Roossenekal Foods (Pty) Ltd v Bargaining Council for Food Retail Restaurant Catering and Allied Trades and Others (JR699 - 2018) [2020] ZALCJHB 249 (4 December 2020)

IN THE LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG

Not Reportable

Case No: JR699 - 2018

In the matter between:

ROOSSENEKAL FOODS (PTY) LTD

Applicant

and

BARGAINING COUNCIL FOR THE FOOD RETAIL

RESTAURANT CATERING & ALLIED TRADES

First Respondent

COMMISSION FOR CONCILIATION, MEDIATION

AND ARBITRATION

Second

Respondent

COMMISSIONER RICHARD BYRNE N.O

Third Respondent

Heard: 21 October 2020 (Via Microsoft Teams)

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 4 December 2020

JUDGMENT

TLHOTLHALEMAJE, J

Introduction:

[1] The Applicant seeks an order reviewing and setting aside a ‘Jurisdictional’ Ruling issued by the Third Respondent (Commissioner) dated 22 November 2017, in terms of which the Commissioner had found that the second Respondent, Commission for Conciliation Mediation and Arbitration (CCMA), lacked jurisdiction to arbitrate the dispute referred before it.

[2] The review application, which is opposed by the First Respondent (Bargaining Council), was filed outside of the statutory periods

stipulated in section 145(1)(a) of the Labour Relations Act (LRA),[1] and the Applicant also seeks condonation in that regard, which was equally opposed.

Background:

[3] The Applicant is a Franchisee operating in the hospitality sector, specifically fast-food. It has about 62 Kentucky Fried Chicken (KFC) outlets located throughout the Provinces of North West, Limpopo, Gauteng and Mpumalanga.

[4] The hospitality industry is governed by four dispensations, viz, the Sectoral Determination 14; the Statutory Council for Fast Food, Catering and Allied Trades (Statutory Council), the Bargaining

Council for the Restaurant, catering and Allied Trades (JHB Council), and the First Respondent (which is referred to as Pretoria Council).

[5] The dispute surrounds whether 8 of the Applicant’s outlets (one in Bronkhorstspruit, and the seven others in Witbank), should fall within the scope and jurisdiction of the Bargaining Council, or be allowed to operate in accordance with the provisions of Sectoral Determination.

[6] The Applicant had referred a demarcation dispute in accordance with the provisions of section 62(1) of the LRA. After some preliminary points were disposed of, the dispute came before the Commissioner for arbitration. In the light of the common cause fact that the eight stores ordinarily fell within the bargaining Council’s jurisdiction, the Commissioner had found that there was no arbitrable dispute before him.

The arbitration proceedings and the award

[7] The Commissioner’s ruling followed upon the hearing of evidence on the issue of jurisdiction. In summary, the Applicant’s case before the Commissioner was that;

7.1 The application for demarcation did not entail the Applicant moving the eight stores from one sector to the other, but rather to remain within the jurisdiction of the Sectoral Determination.

7.2 The basis of seeking a demarcation was that the eight stores should be allowed to fall within the Sectoral Determination in order to prevent its workplace being fragmented and proliferated, with the consequences that the terms and conditions of employment as applicable throughout the Applicant’s stores are fragmented. This was so in that about 50% of the terms and conditions of employment related to benefits in existence at the Applicant would differ substantially to those provided for by the Bargaining Council; the discrepancies between the wages paid by the Applicant to higher grades in comparison to those prescribed by the Bargaining Council; and the fact that eight of the applicant’s stores would fall within the Bargaining Council, whilst 54 fell under the jurisdiction of the CCMA.It was further submitted that whilst the eight stores were demarcated within the Bargaining Council, they were not independent, as direct services to them and other stores were supplied by the Applicant’s head office. To the extent that the Applicant’s employees were not unionised, it was argued that the applicant and its employees would thus be subjected to collective bargaining processes of other the trade unions and the concerned employers, in circumstances where the Applicant’s own internal processes were sufficient.

[8] The Commissioner in concluding that there was no arbitrable dispute before him, had regard to the provisions of Clause 12 of the Sectoral Determination and the scope of application, and held that the Applicant’s stores fell under that scope. The Commissioner however had further regard to the provisions of Clause 3(c) of the Sectoral Determination, which provided that the determination did not apply to employers and employees who were covered by the Collective Agreement of a bargaining council in terms of the provisions of the LRA.

