Zenith Car Rental (Pty) Ltd t/a Avis Rent a Car and Budget Rent a Car (Avis Budget) v Commission For Conciliation Mediation and Arbitration and Others (C668/2022) [2024] ZALCCT 14 (30 September 2024)

THE LABOUR COURT OF SOUTH AFRICA

HELD AT CAPE TOWN

Not reportable

Case no: C668/2022

In the matter between:

ZENITH CAR RENTAL (PTY) LTD T/A AVIS RENT A CAR AND BUDGET RENT A CAR (“AVIS BUDGET”) Applicant And COMMISSION FOR CONCILIATION MEDIATION AND ARBITRATION First Respondent COMMISSIONER L MARTIN N.O. Second Respondent KURT ENGELBRECHT Third Respondent

Heard: 4 July 2024

Date of Judgment: This judgment was handed down electronically by circulation to the parties’ legal representatives by email, publication on the Labour Court website and release to SAFLII. The date and time for handing down judgment is deemed to be 10h00 on 30 September 2024

Summary: application to review – review dismissed – applicant failed to prove that commissioner failed to properly consider the evidence or that the decision is one that a reasonable decision maker could not reach.

JUDGMENT

DE KOCK, AJ

Introduction

[1] This matter concerns an application by the applicant (hereafter referred to as “Avis Budget”) to review and set aside an arbitration award given by the second respondent (hereafter referred to as “Martin”) in his capacity as a commissioner of the first respondent (hereafter referred to as “the CCMA”). The application has been brought in terms of section 145 of the Labour Relations Act[1] (“the LRA”).

[2] The matter arose from the alleged unfair dismissal of the third respondent (hereafter referred to as “Engelbrecht”) for allegations of misconduct. The arbitration proceedings before Martin took place on 12 July 2022, 27 September 2022 and 8 November 2022. Martin, following the conclusion of the arbitration proceedings, issued an award dated 21 November 2022 wherein he found that Engelbrecht’s dismissal was substantively unfair, and ordered that Avis Budget reinstates Engelbrecht with effect from 1 December 2022 retrospective to the date of his dismissal on 14 October 2021. It is this determination that gave rise to the current review application.

[3] The parties agreed that the review application is properly before me, and no jurisdictional issues were raised. Insofar as condonation was required for the late filing of Avis Budget’s late filing of its heads of argument, condonation is granted. The opposed review application was heard on 2 July 2024.

The relevant background

[4] Engelbrecht worked for Avis Budget from 1 March 2014 until 14 October 2021 when he was dismissed. At the time of his dismissal, Engelbrecht was employed as a dispatch supervisor. Engelbrecht was charged with three counts of misconduct, namely:

4.1 failure to adhere to demonstrate acceptable conduct and behaviour in failing to follow the set down work on Avis Budget’s wizard system on 11 and 14 July 2021 by ignoring the wizard prompts when inserting the kilometres before completing the transaction;

4.2 dishonesty relating to usage of his subordinate’s, Situpa, agent identity number without authorisation when completing a wizard transaction while logged onto his own profile; and

4.3 dishonesty in that during the period 15 July 2021 to 27 July 2021, he provided misleading information to his manager regarding the incorrect kilometres rapid movements that took place using Situpa’s Agent number 15005 relating to 11 and 14 July 2021 transactions as per the wizard audit trail.

[5] Engelbrecht was found guilty of all three charges and dismissed. Engelbrecht referred his alleged unfair dismissal to the CCMA, alleging that his dismissal was substantively unfair. The dispute referred was arbitrated by Martin and led to the award issued in favour of Engelbrecht, as referred to above.

The CCMA award

[6] Martin found firstly, in respect of charge 3, that Engelbrecht had conceded already around 22 July 2022 to Orrie that he had been responsible for the offending rapid movement transactions and not on 28 July 2021 as testified to by Orrie, or on 30 August 2021 as put by Avis Budget’s representative to Engelbrecht in cross examination. Martin therefore found that Engelbrecht did not transgress as alleged in charge 3.

