National Union of Metal Workers of South Africa and Others v Welfit Oddy (Pty) Ltd (PS26/20) [2023] ZALCPE 28; [2024] 4 BLLR 416 (LC) (1 December 2023)

IN THE LABOUR COURT OF SOUTH AFRICA, GQEBERHA

Not Reportable

Case No: PS26/20

In the matter between:

NATIONAL UNION OF

METAL WORKERS OF SOUTH AFRICA

First Applicant

SOMYA AND 16 OTHERS

Further Applicant

and

WELFIT ODDY (Pty) Ltd

Respondent

Heard: 9 March 2023

Delivered: This judgment was handed down electronically by circulation to the parties' legal representatives by email, publication on the Labour Court's website. The date and time for hand-down is deemed to be on 1 December 2023.

JUDGMENT

NONGOGO, AJ

[1] The National Union of Metal Workers of South Africa (the first applicant) has referred an unfair dismissal dispute on behalf of its members, the further applicants against Welfit Oddy (Pty) Ltd, the employer. The further applicants were at all material times employees of the employer, Welfit.

[2] It is common cause that prior to the termination of employment of the further applicants the parties participated in a consultation process facilitated by the Commission for Conciliation, Mediation and Arbitration (CCMA) as envisaged by section 189 and 189A of the Labour Relations Act[1].

[3] It is also common cause that pursuant to the facilitation process, the parties concluded a collective agreement which provided the criteria to be used by the employer to retrench the affected employees.

[4] In the statement of claim, the first applicant pleads that its regional secretary signed the collective agreement without having seen the schedules of the agreement in which the names of the workers to be retrenched was contained.

[5] The applicants' case is that the employer failed to select employees for dismissal in accordance with the collective agreement and it was on this basis that they challenged the substantive fairness of the selection of those members.

[6] The employer has raised a special plea that the agreement reached between the parties was binding on the applicants. It contained a clause that it was concluded in full and final settlement of all claims of any nature which any of the retrenched employees may have. The employer's case is that the court lacked jurisdiction to determine the matter as further applicants' claims were compromised or discharged by the settlement agreement.

[7] The main issue for decision is whether the full and final settlement clause compromised the applicants' claims.

[8] On 17 December 2021, in their pre-trial minute, the parties agreed to present evidence on affidavit for the purposes of determining the special plea. They also reserved an option to lead oral evidence in the event of a factual dispute or a need to place further facts before the court. No such evidence was led

[9] On 6 June 2022, the employer filed its founding affidavit pursuant to the pre-trial minute. The employer's founding affidavit contended that the collective agreement between the parties is binding on the applicants. The affidavit further asserted that the collective agreement was in full and final settlement of all issues, relating to the retrenchment of the further applicants and the court cannot abjudicate any matter covered by the agreement. The binding agreement had not been varied, so it was contended.

[10] The employer's founding affidavit confirmed that the regional secretary of the first applicant who signed the settlement agreement agreed that:

10.1 He was signing an agreement which was inclusive of all the attachments;

10.2 The agreement bound all members of NUMSA employed by the employer;

10.3 All the relevant information had been provided and consultation had been sufficient;

10.4 There was a clear need to retrench;

10.5 The pre-retrenchment procedure was fair;

10.6 The selection criteria were fair;

10.7 The names of all the employees who appeared in the annexures were thus fairly selected for retrenchment;

11.8 The Employer would retrench all employees beyond a "core manning" of 433 direct and 150 indirect employees.

[11] It is also contended in the employer's affidavit that the first applicant's regional secretary knew he was agreeing to all the terms of the agreement.

[12] Importantly, the employer also states that the names of affected employees had been provided to the first applicant during the consultation process. It also states that the schedules containing the names of all employees affected by the process were signed by the first applicant's full time shop stewards.

[13] In the affidavit it is stated that the regional secretary knew the total number of excess employees selected for retrenchment The agreement was perfect in every respect and binding on all parties and resolved all issues that could arise from the restructuring of the employer's firm.

[14] It is the employer's averment that the first applicant's; officials/shop stewards signed the schedules to the agreement as the first applicant's duly authorised agents. Consequently, the employer contends that the termination of further applicants' employment was consensual and did not constitute a dismissal as defined in section 186 (1) of the Labour Relations Act. Therefore, the court does not have the jurisdiction to determine the main claim.

[15] The special plea set down for 30 June 2023 was removed from the roll to allow the applicants to lead oral evidence. The matter was set down for the hearing of oral evidence on 7 November 2022. The matter was postponed sine die.

[16] The answering affidavit by the regional secretary does not in any way deal with the averments the employer's founding affidavit. It only makes a bald claim that the employer did not effect the selection in accordance with its obligation in terms of the collective agreement in that it did not select employees in accordance with the agreed criteria. It did not provide specifity on the alleged transgressions of the agreement.

