Independent Municipal and Allied Trade Union obo Dhlamini v Moqhaka Municipality and Others (JR 932/19) [2021] ZALCJHB 60 (24 May 2021)

IN THE LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG

Not Reportable

Case no: JR 932/19

In the matter between:

INDEPENDENT MUNICIPAL AND ALLIED

TRADE UNION obo IM DHLAMINI

Applicant

and

MOQHAKA LOCAL MUNICIPALITY

First Respondent

MOTHUSI MAJE N.O

Second Respondent

SOUTH AFRICAN LOCAL GOVERNMENT

BARGAINING COUNCIL

Third Respondent

Heard: 19 May 2021

Delivered: In view of the measures implemented as a result of the Covid-19 outbreak, this judgment was handed down electronically by circulation to the parties' representatives by email. The date for hand-down is deemed to be 24 May 2021.

JUDGMENT

MAHOSI J

Introduction

[1] This is an application brought in terms of section 145 of the Labour Relations Act[1] (LRA) to review and set aside the arbitration award dated 9 April 2018, issued by the second respondent (the arbitrator) under the auspices of the third respondent, the South African Local Government Bargaining Council (SALGBC) under case number FSD071801.

[2] The first respondent has also brought an application for the late filing of the answering affidavit. Having regard to the pleadings filed, I am of the view that the interests of justice require a full determination of this matter and I, therefore, grant condonation.

[3] The key question is whether the arbitrator’s decision is one that a reasonable decision-maker could not reach.

Background

[4] The applicant’s member (the employee) is employed by the first respondent in a position of Assistant Accountant: Financial Management and Internal Control. On 17 November 2017, the first respondent’s Chief Financial Officer (CFO) and Manager: Expenditure informed the employee that the Accountant: Payroll has passed away and further that she was identified as a suitabled person to act in his position.

[5] Accordingly, the employee commenced to execute the duties and functions of the Accountant Payroll on 20 November 2017. The Manager: Expenditure addressed a memorandum dated 8 January 2018 to the Municipal Manager in term of which the approval of the employee’s acting allowance from 20 November 2017 was requested. The request was supported by both the CFO and the Manager: Expenditure, but not by the Director: Corporate Services. The reason proferred for not supporting the request was that the employee was still in training. The Municipal Manager concurred with the Director: Corporate Services and as a result the acting allowance was not approved.

[6] Upon becoming aware that her acting allowance was not approved, the employee informed the CEO that she would no longer execute the duties and functions of the Accountant: Payroll. The CFO assured her that he would resolve the issue. It was on that basis that the employee continued to execute the duties of the Accountant: Payroll.

[7] Subsequently, the employee became aware of the memorandum in terms of which her acting allowance was approved for the period between 01 March 2018 until the said position was filled. This excluded the period between 20 November 2017 to 28 February 2018. This prompted her to request the applicant to declare a dispute with SALGBC.

[8] The applicant referred an unfair labour practice dispute to the SALGBC challenging the first respondent’s decision not to pay the employee’s acting allowance. The dispute was conciliated unsuccessfully and, as a result, it was referred to arbitration, which was held on 04 March 2019. The arbitrator issued an arbitration award on 25 March 2019 in terms of which he found that the applicant has failed to prove that the first respondent committed an unfair labour practice.

Grounds for review

[9] The applicant challenged the award on the basis that the arbitrator misconstrued the nature of the dispute, ignored material facts and misconducted himself in the conduct of the arbitration which led to the outcome that is unreasonable.

Applicable law and analysis

[10] The test for review has become trite law. The test is whether the decision reached by the arbitrator is one that a reasonable decision-maker could have reached. Therefore, the decision must fall within a radius of reasonableness.

[11] In the current matter, the arbitrator identified two issues to be determined. The first issue was whether the acting allowance claimed by the employee constituted a benefit in terms of section 186(2)(a) and the second issue was whether, by failing to pay the employee’s acting allowance, the applicant committed an unfair labour practice.

[12] Regarding the first issue, the arbitrator relied on the Concise Dictionary, the judgments in Schoeman and another v Samsung Electronics SA (Pty) Ltd; Sithole v Nogwaza NO and others and Northern Cape Provincial Administration v Hambridge NO and others in reaching the following conclusion:

‘27. Although opinions as to what constitutes a benefit (as opposed to remuneration) differ, the common thread running through all the positions and academic writings is that a “benefit” constitutes a material benefit such as pensions medical aid, housing subsidies, insurance, social security or membership of a club or society.

