Pioneer Foods v Commission for Conciliation, Mediation and Arbitration and Others (JR1685/19) [2023] ZALCJHB 132 (28 April 2023)

IN THE LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG

Not Reportable

Case No: JR1685/19

In the matter between:

PIONEER FOODS (PTY) LTD Applicant and COMMISSION FOR CONCILIATION, MEDIATION AND ARBITRATION First Respondent COMMISSIONER L. TAYLOR N.O. Second Respondent FOSAWU OBO NTSAKO MPANGELA Third Respondent

Heard: 12 April 2023

Delivered: 28 April 2023

JUDGMENT

MAKHURA, AJ

Introduction

[1] The applicant (company) seeks to review and set aside an arbitration award issued by the second respondent (arbitrator) on 22 July 2019 under the auspices of the first respondent, the Commission for Conciliation, Mediation and Arbitration (CCMA). In terms of the award, the arbitrator found the dismissal of the individual third respondent (employee) substantively unfair and ordered the company to issue him a final written warning valid for 12 months and to reinstate him with limited backpay. The application is unopposed.

Material facts

[2] On 10 October 2018, the company issued a charge sheet, calling on the employee to attend a disciplinary hearing on 16 October 2018, to answer the following allegations of misconduct:

‘1. ALLEGED MISCONDUCT(S): As described in the Disciplinary Code or otherwise:

4.2 Negligence by not going through silo equipment caused/resulting that wheat to run to screenings and not inspecting transfer scale so wheat ran through without being accounted for, causing silo losses.

5.3 Dishonesty of any nature, 5.4 Fraud & 5.5 Forgery of any nature by changing of data to be captured/backflushed to SAP – Rolling / manipulating of silo losses.’

[3] The company later withdrew the allegation of fraud. The chairperson of the disciplinary hearing found the employee guilty of negligence and dishonesty or forgery. Regarding the sanction, the employee was issued a final written warning valid for 12 months for the charge of negligence, and dismissal for the charge of forgery or dishonesty. The employee was dismissed accordingly on 16 November 2018.

[4] Aggrieved by the decision, the employee referred an unfair dismissal dispute to the CCMA, challenging the substantive fairness of his dismissal and seeking retrospective reinstatement.

The arbitration

[5] At arbitration, the company called two witnesses, Izak Johannes van der Merwe (Van der Merwe) and Willem Nyembezi Mponeng (Mponeng). The employee testified and did not call any witnesses. The evidence presented by both parties is largely common cause or undisputed.

[6] Van der Merwe testified that the employee manipulated the procedure when he changed the silo numbers on the excel spreadsheet in order to avoid accounting for losses or gains. As a result, the system would record that the silo had stock when it was in fact empty. In addition, Van der Merwe testified that the employee was issued with an instruction on how to do his work in 2013 but failed to comply with it. He said that the employee’s conduct constitutes dishonesty, and that dismissal was an appropriate sanction.

[7] Mponeng testified that he works as a silo man, the position the employee held until his dismissal. He testified that the employee trained him on his duties as a silo man. The employee taught him the procedure to mitigate extraordinary losses or gains. After the employee’s dismissal, he was also informed that he too could be disciplined. However, he was never disciplined.

[8] The employee confirmed Mponeng’s testimony that he trained him. In addition, the employee testified that he was trained by Arthur Dagume (Dagume) on the procedure. He disputed the alleged instruction issued to him. He said that, had he known the correct procedure, or that he was not working according to the correct procedure, he would not have continued in the manner in which he did for the period of 5 years.

[9] Having considered the evidence, the arbitrator found that the employee was not guilty of forgery or dishonesty. He found the employee guilty of negligence, declared the dismissal substantively unfair and awarded the employee reinstatement with six months’ backpay.

The grounds of review

[10] The company has advanced seven grounds of review, which are dealt with in detail in its heads of argument. Essentially, the company contends that the arbitrator made findings that are grossly irregular which could not have been made by a reasonable arbitrator. In addition, the company contends that some of these findings constitute material errors of law and fact. There are, in my view, three main grounds, which are summarised below.

[11] First, the arbitrator misconstrued the nature of the charge (dishonesty or forgery) in concluding that the employee was guilty of negligence (error of fact).