[17] The answering affidavit also states that the regional secretary signed the collective agreement without having sight of the schedule with the list of employees affected by the retrenchment. Importantly he states that "at the time...I trusted that the schedules would have been prepared consistently with what had been referred to as the selection criteria. I also did not peruse those schedules on an earlier occasion".

[18] The applicant's affidavit does not dispute that there was a consultation process in terms of section 189 of the Labour Relations Act, between the parties which culminated in the conclusion of the collective agreement. The regional secretary does not dispute the employer's evidence in the founding affidavit that the schedules in the agreement were signed by the first applicant's full-time shop stewards. He also does not dispute that the agreement provides for the full and final settlement clause and it has not been varied.

[19] Importantly, the first applicant's regional secretary did not provide a reason he did not see the schedules to the agreement when the shop stewards of the first applicant had signed same. JHe .also does not dispute that the number of employees affected by the retrenchment was known to him and that the schedules provided were merely categorisation of the employees.

[20] After considering the pleadings and the evidence I find that once the collective agreement was reached in the circumstances which are common cause it is irrelevant whether the regional secretary had seen or signed the schedule to the agreement. It is so that it is settled law that in Ceramic Industries v Betta Sanitary ware[2], the court held that a collective agreement need not be signed by all the parties for it to satisfy the requirements of a collective agreement in terms of section 213 of the Labour Relation Act.

[21] I accept the uncontroverted evidence of the employer that the agreement and the schedules were in any event signed by the officials of the first applicant, namely, the regional secretary in respect of the agreement and the two shop stewards in respect of the annexures.

[22] In fact, the applicants' case is not that there was no agreement but that because the regional secretary did not sign the schedules, the applicants should not be precluded from challenging the inclusion of further applicants in the agreement. I disagree. The regional secretary has asserted that he was the only authorised person to sign on behalf of the first applicant

[23] It is also common cause that clause 15 of the agreement provides that:

"... the payments to the retrenched employee in full and final settlement of all claims of any nature which any of the retrenched employees have against the employer arising from the termination of their employment to retrenchment.'

[24] In SA Municipal Workers Union & others v City of Johannesburg Metropolitan Municipality[3], the court held in respect of a similarly worded clause:

'... The written agreement Is therefore conclusive as to the rights and obligations of the parties.'

[25] In Makiwane v International Healthcare Distributors[4], the court considering such a clause held that:

'Our law is trite that where a party accepts the benefits under any settlement agreement in full and final settlement of the benefits owing to him by his former employer arising from the termination of his employment relationship with such employer, and has abided by such acceptance of those benefits, he has placed himself beyond the jurisdiction of this Court...'

[26] It is undisputed that all the further applicants have accepted the payment of their benefits in terms of the collective agreement and none of them have tendered to repay.

[27] In Ackron & others v Northern Province Development Corporation[5] the court held:

'The employment relationship between the parties in this matter was terminated by agreement. The applicants were not dismissed and

therefore there was no termination of service for operational requirements.'

[28] There is no allegation that the applicants did not voluntary enter into the collective agreement. In terms of the principle of our law – pacta sunt servanda, there is no basis for deviating from the agreement reached between the parties.

[29] In the circumstances the point in limine succeeds. Although the employer sought costs against the applicants, they argued that there be no award of costs. The first applicant argued that it sought to protect the members and there is an ongoing relationship between the parties. I also take into account that the parties have streamlined the issues by agreeing on common cause factors which have largely been determinative of the application.

[30] The following order is issued:

Order

1. The special plea is upheld.

2. There is no order issued to costs.

N Nongogo

Acting Judge of the Labour Court of South Africa

Appearances:

For the Applicants: Adv. F. Le Roux

Instructed by: Gray Moodliar Incorporated

For the Employers: Adv. J. Grogan

Instructed by: Joubert Galpin Attorneys

[1] Act 66 of 1995, as amended.

[2] (1998) 11 BLLR 1120 (LC); (1999) 20 ILJ 123 (LC); Diamond and Others v Damler Chrysler SA (Pty) Ltd and Another [2007] 3 BLLR 197 (LC); [2006] JOL 18286 (LC); NUMSA & others v Hendor Mining Supplies [2003] 10 BLLR 1057 (LC); (2003) 24 ILJ 2171 (LC); Samancor Limited v National Union of Metalworkers of South Africa and Others [2000] ZALC 33.

[3] (2013) 34 ILJ 1944 (LAC) at para 20.

[4] [2003] ZALC 84 at para 19.

[5] [1998] 9 BLLR 916 (LC) at 920 F-G; Kynoch Feeds (Pty) Ltd v CCMA and Others (1998) 19 ILJ 836 (LC) at para 22.