28. In other words, the benefit must have some monetary value for the recipient and be a cost to the employer. It is also something which arises out of a contract of employment.

29. According to Northern Cape Provincial Administration v Hambridge NO [1999] 7 BLLR 698 (LC) benefit is a supplementary advantage conferred on an employee for which no work is required. About the letter in hand, the acting position is not available to all employees.

30. The difference is that benefits are available to all employees, but an acting position is only available to employees that qualify or meet the minimum requirements and who are to undertake extra work.’

[13] It is apparent from the reading of the award that the arbitrator did not consider the later developments in law, particularly in relation to the notion that an employee has to prove a pre-existing right prior to bringing a benefit claim. In Independent Municipal and Allied Workers Union obo Vester v Umhlahhuze Municipality,[2] this Court dealt with a review of an award in terms of which an arbitrator had found that an acting allowance did not constitute a benefit in term of section 186(2)(a). Having reviewed the case law and the academic writings, the Court found, inter alia, that:

‘…an unfair labour practice dispute over an acting allowance, in which an employee is making the claim on the basis that it was granted to him or others in similar circumstances on other occasions, is a claim that the employer has unfairly refused to confer the benefit on the occasion in question…’

[14] The doctrine of legal precedence obliges the lower courts to follow the decisions of the higher courts, for as long as those decisions remain in operation.[3] This principle is equally applicable to commissioners.

[15] It follows that the arbitrator ought to have made a determination whether the applicant’s failure to pay the employee an acting allowance for the period between 20 November 2017 to 28 February 2018 constituted an unfair labour practice. However, the arbitrator enquired whether the employee qualified for the payment of the acting allowance. Having considered Clause 8.2 of the Collective Agreement, the arbitrator found that the employee was not entitled to be paid the acting allowance because she was not appointed in writing by the Municipal Manager or his authorised assignee. It was for this reason,

that he found that the applicant failed to prove that the first respondent had committed an unfair labour practice.

[16] The flaw in the arbitrator’s reasoning stems from the characterisation of an unfair labour practice as the dispute relating to interpretation and application of the collective agreement. The arbitrator overlooked the fundamental issue which is that, what was referred to conciliation was whether the Municipal Manager exercised his discretion unfairly when he, after concurring with the Director General: Corporate services, declined the payment of the acting allowance to the employee. In so doing, he misconstrued the issue that was before him and arrived at an unreasonable decision. Consequently, the arbitrators award must be set aside.

[17] In light of the above, I do not deem it wise to remit the dispute to the SALGBC for arbitration de novo. Instead, I will determine the dispute in terms of section 145(4)(a) of the LRA. To an extent that the employee performed the duties and responsibilities of Accountant: Payroll in an acting capacity from 20 November 2017 without any training, she was only paid an acting allowance for the period starting from 20 March 2018 in similar circumstances and there is no evidence to establish that the Municipal Manager exercised his discretion fairly when he declined the approval of the payment of employee’s acting allowance for the period from November 2017 to March 2018, it follows that the first respondent committed an unfair labour practice.

Costs

[18] With regard to costs, it is my view that the requirements of law and fairness dictate that there should be no order as to costs.

[19] Accordingly, the following order is made:

Order

1. The arbitration award dated 9 April 2018, which was issued by the second respondent under the auspices of the third respondent with case number FSD071801 is set aside and substituted with the following order:

1.1 The applicant succeeded to prove that the first respondent committed an unfair labour practice relating to non-payment of its member’s acting allowance.

1.2 The first respondent is, therefore, ordered to pay the applicant’s member, Ms I.M. Dlamini, her acting allowance for the period from November 2017 to March 2018.

2. There is no order as to costs.

__________________

D. Mahosi

Judge of the Labour Court of South Africa

Representatives:

For the Applicant: Mr S Windvogel, IMATU official.

For the First Respondents: Advocate S Mbhlati

Instructed by: Lebea

and Associates Attorneys

[1] Act 66 of 1995 as amended.

[2] Case number D664/09, 06 May 2011.

[3] Association of Mineworkers & Construction Union & others v Ngululu Bulk Carriers (Pty) Ltd (In Liquidation) & others 2020] ZACC 8 (6 May 2020) (2020) 41 ILJ 1837 (CC).