Public Servants Association of South Africa and Others v Commission for Conciliation Mediation and Arbitration and Others (JR266/22) [2024] ZALCJHB 255; [2024] 10 BLLR 1087 (LC); (2024) 45 ILJ 2795 (LC) (8 July 2024)
The court held that the termination of the 2006 Collective Agreement by SARS, after reasonable notice and consultation, resulted in the cessation of its terms in individual contracts of employment. The applicants acquiesced to the cancellation and the implementation of the new travel allowance policy, which was...
Source-derived case information.
- Citation
- [2024] ZALCJHB 255
- Parties
- Applicant: Public Servants Association of South Africa; Applicant: F J Pienaar and 489 Others; Respondent: Commission for Conciliation Mediation and Arbitration; Respondent: Commissioner Richard Byrne; Respondent: SARS (South African Revenue Service); Respondent: NEHAWU
- Court
- Labour Court Johannesburg
- Jurisdiction
- South Africa
- Case Number
- JR266/22
- Procedural Posture
- Review Application / Judgment on Review of Arbitration Award
- Outcome
- Application for review dismissed; no order as to costs.
- Judges
- D Short
- Legal Topics
- Collective Agreements, Unfair Labour Practice, Travel Allowance, Contractual Variation, Consultation Procedure
Source-derived case record
Summary, issues, holding and outcome
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Parties
Public Servants Association of South Africa
Applicant
F J Pienaar and 489 Others
Applicant
Commission for Conciliation Mediation and Arbitration
Respondent
Commissioner Richard Byrne
Respondent
SARS (South African Revenue Service)
Respondent
NEHAWU
Respondent
Procedural Posture
Review Application / Judgment on Review of Arbitration Award
Legal Issues
- 1 Does the termination of a collective agreement remove its terms from individual contracts of employment?
- 2 Was the employer's withdrawal of the travel allowance policy procedurally and substantively fair?
- 3 Did the employer commit an unfair labour practice by removing the travel allowance?
Ratio Decidendi
The court held that the termination of the 2006 Collective Agreement by SARS, after reasonable notice and consultation, resulted in the cessation of its terms in individual contracts of employment. The applicants acquiesced to the cancellation and the implementation of the new travel allowance policy, which was subject to SARS's discretion and could be amended or withdrawn. The phased withdrawal of the allowance over four years followed a fair consultative process, and the employer's reasons—fruitless expenditure, compliance with legislation, and operational equity—were bona fide and reasonable. The court found no procedural or substantive unfairness in the employer's actions and...
Court Disposition
Application for review dismissed; no order as to costs.
Orders
- The applicant’s application for review is dismissed.
- There is no order as to costs.
Full Case Text
Judgment text and source record
150 paragraphs
FLYNOTES: LABOUR – Collective agreement – Travel allowance – Withdrawn by employer – Terms of terminated collective agreement not living on through contracts of employment – Allowance reduced in tranches over four years – Allowance had become fruitless and wasteful expenditure – Employer had bona fide and fair reasons for removing the allowance – Procedure followed by employer was fair and it did not act irrationally or capriciously.
THE LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG
Reportable
Case no: JR266/22
In the matter between:
PUBLIC SERVANTS ASSOCIATION OF SOUTH AFRICA First Applicant F J PIENAAR AND 489 OTHERS Second Applicant and COMMISSION FOR CONCILIATION MEDIATION AND ARBITRATION First Respondent COMMISSIONER RICHARD BYRNE Second Respondent SARS (SOUTH AFRICAN REVENUE SERVICE) Third Respondent NEHAWU Fourth Respondent
Heard:
26 June 2024
Delivered: 8 July 2024
JUDGMENT
SHORT, AJ
Introduction
[1] The Applicants seek the review and setting aside of an Arbitration Award handed down by the Second Respondent in terms of section 145 of the Labour Relations Act 66 of 1995 (the LRA).
[2] The Applicants, provided that this Court upholds the Application for Review request that the Court substitute the Arbitration Award of the Second Respondent with an Order as set out in paragraphs 2 to 2.3 of the Notice of Motion.
NEHAWU's Role
[3] In order to avoid any confusion as to who the parties to the dispute are, it is necessary for me to furnish a brief explanation.
