Viljoen v Johannesburg Stock Exchange Ltd (JS398/15) [2016] ZALCJHB 361; (2017) 38 ILJ 671 (LC) (23 September 2016)

THE LABOUR COURT OF SOUTH AFRICA, JOHANNESBURG

JUDGMENT

Reportable

case no: JS 398 / 15

In the matter between:

RISMA VILJOEN

Applicant

and

JOHANNESBURG STOCK

EXCHANGE LTD

Respondent

Heard: 8, 9, 10 and 11 August 2016

Delivered: 23 September 2016

Summary: Operational requirements – redundancy of position – meaning of – employee’s position redundant

Operational requirements – alternative position – employee required to apply for available alternatives – employee refusing to apply thus exposing herself to retrenchment

Operational requirements – alternative positions – what constitutes reasonable alternative – alternatives available to employee reasonable

Operational requirements – procedural fairness - principles considered – where employee could avoid her own retrenchment issue of procedural fairness does not arise

Operational requirements – consultation process – joint consensus seeking process – requires proper participation in the process by both parties – employee defeating objectives of process by entering the process with pre-decided agenda

Dismissal – operational requirements – dismissal substantively and procedurally fair – application dismissed

Severance pay – entitlement to – Section 41(4) of BCEA considered – employee unreasonably refused alternative position – not entitled to severance pay

SNYMAN, AJ

Introduction

[1] This case is an unfortunate example of all that can go wrong if parties do not genuinely engage one another in a retrenchment consultation process, with a proper open mind as to one another’s respective positions. An intransigent approach to retrenchments consultations more often than not has the consequence of jobs being lost, when this could have been readily avoided. This matter is a case in point.

[2] The applicant has brought a case of unfair dismissal based on operational requirements to this Court. The applicant has brought this case by way of statement of claim filed on 27 May 2015. The applicant contended that her dismissal was both substantively and procedurally unfair. The respondent, on the other hand, contended that it never wanted to retrench the applicant, and that it was the applicant’s own conduct that caused her ultimate retrenchment, which according to the respondent was in all respects fair. The applicant has further claimed that she be paid severance pay, which the respondent refused to pay her.

[3] The matter came before me on trial on 8 to 11 August 2016. I will now decide this matter by first setting out the relevant facts.

The relevant background

[4] The pertinent facts in this matter were mostly common cause. The matter was also well documented, with most of the interaction between the parties being confirmed in correspondence. Also, all the consultations were recorded and transcribed, and the transcripts were accepted by both parties to be a true and correct reflection of what transpired in the consultations. This leaves me in the fortunate position that very little in this matter turns on the credibility of witnesses, or disputed evidence.

[5] The applicant commenced employment with the respondent on 1 August 2008 as a marketing officer / assistant. The applicant was promoted on 1 January 2013 to marketing manager. It was common cause that the applicant’s position of marketing

manager made her responsible for the disciplines of both marketing and branding, in the respondent, which was all part of her position.

She initially had five subordinates reporting into her, but this was later reduced to three when two analysts that reported to her were moved out to another department in August 2014. Her post grade was at all relevant times classified as H13.

[6] On 1 June 2013, Mpho Ledwaba (‘Ledwaba’) was appointed by the respondent as its Head of Marketing. Ledwaba testified that towards the end of 2013, he was tasked by the respondent to investigate how to grow the respondent’s possible retail market. In simple terms, his mandate was to grow the retail market where it came to individuals investing on the JSE.

The research conducted in this regard showed that indeed there was a business opportunity for the respondent, in that it only managed to accumulate some 260 000 investors in the last 15 years, whilst the research showed a potential market of at least 1.2 million such investors. Added to this was the recent taxation changes where certain investments would be tax free and this would also make investment on the JSE palatable for such individual investors.

[7] According to Ledwaba, going after the retail market necessitated a substantial change in the respondent’s marketing focus. Up to that point, marketing had mostly been education based, meaning that the respondent presented lectures and other forms of education as to what the market was, and so attracted investors. It was not very successful. Ledwaba said that the target of new investors in terms of the new marketing focus was 35 000 new investors in the first year.

[8] The current marketing structure up to that point, and as referred to above, had the marketing manager dealing with all issues relating to marketing, and this included branding. Part of the new strategy was to separate marketing and branding, with a particular focus on each discipline.

[9] As to the brand, it was decided that much more emphasis would be placed on the brand than had been the case before. The first step was a rebranding, followed by extensive brand roll out, and then brand maintenance and management. This would also include further development and expansion of the brand if circumstances change (the brand needed to constantly evolve). The brand had to convince the individual investor that the JSE was readily accessible and approachable. Regular brand surveys needed to be conducted on social media and other platforms.

[10] Turning then to marketing going forward, there would be a complete change in focus, from mostly education based marketing to active retail marketing. This necessitated an increase in the marketing budget, from about R600 000 at that point in time to about R6 million. There would be focus on mass media advertising and more effective engagement on channel marketing through brokers and other partners. Campaigns to recruit new retail customers would also be launched. New products were to be designed and launched, especially in the context of the new tax free savings allowances. Of course, several of the existing marketing functions would remain, albeit that it would be done differently and more extensively.

[11] According to Ledwaba, the existing customer database was in a poor state. It was obsolete in several respects, and was basically a list of e-mail addresses. The new focus would be to firstly clean up, and then grow this database. The database had to be an effective tool to use as a platform for direct marketing. It was a much larger and detailed exercise than what had been the case before.

[12] As to the applicant, she started reporting directly to Ledwaba as from 1 January 2014. With the above changes in mind, the applicant was specifically tasked with the rebranding of the respondent. The applicant had in fact started with this rebranding process already in 2013. The applicant was instrumental in effecting this brand change, and as said by Ledwaba, she did an excellent job in this regard. The applicant was then also responsible to roll out this entire brand. The new brand was first introduced on 14 April 2014.

[13] What the evidence showed is that before the above changes testified to by Ledwaba, and in particular in 2013, the applicant would spend about 75% of her time on marketing, and 25% of her time on branding. Because of the rebranding exercise in 2014, to which the applicant was dedicated, this percentage changed to 55% of time spent on branding and 45% on marketing.

[14] With all the above in mind, the respondent’s board decided that a structural change where it came to the marketing department was necessary. It was decided that separate focus and responsibility was needed in respect of branding, on the one hand, and marketing, on the other. In order to achieve the envisaged objectives, the board approved that the former position of marketing manager in essence be split into two positions, being separate marketing manager and brand manager positions. This split in the position would also affect some of the subordinates. Both these new positions would then report to Ledwaba as Head of marketing.

[15] The respondent then proceeded to grade these two new positions. This grading was done by an external contractor certified in Hay grading. The grading exercise confirmed a H13 grade for both the marketing manager position and the brand manager position. The respondent then engaged Deliotte to develop a role profile for each of the positions, which included the actual job profile, the job requirements, and output requirements. And then finally, PWC was engaged to benchmark the positions against

other related positions in the market. The salaries attached to both these positions would be the same. After this whole exercise, what existed was two proper new positions that needed to be filled.

[16] In simple terms, what used to be done in one position would now be done in two positions. But that was just part of it. What would further need to be done in the two positions would be a lot more, in each specific positon, as well. Because of the operational change, each discipline of brand and marketing now required its own manager focusing only on that discipline. The operational change justified these two separate positions.

[17] I may at this stage add that the passing of time revealed that this view adopted by the respondent was indeed justified. When the matter came up for trial, the respondent still had separate marketing and brand managers. Not only that, the brand manager position had grown to now having two subordinates reporting to it instead of the one originally envisaged. The marketing manager position still had three subordinates reporting to it. I raise this as confirmation of the fact that there indeed

two proper and viable positions created.

[18] According to Ledwaba, the reality of this change would mean that the applicant’s existing position of marketing manager, would be redundant. It would be replaced by these two new positions. As such, she would be affected by this intended restructuring and would need to be consulted in terms of the LRA. There were four other affected employees, along with the applicant, that needed to be consulted.

[19] Ledwaba made it clear that despite this intended restructuring, the primary objective of the respondent was not to lose employees. The idea was to fill all the new positions with the existing employees, and even if there was not a proper fit of an employee in a position, a development program would be applied to the employee to as to train the employee and provide the employee with the necessary skills. But because positions were effected, the respondent felt it necessary to apply a proper process. As far as Ledwaba was concerned, the applicant was competent to fill either of the new marketing manager or branch manager positions.