[12] Second, the arbitrator committed material errors of law in respect of (a) the inconsistency finding; (b) the finding that the employee’s dismissal was unfair because he had not been suspended; (c) hearsay evidence relating to Dagume; and (d) the requirements of forgery.

[13] Third, the arbitrator made unreasonable findings and/or conclusions that (a) the employee was not sufficiently aware of the company’s rule against transfer sheet manipulation; (b) the company acted inconsistently in disciplining the employee; and (c) there was insufficient evidence of a breakdown in the employment relationship.

Analysis

[14] This Court is required to answer the following question, “[i]s the decision reached by the commissioner one that a reasonable decision-maker could not reach?”[1]

[15] The reason for the employee’s dismissal is forgery or dishonesty for allegedly manipulating the numbers on the excel spreadsheet. Forgery is the making of a false document with intent to defraud, resulting or calculated to result in some prejudice to another.[2]

[16] To support this allegation, the company led evidence of Van der Merwe and Mponeng. I have already summarised the witnesses’ material evidence above. It is common cause or undisputed that Dagume trained the employee. In turn, the employee trained Mponeng. Significantly, Mponeng was also taught by the employee on how to ‘mitigate’ the extraordinary losses or gains on the system.

[17] The arbitrator found it implausible that the employee would continue doing the work in the same manner for a period of 5 years if he had known that he was not following the correct procedure. He then concluded that the company failed to prove that the employee

intentionally breached the rule or procedure. Ultimately, he found that the employee was only guilty of negligence. I do not think that there is any material difference between breaching the rule and negligence. The arbitrator’s finding that the employee was negligent does not mean that the rule was not breached. Rather, it implies that the employee had not intentionally breached the rule.

[18] Having found negligence, the arbitrator proceeded to consider the issue of sanction. He considered the company’s disciplinary

code, which makes provision for a final written warning for an offence of negligence. He referred to case law on the approach to be adopted when dealing with the issue of sanction. He recorded that he considered the length of service, that the rule or procedure is inexplicit, the inconsistent enforcement of the rule and that the trust relationship has not irretrievably broken down. He found that dismissal was not appropriate and ordered reinstatement with six months’ backpay.

Error of fact

[19] The company argues that the arbitrator misconstrued the nature of the enquiry in finding that the employee was not guilty of dishonesty or forgery, but was merely guilty of negligence.

[20] It is trite that material errors of fact are not in and of themselves sufficient for an award to be set aside, but are only of consequence if their effect is to render the outcome unreasonable.[3] For five years the employee continued applying the same procedure he learned from Dagume. Mponeng, who joined the company in April 2018, also learned this procedure from the employee.

[21] The employee said that had he known the correct procedure, he would not have continued to follow it. This is an employee who, in my view, has demonstrated that he had not acted intentionally and there is nothing to contradict this version. The evidence of Van der Merwe fell short of proving any intention on the part of the employee to defraud the company or to misrepresent the facts. I, therefore, do not agree that the arbitrator misconstrued the nature of the enquiry. Accordingly, there is no basis to interfere with the arbitrator’s finding that the employee was not guilty of forgery.

Errors of law

[22] Whilst I agree with the elaborate legal exposition in the company’s heads of argument, and that a decision made based on an error of law is unlikely to meet the reasonableness test, I do not believe that this offers any assistance to the company.

[23] The company alleges that the finding of inconsistency constitutes an error of law. I disagree. The common cause fact is that Dagume, who committed the same or similar misconduct, was only issued with a final written warning. I must also add that the company’s own witness adduced evidence that he carried out his work the same way as the employee and that, despite being informed that he would be disciplined after the employee’s dismissal, the company elected not to pursue any disciplinary process against him. The principle of inconsistency is well established.[4] Mponeng was in no different position to that of the employee. Even if the inconsistency argument was not raised in respect of Mponeng, the fact that he was not charged is, in my view, a strong mitigating factor against dismissal. In any event, the arbitrator’s finding, which I have already found to be reasonable, is that the employee is not guilty of forgery.

