Ekurhuleni Metropolitan Municipality v South African Local Government Bargaining Council and Others (JR853/18) [2022] ZALCJHB 272 (4 October 2022)

THE LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG

Not Reportable

Case no: JR853/18

In the matter between:

EKURHULENI METROPOLITAN

MUNICIPALITY Applicant

and

SOUTH AFRICAN LOCAL GOVERNMENT

BARGAINING COUNCIL First Respondent

COMMISSIONER TIMOTHY BOYCE N.O. Second Respondent

DEMAWUSA OBO BALOYI AND 23 OTHERS Third Respondent

Heard: 01 September 2022

Delivered: 04 October 2022

(This judgment was handed down electronically by circulation to the parties' legal representatives by email, publication on the Labour Court’s website and released to SAFLII. The date and time for hand-down is deemed to be 10h00 on 04 October 2022)

Summary: Section 64(4) of the LRA - essential services dispute arbitrated in terms of section 74 of the LRA - the referring party, as dominus litis, chose to prosecute a mutual interest claim despite other alternative causes of action.

JUDGMENT

NKUTHA-NKONTWANA, J

Introduction

[1] In this review application, the applicant, Ekurhuleni Metropolitan Municipality (Ekurhuleni) impugns the arbitration award issued by the second respondent (arbitrator) under case number GPD 051747 dated 30 March 2018. Ekurhuleni contends that the arbitrator committed various reviewable irregularities by erroneously concluding that the dispute before him pertained to mutual interest and finding that it should be resolved in favour of the third respondent, the Democratic Municipal and Allied Workers Union of South Africa (DEMAWUSA).

[2] On 30 January 2020, the Registrar of Labour Relations issued a notice of deregistration of DEMAWUSA in terms of section 109 read with section 106(2A) of the Labour Relations Act[1] (LRA). I raised this issue with the parties during the hearing of oral arguments. However, I deem it unnecessary to be arrested by this issue because nothing much turns on it as the right sought to be vindicated resides with the respondent employees and not the union per se.[2] Tritely, nothing precludes the members of a trade union from proceeding with the dispute after the union withdrew from the dispute which it had initiated on their behalf even if they were not formally joined as parties.[3]

Factual background

[3] DEMAWUSA referred a dispute to the first respondent, South African Local Government Bargaining Council (SALGBC), challenging Ekurhuleni’s decision to unilaterally implement the Uniform Allowance for Night Shift Allowance Policy (Policy) which resulted in the reduction of the nightshift allowance of the members it is acting on behalf (the respondent employees). It is not seriously challenged that the Policy was introduced on 1 October 2002, consequent to the amalgamation of the various independent municipalities (regions) and establishment of Ekurhuleni. The regions had different nightshift policies and rates.

[4] Ekurhuleni contends that the Policy sought to introduce a uniform nightshift allowance in all the regions. Apparently, the Policy is a product of collective bargaining between Ekurhuleni and the trade unions, South African Municipal Workers Union (SAMWU) and the Independent Municipal & Allied Trade Union (IMATU) which was adopted by the resolution of the Municipal Council.

[5] In addition, Ekurhuleni contends that the Policy binds all employees who were employed after 2002. It provides that the nightshift allowance would be paid at 6% rate of the hourly rate of each employee’s basic salary scale up to R1.50 per hour. Notwithstanding, the Policy apparently preserved the contractual rights of the employees, who had been receiving a nightshift allowance at a 14% rate of the annual salary prior to the introduction of the Policy, particularly in Boksburg. Even so, Ekurhuleni failed to implement the Policy.

[6] The respondent employees took up employment at Boksburg after 2002 and had been members of SAMWU up until 2016. They had been paid a nightshift allowance at a rate of 14%. Ekurhuleni contends that the respondent employees were erroneously paid the nightshift allowance at 14% rate, an error it only rectified in March and June 2014. The respondent employees formally challenged Ekurhuleni’s decision to reduce the rate of the nightshift allowance to 6% in 2017, after joining DEMAWUSA.

[7] DEMAWUSA referred the dispute to SALGBC in terms of section 64(1) of the LRA. The arbitrator accepted that SALGBC had jurisdiction to arbitrate the matter since the respondent employees are firefighters and could not participate in a strike because they are engaged in an essential service. The dispute was accordingly referred to arbitration in terms of section 74(4) of the LRA.