[20] Pursuant to following due process, the applicant was presented with a notice as contemplated by Section 189(3) as to the intended restructuring, on 14 November 2014. This notice summarized all the objectives referred to above. It was recorded that the process to follow was aimed at avoiding any retrenchments. The applicant was informed of the splitting of the positions, as aforesaid, and that all five positions in the marketing department were affected. It was proposed that selection for placement in the new positions took place on the basis that employees apply for the positions they wanted and then be interviewed by a panel and be placed in a position commensurate to skills and experience.

[21] The Section 189(3) notice was handed over following a detailed presentation on 14 November 2014, conducted by Ledwaba, and as supported by a slide show. In this presentation, the new marketing strategy was fully explained. It was explained why the change was necessary. The strategy on how the change was to be rolled out was explained. The new structure was also explained.

[22] It was undisputed that a number of consultations were held between the applicant and the respondent, the first being on 18 November 2014 and the final being on 9 January 2015. Each consultation will be individually dealt with hereunder. But what must be said, at this stage, is that the applicant approached each consultation on the basis of a specific modus operandae. She went into each consultation with a pre-prepared script, and only engaged in the consultations based on that script, which script was also handed to the respondent in each consultation. The applicant indicated that she was being assisted and advised throughout by what she called her ‘legal team’. In all these consultations, the respondent was represented by Ledwaba, and the human resources manager, Shyless Nkuna (‘Nkuna’).

[23] As stated, the first consultation with the applicant was scheduled for, and then took place on, 18 November 2014. The applicant, from the outset, was asked if she had any questions about the Section 189(3) notice and the presentation made on 14 November 2014, as well as the process going forward. The applicant immediately reverted to her script. Reading from her script, the applicant said she wanted all her questions answered in writing, first, before she was willing to consult. The applicant made submissions in support of a request that she be legally represented in the process. The applicant asked for a ‘detailed description’ of the changes / new functions as between her existing position, and the new positions of marketing manager and brand manager, as well as the job profiles relating to these new positions. The applicant further asked for the job profiles salary ranges of all available positions, and in particular the positions of marketing officer and marketing administrator. And with regard to the selection process proposed, the applicant asked for particulars as to who the members of the panel would be, what criteria would be used, and how would the criteria be scored. She finally asked for the value of the ‘training’ the respondent would provide as part of its proposals in the Section 189(3) letter.

[24] In response to the question about the new roles of marketing and branding, and the positions associated with this, Ledwaba on 18 November 2014 proceeded to offer a detailed explanation as to why this was needed and what was envisaged. The explanation was more or less the same as has been set out above. He asked the applicant if he had answered her question in this respect, and she said that he did. As to all the other information sought by the applicant, and in response to question by Nkuna whether the parties could consult on it in the consultation, the applicant answered that she required the answers in writing first before she would consult.

[25] Ledwaba however did indicate to the applicant that she needed to indicate which positions she was interested in, as well as her order of preference, so this could be dealt with. The parties also proceeded to make arrangements as to when the questions would be answered by the respondent, as well as the date of the next consultation.

[26] The respondent then answered the applicant’s questions, in writing, on 21 November 2014. As to legal representation, it was indicated to the applicant that she was free to consult a lawyer, but the respondent had no obligation to consult with a lawyer on her behalf and declined to do so. The reason for the two new positions as well as the focus of each position was explained. As to the information on the more junior positions the applicant wanted, the respondent stated that this would be consulted on at the appropriate time should the need arise, as it had concerns whether this would even be viable alternatives for the applicant, considering the diminution in level and status.

[27] The applicant’s questions as to the interview panel, the criteria used, and how it would be scored, were also answered. The applicant was informed that it was not possible to provide her with the value of the training at this stage, as it first had to be established of training was even needed, and if so, what training and to what extent.

[28] The next consultation convened on 26 November 2014. Again the applicant came with a script. The applicant confirmed that her questions from the previous consultation had been answered, and then immediately proceeded to state her ‘concerns’ with the process which she then read from her script. Significantly, the applicant confirmed that she ‘fully supported’ the new structure and the dividing of her existing marketing manager positions into two new positions of branch manager and marketing manager. The applicant also took no issue with the rationale for the restructuring.

[29] The concerns the applicant raised, as read from her script, was that she disputed the fact that she needed to apply for one of these two positions. The applicant indicated that she met the requirements of both positions. She stated that she did not understand why she needed to be subjected to an interview. She stated that she did not get the proper salary band for the new positions, which means the respondent can simply alter the positions unilaterally should she apply for it. The applicant then indicated that as far as she was concerned, and based on what she called an ‘industry standard’, the brand manager position was not the same level as marketing manager and brand managers earn less.

[30] The applicant proposed that the respondent forgo the interview process and that the applicant remain in her current role as marketing manager and that this role be amended by way of negotiation with her, coupled with an undertaking not to reduce her salary or benefits. The applicant also said that she would be willing to accept an offer of a voluntary exit should the respondent not want to retain her services. The applicant did not want to consult on any of the issues she raised, but required an answer from the respondent in writing.

[31] The respondent answered in writing on 28 November 2014. The respondent recorded than an actual consultation process with the view to reach consensus, in which there was a free flow of discussion and ideas in the consultation, was far more appropriate that the current written process the applicant was insisting on. Nonetheless, the respondent did answer the issues raised by the applicant, in writing. The respondent explained that because the applicant’s current marketing manager position was not the same as the new position, and her former position was redundant, she could not just stay in her existing position and needed to apply for one of the new positions.

[32] The respondent explained that it never doubted the applicant’s ability, competence and experience, but a proper restructuring process was required by law to be held, and this process had to be fair. According to the respondent, a fair process envisaged the applicant applying for the positions she wanted, and then be interviewed, and matched to a position. The respondent stated that the brand manager position was at the same level as the marketing manager position. The respondent made it clear that it wanted to retain the services of the applicant, that it appreciated her valuable skill and experience, and that the new structure offered her suitable alternative positions. The respondent urged the applicant to participate in the process.

[33] The next consultation took place on 3 December 2014. Once again, the applicant came with a script. The respondent sought to engage with the applicant, asking whether she was interested in the marketing manager position and whether the process could go forward by way of her applying for the position. Nkuna explained to the applicant that it required a psychometric assessment of the applicant for this role as well, which would be ‘helpful’. Instead of engaging with Nkuna on what she said, the applicant then simply read her script again. The applicant remained adamant that she would not participate in a process where she would have to apply for the role of marketing manager, and that her current position must just be ‘amended’ on the basis she earlier demanded. She again raised the issue of a voluntary exit package.

[34] Nkuna answered saying that an exit package was not on the table, as there was a reasonable alternative for the applicant and the respondent did not want to retrench her. Nkuna was at pains to explain that that from a salary, grade and status point of view, the applicant would not be affected should she apply for any of the two positions. Nkuna said there could be no disadvantage to

the applicant in simply applying for a position in the process. Ledwaba explained it would be unfair towards other employees to have one process for the applicant, and another process for all the other employees, and reiterated that in order to be fair, the respondent must apply the same process to everyone. Nkuna explained that all other affected employees went through the same process.

[35] The applicant answered that based on legal advice she received, she disagreed with what was being explained to her. The applicant maintained her earlier views. The applicant again wanted a response in writing, and did not want to consult on any of the issues in the consultation itself.

[36] The respondent then answered in writing on 5 December 2014. On this occasion, it sought to place its final position with regard to the alternative positions and the selection process on record. The respondent confirmed the applicant’s existing position was redundant. The respondent stated that its interview process was not unreasonable and not aimed causing the applicant embarrassment. The respondent urged the applicant to apply for one of the alternative positions available. The applicant was warned that if she missed the opportunity to apply for a position, and then be retrenched, she would not receive severance pay. It was

made clear that a voluntary retrenchment option was not available to the applicant.