[24] The company’s second argument is that the arbitrator found that dismissal was not a fair sanction because it failed to suspend the employee. This is incorrect. The arbitrator has recorded the factors he considered when considering sanction. When dealing with the alleged breakdown of the employment relationship, the arbitrator considered the fact that the employee was not suspended and found that the trust relationship had not irretrievably broken down. He did not, as the company appears to argue, find that the mere fact that he was not suspended means that his dismissal was unfair. This was not the only factor considered by the arbitrator. This ground is based on complaints about the manner in which the arbitrator treated and assessed the evidence. The arbitrator’s finding falls within the bounds of reasonableness and should not be interfered with.

[25] The third argument is that the arbitrator considered the employee’s hearsay evidence in relation to Dagume. Essentially, the company argues that the employee’s evidence that Dagume trained him to do the job is hearsay. In its heads of argument, it argues that the arbitrator should have excluded Dagume’s evidence and found that the employee was given clear instructions on how to conduct his work in October 2013 and that he disregarded the instruction, resulting in the company suffering considerable loss. The fact that Dagume trained the employee was common cause or undisputed. The company’s complaint is again about how the arbitrator assessed the evidence. There is no merit in this argument, and even if it could be found that the company applied discipline consistently, its disciplinary code provides for a sanction of a final written warning for a charge of negligence.

[26] The fourth argument relates to forgery. The company provides a definition of the word ‘forgery’ and argues that it was only required to prove that the employee knowingly falsified the excel spreadsheet to deceive the company. Nothing turns on this ground. I have already mentioned that the company’s evidence did not come close to establishing forgery.

Unreasonable findings/conclusions

[27] The first argument relates to the finding that the employee was not sufficiently aware of the company’s rule against transfer sheet manipulation. The rule was not placed in dispute. However, the undisputed evidence is that the employee was trained by Dagume and that, together with Mponeng, the employee continued to apply the same procedure.

[28] The company also contends that the finding of inconsistency is unreasonable. I have addressed this above and found that the

arbitrator did not commit an error of law and that regardless, the employee was only found guilty of negligence. Mponeng was not

disciplined, despite committing the same offence. Dagume was only issued with a final written warning.

[29] Having found the employee guilty of negligence, the arbitrator proceeded to consider the appropriate sanction and found that the sanction of dismissal was not fair. After he was charged, the employee continued working for the company for a period of a month without any issues. This, in my view, is evidence that he could be, and was in fact, rehabilitated. Further, it is in keeping with his evidence that, had he known the procedure, he would not have continued to work in the way he was taught by Dagume.

[30] The company’s last argument is that the arbitrator should have considered that the employee was on a final written warning for negligence. The final written warning referred to by the company is in respect of charge 1, emanating from the same investigation and charge sheet that led to the dismissal of the employee. The arbitrator has conducted an enquiry into the appropriateness of the sanction and arrived at a decision that is reasonable. His failure to consider that he was found guilty of negligence emanating from the same enquiry that led to the employee’s dismissal does not, in my view, make his award reviewable.

[31] The company has therefore failed to make out a case for this Court to interfere with the award. The application must therefore fail.

[32] In the premises, the following order is made:

Order

1. The application is dismissed.

M. Makhura

Acting Judge of the Labour Court of South Africa

Appearances:

For the Applicant: Mr J Whyte of Norton Rose Fullbright, Cape Town For the Third Respondent: No Appearance

[1] Sidumo and another v Rustenburg Platinum Mines Ltd and others (2007) 28 ILJ 2405 (CC) at para 110.

[2] See R v Muller 1953 (2) SA 146 (T); S v Dreyer 1967 (4) SA 614 (E).

[3] Herholdt v Nedbank Ltd (Congress of SA Trade Unions as amicus curiae) (2013) 34 ILJ 2795 (SCA) at para 25; See also: Gold Fields Mining SA (Pty) Ltd (Kloof Gold Mine) v Commission for Conciliation, Mediation and Arbitration and others (2014) 35 ILJ 943 (LAC) at paras 16 – 21; Head of Department of Education v Mofokeng and others (2015) 36 ILJ 2802 (LAC) at paras 30 – 33.

[4] SACCAWU and others v Irvin & Johnson Ltd [1999] 8 BLLR 741 (LAC).