Jurisdiction of the SALGBC

[8] I, mero motu, raised the issue pertaining to the jurisdiction of the SALGBC. The parties were given time to file supplementary heads of argument

addressing this issue and they duly obliged. The applicant contends that the SALGBC had no jurisdiction to arbitrate the matter as it pertains to a dispute of unilateral change to terms of conditions of employment in terms section 64(4) of the LRA. To support this contention, reliance is placed on the pre-arbitration minute wherein the issues that were to be determined can be summarised as follows:

8.1 Whether the Policy was binding on the respondent employees;

8.2 Whether there was any unilateral change on the rate of the nightshift allowance; and

8.3 In the event the respondent employees were successful, whether they were entailed to retrospective back pay from March and June 2014.

[9] Section 64(4) of the LRA provides:

‘any employee who or any trade union that refers a dispute about a unilateral change to terms and conditions of employment to a council

or the commission in terms of subsection (1) (a) may, in the referral, and for the period referred to in subsection (1)(a) –

(a) require the employer not to implement unilaterally the change to terms and conditions of employment; or

(b) if the employer has already implemented the change unilaterally, require the employer to restore the terms and conditions of employment that applied before the change.’

[10] The respondent employees, on the other hand, disavow reliance on section 64(4) and that the dispute pertains to unilateral change to terms and conditions of employment. They contend that they referred a mutual interest dispute and since they are essential services employees, the dispute was arbitrated in terms of section 74(4) of the LRA. Any mention of a unilateral change to the terms and terms and conditions of employment was incidental, so they further contended.

[11] Section 74 deals with essential services disputes and provides:

‘(1) Subject to section 73(1), any party to a dispute that is precluded from participating in a strike or a lock-out because that party is engaged in an essential service may refer the dispute in writing to –

(a) A council, if the parties to the dispute fall within the registered scope or that council; or

(b) The commission, if no council has jurisdiction.

(2) The party who refers the dispute must satisfy the council or the commission that a copy of the referral has been served on all the other parties to the dispute.

(3) The council or the commission must attempt to resolve the dispute through conciliation.

(4) If the dispute remains unresolved, any party to the dispute may request that the dispute be resolved through arbitration by the council or the commission.’ (Own emphasis)

[12] It is well accepted that where it is unclear what the issue in dispute is, or which dispute was in fact subjected to the conciliation process, the Court may be called upon to determine the real dispute between the parties. This notion was underscored by the Constitutional Court in National Union of Metalworkers of SA & others v Bader Bop (Pty) Ltd & another,[4] where it was stated that:

‘It is the duty of a court to ascertain the true nature of the dispute between the parties. In ascertaining the real dispute a court must look at the substance of the dispute and not at the form in which it is presented. The label given to a dispute by a party is not necessarily conclusive. The true nature of the dispute must be distilled from the history of the dispute, as reflected in the communications between the parties and between the parties and the Commission for Conciliation, Mediation & Arbitration (CCMA), before and after referral of such dispute. These would include referral documents, the certificate of outcome and all relevant communications. It is also important to bear in mind that parties may modify their demands in the course of discussing the dispute or during the conciliation process. All of this must be taken into consideration in ascertaining the true nature of the dispute.’ (Own emphasis)

[13] Similarly, in Commercial Workers Union of SA v Tao Ying Metal Industries & others,[5] Constitutional Court aptly stated that:

‘…In deciding what the real dispute between the parties is, a commissioner is not necessarily bound by what the legal representatives say the dispute is. The labels that parties attach to a dispute cannot change its underlying nature. A commissioner is required to take all the facts into consideration including the description of the nature of the dispute, the outcome requested by the union and the evidence presented during the arbitration… The dispute between the parties may only emerge once all the evidence is in.’ (Own emphasis)

[14] In the present matter, despite the respondent employees’ disavowal that the dispute that served before the arbitrator pertains to unilateral change to terms and conditions of employment in terms of section 64(4), the referral form requesting conciliation clearly proves otherwise. Paragraph 4 thereof characterised the dispute as the unilateral reduced nightshift allowance.[6] Moreover, the respondent employees signed paragraph 11 of the referral form which gave Ekurhuleni 48-hour notice to restore the

status quo ante in terms of section 64(4) and (5). Finally, the issues in dispute as reflected in the pre-arbitration minute put the mockers on the respondent employees’ contention. In my view, therefore, the dispute that served before the arbitrator pertains to a mutual interest emanating from the unilateral change to terms and conditions of employment.