[37] Following further written questions raised by the applicant, Nkuna answered in writing on 9 December 2014, and explained why the respondent believed psychometric tests to be appropriate as part of the selection process. Nkuna however specifically said that should any of these tests reveal deficiencies, this would not be used as a basis for disqualification of any employee, but further training and skilling of employees will be provided, to avoid any retrenchment. In short, what the respondent meant was that if it should ever be considered that there were deficiencies on the part of the applicant with regard to any of these two new positions she may apply for, this would not be used to disqualify her for the position applied for, but rather be used as

basis to further skill and train her.

[38] The next consultation convened on 10 December 2014. Again, the applicant attended script in hand. Nkuna opened by explaining exactly why the respondent believed the psychometric test would be appropriate, so as to fully inform the applicant as to this purpose when she would apply for a position, going forward. Nkuna explained the psychometric test was part of the ‘development plan’ relating to employees, going forward, as well. Nkuna then asked the applicant pertinently whether she is refusing to apply for the positions.

[39] The applicant once again did not engage the respondent in actual consultation. She once again simply read her script. The script read more like a legal argument as to why the process was unfair, and had little to do with consulting with the respondent with the view to reach consensus. It serves little purpose to repeat all these submissions, which are mostly incompatible with the nature of a process of consultation. The applicant maintained her view and argument that the brand manager position is a demotion, and that she simply remain in her position of marketing manager to be amended by agreement with her. The applicant

even goes so far as to quote case law as to why she would be entitled to severance pay.

[40] But then, and of importance, the applicant makes it clear that she will not apply for the brand manager position as she considers it to be a demotion. The applicant also makes it clear that she will not apply for the marketing manager position because she contends it is not fundamentally different from her existing position, no one else met the requirements for the position, and she was willing to ‘amend’ her existing position. The applicant finally made it clear that she would not apply for any

other positions. The applicant then said she was willing to engage on a voluntary exit package. This was the same position the applicant adopted form the start of the process.

[41] Nkuna answered by explaining why the brand manager position was not a demotion and in fact a position on the same grade. But what Nkuna further tried to explain to the applicant was that no one was forcing her to apply for brand manager position, and she could apply for any one of the two positions as she wished, or even both. Nkuna made it clear that the applicant however had to apply. Ledwaba explained that if the applicant applied for the brand manager position, her grade, salary and benefits would be the same as she currently enjoyed. Both Ledwaba and Nkuna then again sought to explain in detail why it was important and necessary to a fair process that the applicant must apply for the marketing manager position if she wanted it. The applicant remained firm that she would not apply for any of the two positions, for the reasons she had given, and in particular with regard to the marketing manager position, because she believed she did not have to apply. Despite fairly lengthy discussion to and fro

on these issues on 10 December 2014, an impasse arose.

[42] The entire situation then came to the attention of the respondent’s managing director, Nicky Newton-King (‘Newton-King’). Despite having no involvement in the process, Newton-King called the applicant to a meeting on 11 December 2014 to discuss the situation, as there was no intention on the part of the respondent to have to retrench the applicant. Newton-King tried to assure the applicant that there was no risk to the applicant to just participate in the process and apply for the position she wanted. Newton-King also assured the applicant that there was no reason to believe that her application would have any other outcome than a positive outcome, as the applicant was a valuable employee the respondent would like to retain. The applicant conceded in evidence that she believed this approach from Newton-King was genuine, and she left the meeting to think about what she had been told.

[43] Inexplicably, and on 12 December 2014, the applicant sent an e-mail to Newton-King, simply falling back on her earlier position. The applicant raised the same arguments she raised from the outset. She was not willing to give an inch, throughout. The applicant copied the human resources director, Njabulo Mashigo (‘Mashigo’) on the e-mail.

[44] Mashigo answered the applicant on 12 December 2014. He expressed his concern that the applicant was not consulting in a bona fide manner but rather presenting legal argument drafted by a legal representative. Mashigo confirmed that it had been explained in

detail to the applicant why the two new positions were different from her former position, which was redundant. Mashigo further

confirmed that it had been explained in detail to the applicant why she needed to participate in the process by applying for a position. Mashigo stated that the applicant was capable of fulfilling both the marketing manager and branding manager positions, and the interview process was there to determine which she was most suited to and what was needed to develop her (if needed). But of importance is that Mashigo then made a concession to try and resolve the matter with the applicant, considering the impasse that had been reached as referred to above. Whilst Mashigo reiterated the respondent’s view that the applicant needed to apply and be interviewed, Mashigo nonetheless stated that the applicant would be placed, without application or interview, in the brand manager position.

[45] Significantly, it was explained why the applicant was being placed in the brand manager position. The fact is that in the last two years, the applicant devoted most of her time and effort to the brand discipline and she excelled at it. She had a very current and proven track record in this regard. Ledwaba testified that from his interaction with the applicant over the last year, he was convinced that brand manager was most suited to the applicant. In simple terms, the respondent considered placement of the applicant in the brand manager position as the most viable, where it came to unilateral placement. Mashigo assured the applicant that brand manager was not a demotion. The applicant was given time to consider her position until January 2015, when she

would then be placed in the brand manager position. But even in these circumstances, Mashigo still made it clear to the applicant that if she wanted the marketing manager role, all she needed to do was apply, and be interviewed. The applicant was asked to convey her intentions.

[46] The applicant responded on 19 December 2014. Needless to say, nothing changed. She adopted the same position, and raised the same arguments as before. However, and this correspondence, the applicant intimated that by placing the applicant in the brand manager position, the respondent was ‘driving’ at a specific outcome. The applicant proceeded to try and discredit the scope of the envisaged band manager position. But, and worse still, despite the respondent making it clear that placing her in the brand manager position without application or interview was a concession aimed at resolving the impasse, the applicant then accuses it of inconsistency in its own process. The applicant concluded her correspondence by refusing to accept the brand manager position, refusing to apply for the marketing manager position, and leaving it up to the respondent to advise on the ‘next steps’.

[47] Despite the applicant’s adopted position, Mashigo tried to give it one last chance, and wrote to the applicant again on 20 December 2014. Mashigo explained that what he was concerned about is that it would seem in the consultations that the applicant understood what was being conveyed to her, but would then return with correspondence that displayed a mind closed to debate, discussion or persuasion. Mashigo pointed out that the applicant adopted a fixed position from the outset not open to any persuasion or change. Mashigo confirmed the applicant’s former position was redundant, and she could apply for, and be interviewed, for either of the two new roles, but refused.

[48] Mashigo made it clear that placing the applicant in the brand manager position was what the respondent considered most suitable, as a compromise, and to resolve the impasse. Mashigo confirmed the brand manager would not be a demotion and the applicant would have the same salary, benefits, grade and status as before. Mashigo confirmed that if the applicant wanted the marketing manager position, she needed to apply and be interviewed. Mashigo then drew the line in the sand so to speak. He said that when the applicant came back from leave on 9 January 2015, she had one of two options. She could either start work as brand manager, or she could apply for marketing manager. If the applicant did not accept one of these two options, she would face

retrenchment without severance.

[49] In line with this correspondence from Mashigo, the final consultation with the applicant then convened on 9 January 2015. This was the one and only consultation the applicant came to without a script. The respondent recapped the process to date. It was confirmed by the applicant that she still refused to accept the brand manager position, and refused to apply for the marketing manager position. The applicant was then presented with a letter of termination of employment, dated 9 January 2015, which was discussed with her. It was discussed with her why her employment was being terminated and what payments she would receive

on termination of employment. It was explained to her why she would not be paid severance pay. The applicant’s effective date of termination of employment was 28 February 2015.

[50] The applicant was not required to work out her notice, and was paid in lieu of notice. The applicant was not paid severance pay. The applicant referred an unfair dismissal dispute to the CCMA on 6 February 2015. An entitlement to severance pay dispute followed on 2 March 2015. Conciliation failed (respectively on 27 February and 7 April 2015), and both these disputes were then referred to the Labour Court, by the applicant, as aforesaid.

[51] In her Labour Court statement of case, the applicant challenged the fairness of her dismissal as being both substantively and procedurally unfair and demanded reinstatement as marketing manager alternatively maximum compensation. She also demanded the payment of severance pay. I will now deal with each of these elements of the applicant’s case, next.

Was the dismissal substantively unfair?