[9] The Commissioner further had regard to the scope and geographical area of the Bargaining Council as varied with effect from February 1993, and found that the Applicant’s stores fell under the definitions in view of the area covered, and agreed with both parties that the Bargaining Council had jurisdiction over the stores.

[10] In regards to whether there was a dispute before him, the Commissioner had regard to the provisions of section 62 of the LRA, which concerned whether any employee, employer, class of employees or class of employers is or was engaged in a sector or area, and concluded that even if the Applicant’s stores fell under the jurisdiction and thus the Sectoral Determination, the jurisdiction of the Bargaining Council took precedence, and there was thus no dispute in law.

[11] The Commissioner had observed that what the Applicant sought was in effect an award demarcating the eight stores out of the jurisdiction of the Bargaining Council despite these falling under that jurisdiction. The CCMA therefore had no jurisdiction to assign employers and employees to a legal regime other than the one they legitimately reside, in that to do so would permit employers and employees to elect which legislated terms and conditions of employment they wished to resort to, in contradiction to subordinate legislation or collective agreement prevailing in an industry.

[12] The applicants seek to review and set aside the ruling on a variety of grounds, including that the Commissioner committed errors amounting to a mistake of law; that the errors constituted a gross irregularity in the proceedings; that the Commissioner effected administrative action that was not in accordance with the law and thus unlawful; that the errors resulted in the award being unreasonable; and that the Commissioner misconceived his duties and the process in terms of section 62 of the LRA

Condonation:

[13] As already indicated, the review application was filed out of time. On the Applicant’s own version, the delay is about 14 weeks, which is excessive in the extreme.

[14] In explaining the delay, it was submitted on behalf of the Applicant that when the arbitration award was received, the Applicant was engaged in ‘sensitive high level’ negotiations pertaining to the sale of the Applicant’s business to a third party. According to the Applicant, the negotiations had continued for six months, and deadlock was reached in March 2018. A decision to review the ruling was only taken after an emergency board meeting of the Applicant on 6 April 2018.

[15] Section 145(1A) of the LRA requires that ‘good cause’ be shown for non-compliance with the statutory time frames. This entails that the Court in the exercise of its discretion, must consider all the facts, inclusive of the degree of lateness, the explanation therefor, the prospects of success and the importance of the case and the respondent’s interests in finality[2]. In the end, the interests of justice upon a consideration of these factors would dictate whether condonation should be granted or not[3].

[16] As already indicated, a delay of 14 weeks is excessive in the extreme. This therefore implies that there is even a greater burden on the applicant to give full, detailed and accurate account of the causes of the delay and their effects, so as to enable the Court to understand clearly the reasons and to assess their responsibility[4]. In the light of this excessive delay therefore, it cannot be correct as submitted on behalf of the applicant that the Court in considering the condonation application, should adopt a less stringent approach.

[17] The explanation proffered by the Applicant can hardly be described as full, detailed or accurate. In the words of Moila v Shai N.O and Others, the explanation amounts to no explanation at all[5]. All that the explanation boils down to is that the applicant was engaged in the high level negotiations with the potential buyers of the stores. Each and every period of the delay is hardly accounted for as correctly pointed out on behalf of the bargaining Council, and in any event, one fails to appreciate what the negotiations had to do with compliance of the time frames, if the Applicant was serious about pursuing this review application. Nothing prevented it from bringing the application on time, whilst also pursuing those negotiations

[18] Other than the fact that no satisfactory explanation has been proffered, it would also appear that the application for review is an afterthought. Until the alleged negotiations with the unnamed third party collapsed, there appears to have been no inclination on the part of the Applicant to take the Commissioner’s ruling any further. In my view, the matter ought to have ended at that point in that the application for review lacks prospects of success.

[19] It is accepted that in the absence of a satisfactory, reasonable and acceptable explanation for the excessive delay, the prospects of success are immaterial and that without good prospects of success, no matter how good the explanation for the delay, an application for condonation should be refused[6].

[20] In this case however, for the sake of completeness and also given the importance of the matter in the industry concerned, I will proceed to deal with the merits, to demonstrate how poor they are.

[21] The review test in regards to jurisdictional ruling is whether the Commissioner reached a correct decision. When matters are referred to the CCMA in terms of section 62 of the LRA[7], the Commissioner correctly pointed out that the issue to be determined was whether any employer, employee, class of employers or employees is or was engaged in a sector or area, and this was to be done by an assessment as to whether those parties were engaged in a certain sector by reference to the scope of the prevailing legislation or of competing legislation.