[15] The next issue is whether a dispute conciliated in terms of section 64(1) could be referred to arbitration in terms of section 74(4) and, in so doing, circumvent the dispute resolution procedures provided for in section 74(3). In City of Cape Town v SALGBC & another,[7] confronted with the similar, this Court per Basson J, opined that:

‘In principle I am therefore in conclusion of the view that it would also be unduly technical and formalistic to insist that a referring party refer a dispute to conciliation in terms of a specific (or the correct) section of the LRA. The question should rather be whether or not the dispute between the parties was conciliated irrespective of the section in terms of which the dispute was referred. Having said this, I must, however, raise one issue of concern. There is, in my view, a practical difference between a dispute that is referred to conciliation with the option of resorting to strike action in the event conciliation fails on the one hand, and, on the other hand, a dispute referred to conciliation with the option of referring the dispute to (compulsory) arbitration in the event conciliation fails. This difference may in fairness require the referring party to be more specific in the application for conciliation in respect of the nature of the dispute and may also require the referring party to at least alert the employer of the possibility of referring the dispute to compulsory arbitration where the dispute also involves essential services’ employees…’ (Own emphasis)

[16] I concur with the above observations. In essence, the fact that the respondent employees did not follow the prescribed procedure

in terms of section 74(3) is not fatal if regard is had to the fact that the dispute between the parties was conciliated irrespective of the section in terms of which the dispute was referred.

[17] That takes me to Ekurhuleni’s main assail at the SALGBC jurisdiction to arbitrate the matter. It contends that the respondent employees could have availed themselves to other alternative remedies, including a contractual claim for specific performance. I disagree. The decision in Abrahams v Drake & Scull Facilities Management (SA) (Pty) Ltd and another[8], relied to by Ekurhuleni, is distinguishable because the employee party in that matter was an individual and as such could not

vindicate her rights in terms of a section 64(1).

[18] In the present matter, as correctly submitted by the counsel for the respondent employees, Mr Vilakazi, the respondent employees, as dominus litis (the master of suit), had the right to choose the cause of action and grounds upon which their claim is based. It is well accepted that the “LRA recognises collective bargaining as a means to change terms and conditions of employment, and expressly permits a resort to strikes and lock-outs as legitimate measures to press for agreement to a proposed change. Strikes and lock-outs are part and parcel of the collective bargaining process established by the LRA; indeed, they are essential elements of and integral to collective bargaining”[9].

[19] The refusal by Ekurhuleni to restore the status quo ante “[gave] rise to a dispute, the consequences of which are to preclude a category of workers from participating in a strike.

Section 74 provides for a clearly defined mechanism to deal with such an impasse.”[10] Since the respondent employees are barred from resorting to a strike because they render an essential service, the arbitrator was properly clothed with the powers to arbitrate the dispute in terms of section 74(4).

[20] Evidently, the arbitrator was alive to the task at hand and duly resolved that the main issue to be decided was a mutual interest

dispute and that he was properly clothed with the jurisdiction to proceed with the arbitration proceedings. As such, Ekurhuleni’s

contention that it had objected to the jurisdiction of the SALGBC is not of any assistance to its case.

Merits

[21] It is common cause that the respondent employees enjoyed the payment of the nightshift allowance at 14% rate for an uninterrupted period of almost 12 years. In 2014, without any notice or consultation or agreement, Ekurhuleni reduced the respondent employees’ nightshirt allowance to 6% rate, capped at R1.50.

[22] Mr Themba Seretsane (Mr Seretsane), one of the respondent employees and their only witness, testified that prior to 2014, their nightshift allowance varied between R1400 and R1600 per month on average. Subsequently, their nightshift allowance was reduced to a maximum R162 per month.

[23] The high watermark of the Mr Seretsane’s cross-examination appears to be the fact that SAMWU was a party to the negotiations that led to the introduction of the Policy. Nothing, in my view, turned on that as it was the respondent employees’ undisputed evidence that they were not aware that there was a Policy regulating the nightshift allowance up until the year 2014. Hence, it was a surprise when their payslips reflected a drastic reduction in the nightshift allowance. It was only after the enquiry for several months that they were informed of the reason for the reduction.

[24] The evidence referred to above was neither challenged nor rebutted by Ekurhuleni. Instead, it badly contended that the payment of the 14% nightshift allowance was an error. Yet, there was no evidence led to explain the reason why it took almost 12 years to realise the error. In addition, there was no explanation proffered for the unilateral decision to reduce the rate of the respondent

employees’ nightshift allowance to 6%.