[4] Pursuant to a joinder application, National Education and Allied Workers Union of South Africa (NEHAWU) were joined as a party to these proceedings.
[5] The nett effect of the Joinder Ruling is that NEHAWU albeit cited as the Fourth Respondent is in reality a Co-Applicant in the arbitration proceedings before the First Respondent and participated in the arbitration proceedings before the Second Respondent.
Background Facts
[6] This matter has a long history, however, I set out hereunder those facts which in my assessment are material to the determination of the Review Application and which appear from the papers to be uncontentious.
[7] During 2006 the First Applicant, the Fourth Respondent and the Third Respondent concluded a Collective Agreement which provided that certain grades of qualifying Field Workers, i.e., employees of the Respondent who travelled excessively in the course of performing
their duties, would be paid a Field Worker's allowance.
[8] The Field Workers Allowance was in its true essence a travel allowance which would be paid on a monthly basis to compensate the employees eligible to receive such allowance for official business travel up to 500 (five hundred) kilometres.
[9] For travel exceeding 500 (five hundred) kilometres a month, such employees would be reimbursed for each kilometre of extra travel at the applicable rate determined by the Department of Transport.
[10] On 26 March 2008 the Collective Agreement was amended by way of an Addendum Agreement which recorded that the travel allowance would be excluded from forming part of the eligible employees' total remuneration package.
[11] In July 2014 the Third Respondent tabled a position paper at the National Consultative Forum (NCF) which set out the difficulties
experienced by SARS in granting the travel allowance.
[12] In response to the Third Respondent's position paper relating to the travel allowance, the First Respondent submitted its position paper.
[13] A number of NCF and National Bargaining Forum (NBF) meetings ensued to discuss the issue of the travel allowance as birthed by the 2006 Collective Agreement.
[14] On 4 April 2015 the Third Respondent gave the First Respondent as well as the Fourth Respondent three months' notice of termination of the 2006 Collective Agreement, which termination was to become effective on 4 July 2015.
[15] Pursuant to a further discussion regarding the mechanics of the cancellation of the Collective Agreement, the Third Respondent on 10 February 2016, advised the affected employees that the allowance would be withdrawn with effect from 1 April 2016, and that a new Policy for employees who travel excessively due to work assignments would be in place with effect from 1 April 2016.
[16] The Travel Allowance Policy took effect on 1 April 2016 and regulated the payment of travel allowances and according to its terms, superseded and replaced all previous policies relating to the travel allowance. It could also be amended or withdrawn at the discretion of the Third Respondent.
[17] On 5 September 2018 the Executive Committee of the Third Respondent decided that the Third Respondent should embark on a process of withdrawing the Travel Allowance Policy in its entirety. Engagements between the Third Respondent and organised Labour took place at the NCF and NBF during November 2018.
[18] The Third Respondent's rationale for the removal of the travel allowance was sixfold. Many of the Third Respondents' employees
receiving the travel allowance did not have sufficient business travel requirements and approximately 41% (forty one percent) of the employees receiving the allowance did not travel the 500km.
[19] The Third Respondent held the view that the payment of a travel allowance where the majority of travel is not for business purposes, constitutes a violation of the Public Finance Management Act[1] and amounts to fruitless and wasteful expenditure.
[20] The introduction of the travel allowance in 2016 according to the Third Respondent created pay inequities between employees receiving the allowance and those not receiving it, even though they all have same/similar business traveling patterns.
[21] The Third Respondent was further of the view that the default taxable percentage of the allowance is 80% (eighty percent), therefore such employees only pay in when they submit their Income Tax Returns, some 12 months later, thus depriving the Third Respondent of tax revenue and increasing its debt book.
[22] The termination of the Travel Policy would in the view of the Third Respondent impede compliance with tax legislation or travel
allowances.
[23] The Third Respondent contended that the removal of the Travel Allowance Policy by the Third Respondent would result in a minimum
saving of R33 000 000.00 (Thirty-Three Million Rand) per annum as travel allowances were being paid to a number of employees who did not travel to any significant degree.
[24] On 5 September 2018 the Third Respondent's EXCO decided that it should consider embarking on a process of withdrawing the travel
allowance and initiate the consultative process with the Unions which at that stage, were the Applicant and the Fourth Respondent.
