Komatsu Mining Corporation Group v Metal and Engineering Industries Bargaining Council and Others (JR2725/21) [2024] ZALCJHB 361 (29 October 2024)

THE LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG

Not Reportable

Case No: JR2725/21

In the matter between:

KOMATSU MINING CORPORATION GROUP Applicant and METAL AND ENGINEERING INDUSTRIES BARGAINING COUNCIL First Respondent MOHAMED RAFFEE N.O. Second Respondent CONFERENCE ZWANE Third Respondent

Heard: 23 October 2024

Delivered: 29 October 2024

This judgment was handed down electronically by emailing a copy to the parties. The 29th of October 2024 is deemed to be the date of delivery of this judgment.

JUDGMENT

ITZKIN, AJ

Introduction

[1] The applicant seeks an order reviewing and setting aside an arbitration award in which it was found, amongst other things, that the applicant (Komatsu) committed an unfair labour practice by demoting the third respondent (Mr Zwane).

[2] There is no controversy that Mr Zwane was demoted. His demotion occurred following allegations of misconduct being levelled against him. Those allegations pertained to alleged breaches of confidentiality as a result of Mr Zwane sharing certain e-mails with Ms Nokulunga Kabanyane, an artisan and Mr Zwane’s subordinate.

[3] The application is opposed.

Background

[4] Mr Zwane was appointed as a Fitter on 3 May 2001.

[5] On 3 October 2018, Mr Zwane was promoted to the position of Foreman.

[6] Ms Kabanyane was originally scheduled for day shift work, but at a historical point in time, she was scheduled for night shift work. However, at a later stage, she was again scheduled for day shift work, subsequent to which she requested to be scheduled for night shift work once again.

[7] On 12 December 2018, Mr Zwane sent an e-mail to Lorinda Lakay, Komatsu’s Senior Manufacturing Manager (copied to certain other persons), stating the following:

‘Morning all

Lorinda, Lebo and Conference had a discussion about the request Nokulunga Nkabanyane put forward asking to go and work night shift, I have discus with Johannes Tsotetsi asking him if he can able to swap with Nokulunga he agreed. So as from 07/01/2019 the two Electricians will swap. Johannes Tsotetsi will come day shift then Nokulunga Nkabanyane will go Night shift.

Thanks.’

[8] On 13 December 2018, Santu Dube sent an e-mail to Mr Zwane and Ms Lakay (copied to certain other persons), stating the following:

‘Hi all

This is not good news, communication about this swop should have been sent earlier and discussed. This is counter-productive.

I should have been consulted on this matter as it is very sensitive.

There are issues surrounding “women” working night shift, which led to three women then working nights to be moved to dayshift, and Nokulunga was one of them.

The agreement was there was not going to be any women working night shift for the sanity of the shift. WHAT HAS CHANGED!!!!!!

And if it has changed, how come it has not been communicated accordingly!!!!!!!!

This is greatly unfair as I have to put up with all challenges by myself.

I deserve respect, consideration and involvement in the movement of people to and from night shift/dayshift.

The electrical team leader Clifford was not aware too. Tsotetsi himself did not have intentions of swopping, and when called said he had a vague idea about the swop but not definite. Hence he did not tell.

Let there be clear, just and effective consultations, communications, involvement and decision-making at leadership level.’

[9] Mr Zwane shared these e-mails with Ms Kabanyane (as opposed to providing her with verbal feedback to the effect that she would not be scheduled for night shift).

[10] As a result, the following allegations of misconduct were levelled against Mr Zwane:

‘Allegation 1:

Breaching confidentiality in that you personally provided an employee by the name Nokulunga Kabanyane with confidential emails sent by yourself on the 12th December 2018 and Santu Dube response on the 13th December 2018. The said emails where addressed to specific recipients and not addressed to Nokulunga Kabanyane.

And/Or

Allegation 2:

Breaching of employment contract stipulation in that you violated Section 6 of your employment Contract by providing an employee by the name of Nokulunga Kabanyane with confidential emails sent by yourself on the 12th December 2018 and Santu Dube response on the 13th December 2018. The emails were addressed to specific recipients and not addressed to Nokulunga Kabanyane.’

