SAMA obo Galo v Department of Health, EC and Others (P109/2023) [2024] ZALCPE 18 (23 February 2024)

IN THE LABOUR COURT OF SOUTH AFRICA

(EASTERN CAPE DIVISION, GQEBERHA)

CASE NO: P109/2023

DATE: 2024.02.23

In the matter between:

SAMA obo DR LUNTU GALO Applicant

and

DEPARTMENT OF HEALTH, EC 1st Respondent

MEC, DEPARTMENT OF HEALTH

2nd Respondent

HOD, DEPARTMENT OF HEALTH

3rd Respondent

BEFORE THE HONOURABLE MR JUSTICE MAKHURA, M

JUDGMENT

ON BEHALF OF THE APPLICANT : ADV L GAGIANO

ON BEHALF OF THE RESPONDENT: ADV M THYS

MAKHURA, J

Background

1. On 24 November 2023 the applicant, the South African Medical Association on behalf of Dr Luntu Galo, brought an application against the Department of Health, the 1st respondent, the MEC of the Department of Health and the HOD of Department of the Eastern Cape province as the 2nd and 3rd respondents respectively.

2. The applicant in this matter obtained, what is ordinarily referred to as ex parte order in terms of which the 2nd and 3rd respondents were ordered to appear before this court to show cause why they should not be found to be in contempt of court for failing to comply with the court orders of 9 March 2021 under case P124/2020 and second order of 26 November 2021 under case P101/2021 by failing to restore and pay Dr Galo’s full benefits upon his reinstatement to his position of medical services manager.

3. That is the material part of this order. There were additional orders which included costs on an attorney/own client scale to be paid jointly by the three respondents.

4. The history of this matter started over three and a half years ago when on the 25th of June 2020 the applicant obtained an order in terms of which the MEC and the department or head of department were ordered to direct the human resources section or were directed to pay Dr Galo’s salary for May 2020 as well as his salary for successive months as and when they become due for the duration of his employment with the department. Again, the respondents were ordered to pay costs.

5. On the 9th of March, which is the day that another order was issued this court declared the notice of discharge that was issued by the respondents

against the applicant to be a nullity and of no force and effect and ordered the specific performance. The specific performance ordered by this court was reinstatement as a medical services manager at Cecilia Makiwane Hospital with immediate effect. Again, the respondents were ordered to pay the costs.

6. Another order was issued by this court about 3 months later on the 18th of June 2021. That order was issued pursuant to an application for contempt against the respondents. That order, as I understand

the papers, was issued by agreement between the parties in terms of which after reaching the agreement, although the applicant in his papers says that the matter was removed, it is clear that the application was withdrawn from this court and the respondents were ordered to pay the costs.

7. What followed after that was a number of correspondences between the parties or rather to be specific, a letter from the applicant’s attorneys dated the 14th of July 2021. At paragraph 3.1 of the letter under the heading Dr Galo’s reinstatement the applicant’s attorneys wrote:

“We confirm, as per your letter, received on 11 June 2021 that you advised that Mr Galo was reappointed on the system, and back paid an amount of R746 073,23 nett salary.”

8. The letter makes further reference to payment of bonus that was made and it also makes reference to certain payments that were still outstanding. At paragraph 3.4, the applicant raises an issue regarding the deduction from his salary of about R7 000. At paragraph 3.5 of the letter the applicant makes reference to the medical aid contributions that were seemingly at the time an issue that the respondents were not attending to. At paragraph 3.6 of the letter the applicant’s attorneys wrote and I quote:

“We hereby demand that you attend to make contributions to the medical aid payments as well as reimburse Dr Galo for amounts which he has paid out of his pocket.”

9. That demand was preceded by paragraph 3.5 of the letter which reads:

“Dr Galo has further informed us that he currently is not receiving any medical aid contribution from the hospital. We wish to remind you that an order of reinstatement means to place an employee in the same position he or she was prior to the discharge with benefits on the same conditions that previously prevailed to him or her. Dr Galo’s medical aid forms part of the benefits in accordance with his employment contract with the hospital. By reversing the medical aid contribution you have unilaterally changed the terms of employment and in breach thereof and such action is unlawful.”

