means that it was not negoiated on. This is what placed the issue in dispute, as agreement could not be reached on this demand. As the issue was not negotiated on, it could not have been settled in full and final settlement.

[52] In view of the afore-going, the bonus demand could not have been and was not, in my view, regulated by the substantive agreement as it was expressly excluded from the substantive agreement. The procedural requirements were met by the respondents in terms of section 64 of the LRA. Therefore, the contemplated strike action, should it proceed, would be protected.

Did the respondents comply with the procedural requirments of the contemplated strike action?

[53] Insofar as the remaining two grounds to interdict the strike is concerned, that is, the failure by the respondents to comply with the necessary procedural requirements and the first respondent’s purported undertaking not to a proceed with the strike action at all, in my view, the first respondent has substantively complied with all the procedural requirements. It complied with the provisions of clause 16.4 of the Recognition Agreement, and with the provisions of sections 64(1)(a) and section 150(1) of the LRA.

[54] The first respondent gave no general undertaking not to strike as alleged by the applicant – instead it gave an undertaking not to strike pending the finalisation of the section 150(1) proceedings at the CCMA. This is clear from the correspondence between the parties.

Conclusion

[55] In view of the afore-going, I find that the contemplated strike is not regulated by the substantive agreement and this is apparent when one has regard for the context and surrounding circumstances under which the substantive agreement was concluded. The respondents have complied substantially with the procedural requirments for strike action.

[56] In the circumstances and on the Plascon Evans[17] rule, the applicant is not entitled to final interdictory relief.

[57] In the premises, the order is as follows:

Order

1. The application is heard as urgent in terms of rule 38 of the Labour Court Rules.

2. Leave is granted to file the supplementary affidavit.

3. Leave is not granted to amend the notice of motion.

4. The application is dismissed.

5. There is no order as to costs.

M. T. M. Phehane

Judge of the Labour Court of South Africa

Appearances:

For the Applicant: Adv Pillay (Ms.)

Instructed by: Yusuf Nagdee Attorney

For the Respondents: Mr. Makuwa of Cheadle Thompson & Haysom Inc.

[1] Act 66 of 1995, as amended.

[2] Clause 16.2 of the Recognition Agreement makes provision for dispute resolution and provides: ‘Notification of a Dispute Either party shall be entitled to declare a dispute after all internal procedures have been exhausted. A dispute shall be declared in writing, and shall describe the dispute and a proposed solution. The notification of a dispute must take place within fourteen (14) days from the dispute arising.’ See: p 002-54.

[2] Clause 16.2 of the Recognition Agreement makes provision for dispute resolution and provides:

‘Notification of a Dispute

Either party shall be entitled to declare a dispute after all internal procedures have been exhausted. A dispute shall be declared in writing, and shall describe the dispute and a proposed solution. The notification of a dispute must take place within fourteen (14) days from the dispute arising.’

See: p 002-54.

[3] Respondents’ heads of argument at paras 7 to 10 and the authorities cited in footnote 7.

[4] Rules Regulating the Conduct of the Proceedings of the Labour Court published under GN 4775 in GG 50608 of 3 May 2024.

[5] [2012] ZACC 19; (2012) 33 ILJ 2549 (CC).

[6] Ibid at para [54].

[7] Ibid at para [43].

[8] [2006] ZALC 46; [2006] 7 BLLR 659 (LC) at para [17].

[9] See: answering affidavit at para 11 on p 004-5 and first respondent’s demands at p 004-19.

[10] See: annexure “MM3” to the answering affidavit on p 004-24.

[11] The referral appears at pp 002-36 to 002-40.

[12] p 002-35.

[13] [2021] ZACC 13; 2021 (8) BCLR 807 (CC).

[14] Ibid at paras [65] to [70].

[15] See: Tshwane City v Blair Atholl Homeowners Association [2018] ZASCA 176; 2019 (3) SA 398 (SCA), where the SCA held that the distinction between context and background circumstances has been jettisoned and now, the context and surrounding circumstances must be taken into account when interpreting the agreement and its terms, and ultimately, the intention of the parties.

[16] [2015] ZASCA 111; 2016 (1) SA 518 (SCA) at paras [27] to [28].

[17] Plascon-Evans Paints Ltd v Van Riebeeck Paints (Pty) Ltd [1984] ZASCA 51; 1984 (3) SA 623 (A).