[52] The issue of whether a dismissal for operational requirements is substantively fair is decided by way of answering what is called a general question and a specific question. As said in Chemical Workers Industrial Union and Others v Latex Surgical Products (Pty) Ltd[1]:

‘Whether or not there was a fair reason for the dismissal of the individual appellants relates to a general question and a specific question. The general question is whether or not there was a fair reason for the dismissal of any employees. The specific one is whether there was a fair reason for the dismissal of the specific employees who were dismissed, which in this case, happened to be the individual appellants. The question of a fair reason to dismiss the specific employees who were dismissed goes to the question of the basis upon which they were selected for dismissal whereas the other question relates to whether or not there was a reason to dismiss any employees in the first place.’

[53] In answering the general question first, it was apparent from the evidence of both parties in Court that the applicant never took issue with what can be said to be the rationale of the restructuring. It was accepted that the respondent was entitled to restructure in pursuit of the objectives as set out above, and that the splitting of the position of marketing manager, which position encapsulated both marketing and branding, into separate marketing manager and branding manager positions, made business sense and was operationally

justified. The applicant confirmed in the consultations what she supported this new structure, and the objectives the respondent

sought to achieve in terms thereof. Therefore, there exists a proper business rationale in this instance. As said Kotze v Rebel Discount Liquor Group (Pty) Ltd[2]:

‘…What we have to do is to decide whether the respondent's decision to retrench was informed and is justified by a proper and valid

commercial or business rationale. If it is, then that is the end of the enquiry even if it might not have been the best under the

circumstances. …’

[54] Hindsight confirms the veracity in the respondent’s restructuring. It managed, in the new structure, to secure some 25 000 new customers against a target of 35 000 for the first year. The position of brand manager expanded to include a further assistant to the one originally envisaged. Both positions operate at proper efficiency. There would therefore be little scope for interference in what the respondent thus sought to do, and achieve. The fact is that the general question must be answered in favour of the respondent.

[55] This then leaves the specific question, being whether there was a proper reason to retrench the applicant, specifically. The crux of the case of the applicant, where it came to substantive fairness, was that her position of marketing manager had not become redundant. The applicant’s case was that the new marketing manager position was substantially the same position she had been occupying, and therefore there was no obligation on her to apply for what was not a new position. According to the applicant, all the respondent needed to do was keep her in her existing position, and if the respondent wanted to make changes to that position, it should negotiate with her with the view of reaching agreement on this. As to the brand manager position, the applicant’s case is that this position would be a demotion for her and thus should not feature in assessing whether her

dismissal was fair.

[56] The respondent case, in simple terms, was that the position of marketing manager the applicant had occupied ceased to exist, and was thus redundant. What was formerly one position was now two distinct and separate new positions that did not exist before. The respondent accepted that the applicant would be competent to fill either of these positions, which positions were of the same grade, status, salary and benefits. There were just now two different disciplines associated with each position. According to the respondent, when the applicant consistently refused to either apply for or accept any of these two positions, which would

have avoided her retrenchment, she in effect selected herself for retrenchment.

[57] I will commence deciding these cases by the parties by way of answering the core question – was the applicant’s existing position of marketing manager rendered redundant in the new structure? In other words, was the new marketing manager position substantially the same as the old marketing manager position? In the light of the reasons to follow, I have little hesitation in concluding that the applicant’s existing marketing manager position was indeed redundant in the new structure.

[58] Firstly, and even on the applicant’s own version, her position of marketing manager as it existed consisted of, so to speak, 75% marketing and 25% brand in 2013. And in 2014, it was 55% brand and 45% marketing. I accept that the additional brand duties in 2014 coincided with the new brand roll out, but considering what the respondent had in mind where it came to brand, going forward, brand would be a significant component of marketing in general as a standalone function. I believe that if the respondent did not split the position of marketing and branding, and then implemented the new business strategy, the applicant would have spent close on equal time in her position attending to the respective disciplines of marketing and branding. As I have touched on above, hindsight confirms this to be more or less the case.

[59] In any event, if at least 25% of a position and its responsibilities are stripped out and moved to another position, it simply cannot be said that what remains is the same position. In short, a marketing manager position attending to marketing and branding is not the same as a marketing manager position doing only marketing, especially considering that branding is a justified discipline on its own. Logic and common sense dictates this kind of conclusion. The fact that the applicant could not appreciate this, despite extensive discussion and explanation, is disturbing. It in fact shows how closed her mind was to any scenario that was not in line with her own subjective views. It has to follow that the new marketing manager position, on this basis alone, is just not the same as the applicant’s existing marketing manager’s position.

[60] What the applicant did in the course of the consultation process was to take the position profile of the new marketing manager position she was provided with by the respondent, and compare it to what she was doing in her existing position. Based on this comparison, she then sought to argue that the new position profile contained virtually exactly the same functions as her current position. The problem with this comparison is that it completely misses the point, as Ledwaba was at pains to try and explain to the applicant.

[61] In fact, a simple example can be found in the increase in the budget. Ledwaba explained that to manage a budget of R600 000 is not the same as managing a budget of R6 million, which is what the new position came with. I tend to agree. Clearly there would be more responsibility in managing such a drastically increased budget, as well an increased scope in spending which must be managed. This is different to what it was before. In simple terms, by way of comparison, it can hardly be said that managing a corner shop is the same as managing a massive retail supermarket.

[62] I accept that at the level of basic description, for want of better terminology, the functions of the applicant’s existing position and the new marketing manager position may be quite comparable. But yet again, such an approach misses the point. Take for example what Ledwaba referred to as retail marketing. According to Ledwaba, the manner in which retail marketing took place under the applicant’s existing position was by way of events and education. Now the emphasis would be on direct retail marketing, channel marketing and mass advertising, with the objective of directly leading to the procurement of new customers.

[63] Although, in general terms, both these instances can broadly be described as retail marketing, it is not the same. This same kind of situation would also apply to the other marketing functions in the new marketing manager position. In the end, and considering that which Ledwaba fully explained, where it came to new strategy and objectives of the respondent where it came to marketing, it is in my view common sense that the ‘job’ the applicant did and the ‘job’ associated with the new position are different to the extent of making it a different position.

[64] Ledwaba testified as to how the new marketing manager and the existing marketing manager positions differed, in particular in focus, scope, strategy and deliverables. This evidence was not really challenged, and fully corresponded with the documentary evidence and what was sought to be conveyed to the applicant in the consultations. The applicant’s adopted position where it came to comparing the two positions was simply out of touch with reality, and basically her own personal and subjective opinions.

[65] Accordingly, and based on the removal of the brand discipline from the existing marketing manager position, as coupled with the addition of duties and the change in focus, scope, strategy and deliverables to the new marketing manager position, I have little hesitation in accepting that the new marketing manager position was not the same position as that occupied by the applicant before the restructuring. As touched on above, the applicant actually agreed with the new business strategy of the respondent and

the changes to its organizational structure as a result, and in particular, the splitting of the position.

[66] I am satisfied that the applicant’s position she occupied was de facto redundant. One can do little better than to draw a comparison with the following dictum from the judgment in Van Rooyen and Others v Blue Financial Services (SA) (Pty) Ltd[3] where it was held as follows:

‘… It is clear though that the regional managers would, in the restructured organization, be required to undertake additional responsibilities in relation to the expanded product lines and that the nature of their function would change. On balance, I am satisfied that the respondent has established that the difference in job content between the old and the new profiles of the regional managers' positions was sufficiently significant to justify the requirement that the applicants be assessed for their suitability for appointment to the new positions. Indeed, this appears to be the approach adopted by the applicants themselves in their memorandum addressed to Klopper on 28 December 2007 in which they appear to accept that the new profile developed by the respondent was technically exact and complete, and that the additional responsibilities that regional managers would be required to assume had the consequence of an appreciable difference in job content. … In short, I am satisfied that the respondent has established a fair commercial rationale for its decision to restructure its business operations and that the change rendered the applicants redundant, at least in the sense that its decision to assess the applicants' suitability for the restructured posts was fair in the circumstances.’

The comparisons to the matter in casu are apparent.

[67] In Plaaslike Oorgangsraad van Bronkhorstspruit v Senekal[4] the Court accepted that redundancy can result from a reorganization of a business. Similarly, and in Broll Property Group (Pty) Ltd v Du Pont and Others[5] the Court held that redundancy of job included the following:

‘… on the evidence their jobs did become redundant; it was their duties that remained and were allocated for performance by other employees

within the revised structure.’