[25] It follows, obviously, that there no merit in Ekurhuleni’s denunciation of the arbitrator’s finding that, after such a long period of time of enjoying the nightshift allowance calculated at the 14% rate, it became entrenched as a benefit or entitlement in terms of practice.[11] The respondent employees successfully showed that unilateral changes were effected to the terms and conditions of their employment contracts without their consent.[12]

[26] Ekurhuleni seems to suggest that it was justified in unilaterally implementing the Policy and, in so doing, reducing the rate of respondent employees’ nightshift allowance. This contention is untenable in the light of the following pertinent legal principles aptly enunciated by Labour Appeal Court, per Jafta AJA (as he was then) in Mazista Tiles (Pty) Ltd v National Union of Mineworkers and Others[13]:

‘An employer who is desirous of effecting changes to terms and conditions applicable to his employees is obliged to negotiate with the employees and obtain their consent. A unilateral change by the employer of the terms and conditions of employment is not permissible. It may so happen, as it was the position in the case, that the employees refuse to enter into any agreement relating to the alteration of their terms and conditions because the new terms are less attractive or beneficial to them. While it is impermissible for such employer to dismiss his employees in order to compel them to accept his demand relating to the new terms and conditions, it does not mean that the employer can never effect the desired changes. If the employees reject the proposed changes and the employer wants to pursue their implementation, he has the right to invoke the provisions of s 189 and dismiss the employees provided the necessary requirements of that section are met.’ (Own emphasis)

Conclusion

[27] It all the circumstances, the award is unassailable as it is reasonable and, alternatively correct.[14] Accordingly, the review application stands to be dismissed.

Costs

[28] It is trite that costs do not follow the result in this Court especially if it would offend the principles of law and fairness.

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

Order

1. The review application is dismissed.

2. There is no order as to costs.

P Nkutha-Nkontwana

Judge of the Labour Court of South Africa

Appearances:

Applicant: MC

Matabethe from BM Kholisi Inc. Attorneys

Third Respondent: J Vilakazi

Instructed by: Creighton

Attorneys

[1] Act 66 of 1995, as amended.

[2] McDonald’s Transport Upington (Pty) Ltd v Association of Mineworkers and Construction Union and others (2016) 37 ILJ 2593 LAC at para [36].

[3] See: County Fair Foods (Pty) Ltd v CCMA [2003] 2 BLLR 134 (LAC) at paras [17] - [18].

[4] (2003) 24 ILJ 305 (CC) at para [52]. See also Aucamp v SA Revenue Service (2014) 35 ILJ 1217 (LC) at paras [18] - [19].

[5] (2008) 29 ILJ 2461 (CC) at para [66].

[6]See: Index to SALGBC records bundle, p 5.

[7] [2011] 5 BLLR 490 (LC) at para [22].

[8] (2012) 33 ILJ 1093 (LC) at para [1].

[9] Airline Pilots Association of SA v SA Airways SOC Ltd & others (2021) 42 ILJ 1087 (LC) at para [13].

[10] National Union of Mineworkers and another v Eskom Holdings (Pty) Ltd and others (2010) 31 ILJ 2570 (LAC).

[11] See: index to review application bundle, arbitration ward p 37 at para 16.

[12] See: Staff Association for the Motor and Related Industries (SAMRI) v Toyota of South Africa Motors (Pty) Ltd (1997) 18 ILJ 374 (LC) at p379A-B; Macsteel Service Centres SA (Pty) Ltd v National Union of Metalworkers of SA & Others (2020) 41 ILJ 2670 (LC) at para [70].

[13] (2004) 25 ILJ 2156 (LAC) at paras [48]; see also National Union of Metalworkers of South Africa and others v Aveng Trident Steel (a division of Aveng Africa (Pty) Ltd) and another [2021] 1 BLLR 1 (CC) at para [97] – [101].

[14] See: Sidumo and Another v Rustenburg Platinum Mines Ltd and Others (2007) 28 ILJ 2405 (CC); Head of the Department of Education v Mofokeng and others [2015] 1 BLLR 50 (LAC); Gold Fields Mining SA (Pty) Ltd (Kloof Gold Mine) v Commission for Conciliation, Mediation and Arbitration and others (2014) 35 ILJ 943 (LAC); Herholdt v Nedbank Ltd (Congress of South African Trade Unions as amicus curia) [2013] 11 BLLR 1074 (SCA).