[25] The Third Respondent commenced with the consultative process on 5 November 2018. A series of discussions were held between the Third Respondent, the Applicant and the Fourth Respondent ranging from bilateral discussions to discussions in the NCF and NBF.
[26] On 15 January 2021 the Third Respondent forwarded notices to all the individual Applicants affected by its decision to withdraw the travel allowance.
[27] The travel allowance was to be phased out over a period of four years commencing in April 2021, by way of a 25% reduction in the travel allowance per year, until it was reduced to zero.
[28] On 12 March 2021 the First Applicant acting on behalf of the Second to Further Applicants then lodged an Unfair Labour Practice Dispute with the First Respondent.
[29] The Second Applicant arbitrated the dispute referred by the Applicants and with which the Fourth Respondent aligned itself and concluded that the Third Respondent had not committed an unfair labour practice.
[30] The Award of the Second Respondent is the focal point of the Application before me.
Grounds of Review
[31] The Applicants raise one principal ground of review with sub grounds.
The Principal Ground of Review
"The Arbitrator, in conflict with the behests of the Act, handed down an Award which is not an Award of a reasonable and objective decision maker, failed to apply his mind, misconducted himself, committed a gross irregularity, exceeded his powers by acting unreasonably or unjustifiably."
The Sub Grounds
"The Arbitrator's seminal finding is that upon cancellation of the Collective Agreement, the allowance falls away i.e. the contracts of employment are only varied whilst the Collective Agreement remains in place".
This is a material error of Law in that the nature of the 2006 Collective Agreement as amended, introduced an allowance against which employees would be paid for undertaking certain travel tied to their duties.
Clearly a variation of the employment contract in such circumstances is not limited to the existence of the Collective Agreement, as Section 23(3) clearly cannot be construed in this manner and de facto the contracts of employment were already amended. Any unilateral removal of that right is clearly unfair and constitutes an unfair labour practice.
Furthermore, the Arbitrator fails to deal with the fact that the subsequent imposition of the travel allowance did not impact upon this contractual right to an allowance as it reflected the existing contractual term and entitlement, and the Arbitrator failed to deal with the unilateral removal of such ostensibly on the basis that employees were not using the allowance.
In circumstances where it is common cause that the majority i.e. 60% (sixty percent) were still using the allowance, the Arbitrator's conclusion that the removal was fair cannot be sustained, as at the very least in respect of the 60% (sixty percent) they had an allowance that they were still using, and entitled to removed (sic) for no reason, other than that the Third Respondent was of the view that 40% (forty percent) were not using it to extrapolate the alleged circumstances of 40% (forty percent) to the 60% (sixty percent), and imposing this is clearly a reviewable finding".
The Alleged Error of Law
[32] The Applicants contend that the 2006 Collective Agreement had as contemplated in section 23 (3) of the LRA varied the employees'
contracts of employment, and therefore, lived on through the Individual Applicants' contracts of employment after the 2006 Collective Agreement was cancelled / terminated by the Third Respondent.
[33] There is no dispute that the travel allowance which is the subject matter of the dispute between the Applicants and the Respondent
initially arose as a result of the 2006 Collective Agreement.
[34] There is also no dispute between the parties that the Third Respondent terminated the Collective Agreement on three months'
notice.
[35] Where the parties are at odds, is whether post the termination of the Collective Agreement the Field Assistant Allowance remained a term of the individual contracts of employment of the individual Applicants, which could only be terminated or varied by a subsequent Collective Agreement. This is what was referred to by Mr Jones appearing on behalf of the Third Respondent as the nub of the dispute.
[36] The Third Respondent contends that once the Collective Agreement was terminated, the terms thereof which had become incorporated into the individual contracts of employment of the Applicants, ceased to be of any force and/or effect, and that it was replaced with a Travel Allowance Policy allowing qualifying employees to apply for a Travel Allowance in accordance with the provisions of such policy.
[37] The Third Respondent's stance found favour with the Second Respondent.
[38] The Second Respondent, however, from a reading of his Award did not expressly deal with the issue of whether or not the 2006 Collective Agreement, was one which was capable of unilateral termination, as contemplated in section 23(4) of the LRA, however, from his ultimate finding, I am of the view that he most likely accepted that such collective agreement could be unilaterally terminated.