10. The letter also confirmed a claim for leave payment, which I do not consider material for the purpose of this application.

11. There was a follow-up letter written on the 4th of August 2021 and it will appear that the respondents were not so cooperative and this led to a further order or led to the applicant approaching this court for a further order. That order was granted on the 29th of October 2021. That order was for contempt. It is an order that the respondents be found guilty of contempt for failing to comply with the order of 9 March 2021.

12. There were also a number of exchanges and there was an internal memorandum which, I understand from the papers, was sent to the applicant. This memorandum obviously attempts to explain the respondent’s conduct in its attempts to comply with the order of 9 March 2021. The memorandum makes confirmation of the reappointment on the system and certain payments that were made to the applicant.

13. It will appear that the applicant was still not satisfied with that and on the 26th November 2021 he obtained another order. That order reads as follows:

1) “The respondents to comply with the terms of the order of 9 March 2021 by no later than 21 December 2021 as follows.

1.1) Dr Luntu Galo’s title shall be restored to that of medical services manager at the Cecilia Makiwane Hospital.

1.2) Dr Galo’s medical aid contributions shall be reinstated in full and such employer contributions that were not paid be refunded to Dr Galo as part of his salary.

1.3) Dr Galo’s leave credits will be regularised to include such leave days which were erroneously forfeited.

1.4) Respondents to do all that is necessary to regularise the tax implications of complying with the terms of Dr Galo’s reinstatement to his position as a medical services manager at the hospital.”

14. The second paragraph of that order is payment of the legal costs by the respondent.

15. Again further correspondence ensued between the parties and on the 26th of January 2022 the applicant’s attorneys addressed a letter to the department. Paragraph 3 of the letter reads as follows:

“We have been instructed by Dr Galo that his job title has still not been restored to that of a medical services manager at the Cecilia

Makiwane Hospital.”

16. This letter again raises issues of medical aid contributions and leave pay and the regularisation of the tax implications of the applicant, Dr Galo.

17. On 14th of June 2023 the applicant’s attorneys addressed a further letter to the respondents. In this letter at paragraph 10 the applicant’s attorneys wrote:

“10. We are informed by the hospital that in terms of an internal memorandum dated 28 February 2022 the issue concerning Dr Galo’s job title had been resolved and his job title was reflected as manager medical services.

11. However, we have been instructed that this issue has not been resolved and Dr Galo has been placed on a persal notch 1 and not reinstated in the position of manager medical services, personal notch 2, as directed by the Labour Court in its order of 9 March 2023” (Says 2023, should be 2021).

18. Again, there is a claim or contention in terms of how much, what should be paid to Dr Galo. All of that is set out in the letter. How much, if Mr Galo is placed on notch 2 should be receiving, how much has been received. The issue of leave is again captured in this letter. The issue also of non-pensionable cash allowance, pension and medical aid allowances are also addressed in the same letter.

19. Again, it will appear that not much happened in terms of Dr Galo being satisfied with whether there has been compliance with the court order of 9 March 2021. And as it appears in this court order that was subsequently issued on the 24th of November 2023 the applicant seeks contempt for non-compliance with the two orders; the one of the 9th of March 2021 and the one of 26 November 2021.

20. So in my view the wording of the court order is important. Paragraph 1 is material in that it provides that the respondents are required to show cause why they should not be found in contempt. Significantly I quote what the order says.

“By failing to restore and pay Dr Galo’s full benefits upon his reinstatement to his position of medical services manager at the Cecilia Makiwane Hospital.”

21. In my view the applicant seeks an order to hold the respondents in contempt for failing to make payment of his benefits pursuant to an order of reinstatement by this court on the 9th of March 2021, which was in my view just simply confirmed by the order of my sister, Lallie, J on the 26th of November 2021.