[22] The Commissioner had correctly concluded that there was no dispute before him requiring arbitration based on the Applicant’s own version, let alone the undisputed facts. To the extent that the alleged dispute concerns the eight stores, the Applicant had conceded that these fell within the geographical area of the Bargaining Council, and the issue of sector did not even feature.

[23] It was submitted on behalf of the Applicant that the Commissioner failed to deal with the merits of the case. I still fail to appreciate what other merits the Commissioner had to deal with in view of the two central issues under sub-sections 62(a) and (b) of the LRA not being in dispute. There was no dispute about the scope and geographical area of the stores, nor was there any dispute about the binding nature of the Bargaining Council Collective Agreement.

[24] As confirmed on behalf of the Applicant, it simply does not want to fall under the auspices of the Bargaining Council because of the problems it has in relation to the fragmented implementation of terms and conditions of employment in view of the applicability of both the Sectoral Determination and the Collective Agreement of the Bargaining Council across all its stores. However, as it was correctly pointed out on behalf of the Bargaining Council, it is not for the Applicant to simply ‘wish’ or elect

where or how those eight stores should be regulated, and circumvent the binding prescripts applicable in the industry. Further as correctly pointed out, rather than approaching the CCMA under the provisions of section 62 of the LRA, the Applicant could simply have approached the Bargaining Council’s Exemption Committee to obtain an exemption from certain or all of the provisions of the Collective Agreement.

[25] The conduct of the Applicant in persisting with this application is clearly meant to defeat the primary objectives of the LRA, which are self-regulation through collective agreement, and expeditions resolution of disputes. On the Bargaining Council’s version, the dispute between the parties date back to March 2016 after compliance orders were issued against the Applicant. Despite several compliance orders which were ignored, and an arbitration award issued in terms of section 33A of the LRA requiring the Applicant to register with the Bargaining Council, it has resisted all these attempts, until the award issued was certified.

[26] In the light of the above and the conclusions reached, it follows that there is no basis upon which a finding can be made that the Commissioner’s decision was wrong. The Applicant’s contention that the wording of the Commissioner’s ruling is not clear as to what he had ruled on does not take its case any further. I agree that in the light of the factors considered by the Commissioner and the conclusions reached, it was not necessary for the Commissioner to have issued an order to the effect that the eight stores fell under the jurisdiction of the Bargaining Council . In any event, the lack of clarity in that order does not make the ultimate decision wrong or reviewable. That order merely reiterated the common cause facts upon which it was concluded

that there was no arbitrable dispute before the Commissioner.

[27] In the end, the Applicant has failed to demonstrate good cause for the excessive delay in bringing the review application, and clearly it would not be in the interests of justice to grant condonation. Further given the conduct of the Applicant as dealt with elsewhere in this judgment in persisting with this application, the considerations of law and fairness dictate that it be burdened with the costs of this application.

[28] Accordingly, the following order is made;

Order:

1. The Applicant’s application to review and set aside the Ruling of the Third Respondent dated 22 November 2017 is dismissed with costs.

___________________

Edwin Tlhotlhalemaje

Judge of the Labour Court of South Africa

REPRESENTATION:

For the Applicant: Adv. Craig Bosch, instructed by Van Zyl Inc

For the First Respondent: Anton Barker, of Anton Bakker Inc

[1] Act 66 of 1995, as amended

[2] Melane v Santam Insurance Co Ltd 1962 (4) SA 531 (A)