[11] A disciplinary hearing was convened, and it culminated in a determination that Mr Zwane was guilty of the alleged misconduct, and in a recommendation that he be dismissed.

[12] Mr Zwane appealed against the outcome of the disciplinary hearing. The appeal chairperson found that Mr Zwane was indeed guilty of the misconduct, and recommended that he be demoted and transferred to another area of the business.

[13] Following this recommendation, Mr Craig Paton, Komatsu’s Employee Relations Manager, held discussions with Mr Zwane on 18, 23 and 28 October 2019.

[14] There is a controversy regarding whether or not Mr Zwane agreed to be demoted, and if so, whether his agreement was secured through duress.

[15] Mr Zwane was demoted to the position of Fitter (from the position of Foreman), and he referred an unfair labour practice to the bargaining council which culminated in the award.

Evaluation

[16] The Commissioner’s evaluation is encapsulated in the following paragraphs of the award:

‘20. The balance of probabilities favour the version of the applicant more than that of the respondent. There was no intention by or on behalf of the applicant to breach any confidentiality of the respondent.

21. The version that the applicant gave feedback without having contemplated any breach of confidentiality was when he acted in the course and scope of his duties. The subordinate held a direct interest in the decision made by management.

22. The relief sought by the applicant is hereby granted.’

[17] This is followed by his orders to the following effect:

‘1. The emails shared by the applicant, Conference Zwane were not confidential.

2. The sanction of demotion and transfer of the applicant, Conference Zwane to another department was inappropriate.

3. There was no agreement reached for the applicant, Conference Zwane to be demoted.

4. The respondent, Komatsu Mining Corporation committed an unfair labour practice.

5. The applicant, Conference Zwane is reinstated to the position of foreman with effect from the date of this award.

6. The relief sought excludes any backpay that may be due to the applicant, Conference Zwane from the date he was demoted to the date of this award. (This was a specific request in the applicant’s closing argument).

7. Such reinstatement is to occur by 1 December 2021.’

[18] The 12 December 2018 e-mail does not appear to contain any sensitive or confidential information. It simply relayed a request that Ms Kabanyane be scheduled for the night shift. The sharing of that e-mail with Ms Kabanyane, on its own, would thus not be untoward, and I accept that it would constitute Mr Zwane providing Ms Kabanyane with feedback reflecting that he had made a request for her to be scheduled for the night shift. Counsel for Komatsu fairly conceded this in oral argument.

[19] The same cannot be said regarding the 13 December 2018 e-mail. It contains concerns regarding the manner in which the issue of swapping of shifts was handled, and it refers to the matter as being “sensitive”. It also refers to “issues surrounding women working nightshift” and to communication issues “at leadership level”. It emerged, from Komatsu’s evidence, that the sensitivities pertained to sleeping on duty and sexual conduct allegedly occurring among night shift staff, as a result of which a decision was taken not to schedule female employees for the night shift.

[20] Although Mr Zwane alleged that he did not have a full appreciation of this context and the sensitivities alluded to in the 13 December 2018 e-mail, on a reading of the e-mail, it would have been apparent to Mr Zwane that its content pertained to considerations of a sensitive nature. Those concerns were shared with a specific, closed group of recipients which included managerial employees, human resources (HR) personnel and administrative personnel relevant to those areas. Despite this, Mr Zwane shared the e-mail with Ms Kabanyane.

[21] Although the e-mail did not contain trade secrets or proprietary commercial information, it is evident given the nature of the issues referred to therein, that it was confidential in the sense that it pertained to concerns at managerial level regarding the scheduling of women for night shift work, and that it raised issues regarding decision-making processes at leadership level.

[22] The following exchange during the evidence of Mr Zwane is relevant in this regard:

‘ADV MOFOKENG: And then you said to me earlier on, the issues that you were discussing on the email were the departmental issues, right?

MR ZWANE: Yes.

ADV MOFOKENG: And management in that department was part-taking on the discussions, is it not?

MR ZWANE: The manager and a foreman.’