The aforesaid being found to be the case, the Court then concluded:[6]

‘… It followed that the three respondents were liable to be dismissed for substantive reasons unless they were appointed to other positions

within the revised structure. …’

In simple terms, the aforesaid is what happened to the applicant. Her duties relating to branding and also marketing were allocated to other new positions, still vacant. But even her existing duties relating to marketing were different as well, as has been discussed above. There can be no doubt redundancy existed.

[68] With the applicant’s former position in fact being redundant, and pursuant to answering the specific question referred to above, could her retrenchment then have been avoided? Or was it the applicant’s own intransigent and immovable position she adopted from the very outset that stood squarely in the way of her avoiding her own retrenchment? These questions are to be answered based on considering whether it can nonetheless be argued that the applicant could justifiably adopt the position that she simply remain in her position, without applying for the new position, and that the respondent negotiate changes to the

applicant’s existing position with her. This was certainly the applicant’s firm view, without compromise, throughout.

[69] I do not believe this was a justified position to adopt, as her former position had actually ceased to exist because of the changes made. The applicant cannot insist on remaining in a position that does not exist and then seek to negotiate changes to it. In Freshmark (Pty) Ltd v Commission for Conciliation, Mediation and Arbitration and Others[7] the Court said the following, which ratio can also be applied in this matter:

'An employer enters into a certain contract of employment with an employee on certain terms and conditions because he or his business

or undertaking requires an employee who is prepared to work in accordance with those terms and conditions in order to meet the

operational requirements of the business or undertaking. When that contract of employment as a whole or some of its terms and conditions

can no longer serve or no longer suit the operational requirements of the business, that is a valid reason for the employer to terminate that contract of employment. However, if the employer has need to employ an employee on a contract of employment that is different either as a whole or only in some respects from the one that he has terminated, or wishes to terminate the employer must offer the new contract to the employee whose contract of employment has been terminated or is under threat of termination if that employee is suitable for employment on the terms of the new contract of employment. If the employee accepts the offer of a new contract of employment, he avoids being out of employment but this does not mean that his previous contract of employment remains. It does not. It is cancelled or it is amended. In either case the employment of the employee by the employer is subsequently governed by the terms and conditions of employment that are different from the terms and conditions which previously governed his employment. From this it is clear that the position is that the reason why in this case the contract of employment of the employee was terminated is that it was no longer suitable for the operational requirements of the employer, but, the reason why the employee was not employed on the new terms and conditions, and, therefore, why she became unemployed is that she rejected the appellant's offer of employment on terms and conditions of employment that, save for one new condition, were the same as the terms and conditions of employment that governed her employment.’

[70] Considering the actual redundancy of the applicant’s existing position, and the nature of the changes made to the new marketing manager position, it is in fact the proper approach for the respondent to apply an restructuring (operational requirements) process to effect the changes it wants. It needs to finally determine the actual redundancy of the former position, the nature of the new position, and then how the new position is to be filled, in the course of a restructuring exercise under Section 189 of the LRA. The Court in Forecourt Express (Pty) Ltd v SA Transport and Allied Workers Union and Another[8] dealt with the situation where employees were offered alternative positions with a temporary employment service in circumstances where the employer, due to its business methodology, decided to declare those positions internally in the employer itself redundant.

The Court held:[9]

‘… the appellant was entitled to choose the manner in which it would run its business provided that it did not change the terms and conditions of employment of the employees without their consent, and provided that, if it contemplated the dismissal of the employees, it complied with its obligations provided for in s 189 of the Act.’

[71] The fact further is that where a position is redundant and a new position is created, it is entirely competent for an employer to fill these new positions based on a process where employees are required to apply for such available positions, and are then interviewed for such positions for the purposes of placement. The proviso is that the selection criteria used in the interview process and subsequent placement must be fair and objective, or agreed to.

In the current matter, there was no suggestion that the selection criteria that would be applied by the respondent in the interview

process would be anything but fair and objective. All the applicant then needed to do was apply. The Court in Blue Financial Services[10] held as follows:

‘To the extent that the present case concerns a requirement that employees apply for posts within a restructured organizational template, the legitimacy of this approach was recognized by the Labour Appeal Court in Vancoillie v Santam Life Insurance Ltd (2003) 24 ILJ 1518 (LAC). It is not a strategy that is without risk to the employer seeking to implement it. …’

The Court also referred with approval to an article by Alan Rycroft titled ‘Corporate Restructuring and "Applying for your own Job"'[11], where the learned author says:

‘… employers will bear the onus of showing how the new jobs are different from the old jobs. If they are not sufficiently different, the employer will have to show why skills could not have been upgraded rather than resort to retrenchment.'

In casu, the differences in the positions have been fully discussed above. Clearly the kind of concerns referred to by Professor Rycroft as quoted in Blue Financial Services do not arise in this instance.

[72] The respondent fully explained to the applicant why she needed to follow the process and apply for the positions. In particular, and as made clear to the applicant not only in the consultations themselves, but also in later correspondence, it was essential to ensure a fair process to other employees as well that the procedure of applying and then interviews were consistently applied. In short, the respondent said that to have the other employees comply with this process and then treat the applicant differently would be unfair. The applicant’s answer was that she did not have much of a concern with regard to what may be the position with regard to other employees. The approach of the respondent was right, whilst that of the applicant was wrong. This is confirmed by the following dictum in SA Airways v Bogopa and Others[12] where the Court said the following:

‘In my judgment the appellant's requirement that employees should apply for appointment to the positions in the new structure was effectively part of a process used to select the employees who would remain in the appellant's employ and those who would be dismissed for operational requirements. The appellant required the respondents to apply for positions in the new structure so that it could, by the use of the so-called best competency fit test, decide whether they would remain in the inflight service department or whether they would be dismissed, subject to whether they got appointed to other vacant positions outside the inflight service department but within the appellant. The respondents refused to apply for what they referred to as their old positions. It is important to make the point that the appellant has failed to justify its decision to require some employees to apply when it appointed others without requiring them to apply. …’

The Court then held as follows as to this failure of the employer referred to:[13]

‘… This means that in insisting on this requirement the appellant acted in breach of the parity principle. That is the principle that an employer should treat its employees equally or consistently when they are in the same circumstances unless there is justification to differentiate between them.’

The respondent was clearly heeding the warning enunciated by the Court in Bogopa in its consultations with the applicant on this issue.

[73] This then bring me to the next critical consideration in this matter. This is the applicant’s persistent refusal to apply for the positions available to her. Considering that the applicant had legal advice throughout, I am entirely mystified as to why the applicant did not apply for the positions. I find her approach in this regard to be bordering on the ludicrous. The applicant in the end conceded that what she did was based on her own personal and subjective considerations, which were entirely unfounded. I explored with the applicant when she testified as to what possible risk there could have been to her if she had simply applied for a position. She could provide no satisfactory answer. The point is she had no risk. If she applied, and was not successful and then retrenched, she could still challenge her retrenchment as being unfair on the same basis she is now doing. In particular, if it should be found that she could competently fill either of the two positions but was not so placed but rather retrenched, it would be highly likely that she would succeed in Court. If she applied, and was successful, she would

still have a job, in a position she was competent in, was of the same grade and status, and at the same remuneration. There was simply no downside for her.

[74] As I will deal with in more detail below, the consultation process, in order to be effective, envisages compromise by both parties, if jobs are to be saved. The applicant’s unwillingness to in any way compromise the position she adopted before the consultation even really started closed her eyes to the opportunities available to her. If the applicant was advised to adopt this approach, she was poorly advised.