[39] In the preamble of the LRA, one of the primary objects of such act is to promote orderly collective bargaining. Section 23 of the LRA provides a mechanism for orderly collective bargaining by regulating and providing a framework for collective agreements as well as setting out the legal effect of such collective agreements.
[40] Section 23(4) of the LRA reads thus:
"Unless the Collective Agreement provides otherwise, any party to a Collective Agreement that is concluded for an indefinite period may terminate the agreement by giving reasonable notice in writing to the other parties".
[41] From a reading of the 2006 Collective Agreement, it appears that it was of indefinite duration, thus rendering it susceptible to unilateral termination by either of the parties as contemplated in section 23 (4) of the LRA. None of the parties have, in their papers, suggested that this is not the case.
[42] The Applicants as far as I can glean from the papers and as pointed out by Mr Khutumela in argument launched no protest against the reasonableness of the notice period preceding the termination of the Collective Agreement, and therefore I accept in the absence of an opposing stance on this issue, that the notice period of three months was reasonable.
[43] The question which then requires attention is, what effect the termination of the Collective Agreement had on the contract of employments of the individual Applicants, and consequently the fairness of the Third Respondent's actions in ultimately removing the travel allowance.
[44] Section 23(3) states:
“Where applicable, a collective agreement varies any contract of employment between an employee and employer who are bound by the collective agreement”.
[45] None of the parties have included any of the individual contracts of employment of the Applicants in the Record which leads me to conclude that the terms of the 2006 Collective Agreement, particularly with regard to the field workers allowance were not expressly inserted into such contracts of employment but were rather incorporated by dint of a deeming provision.
[46] In the matter of SAMWU v City of Tshwane and Others[2], this court held that:
"[18] It is trite that the terms of a Collective Agreement are not only binding on the individual employees but as a matter of law are incorporated into the employee's contract of employment."
The court went on to say:
"It is therefore my view that even though the 2006 Collective Agreement lapsed, it's provisions having been incorporated into the employment contracts of the individual members of the Applicant, continued beyond the life span of the Collective Agreement. The Shift System remained as was before the lapse of the Collective Agreement because its provisions became part of the individual employees' employment contracts. In other words, those terms and conditions set out in the Collective Agreement remained in force, even after the lapse of the Collective Agreement and would remain as such until another Collective Agreement had been incorporated into the individual contracts."
[47] There is an important characteristic of the SAMWU Decision, which I have referenced hereabove, which differentiates it from the decision in Imperial Cargo Solutions v SATAWU and Others[3] matter referred to below and the matter at hand, namely:
47.1 The Collective Agreement in the SAMWU matter was not cancelled or terminated by any of the parties and lapsed as it had reached the end of its agreed lifespan and there was no provision in such agreement that it would terminate upon its lapsing. None of the parties signalled that they did not wish its terms to continue to be of any force and/or effect. This being the case it fell outside of the compass Section 23 (4) of the LRA which provides:
47.2 "(4) Unless the Collective Agreement provides otherwise, any party to a Collective Agreement that is concluded for an indefinite period may terminate the agreement by giving reasonable notice in writing to the other party";
47.3 Mr Jones submitted that the Applicants contention is that post the cancellation / termination of the 2006 Collective Agreement, its terms had remained entrenched in the contracts of employment of the Applicants and could not be removed by the Third Respondent in the manner in which the Third Respondent did so.
[48] If it were correct that the terms of a Collective Agreement which was cancelled by one of the parties thereto continued to live on through the contracts of employment into which they were incorporated, this would in effect render the provisions of Section 23 (4) redundant, which could not have been intended by the Lawmaker. This would also hamper orderly collective bargaining rather than promote it.
[49] In the matter Imperial Cargo Solutions, the Labour Appeal Court being aware of the existence of the SAMWU Judgment referred to above, distinguished such matter on its facts from the matter it was called to determine. The court however, stopped short of furnishing reasons for distinguishing the facts in the aforementioned decision from those which existed in the SAMWU decision which I reference hereabove.