[23] Mr Zwane conceded, during cross-examination, that nothing prevented him from verbally providing Ms Kabanyane with feedback regarding the request to schedule her on the night shift (to the effect that she would not be scheduled).

[24] In these circumstances, the Commissioner’s determination that Mr Zwane was not guilty of sharing any confidential information, falls outside the range of decisions that a reasonable decision maker could arrive at on the evidence.

[25] The key issue that remains to be considered pertains to the sanction of a demotion.

[26] The first aspect for consideration on that issue pertains to whether or not Mr Zwane agreed (or consented) to be demoted. If he did, this would not exclude jurisdiction to arbitrate or necessarily be decisive in relation to the question of fairness, but it would be a relevant factor in the assessment of fairness.[1]

[27] In Builders Warehouse (Pty) Ltd v Commission for Conciliation, Mediation And Arbitration and Others[2] (Builders Warehouse), the Labour Appeal Court (LAC) expressed the position in these terms (in the context of a ruling to the effect that the Commission for Conciliation, Mediation and Arbitration had no jurisdiction to entertain an unfair labour practice dispute on demotion where the employee had agreed to be demoted):

‘[14] Employers and employees are encouraged to settle their differences by agreement. When they have done so, a binding contract comes into existence. Contracts are binding unless there is a valid reason to have them set aside. The commissioner correctly appreciated that she did not have any power to set aside the contract (which is what the third respondent wanted). But the commissioner erred in concluding that the agreement between the parties meant that the CCMA did not have jurisdiction to hear the dispute. The court a quo is correct that a dispute about an alleged unfair labour practice extends to “unfair conduct relating to demotion”. The fact that the parties have agreed that the aggrieved employee accepts demotion is not a complete defence because the ambit of this unfair labour practice is wider than this. The implementation of an agreement to accept demotion, may constitute an unfair labour practice.’

[28] And further:

‘[17] In the appeal before us, the commissioner was obliged to have regard to the statutory formulation of the concept of an unfair labour practice. The agreement between the appellant and the third respondent was part of the material relevant to a finding on jurisdiction but it was not decisive as regards the jurisdictional question. It may well be decisive when the merits of the complaint are adjudicated.’

[29] Mr Zwane testified that he did not agree to his demotion.

[30] However, during cross-examination, he stated that on 23 October 2019, Mr Paton had put him “under duress to agree to a demotion”. He later alleged that “I thought about my kids when they present that demotion to me”, and that he agreed to the demotion because if he did not do so, he would face dismissal.

[31] During re-examination, he conceded that there was an agreement, but alleged that it pertained to him moving from one department to another, and not to him being demoted.

[32] On 29 October 2019, Mr Paton addressed a letter to Mr Zwane stating the following:

‘As agreed by yourself on the 29th October 2019 you will report to the Mechanical Department on the 30th October 2019 at 07h00 and report to Patrick Sibeko (foreman) as a Fitter.’

[33] Mr Zwane did not respond to the letter contesting that he had agreed to the demotion.

[34] On an overall consideration of the evidence, it is evident that on the probabilities, Mr Zwane agreed to be demoted to a position in a different department.

[35] With reference to the issue of duress, in the High Court’s judgment in Arend and Another v Astra Furnishers (Pty) Ltd,[3] which has been cited with approval in several later judgments,[4] the requirements to establish duress are as follows:[5]

‘[I]t is clear that a contract may be vitiated by duress (metus), the raison d’etre of the rule apparently being that intimidation or improper pressure renders the consent of the party subjected to duress no true consent… Duress may take the form of inflicting physical violence upon the person of a contracting party or of inducing in him a fear by means of threats. Where a person seeks to set aside a contract, or resist the enforcement of a contract, on the

ground of duress based upon fear, the following elements must be established:

i. The fear must be a reasonable one.

ii. It must be caused by the threat of some considerable evil to the person concerned or his family.

iii. It must be the threat of an imminent or inevitable evil.

iv. The threat or intimidation must be unlawful or contra bonos mores.

v. The moral pressure used must have caused damage.’

[36] Applied to the facts of this case, in my assessment, the threshold for establishing duress is not met.