[7] In respect of charge 1, Martin found that he is satisfied that Engelbrecht had conceded during the arbitration proceedings that he ought to have pleaded guilty to charge 1 at the disciplinary hearing. Martin also found that it is clear from the evidence presented at arbitration that Engelbrecht conceded to having transgressed as stated in charge 1 insofar as failing to follow the set down work procedure on the wizard system on 11 and 14 July 2021.

[8] In respect of charge 2, Martin found that Avis Budget has not overcome the evidentiary burden it bears to prove the allegations.

Martin referred to Avis Budget not having contested that the security screen does not prompt for an agent identity number; that Orrie conceded that the rapid movement transaction could be done without the use of an agent identification number; that it was not probable that Engelbrecht had memorised Situpa’s agent identification number from previous use; that the evidence suggests that the use of another’s agent identification does occur in the workplace and that it is in fact tolerated in the workplace and does not attract the sanction of dismissal; and that had Engelbrecht been truthful he would not have been dismissed. Martin however found that Engelbrecht had not been untruthful as alleged.

[9] Martin also referred to the email of 28 July 2021 from Crawford, which was presented by Avis Budget in shifting its evidentiary

burden. In this email she states that she had been informed that the raw data received is the same as that reflected in the audit trail. The response that was required from Crawford, as requested by Orrie, was whether an agent number can appear in the audit trail without it having been physically entered. Martin found that Crawford’s response did not address Orrie’s question.

[10] Martin found that for him to decide what is correct and accurate, Avis Budget was required to present the evidence of the author of the email and that of the IT developer. According to Martin, there was no evidence that the system cannot insert an agent identity number automatically in circumstances where it had not been entered physically by a person. Martin further referred to Engelbrecht’s evidence in the disciplinary hearing during which it became clear that Engelbrecht had performed this task in a particular manner over the years of his employment, and that it was incumbent on Avis Budget to have investigated Engelbrecht’s history of performing this function. Martin concluded that he has no reason not to accept Engelbrecht’s testimony in this regard.

[11] Martin found that, if there was a rule in respect of how this is supposed to be done, there was no evidence thereof placed before him. In respect of the rule pertaining to the prohibition of the use of another’s agent identity number, the evidence shows that the rule had not been implemented nor adhered to in the workplace. On the other hand, if the rule had been adhered to, the evidence shows that it had not necessarily culminated in the sanction of dismissal.

[12] Martin found further that it is unlikely that Engelbrecht would have used Situpa’s agent identification number when doing the rapid transaction in order to shift the blame onto Situpa, as Situpa does not do any rapid movement transactions and Engelbrecht, as Situpa’s supervisor, would probably have known that Situpa does not do such transactions.

[13] Martin concluded that he is satisfied that Engelbrecht had probably done the rapid movement transaction in the manner that he had always done by using the security screen, which does not require the physical insertion of an agent identification number when doing the transaction and does not prompt for it either.

[14] Martin also found that, even if Engelbrecht had used the agent identification number of Situpa, which he found that he probably had not, then there was still no evidence that Engelbrecht had lied. It was found that the evidence shows a willingness by Engelbrecht to admit to his conduct, as in the instance of having done the rapid movement transactions in question.

[15] Martin therefore found that the circumstances that prevail in the matter are not sufficient to conclude on balance that Engelbrecht had become untrustworthy. Reference was made to Orrie’s evidence that Engelbrecht had never done anything dishonest which is why it was difficult to distrust him in the process. Orrie’s uncertainty is further manifested in his asking Crawford to confirm that the system does not insert an agent identification number automatically in certain circumstances was in fact not confirmed.

[16] In respect of the possible motive put forward by Avis Budget that Engelbrecht had something to gain, Martin found that there is nothing to show that Engelbrecht had anything malicious against Situpa and that he was honest and open about his investigation concluding that Situpa had not been responsible. Reference was further made to Engelbrecht’s unchallenged evidence that Mushi committed a similar offence and that Engelbrecht sought Orrie’s advice. The undisputed evidence, other than Orrie not being able to recall if Mushi’s action was a severe transgression, was further that Mushi received a written warning for the same kind of transgression. Martin found, in such circumstances even if Engelbrecht had transgressed and had admitted thereto the sanction of dismissal would be too harsh due to Avis Budget’s failure to apply its sanction consistently.