22. It is trite that payments of benefits are provided for or disputes about payments of benefits are provided for in section 186(2) of the Labour Relations Act. Should there be any dispute about such benefits which clearly from the papers are benefits that accrued or were supposed to accrue, of course, as a result of the reinstatement order that was granted – these being benefits that accrued or were supposed to accrue post the court order of 9 March 2021, the available remedy is to process the dispute in terms of section 186 of the LRA.

23. The applicant has however brought these contempt proceedings against the respondents and has to satisfy the test for contempt. This test has been set out in many judgments of the Constitutional Court, Supreme Court of Appeal, including Fakie and the Constitutional Court judgment of Matjhabeng v Eskom, a 2017 judgment.

24. However, the most recent judgment on contempt is that of the Secretary of Judicial Commission of Inquiry into Allegations of State Capture, Corruption and Fraud in the Public Sector, including Organs of State v Zuma & Others, reported in [2021] 9 BCLR 992 (CC). At paragraph 37, the Constitutional Court essentially reiterated what the principles really are. The Court sets out that for a contempt application to succeed the applicant has to show that there is an order that was granted against an alleged contemnor. Secondly, that there has been service on the alleged contemnor or alleged contemnor had knowledge of it. Thirdly, that the alleged contemnor has failed to comply.

25. Once the applicant establishes the three factors, the evidentiary burden shifts to the respondents or alleged contemnor to show that the non-compliance was not wilful and male fide. The same principle, as I indicated was established as early as 2006 by the SCA in Fakie v CCI Systems. It is a judgment that is fairly well known.

26. It is common cause here that the applicant is no longer at least in these proceedings today pursuing an order against the 2nd respondent, which is the MEC of the Department of Health, Eastern Cape. So this application is against the third respondent which is the head of department, Department of Health, Eastern Cape.

27. There has been service of the order on the HOD. It is common cause that the order was granted and served. The HOD has knowledge of the order. The third requirement as I have set out in terms of the test is the failure to comply.

28. The respondents argued in their answering papers, in response to the allegation for failure to comply with the court order, at page 87 of the record, paragraph 5.2 to page 88, as follows:

It is alleged that,

“this part of the relief sought and order has been fulfilled as evidenced by the restoration of Dr Galo from clinical manager to manager medical services. Please refer to a Persal printout denoted as Annexure A for confirmation.”

29. This is the respondent dealing with the allegation that, in particular the issue of job title that he has not been essentially put back to the position as the medical services manager and the reliance that the applicant has put was on the salary slips that also formed part of the record. The respondents have attached in their papers Annexure A as referred to in paragraph 5.2 and that Annexure A, which is a Persal printout, clearly reflects the position of the applicant as manager medical services.

30. In reply to this allegation the applicant submitted in paragraph 32 of his replying affidavit as follows:

“The tax issues were corrected retrospective, IRP5’s issued to rectify the errors made in 2021. However, recent payments made on 22 December 2023, 15 January 2024, 12 February 2024 have triggered notice issues, payments made for the 2021/22 financial years are once again reflected in the current tax year, thus recreating the burden that arose in 2021. The tax issues particularly affect the payments made on 12 and 15 February 2024.”

31. In fact, the correct referencing, the paragraph I have just read out, although it also seeks to respond to paragraph 5.2 of the

respondents’ answering affidavit, the specific one that addresses the issue of the job title is at paragraph 28 of the replying affidavit which reads:

“[28] It is so that Dr Galo’s job title was corrected in December 2021 from clinical manager to manager medical services following a court order of 26 November 2021. Annexure A to the respondents’ answering affidavit as at 26 May 2022 accurately displayed Dr Galo’s correct job title as manager medical services. However, Dr Galo’s job title has since been reverted back to clinical manager again as is evident from Dr Galo’s most recent payslip dated 12 February 2024. A copy of which is annexed hereto and marked as FA23. The respondents have effectively demoted Dr Galo to clinical work while he has been employed as a non-clinical manager.