[37] This is so because there was no “threat of some considerable evil to the person concerned or his family”. The prospect of a dismissal for Mr Zwane’s proven misconduct, if Mr Zwane did not agree to the demotion, would not meet this threshold; just as an agreement with an employee who otherwise faces retrenchment, to take up an alternative and more junior position (as a retrenchment avoidance measure), would not be vitiated based on duress, merely on the basis that the employee may be retrenched if the alternative position is not agreed to.

[38] The position may have been different if Mr Zwane had not committed any misconduct at all, and if he was nonetheless threatened with dismissal if he did not agree to a demotion. In that context, the requirement of a “threat of some considerable evil to the person concerned or his family” which may be “unlawful or contra bonos mores”, may have been present.

[39] Mr Zwane’s representative sought to advance a further basis for contending that there was no agreement on a demotion.

[40] He argued that Mr Paton had no authority to agree to a demotion. He relied on a provision in Komatsu’s disciplinary procedure to the effect that “[a]ll outcomes on disciplinary hearings are subject to review by Top Management for consistency purposes”. He argued that Mr Paton, despite being a member of management, was not a member of “Top Management” and that he was thus not authorised to agree to a demotion. He also relied on Mr Paton’s concession that he had no authority to reverse the appeal chairperson’s outcome (which recommended a demotion).

[41] This argument is not sustainable. Aside from the fact that Mr Zwane did not advance this contention during his evidence and prior to the closure of his case, it is evident that by engaging with Mr Zwane regarding his demotion, Mr Paton was not reversing the appeal outcome, and was instead engaging with Mr Zwane in relation to giving effect to the recommendation therein.

[42] Turning to the issue pertaining to whether or not the demotion, despite being agreed to (and not vitiated through duress), was nonetheless unfair, the Commissioner’s finding that it was unfair falls outside a range of reasonable decisions.

[43] This is so given that the demotion was agreed to (which is a weighty consideration in the assessment of fairness which the LAC held, in Builders Warehouse, “may well be decisive when the merits of the complaint are adjudicated”[6]), and given that in sharing the 13 December 2018 e-mail with Ms Kabanyane, Mr Zwane committed misconduct of a relatively serious

nature, and has not expressed any remorse or acknowledgement of wrongdoing on his part.

[44] It follows that the arbitration award falls to be reviewed and set aside. Given that the Court has the benefit of the full record of the arbitration at which the matter was comprehensively ventilated, no purpose would be served by remitting the matter to the CCMA, and an order for the substitution of the award would be appropriate.

[45] With reference to the issue of costs, this Court has a broad discretion to make costs orders in accordance with the requirements

of law and fairness. In my view, the interests of justice will be best served by making no order as to costs.

[46] In the result, the following order is made:

Order

1. The arbitration award issued by the second respondent under case number MEGA 56890 dated 19 November 2021, is reviewed and set aside.

2. The arbitration award issued by the second respondent under case number MEGA 56890 dated 19 November 2021, is substituted with an order to the following effect:

“1. The applicant’s unfair dismissal dispute is dismissed.”

3. There is no order as to costs.

R Itzkin

Acting Judge of the Labour Court of South Africa

Appearances

For the Applicant: Z Navsa Instructed by: Cliffe Dekker Hofmeyr Incorporated For the Respondent: LE Phiri of Phiri Ace and Associates Attorneys

[1] Although it appears to be arguable that the existence of an agreement on demotion excludes unilateral conduct on the part of the employer, thus precluding the existence of “unfair conduct by the employer relating to… demotion” as envisaged in section 186(2)(a) of the Labour Relations Act 66 of 1995, as amended, this Court is bound by the Labour Appeal Court judgment referred to in the succeeding paragraph.

[2] (PA 1/14) [2015] ZALAC 13 (5 May 2015).

[3] 1974 (1) SA 298 (C) (Arend).

[4] See, for instance, Visser and Another v Kotze (519/2011) [2012] ZASCA 73 (25 May 2012) at para 13.

[5] Arend supra at 305H – 306C.

[6] Builders Warehouse supra at para 17.