[17] Martin concluded that Engelbrecht’s dismissal, on a balance of probabilities, was substantively unfair, and ordered that Avis Budget reinstates Engelbrecht retrospectively to the date of his dismissal.

The test for review

[18] In Sidumo and Another v Rustenburg Platinum Mines Ltd and Others,[2] the Court held that ‘the reasonableness standard should now suffuse section 145 of the LRA’, and that the threshold test for the reasonableness of an award was: ‘…Is the decision reached by the commissioner one that a reasonable decision-maker could not reach?...[3]. In Herholdt v Nedbank Ltd and Another[4] the Court applied this reasonableness consideration as follows:

‘… A result will only be unreasonable if it is one that a reasonable arbitrator could not reach on all the material that was before the arbitrator. Material errors of fact, as well as the weight and relevance to be attached to the particular facts, are not in and of themselves sufficient for an award to be set aside, but are only of consequence if their effect is to render the outcome unreasonable.’

[19] This test has thus been applied as a two-stage review enquiry. Firstly, the review applicant must establish that there exists a failure or error on the part of the arbitrator. If this cannot be shown to exist, that is the end of the matter. Secondly, if this failure or error is shown to exist, the review applicant must then further show that the outcome arrived at by the arbitrator was unreasonable. If the outcome arrived at is nonetheless reasonable, despite the error or failure, that is equally the end of the review application. In short, in order for the review to succeed, the error or failure must affect the reasonableness of the outcome to the extent of rendering it unreasonable.

[20] Further, the reasonableness consideration envisages a determination, based on all the evidence and issues before the arbitrator, as to whether the outcome of the arbitrator arrived at can nonetheless be sustained as a reasonable outcome, even if it may be for different reasons or on different grounds.[5] This necessitates a consideration by the review court of the entire record of the proceedings before the arbitrator, as well as the issues raised by the parties before the arbitrator, with the view to establish whether this material can, or cannot, sustain the outcome arrived at by the arbitrator. In the end, it would only be if the outcome arrived at by the arbitrator cannot be sustained on any grounds, based on the material, and the irregularity, failure or error concerned is the only basis to sustain the outcome the arbitrator arrived at, then the review application would succeed.[6]

[21] I will now proceed to consider the review application by the applicant against the above principles and test applicable to review applications.

Grounds of review

[22] Avis Budget’s grounds of review are contained in the founding and supplementary affidavits and argued in accordance with the heads of argument delivered by Avis Budget. I will for purposes of this judgment, address the grounds of review as contained in the heads of argument, and as argued before this Court.

[23] Avis Budget did not take issue with Martin’s finding in respect of charge 1. This is clearly so given that Engelbrecht conceded that he ought to have pleaded guilty to charge 1 and the disciplinary hearing, and that he conceded during the arbitration proceedings that he was the one who did the rapid movement transactions in question.

[24] The crux of Avis Budget’s challenge in the review application is Martin’s findings in respect of charges 2 and 3. The challenge in respect of charge 2 will be addressed first.

Charge 2

[25] Avis Budget takes issue with Martin’s finding that it was not contested by Engelbrecht that the security screen does not prompt for an agent identity number. It was argued that the question before Martin was whether it was possible to access information on Wizard System without using credentials, i.e. the agent identification code. Avis Budget’s evidence was that whilst it is possible to capture and populate information without using an agent’s identification code, such would be indicated as such on the Wizard System as a zero whereas, where an agent’s identity code had been used, the Wizard System will indicate the agent’s identity code used during the transaction.

[26] It was therefore argued that Martin’s finding that Engelbrecht’s claim was not contested is unreasonable and ignores material evidence that was placed before him. It was also argued that Martin’s evidence was not supported by the evidence that was submitted, referring specifically to the email communication between the IT department and Orrie which confirmed that the data to the effect that transactions were carried out by Engelbrecht using Situpa’s agent identity code was accurate. Reference was also made to the example that was submitted of the Wizard System Report where an employee used an agent identity code, which shows that agent’s identity code, and where an agent identity code was not used, which indicate a “0”.