[75] Further, the fairness of what happened to the applicant must also be considered on the basis of a complete conspectus of what happened

throughout the consultation process, and in particular, how the respondent conducted itself as well. In the end, there can be no

doubt that the respondent’s approach in the consultation process was entirely focussed on avoiding the retrenchment of the

applicant. It wanted to retain her, and in effect pleaded with her to apply for the position she preferred. The respondent went to the extent of compromising at the end of the process (possibly even to its own detriment where it came to other employees in the process) by way of foregoing the requirement of application and interview and placing the applicant in the brand manager position. All the applicant needed to do, to remain employed, was to apply for a position she wanted or take up the placement. Even if there was not an exact fit, the respondent would apply training. The respondent did exactly what was required of it to be fair. As was held in Bogopa:[14]

‘The question which arises is what the obligation of an employer is in relation to the dismissal of employees for operational requirements

when it does away with an old structure and adopts a new structure (for operational requirements). An employer has an obligation to try to avoid the dismissal of an employee for operational requirements. This obligation entails that an employer may not dismiss an employee for operational requirements when such employer has a vacant position the duties of which the employee concerned can perform with or without at least minimal training.’

[76] It was fully explained to the applicant why the respondent considered it to be appropriate to compromise where it came to the brand manager position. In simple terms, the reason was that for the period of some two years immediately preceding the restructuring, the respondent witnessed how the applicant excelled in that position. Also, for the last year at least prior to the restructuring, the applicant’s main focus was on branding. It was common sense that this would be the best fit for the applicant, as far as the respondent was concerned. I can see nothing unreasonable or even wrong in this approach.

[77] How the applicant however responded to the attempted compromise leaves one with a rather bad taste in the mouth. Instead of seeing the positive in this, she immediately assumes the worst of intentions on the part of the respondent. She accuses the respondent of always intending to drive her into the position of brand manager, which she saw as a demotion and an attempt to discredit her. There is simply no substance in this point of view adopted by the applicant. As stated above, I accept that the respondent was justified in its view (without the benefit of application and interview) that the applicant was best suited to the position of brand manager.

[78] Further, the suggestion that the respondent was always driving her into the position of brand manager is preposterous. If that was the case, then the respondent would simply have placed her in that position from the start of the process. Not only did the respondent not do that, but it made it clear from the start of the process that it was entirely up to the applicant to indicate which position she wanted, by applying for the positions in an order of preference. Finally, in this respect, and even when

the applicant was placed in the brand manager position, the applicant was still specifically informed that she could still apply for the marketing manager position and be interviewed for it. This conduct is completely inconsistent with the objective of driving the applicant into a position.

[79] With regard to the contention that the brand manager position was a demotion, it is my view that this was simply a deliberate design by the applicant to justify the entirely unreasonable position she adopted, that has no merit. Once it was made clear to the applicant that the brand manager position had a proper independent existence of sufficient scope, that it was on the same H13 grade and of the same status, and that the applicant’s salary and benefits would remain the same, any consideration that it

was a demotion was completely unsustainable. The applicant then resorted to more obscure means to try and justify her contention of a demotion. One of these means was to conduct her own personal research on the internet as to the status and prospect of brand manager positions in what she called ‘the market’. This research was ill conceived and without proper factual foundation. It was entirely unsubstantiated. In fact, there was not even a proper indication of the parameters of this research and what this ‘market’ was supposed to be. This research was nothing more than an act of self-justification.

[80] Further, the applicant contended that the brand manager position had only one direct subordinate whilst the marketing manager position had three. That may be, but I do not believe that this constitutes a demotion. As Ledwaba explained, the brand position was more strategic, whilst the marketing position was more management. Therefore, the number of subordinates are linked to the nature of the position, and not to its level or status. In any event, and what the evidence revealed is that the brand manager position at the respondent, after it had been filled by the respondent following the applicant’s departure, continued to exist and was a position of substance at the same level as that of marketing manager. In fact, the discipline had grown to the extent that a further direct subordinate was added. The applicant sought to contradict this by saying she did not know this at the time. But the point is that she did not even give the position a chance. Despite the respondent in effect pleading with her, following

detailed explanations, to accept that brand manager position was one of substance and not a demotion, the applicant simply was not interested in listening. She adopted a position, stuck to her guns, and was not open to any considerations to the contrary.

[81] The fact that the respondent was entirely genuine in seeking to retain the services of the applicant is not only apparent from the manner in which the consultations were conducted and the contents thereof, but also from what happened at the end thereof. As referred to above, and when the applicant’s approach came to the attention of the respondent’s CEO, Newton-King, the CEO in an unprecedented move involved herself to convince the applicant to change her views. Newton-King made it clear to the applicant that there was no risk to the applicant simply participating in the process and applying for a position as the respondent wanted to keep her. The applicant testified that she accepted that Newton-King was genuine, and undertook to go and reconsider her position. What the applicant then did, after this meeting, is flabbergasting, as she simply reverted to her original stance raising the exact same arguments as before. The applicant’s conduct, I must confess, makes little sense to me.

[82] The respondent’s HR director, Mashigo, then becomes involved. It is he who sanctioned the compromise relating to placement of the applicant into brand manager without application and interview. His correspondence to the applicant could not be clearer and has been dealt with in detail above. In the end, and after giving the applicant some three weeks over Christmas to finally consider her position, all the applicant had to do in January 2015 was either take up the position of brand manager, or apply for the position of marketing manager. She remained steadfast in her refusal to do either. I find this to be inexplicable, and unreasonable.

[83] I add that I have very little hesitation in accepting that if the applicant applied for the position of marketing manager, she would have been placed in it. This is evident from the fact that the undisputed evidence was that the applicant was considered by the respondent to be overall competent to fill the marketing manager position and certainly qualified for it. If the interview process and accompanying psychometric test highlighted any deficiencies in the applicant’s make up for the position, then she would be trained to skill and equip her. The respondent made this clear to her in the consultation.

[84] In the end, the applicant should have applied for the new positions of marketing manager or brand manager, or even both in an order of preference. At the very least, she should have taken up the position of brand manager in which she was ultimately placed as a basis of compromise by the respondent. Her failure to do so must be fatal to her case of substantive unfairness. She left the respondent with no choice but to retrench her, despite being in a risk free position to have avoided her own retrenchment. The applicant only has herself to blame for what happened to her. As was said in Freshmark[15]:

‘ …. an employee who unreasonably refuses an offer of alternative employment is not without fault. He has himself to blame if he subsequently finds himself without employment and, therefore, does not deserve to be treated on the same basis as the employee who finds himself without employment due to no fault on his part …. Where the employer offers to continue to employ the employee - whether in the same position but on different terms or on the same terms but in a different position or in the same position and on the

same terms but in a different place, that is still alternative employment. It is an offer of an alternative contract of employment.’

[85] The same sentiment was echoed in Latex Surgical[16] where the Court said:

‘ …. Accordingly, when an employer's operational requirements dictate that its workforce should work in accordance with certain terms and conditions by which such workforce is not bound, the employer should convey this to the workforce and ask them to agree to work according to such terms and conditions, negotiate with them and warn them that, if they reject such terms and conditions, he will have to terminate their contracts of employment and employ new employees in their place, who will accept such terms and conditions. … If the employees reject such proposals and the employer terminates their services, the employees cannot complain that they were not given a chance to avoid their dismissal by accepting the new terms and conditions of employment.’

[86] In Entertainment Catering Commercial and Allied Workers Union of SA and Others v Shoprite Checkers t/a OK Krugersdorp[17] it was held as follows:

‘… where the amendment to terms and conditions of employment is proffered by an employer as an alternative to dismissal during a bona fide retrenchment exercise and it is a reasonable alternative based upon the employer's operational requirements, the employer will be justified in dismissing employees who refuse to accept the alternative on offer.’

[87] I also again mention Forecourt Express[18], where the Court said the following, in circumstances where it was argued that the alternative positions at a third party were less attractive to the employees:

‘… In my view the second and further respondents' loss of income arose out of their refusal of the offer of employment by the subcontractor and labour broker and not from their dismissal. It seems to me that the second and further respondents are, in this regard, the authors of their own misfortune.’