[50] In brief, in the Imperial Cargo matter, the Court had to determine whether after the unilateral cancellation of a Collective Agreement entitled a 'guard allowance' which provided for Truck Drivers to perform duties of tarping and securing of loads on the truck in return for an allowance, were obliged to continue performing such duties after the cancellation / termination of the Collective Agreement by the Trade Union SATAWU? The Court held that upon the cancellation of the Collective Agreement by SATAWU, the ancillary duties required of the Drivers by virtue of the Collective Agreement, fell away and ceased being of any force and/or effect and so did Imperial’s duty to compensate them for such ancillary duties. This being the case, the refusal of the Drivers to perform the ancillary duties as contemplated in the Collective Agreement could not amount to a strike. This put paid to the contention that the terms of a Collective Agreement which is cancelled / terminated by one of its parties, continue to live on through the contracts of employment of the employees concerned.
[51] The Labour Courts decision in Imperial, firstly makes sense and secondly, gives a purposive application to section 23(4) of the LRA, thereby promoting orderly collective bargaining. It makes no sense for a term of a collective agreement to live on through the contracts of employment of the employees concerned where either one or both of the parties decide that they no longer wish such term to continue to be of force and/or effect. This situation is materially different to a situation where the parties to the collective agreement on its termination once it has reached the end of its lifespan, allow it to live on either expressly or tacitly through their conduct.
[52] In the wake of the Imperial decision referred to above, it appears to me that where a Collective Agreement is cancelled by one of the parties to such agreement, this has the effect that the terms of the cancelled / terminated Collective Agreement, do not live on through the contracts of employment into which they were incorporated. This position gives full effect to the provisions of section 23(4) of the LRA and accordingly promotes collective bargaining.
[53] It is my view that in light of the concessions made by the Applicants during the arbitration proceedings that they did not mount any formal process to halt the cancellation of the Collective Agreement, and that the individual Applicants continued to claim travel allowance under the policy which was ultimately put in place by the Third Respondent after consultations in the NCF, they in effect acquiesced to the cancellation of such Collective Agreement as well as the implementation of the Travel Allowance Policy and certainly did not by their actions, regard the 2006 Collective Agreement, as having lived on through the Individual Applicants' contracts of employment. As, if that was the case, it would have rendered the Travel Allowance Policy futile.
[54] Mr Jones submitted that the facts of the Imperial matter to which I refer to above, are discernible from the facts of the present matter. His submission hinges on the fact that the Collective Agreement, which was concluded in the Imperial matter, superimposed additional duties on the Drivers concerned, whereas in the current matter travelling was always part of the duties of the employees concerned. It is my view that the nature of the duties of the employees concerned and how they arose is a 'red herring', and cannot serve to differentiate the matters to such a degree that the principle established in the Imperial matter is not applicable to the facts in the current matter.
[55] Mr Khutumela submitted that the facts in the Imperial decision are on all fours with the facts of the current matter. Mr Khutumela further drew my attention to a decision of this Court being Bargaining Council for the Clothing Industry Natal v Confederation of Employees of Southern Africa and Others[4] where the Court held that "a Judgment of the Labour Appeal Court is binding on the Labour Court unless…". This accords with the entrenched principle of law i.e. stare decisis.
[56] Mr Khutumela further drew my attention to correspondence addressed by the Applicant to the Third Respondent, as well as Minutes of NCF and NBF meetings where the First Applicant states that it had no interest in pursuing any litigation against the Third Respondent as a result of the cancellation of the 2006 Collective Agreement. This to my mind, is a clear and unequivocal demonstration that the terms of the Collective Agreement did not live on through the Individual Applicants' contracts of employment as the parties were effectively, in agreement that the 2006 Collective Agreement would cease to exist and would be replaced by the Travel Allowance Policy.
[57] There can be no controversy that the Applicants albeit begrudgingly, made peace with the cancellation of the Collective Agreement, and the implementation of a policy pursuant to a consultative process. This in my view constituted a clear election not to challenge the cancellation / termination of the 2006 Collective Agreement and the consequent creation of the Travel Allowance Policy.
[58] It is therefore my view that the Applicants' contention that the terms of the Collective Agreement survived the cancellation of the Collective Agreement and its replacement by a Travel Allowance Policy is unsustainable.
