Ekurhuleni Metropolitan Municipality v South African Local Government Bargaining Council: Gauteng Division and Others (JR 2702/08) [2013] ZALCJHB 259 (3 October 2013)

REPUBLIC OF SOUTH AFRICA

THE LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG

JUDGMENT

Case No JR 2702/08

In the matter between:

EKURHULENI METROPOLITAN MUNICIPALITY ....................................................Applicant

and

SOUTH AFRICAN LOCAL GOVERNMENT BARGAINING

COUNCIL: GAUTENG DIVISION .................................................................First Respondent

ZODWA MDLADLA N.O. ........................................................................Second Respondent

SOUTH AFRICAN MUNICIPAL WORKERS UNION ..................................Third Respondent

T Tanga Fourth Respondent

Heard: 15 December 2010

Delivered: 03 October 2013

_______________________________________________________________

Gule, AJ

The Fourth Respondent employee (“Tanga”) was employed by the Applicant on a five year fixed term contract of employment as a Director: Health and Social services. The contract expired on 31 March 2007.

Towards the end of 2006, the Applicant advertised the position which was occupied by the Tanga since it would become vacant on

31 March 2007, when her contract expired. Tanga applied for the position and was interviewed, but she was unsuccessful.

There are two other executive directors, Karuna Mohan (Mohan) and Mark Wilson (Wilson) whose contracts were going to expire who had to apply for their positions who were also unsuccessful but they were offered other executive director positions for a fixed term of five years.

At the expiry of the contract, Tanga did not leave the employment of the Applicant. She went on leave on 29 March 2007 at the behest of the Applicant because it was trying to find her alternative employment. No alternative employment could be found for Tanga. As a result, her continued employment after the expiry of the fixed term contract was terminated.

Tanga referred a dispute to the first respondent alleging that she was unfairly dismissed on the basis that the failure to renew her contract by the applicant constituted an unfair dismissal as postulated in section 186(1)(b) of the Labour Relations Act 1995 (the Act ).

The second respondent heard the matter and made an award that the applicant dismissed Tanga as envisaged by section 186(1)(b) of the Act when they failed to renew her five year fixed term contract of employment on the level of executive director because the applicant created a legitimate expectation that her contract would be renewed on similar terms and conditions as those of executive directors.

She made an order that the applicant should re-employ Tanga in any alternative position that is at the level of an executive director on a fixed term contract of not less than five years.

Review

The applicant brought a review of the award made by the second respondent on three grounds.

8.1. That the second respondent exceeded her powers under the Act because there was no dismissal and section 186(1)(b) was not

applicable, consequently, the arbitrator did not have jurisdiction to arbitrate the dispute;

8.2. The order of re-employment made by the second respondent, that Tanga should be re-employed, is not practicable because there was no identifiable position into which Tanga could be re- employed and there was no suitable work for her to do. Consequently, the relief ordered by the arbitrator ought to be set aside even if her dismissal was unfair; and

8.3. The second respondent failed to appreciate that proof of dismissal is not the same as proof of unfair dismissal which indicates that the she failed to apply her mind to the key issues before her. Consequently, the award falls to be set aside on that basis as well.

8.4. The applicant filed supplementary heads of argument in which it addressed what it referred to as the "impact of the legislative

scheme on the issues before the arbitrator”.

Termination in terms of section 186(1)(b)

The main contention by Tanga when she appeared before the first respondent is that the applicant's failure to renew her contract as the Director: Health and Social services amounted to an unfair dismissal because she had a reasonable expectation that her contract would be renewed.

The second respondent found that Tanga could not have had a reasonable expectation that she would be re-appointed to the position. It is the finding of the second respondent that, Tanga had a "legitimate expectation that her contract would be renewed on

similar terms and conditions as those of Executive Director" that is the subject matter of this review application.

The issue to be decided is whether the second respondent made an award that a reasonable decision maker could have made in terms of Sidumo and Another v Rustenburg Platinum Mines Ltd and Others,1 in finding that Tanga had established that she had a legitimate expectation that she would be given an alternative position as an executive director and, consequently, that she was dismissed within the meaning of section 186(1)(b). In other words, can section 186(1)(b) be extended to a reasonable expectation in respect of a position that was not previously occupied by an employee in terms of a fixed contract. It is only if that question is answered in the affirmative that the enquiry can proceed to the next stage, to establish whether in the circumstances of the case, the arbitrator reached a decision that a reasonable decision maker would have made when she found that Tanga had established that the conduct of the applicant had created a reasonable expectation that she would be re-employed.

In the University of Pretoria v Commission for Conciliation, Mediation and Arbitration and Others,2 the court had to deal with the interpretation of Section 186(1)(b) of the Act. In that matter, the employee who was employed by the University by means of successive fixed term contracts (which were renewed on seven occasions) applied for a permanent position but was unsuccessful. She was then offered a further fixed term contract of employment which she rejected claiming that she reasonably expected to be appointed on a permanent basis and that failure to appoint her constituted a dismissal in terms of Section 186(1)(b) of the Act. The question that the Applicant in that matter had to deal with was not dependent on the facts, which were not in dispute, but was whether a reasonable expectation of indefinite employment meets the requirements of section 186(1)(b), meaning that if the facts were proved, the employee could have been dismissed in terms of the Act.