[88] Another apt example is found in the judgment of Mineworkers Union/Solidarity on behalf of MacGregor v SA National Parks[19] where the Court held as follows in finding the retrenchment of the employee to be fair:

‘If the applicant had followed the instructions of Mr Mogome, he would have just continued in the employ of the respondent, but in the position of manager: environmental management services. His intransigent stance in refusing to change direction caused the

respondent to advertise that position internally and to treat all the applicants the same. The applicant was nonetheless encouraged to apply, even belatedly, as the respondent believed he was the best person for the position. However, after the long consultation

process, which included meetings and correspondence, the respondent was entitled to decide not to accept an 'under duress' application

for the position. The applicant was interviewed though. It was clear that he was not interested in the position. If he was, he would have withdrawn the 'under duress' reservation. … ‘

[89] All the above being the case, can it be said that the respondent’s decision, and subsequent course of action, was genuine and pursuant to proper operational reasons? In my view, no doubt, considering what happened in the consultation process as a whole. As the Court said in Latex Surgical:[20]

‘The function of the court in scrutinizing the consultation process is not to second guess the commercial or business efficacy of the employer's ultimate decision but to pass judgment on whether such a decision was genuine and not merely a sham. The court's function is not to decide whether the employer made the best decision under the circumstances, but only whether it was a rational commercial or operational decision, properly taking into account what emerged during the consultation process.’

[90] For all the reasons as set out above, I thus conclude that the applicant’s dismissal by the respondent was substantively fair.

Was the dismissal procedurally unfair?

[91] The applicant has raised eight individual grounds as to why she believes her dismissal was procedurally unfair. These are all articulated in the pre-trial minute and in summary, suggest that she was not properly consulted on the consultation topics in terms of Section 189(3), her questions and concerns were not answered, she was not provided with proper information, the respondent did not consult on selection criteria, the respondent did not apply its own retrenchment policy, and the respondent consulted in bad faith.

[92] There is a simple answer to the applicant’s case of procedural unfairness. The fact is that the applicant could have avoided her retrenchment by simply accepting the alternative positions that were actually available to her. As fully discussed above, these were proper alternative positions which the applicant was fully competent to fill, of equal status, and would leave her salary and benefits unchanged. All this being the case, any case of procedural unfairness is of no consequence, even if

it existed, as the applicant could have avoided her own retrenchment.

[93] In Arthur Kaplan Jewellery (Pty) Ltd v Van De Venter[21] the LAC dealt with an appeal against a finding of procedural unfairness by the Labour Court in an instance where the employer indeed failed to consult as contemplated by Section 189. The Court said:[22]

‘Appellant’s failure to so consult is not, however, determinative of the dispute. The key issue concerns appellant’s subsequent conduct. …’

The Court concluded as follows, in finding the dismissal to be nonetheless fair:[23]

‘In my view, the evidence is compelling that the alternatives which were proposed to respondent were reasonable and that she did not provide sufficient justification as to the reasons for refusing to accept one of these alternative positions. Accordingly, appellant acted neither substantively nor procedurally unfairly in the manner in which respondent was ultimately retrenched. On these facts it is therefore clear that even though the appellant may have acted unfairly in not consulting respondent about the closing down of the training department, such unfairness did not lead to her losing employment with appellant. She lost employment with appellant because she failed, without any justification, to accept one of the jobs offered to her by appellant and for that, she only has herself to blame.’

[94] In Fidelity Springbok Security Services (Pty) Ltd v SATAWU obo Chabalala and 7 Others[24] the LAC adopted a similar view and said the following, specifically referring to an offer of alternative employment in the context of an allegation of unfair retrenchment:

‘… the dismissed employees did not accept this offer. If they had accepted it, the dismissed employees would not have been dismissed and there would have been no claim for unfair dismissal. They are the authors of their own misfortune and should not complain. Even if there may have been unfairness in the way in which the appellant handled the consultation process or any aspect of the matter prior to that offer, such unfairness would not have been in issue if they accepted the job offer.”

[95] Recently, and in SA Transport and Allied Workers Union on behalf of Dube and Others v Fidelity Supercare Cleaning Services Group (Pty) Ltd[25] the Court applied what had been said in Arthur Kaplan and Chabalala and Others, and held:

‘… When the respondent considered the alternatives, and an opportunity was offered to her, Dube never applied for a position under the new Wits contract and instead sought and pursued a disability benefit. I find that Dube could have avoided her own dismissal by applying for a position as supervisor on the new Wits contract. In this regard, the undisputed evidence of Croukamp was that if Dube had applied for a position, Croukamp would have given her a position. In fact, Croukamp pursued Dube to enquire why she had not applied for a position, and it was then that Dube expressed her wish to seek a disability benefit. Because of these critical considerations, the issue of procedural fairness is actually of no consequence, as the respondent did not want to dismiss Dube and it was within her own power to avoid her dismissal.’

I agree with this reasoning, and find that it applies in casu.

[96] Accordingly, and because the applicant could have avoided her own retrenchment by simply accepting what was on the table or applying for the positions she could have been placed in, she simply cannot be seen to now complain about procedural unfairness, even if it is accepted that the respondent did not properly consult with her on the basis she is contending to be the case. Her retrenchment must nonetheless be considered to be fair. That should be the end of the case of procedural unfairness raised by the applicant.

[97] There is however a further consideration. That is the conduct of the applicant in the course of the consultation process. In my view, a consideration of the transcripts of the consultations and the correspondence that passed between the parties shows that the respondent was bona fide in conducting the consultations and genuinely sought to avoid the applicant’s retrenchment in these consultations. But where it comes to the manner in which the applicant participated in the consultations, this in my view smacks of mala fides. What is patently apparent is that the applicant adopted a position from the start, which has been extensively dealt with above. The applicant closed her mind to any suggestion contrary to the position she adopted. No amount of effort on the part of the respondent, which was considerable, could sway her. The applicant was not intent on any compromise. She wanted what she said, and that was that.

[98] Something must also be said about the method of conducting consultation by way of script, as the applicant did. This is not meaningful participation in the consultation. It can serve no purpose for a party to attend a consultation, read from a pre-prepared script (which is also handed into the consultation like it is some or other written argument), refuse to consult on this, and demand that answers be given in writing. In fact, what the transcripts of the consultations reveal is where the respondent tries to engage with the applicant she first listens, but does not in turn engage. Once the respondent is finished with what it suggested, the applicant starts reading her script, and this on some occasions did not even have a bearing on what was suggested to her. The applicant needed to engage the respondent. Open discussions needed to have been held between the parties in the consultations, which had to be dynamic in nature, adapting to the events and submissions as they transpired in the process itself. A scripted participation in the consultations is indicative of a closed mind.

[99] In Blue Financial Services[26] the Court held:

‘Fair procedure primarily requires that the parties engage in a meaningful joint consensus-seeking process. This obligation, which has its origins in Johnson & Johnson v Chemical Industrial Workers Union (1999) 20 ILJ 89 (LAC), requires at least that the parties attempt to reach consensus on the issues listed in s 189(2) and (3). More precisely, the employer must invite representations on these issues from the appropriate consulting party, seriously consider and respond to any representations that are made. Both parties are required, in good faith, to seek consensus. This is not a mechanical process - meaningful joint decision-making requires that the parties act with the honest intention of exploring the prospects of agreement. If no joint consensus-seeking process has occurred, the court is obliged to determine which party was responsible for this state of affairs.’

[100] The respondent tried its level best to encourage participation from the applicant. In fact, Mashigo tried to explain to her, in writing as she demanded, why her approach to the consultation was not conducive to having proper and effective consultations as envisaged by the LRA. Instead of taking what was sound advice to heart, the applicant accuses Mashigo of criticising her and acting in bad faith. I have no doubt that the applicant had very little intention, from the start, in engaging the respondent in consultations. Should there be any failure in the joint consensus seeking process, the applicant was responsible.

[101] I also find it concerning that the applicant continued to press the option of a voluntary separation agreement and package, when the respondent made it clear on several occasions that this was not an option as it wanted to retain the applicant’s services and believed there was a viable option for her to stay. The applicant’s approach in this respect yet again places a question mark over her bona fides.

[102] Therefore, the approach of the applicant to the consultations must similarly stand squarely in the way of the legitimacy of any case of procedural unfairness. In this regard, reference is made to SA Society of Bank Officials v Standard Bank of SA[27], where the Court said that

‘Consultation is a two-way street’.

[103] That being the case, and as held in Johnson and Johnson (Pty) Ltd v Chemical Workers Industrial Union[28]:

‘The achievement of a joint consensus seeking process may be foiled by either one of the consulting parties.’