[59] In light of what I have set out above, the first leg of the Applicants' argument fails.
The Fairness of the Removal of the Policy
[60] The issue which requires consideration under the second leg of the Applicants' argument is whether the removal of the travel allowance as enshrined in the Travel Allowance Policy was unfair, and amounts to an unfair labour practice as contemplated in section 186 (2) (a) of the LRA:
"(2) Unfair Labour Practice means any unfair act or omission that arises between an employer and an employee involving –
unfair conduct by the employer relating to the promotion, probation (excluding disputes about dismissals for a reason relating to probation) or training of an employee or relating to the provision of benefits to an employee".
[61] In the matter of Apollo tyres[5] the Court unanimously held that the term 'benefit' means existing advantages or privileges to which an employee is entitled as a right or granted in terms of a policy or privilege, subject to the employer's discretion.
[62] With regard to the powers of the CCMA in determining Unfair Labour Practice Disputes, in the Apollo Tyres matter the Court had the following to say:
"Section 186 (2) (a) is the legislator's way of regulating employer conduct by superimposing a duty of fairness irrespective of whether that duty exists expressly or implicitly in the contractual provisions that establish the benefit".
[63] From the evidence led before the Second Respondent it appears undisputed that the Third Respondent had crafted a position paper
setting out in clear terms the reasons for wishing to withdraw the Travel Allowance Policy, this position paper was circulated to the First Applicant and NEHAWU for their consideration and input prior to any final decision regarding the fate of the travel allowance policy was made.
[64] The Applicants engaged with the Third Respondent in the NCF and even suggested an alternative, which was that the Third Respondent include the travel allowance in the Second to Further Applicants' remuneration. This alternative was rejected by the Third Respondent
as not addressing the very problems it sought to address through the proposed removal of the Travel Allowance Policy.
[65] The Third Respondent decided after consulting the Applicant and the Fourth Respondent not to remove the travel allowance immediately but rather reduce it in tranches of 25% (twenty five percent) over a period of four years, which the parties then referred to as the 'soft landing' approach. I fail to grasp how the Applicant can on the one hand, agree to a phasing out of the Travel Allowance Policy, but on the other hand, contend that the Employer cannot lawfully remove the Policy. The Applicant simply cannot have it both ways.
[66] It is common cause that the Third Respondent accepted the 'soft landing' approach and did not reject the phasing out approach adopted by the Third Respondent.
[67] The Industrial Court in the decision MAWU v Hart[6] held that:
“If in the context of a dismissal based on operational requirements, there is a distinct and substantial difference between consultation and bargaining. To consult means to take counsel or seek information or advice from someone and does not imply any kind of agreement, whereas to bargain means to haggle or wrangle so as to arrive at some agreement in terms of give and take. The term negotiate is akin to bargaining and means to confer with a view to compromise and agreement”.
[68] The Applicants appear to be of the view that the employer was not lawfully entitled to remove the Travel Allowance Policy unilaterally
but could only do so if the employer, the First Applicant and NEHAWU concluded a Collective Agreement in this regard. This was as far as I can gather, the evidence given by Mr Matthysen, a Shop Steward of the First Applicant.
[69] I am not in agreement with the stance adopted by the Applicant and the Fourth Respondent and am of the view that benefits and in particular, discretionary benefits, can be revoked by an employer, provided that such removal is effected fairly. The Court in Protekon (Pty) Ltd v CCMA[7] held that travel concessions were considered benefits as contemplated in section 186 (2) (a) and unilateral withdrawal thereof without consulting the employees was held to be procedurally unfair. What this implies is that the standard of fairness similar to that which applies in unfair dismissals would need to be applied before the benefit as in the present matter could be removed, which in its summarised form, would imply that there had to be a fair reason for the removal of the benefit and a fair procedure would need to precede any decision to remove the benefit, and that the removal not be based on arbitrary or capricious reasons.
[70] The Protekon Court therefore reinforced that an employer in order not to act procedurally unfairly, had to consult with the affected party/parties. In this regard, the term ‘consult’ must be given the meaning ascribed to it in the MAWU v Hart decision, referred to above.