Although the facts in the present case are not exactly the same as the facts in the University of Pretoria case, the principles applicable to the interpretation of section 186(1)(b) are the same. The question in the present case being whether the Arbitrator reached a decision which a reasonable decision maker could have made, in finding that, notwithstanding that Tanga did not have a reasonable expectation that her contract of employment as a Director: Health and Social Services would be renewed, she had a reasonable expectation that she would be given an alternative position which she previously did not occupy at the same level as that of her previous position.

In dealing with the plain language in which legislation should be interpreted, in the University of Pretoria case, the court held as follows:

‘in S v Zuma and Others 1995(2) SA 642” (CC) paras 17 – 18, the Constitutional Court warned that courts cannot interpret legislation so that it means whatever we might wish it to mean. In other words, language chosen by the legislature must be respected. This conclusion should not be read to deny the inherent ambiguity in the use of language but it emphasises that a court is obliged to engage carefully with the words that have been used in the Act and to develop an interpretation which can be plausibly justified on the basis of the words chosen by the legislature. See also South African Airways (Pty) Ltd v Aviation Union of South Africa and Others (2011) 32 ILJ 87 (SCA) at paras 27 – 33.’3

Applying that principle to the present case, the question which this court has to decide is whether the wording of section 186 can be interpreted to give protection to Tanga, if the facts are proven, that she had a reasonable expectation that she would be given another position which is at the same level as the position which she previously occupied.

The court in the University of Pretoria case went on to state that:

‘the words employed in Section 186 envisaged that two requirements must be met in order for an employer’s action to constitute a dismissal”.

A reasonable expectation on the part of the employee that a fixed term contract on the same or similar terms will be renewed; and

A failure by the employer to renew the contract on the same terms or a failure to renew it at all.’4

These words do not, however, carry the meaning which is urged by Third Respondent, namely that by being employed on the basis of a series of fixed term contracts, an employee has without more reasonable expectation of a permanent appointment.

It was further held that:

‘The words chosen by the legislature, absent an amendment to the legislation, cannot carry the burden of the Third Respondent’s

case in that it covers a restrictive set of circumstances, namely a reasonable expectation of renewal of that which had previously

governed the employment relationship, namely a fixed term contract which had previously been enjoyed which had now expired and by virtue of the factual matrix created, at best a reasonable expectation of a renewal.’

According to the award of the Second Respondent, Tanga had an expectation not of renewal of the contract which previously existed

since the position which she was supposed to have been re-employed in and was an entirely new position and would have been governed by new terms and conditions. The only obvious common feature between the old and the new contracts being that it was at the level of an executive director and it would have been for a fixed term of five years. The term renewal envisages renewal of that which previously existed which is not the case in the present case.

There can only be a dismissal in terms of section 186(1)(b) if the employee expected the contract to be renewed on the same or similar terms.5

Finding of Arbitrator on facts

The Arbitrator found that the conduct of the Applicant, in particular Duma Nkosi, led the applicant to have a reasonable expectation that she would be offered another position and that it was not unreasonable for the Applicant to have such an expectation having regard to the fact that Mohan and Wilson were offered alternative positions.

The finding by the second respondent in this regard is not reasonable because it is based on an incorrect interpretation of section 186(1)(b). The high water mark of Tanga’s case on the facts is that she was promised another position which she was not offered. Such a promise cannot be covered by the provisions of section 186(1)(b) because it does not relate to the renewal of her old contract but is the expectation of another contract and for a different purpose, SA Rugby Players Association and Others v SA Rugby (Pty) Ltd and Others.6

The fact that Mohan and Wilson were offered alternative positions is not relevant to the consideration of whether there was a dismissal in terms of s 186(1)(b) since the expectation that could have been created by the other directors being offered alternative position is that of a new position and not the old contract that was previously occupied by Tanga.

I, accordingly find that there was no dismissal as contemplated by section 186(1)(b) of the Act. Consequently, the First Respondent had no jurisdiction to entertain the dispute in terms of the Act, SA Rugby Players Association and Others v SA Rugby (Pty) Ltd and Others.7

Having made the above finding, it is not necessary for the court to deal with the other submissions made by the parties in their heads of argument and in court.

I, accordingly, make the following order:

The award made by the Second Respondent is reviewed and set aside and substituted with an order that the Third Respondent was not dismissed; and

The Third and Fourth Respondents to pay the costs of the Applicant jointly and severally on a party and party scale.

______________

GULE, AJ

Acting Judge of the Labour Court

Appearances:

For the Applicant: Adv G.I Hulley SC

Instructed by: Brink Cohen Le Roux Inc

For the Respondent: Adv F.A Boda

Instructed by: Cheadle Thompson and Haysom Inc

1(2007) 28 ILJ 2405 (CC) at para 110.

2(2012) 33 ILJ 183 (LAC).

3Ibid at para 17,

4Ibid at para 18.

5See Gubevu Security Group (Pty) Ltd v Ruggiero NO and Others (2012) 33 ILJ 1171 (LC) para 20.

6(2008) 29 ILJ 2218 (LAC).

7Ibid at para 39.