In this instance it was the applicant. In Visser v Sanlam[29] the Court held:

‘The process of consultation envisaged in s 189(2) involves a bilateral process in which obligations are imposed upon both parties to consult in good faith in an attempt to achieve the objectives specified in the section. In my view, the respondent fulfilled its obligations in terms of s 189(2). If any conclusion is justified, it is that appellant failed to engage adequately in the consultation process envisaged in the section. Accordingly, it cannot be said that the retrenchment of appellant was procedurally unfair.”

The same reasoning would in my view equally apply in casu.

[104] Similarly, and in Smith and Others v Courier Freight[30] the Court said the following:

‘I find on a balance of probabilities that the union was responsible for frustrating the restructuring process to the detriment of its members, the employees. In NUMSA & others v Kaefer Thermal Contracting Services (Pty) Ltd [2002] 6 BLLR 570 (LC) the court held that where the consultation process has been frustrated it is not for the party who caused the frustration to complain that there was non-compliance with the consultation process. …

I am satisfied that the employer made genuine attempts to engage with the union on the retrenchment process. However, it could not allow the union to delay the process of restructuring indefinitely. The union overplayed its hand and must now accept the consequences of its ill-advised decision unnecessarily to delay the consultation process. In the light of the aforesaid, I believe there was substantial compliance with the provision of s 189 of the Act by the employer.’

[105] The applicant called Waldemar Budeli (‘Budeli’) as a witness who was also subjected to the retrenchment process, by the respondent. His evidence was of no value in deciding this matter. His circumstances were entirely different, and ultimately, there was not a suitable alternative position for him to fill. He also did not complain about the retrenchment process, per se, but just said it was, in his view, not ‘transparent’. His testimony does not assist the applicant.

[106] It is therefore my conclusion that the applicant’s retrenchment, for the reasons set out above, cannot be considered to have been procedurally unfair. If there were any failures in the conducting of the process, these did not emanate from the respondent, but can squarely be placed at the door of the applicant. Overall, I am satisfied that the respondent properly consulted the applicant, and that it was the applicant’s own conduct that gave rise to her ultimate dismissal. I find that the applicant’s dismissal must be considered to be procedurally fair.

The issue of severance pay

[107] This then only leaves the issue of severance pay. In terms of Section 41(4) of the BCEA[31]:

‘An employee who unreasonably refuses to accept the employer's offer of alternative employment with that employer or any other employer, is not entitled to severance pay in terms of subsection (2)’

[108] There can be no doubt that the options of brand manager and marketing manager available to the applicant were proper alternatives of the kind as contemplated by Section 41(4). Added to that, and as stated, the applicant could have simply taken up the brand manager position, which was available without qualification. As I have discussed above, the applicant’s failure to take up these alternatives is certainly unreasonable. Because the applicant refused to take up these alternatives, she had forfeited her right to severance pay in terms of the BCEA.

[109] In Irvin & Johnson Ltd v Commission for Conciliation, Mediation and Arbitration and Others[32] the Court held:

‘It seems to me that the effect of s 41(4) is that, where the employer has arranged alternative employment for an employee who is facing a (possible) dismissal for operational requirements, either in his employ or in the employ of another employer, three scenarios are possible:

• The one scenario is that the employee unreasonably refuses such alternative employment in which case s 41(4) applies and the employee

forfeits the right to severance pay.

• The second scenario is where the employee reasonably refuses such alternative employment in which event he is entitled to payment of severance pay.

• The third scenario is where the employee accepts the alternative employment in which event he also forfeits the right to severance

pay.

It will be seen from the three scenarios set out above that in no scenario does an employee get both the severance pay and the alternative employment. However, there is a scenario where he gets neither. That is where he has himself to blame because he has acted unreasonably in refusing the offer of alternative employment.’

[110] The conduct of the applicant thus resorts squarely within the parameters of where an employee does not get severance pay even where the employee did not get an alternative position. In an actual scenario comparative to the conduct of the applicant, the Court in Pretorius v Rustenburg Local Municipality and Others[33] said:

‘…the appellant's rejection of the first respondent's offer of alternative employment and his insistence that he be offered the same position or a position at the same or a higher level is, in all the circumstances of this case, quite unreasonable. Accordingly, he forfeited whatever right he might otherwise have had to severance pay. He was going to suffer no reduction of salary. The position he was offered was quite a senior position. The first respondent had to try and accommodate all the employees. He was to report to the municipal manager. The first respondent made it clear that it needed his technical skills.’

Clearly, the same scenario applied to the applicant in the current proceedings, and she must thus be visited with the same consequences.

[111] In the circumstances, the applicant had forfeited her right to severance pay, and I conclude that she is not entitled to the payment of severance pay.

Conclusion

[112] Therefore, the applicant’s dismissal by the respondent for operational requirements must be held to have been both substantively and procedurally fair. The applicant’s unfair dismissal claim thus falls to be dismissed. The applicant is also not entitled to the payment of any severance pay resulting from her dismissal.

[113] As to costs, it must be considered that the applicant was legally assisted in the retrenchment process from the start, by what she referred to as ‘her legal team’. The content of some of the writing emanating from the applicant clearly had a legally qualified hand in them. This being the case, I simply cannot fathom why the applicant acted as she did. Surely competent legal advice must have made it clear to the applicant that her conduct with regard to the consultation process was simply unreasonable. The applicant could easily have avoided all the litigation that followed, but chose to be obstructive.

[114] As touched on above, I also do not believe the applicant was bona fide. The respondent has been caused to spend time, effort and costs on defending a matter which should not have arisen in the first place, and which it tried its best to avoid. The applicant then pursued a case to this Court which, considering the undisputed facts, had little hope of success. It is my view that a costs order against the applicant is certainly appropriate, for these reasons given. In any event, applying the broad discretion I have with regard to the issue of costs in terms of Section 162 of the LRA, I consider it fair and appropriate that the respondent not be left completely exposed where it comes to the payment of legal fees, and should be entitled to party and party costs in opposed trial proceedings.

Order

[115] For all of the reasons as set out above, I make the following order:

1. The applicant’s application is dismissed with costs.

_____

S Snyman

Acting Judge of the Labour Court

Appearances:

For the Applicant:

Advocate S Jackson

Instructed by:

Norton Rose Fulbright SA Inc

For the Respondent:

Advocate A N Snider

Instructed by:

William Berry Attorneys

[1] (2006) 27 ILJ 292 (LAC) at para 55.

[2] (2000) 21 ILJ 129 (LAC) at para 36.

[3] (2010) 31 ILJ 2735 (LC) at para 22.

[4] (2001) 22 ILJ 602 (SCA) at para 27.

[5] (2006) 27 ILJ 269 (LAC) at para 24.

[6] Id at para 26.

[7] (2003) 24 ILJ 373 (LAC) at para 25.

[8] (2006) 27 ILJ 2537 (LAC).

[9] Id at para 39.

[10] (supra) at para 17.

[11] (2002) 23 ILJ 678 at 682.

[12] (2007) 28 ILJ 2718 (LAC) at para 57.

[13] Id at para 58.

[14] (supra) at para 60.

[15] (supra) at para 24.

[16] (supra) at para 69.

[17] (2000) 21 ILJ 1347 (LC) at para 28.

[18] (supra) at para 41.

[19] (2006) 27 ILJ 818 (LC) at para 39.

[20] (supra) at para 18(i). See also SA Clothing and Textile Workers Union and Others v Discreto A Division of Trump and Springbok Holdings (1998) 19 ILJ 1451 (LAC) at para 8.

[21] [2006] ZALAC 7 (21 February 2006).

[22] Id at para 11.

[23] Id at para 18.

[24] Unreported LAC case no JA 14 / 2004 dated 28 February 2006.

[25] (2015) 36 ILJ 1923 (LC) at para 60. See also Schatz v Elliott International (Pty) Ltd and Another (2008) 29 ILJ 2286 (LC) at para 56.

[26] (supra) at para 19.

[27] (2011) 32 ILJ 1236 (LC) at par 25

[28] (1999) 20 ILJ 89 (LAC).

[29] (2001) 22 ILJ 666 (LAC) at para 24.

[30] (2008) 29 ILJ 420 (LC) at para 68 – 69.

[31] Basic Conditions of Employment Act 75 of 1997.

[32] (2006) 27 ILJ 935 (LAC) at paras 44 – 45

[33] (2008) 29 ILJ 1113 (LAC) at para 67.