[3] Steenkamp and Others v Edcon Limited 2019 (7) BCLR 826 (CC); (2019) 40 ILJ 1731 (CC), where it was held; ‘[36] Granting condonation must be in the interests of justice. This Court in Grootboom set out that: “[T]he standard for considering an application for condonation is in the interests of justice. However, the concept ‘interests of justice’ is so elastic that it is not capable of precise definition. As the two cases demonstrate, it includes: the nature of the relief sought; the extent and cause of the delay; the effect of the delay on the administration of justice and other litigants; the reasonableness of the explanation for the delay; the importance of the issue to be raised in the intended appeal; and the prospects of success. It is crucial to reiterate that both Brummer and Van Wyk emphasise that the ultimate determination of what is in the interests of justice must reflect due regard to all the relevant factors but it is not necessarily limited to those mentioned above. The particular circumstances of each case will determine which of these factors are relevant. It is now trite that condonation cannot be had for the mere asking. A party seeking condonation must make out a case entitling it to the court’s indulgence. It must show sufficient cause. This requires a party to give a full explanation for the non-compliance with the rules or court’s directions. Of great significance, the explanation must be reasonable enough to excuse the default. The interests of justice must be determined with reference to all relevant factors. However, some of the factors may justifiably be left out of consideration in certain circumstances. For example, where the delay is unacceptably excessive and there is no explanation for the delay, there may be no need to consider the prospects of success. If the period of delay is short and there is an unsatisfactory explanation but there are reasonable prospects of success, condonation should be granted. However, despite the presence of reasonable prospects of success, condonation may be refused where the delay is excessive, the explanation is non-existent and granting condonation would prejudice the other party. As a general proposition the various factors are not individually decisive but should all be taken into account to arrive at a conclusion as to what is in the interests of justice.” [37] All factors should therefore be taken into account when assessing whether it is in the interest of justice to grant or refuse condonation.”

[3] Steenkamp and Others v Edcon Limited 2019 (7) BCLR 826 (CC); (2019) 40 ILJ 1731 (CC), where it was held;

‘[36] Granting condonation must be in the interests of justice. This Court in Grootboom set out that:

“[T]he standard for considering an application for condonation is in the interests of justice. However, the concept ‘interests of justice’ is so elastic that it is not capable of precise definition. As the two cases demonstrate, it includes: the nature of the relief sought; the extent and cause of the delay; the effect of the delay on the administration of justice and other litigants; the reasonableness of the explanation for the delay; the importance of the issue to be raised in the intended appeal; and the prospects of success. It is crucial to reiterate that both Brummer and Van Wyk emphasise that the ultimate determination of what is in the interests of justice must reflect due regard to all the relevant factors but it is not necessarily limited to those mentioned above. The particular circumstances of each case will determine which of these factors are relevant.

It is now trite that condonation cannot be had for the mere asking. A party seeking condonation must make out a case entitling it to the court’s indulgence. It must show sufficient cause. This requires a party to give a full explanation for the non-compliance with the rules or court’s directions. Of great significance, the explanation must be reasonable enough to excuse the default.

The interests of justice must be determined with reference to all relevant factors. However, some of the factors may justifiably be left out of consideration in certain circumstances. For example, where the delay is unacceptably excessive and there is no explanation for the delay, there may be no need to consider the prospects of success. If the period of delay is short and there is an unsatisfactory explanation but there are reasonable prospects of success, condonation should be granted. However, despite the presence of reasonable prospects of success, condonation may be refused where the delay is excessive, the explanation is non-existent and granting condonation would prejudice the other party. As a general proposition the various factors are not individually decisive but should all be taken into account to arrive at a conclusion as to what is in the interests of justice.”

[37] All factors should therefore be taken into account when assessing whether it is in the interest of justice to grant or refuse condonation.”

[4] Mulaudzi v Old Mutual Life Assurance Company (South Africa) Limited 2017 (6) SA 90 (SCA). At para 26

[4] Mulaudzi v Old Mutual Life Assurance Company (South Africa) Limited 2017 (6) SA 90 (SCA).

At para 26

[5] Moila v Shai N.O and Others (2007) 5 BLLR 432 (LAC); (2007) 28) ILJ 1028 (LAC) at para 34

[6] Collett v Commission for Conciliation, Mediation and Arbitration (2014) 6 BLLR 523 (LAC)

[7] 62. Disputes about demarcation between sectors and areas (1) Any registered trade union, employer, employee, registered employers’ organisation or council that has a direct or indirect interest in the application contemplated in this section may apply to the Commission in the prescribed form and manner for a determination as to- (a) whether any employee, employer, class of employees or class of employers, is or was employed in a sector or area; (b) whether any provision in any arbitration award, collective agreement or wage determination made in terms of the Wage Act is or was binding on any employee, employer, class or employees or class of

employers.

[7] 62. Disputes about demarcation between sectors and areas

(1) Any registered trade union, employer, employee, registered employers’ organisation or council that has a direct or indirect interest in the application contemplated in this section may apply to the Commission in the prescribed form and manner for a determination as to-

(a) whether any employee, employer, class of employees or class of employers, is or was employed in a sector or area;

(b) whether any provision in any arbitration award, collective agreement or wage determination made in terms of the Wage Act is or was binding on any employee, employer, class or employees or class of

employers.