[71] The Apollo Tyres and Protekon courts when considering the fairness of an employer’s actions with regard to provision of benefits, put the procedural requirement no higher than a duty to consult. From a reading of the record, it appears that prior to revoking the Travel Allowance Policy, the Third Respondent engaged in a consultative process with organised labour in bilateral discussions as well as in the National Consultative Forum and The National Bargaining Forum. This process commenced in 2018 and continued up and until 2021. The process yielded the result of a ‘soft landing’ for the Applicants whereby the travel allowance was removed from such Applicants in instalments of 25% over a period of four years, which indicated to me that the consultative process was not merely a sham.
[72] The Applicant’s stance appears to be that the Third Respondent was not lawfully entitled to remove the Travel Allowance Policy but does not challenge the process on which the Third Respondent embarked to remove the Policy.
[73] I am of the view that as the matter brought before the Second Respondent was framed as an unfair labour practice relating to the provision of benefits the procedural standard as set out in Protekon and Apollo Tyres is applicable and must be followed before the removal of a benefit can be held to be fair.
[74] From the papers before me, it is clear to me that one of the principal motivations for withdrawing the travel allowance was that many of the employees who were receiving the travel allowance were not travelling at least 500 kilometres per month and were therefore being paid in anticipation of travel which they were not undertaking on behalf of the Third Respondent, with the result that the Third Respondent was not deriving any return on its investment. It matters not what the exact number of employees travelling excessively were and those who were not. This undoubtedly also resulted in disparity amongst the employees of the Third Respondent, as other employees who did not travel, were disqualified from receiving the allowance. It is in any event, common cause that upon the withdrawal of the Policy, employees of the Third Respondent travelling for business purposes and using their own vehicles could claim for every kilometre of business travel, on the Department of Transport tariff. This I believe is fair and equitable to all the employees of the Third Respondent.
[75] There were also other reasons addressed by the Third Respondent for withdrawing the travel allowance which related to it having become fruitless and wasteful expenditure, as contemplated in the Public Finance Management Act[8] (PFMA) and also constituting a contravention of the Income Tax Act[9], which in the main was not disputed by the Applicants, except that they confirmed that there was no prescribed minimum travel.
[76] It is my view having considered the evidence, which was placed before the Second Respondent, that the Third Respondent had bona fide and fair reasons for removing the travel allowance. The Third Respondent's rationale was not disputed by the Applicants as appears
to have been conceded by Mr Matthysen and to an extent Mr Viljoen under cross examination. In any event, by agreeing to the ‘soft
landing’, I am of the view that the Applicant and the Fourth Respondent, ultimately agreed to the removal of the Travel Policy
either expressly or tacitly by their conduct.
[77] The Third Respondent embarked on a consultative process which endured for close to three years where Organised Labour were given the opportunity of making proposals to the Third Respondent, which they did. The phased removal of the benefit in four tranches of 25% was a proposal made by the Applicant and Fourth Respondent. in light of this, I find the procedure followed by the Third Respondent, fair and that it did not act irrationally or capriciously.
Conclusion
[78] For all the reasons set out above, I am of the view that the Award of the Second Respondent is one which any reasonable Arbitrator could have made on the evidence which was placed before the Second Respondent, and I find no basis to disturb such Award.
Costs
[79] With regard to the issue of costs, it is my view that it would be inappropriate to mulct the Applicants and/or the Fourth Respondent
with costs, as there is an existing employment relationship between the Second to Further Applicants and the Third Respondent, a cost order against the Applicants could negatively impact such relationship.
[80] In the circumstances, the following order is made:
Order
1. The Applicant’s application for review is dismissed;
2. There is no order as to costs.
D. Short
Acting Judge of the Labour Court of South Africa
Appearances: For the applicant : Mr J Jones of MacGregor Erasmus For the respondent : Adv L Khutumela Instructed by : Cliffe Dekker Hofmeyr Inc.
[1] No. 1 of 1999.
[2] (2014) 35 ILJ 241 (LC).
[3] [2017] 12 BLLR 1189 (LAC).
[4] [1998] 9 BLLR 928 (LC) para 11-12.
[5] [2013] 5 BLLR 434 (LAC).
[6] (1985) 6 ILJ 478 (IC).
[7] [2005] 7 BLLR 703 (LC).
[8] No. 1 of 1999.
[9] No. 58 of 1962.