[29] Regardless even after the respondents have temporarily corrected Dr Galo’s job title he remained on a persal notch throughout (and still does) when he was and is supposed to be on a notch 2. This significantly and incorrectly impacts his remuneration and [indistinct] over time.”

32. What I have just read out in the answering affidavit and the relying affidavit clearly suggests that there is an issue about the job title of Dr Galo. Mr Thys, for the respondent, has submitted that for all intents and purposes Dr Galo has been reinstated and is in terms of the Persal report a manager medical services. That is supported by a report from Persal.

33. The applicant has provided the payslip to substantiate that he has not been reinstated. However, the difficulty in this case is that or in the applicant’s case is that he was reinstated, which I do not need to go through the legal principles of what reinstatement means. Those are covered extensively in the same judgment that I am about to refer to which is the judgment of NUMSA obo Fohlisa & Others V Hendor Mining Suppliers (2017) 38 ILJ 1560 (CC).

34. In that judgment, which is now the trite legal principle, it was held that the restoration of a contract of employment has the result that an employee has a contractual claim for payment in arrear salaries. So that is with reference to post reinstatement of an employee, that any claim for arrear salaries is a contractual claim.

35. This was also confirmed in the LAC or reiterated in the LAC judgment of Kubeka & Others v Ni-Da Transport [2021] 4 BLLR 352 (LAC). In that case the court reiterated that reinstatement essentially resulted in the restoration of employment contract and any claim to wages and I must add, and benefits, is a contractual claim and I will add in respect of the benefits part or aspect of it, an LRA claim in terms of 186(2) of the Labour Relations Act. And those two claims - contractual or the claim in terms

of 186(2) are to be dealt with within the terms of the relevant legal prescripts and legal proceedings.

36. I have already indicated that section 186(2) claims are ordinarily unfair labour practice disputes which must be referred to the relevant bargaining council or the CCMA. For contractual claims, of course this court has jurisdiction in terms of the Basic Conditions of Employment Act to entertain.

Conclusion

37. So what is before me today is a matter where there is clearly an issue firstly, with the court order itself that it seeks to hold the respondents in contempt for failing to make payments.

38. Although the court order specifically makes reference to the benefits, the application seems to suggest also that there is an issue with the job title. As I have indicated, that issue relating to the job title is clearly disputed by the respondents. In my view the applicant should have foreseen this potential dispute of fact and should have decided to act accordingly. I have no reason to doubt the Persal report that has been produced. I have no reason to disagree or reject Mr Thys submission that that is the current position.

39. On that basis alone this application should fail. However, even if I am wrong on this, the applicant‘s application in substance is really an application for a claim for payment of monies. Payment of monies arising from contract have to be addressed in a separate legal process. At some point the applicant suggested there was some unilateral change of the terms and conditions.

40. What is very clear here is that the application is about certain increases that should be effected to him and it is in my view incompetent for the applicant to bring such an application by way of contempt proceedings.

41. On the basis of NUMSA obo Fohlisa & Others v Hendor Mining Supplies and the Kubeka judgment that I have referred to earlier, the applicant’s remedies are elsewhere, definitely not found in contempt proceedings. On that basis again, this application must fail and it is therefore dismissed.

Costs

42. With regard to the issue of costs, both parties have sought costs. I am mindful of the fact that there has been cost orders awarded to the successful litigant, it has been a trend in the litigation between these two parties which have an unfortunate history of non-stop. Over the past three and a half years, the applicant has been to this court about seven times. In almost, if not all of those occasions, the respondents were ordered to pay costs.

43. Therefore I do not see any reason why costs should not be granted in this application. Ms Gagiano, for the applicant has also insisted that costs should be paid and that was her instruction.

ORDER

1. The application is dismissed with costs.

THE HONOURABLE MAKHURA, M

LABOUR COURT OF SOUTH AFRICA

DATE