[27] It was argued further that there was sufficient evidence that Situpa’s agent identity code was used, that Situpa did not give Engelbrecht his agent identity number to carry out the instruction and therefore that Engelbrecht must have acted dishonestly in using Situpa’s agent identity code to complete the Wizard transaction. Engelbrecht should therefore have been found to have committed the misconduct, with the aggravating factor being his denial that he used Situpa’s identity code. Avis Budget also referred to Engelbrecht’s initial denial, and that it is only after he had been confronted with camera footage that he conceded to have used Situpa’s workstation.

[28] It was argued on behalf of Engelbrecht that Martin correctly concluded that Avis Budget had “not overcome the evidentiary burden it bears to prove the allegation in charge 2.” It was found that Avis Budget’s case was found lacking in terms of expert evidence in that no IT expert testified to explain the Wizard System and neither did Kim Crawford testify. Reference is also made to Orrie’s own admission that he had “limited knowledge” of the Wizard System. Insofar as Orrie relied on Crawford’s email to Orrie dated 23 July 2021, it was argued that Martin correctly concluded that Avis Budget could not establish the correctness or accuracy of Orrie’s claim that the Wizard System shows a zero when no agent ID is inserted “without the author of the email [Crawford] testifying thereto and with testimony from the IT developer”.

[29] It was further argued that there was a more fundamental flaw in Avis Budget’s argument as the allegation that Engelbrecht “clearly stood to benefit by hiding his identity as the person who moved the vehicles” is devoid of logic. Further arguments were presented in this regard, which will not be summarised for purposes of this judgment save to note that Martin found no evidence to show that Engelbrecht had anything malicious against Situpa, and Situpa offered no such evidence during his evidence.

[30] It was lastly argued that Martin was accordingly correct in placing no reliance on the limited knowledge of Orrie in this regard and to find that “there is no evidence that the system cannot insert an agent identify number automatically in circumstances where it had not been entered physically by a person”. It was argued that Avis Budget therefore failed to overcome the evidentiary burden to prove its allegation in terms of charge 2.

[31] The test on reviews, as stated above and as referred to by both parties in their heads of argument, is clear. This Court is therefore required to determine, based on the grounds of review in relation to charge 2, whether Martin’s finding was one that no other reasonable decision maker could reach. This Court is not at liberty nor entitled to consider the application based on an appeal.

[32] After a careful consideration of the parties’ respective submissions in relation to charge 2, and Martin’s reasons for arriving at the finding that Avis Budget failed to overcome the evidentiary burden, I have been unable to find that Martin’s finding is one that no other reasonable decision maker could reach. Nor am I of the view that Martin’s finding was unreasonable and that it ignored material evidence, or that Martin’s finding is not supported by the evidence.

[33] As is the case in all dismissal disputes, the onus to prove the allegations pertaining to charge 2 rested with Avis Budget. Martin found that, in the absence of calling the author of the email in question, as well as calling someone from IT to address Engelbrecht’s version, Avis Budget could not establish the correctness or accuracy of Orrie’s claim. Martin further substantiated this finding in his award by referring inter alia to Engelbrecht’s evidence that he had always done the transactions in this manner, and to Orrie’s own uncertainty in seeking clarity from Crawford.

[34] Whether this Court would have arrived at a different conclusion is not the issue to be determined. The issue to be determined is whether Martin arrived at a decision that no other reasonable decision maker could reach. I am unable to find this to be the case. There was certainly no reviewable irregularity, and Martin applied his mind to the evidence, or in this case the lack of evidence from Crawford and someone from IT. Martin’s finding is certainly a decision that falls within the bands of reasonableness and does not justify interference by this Court.

Charge 3

[35] In respect of charge 3, Avis Budget takes issue with Martin’s finding that Engelbrecht had already conceded around 22 July 2022 to Orrie that he had been responsible for the incorrect rapid movement transactions and not on 28 July 2021 as testified by Orrie. It was argued that this finding is incorrect and contradicts the evidence of Orrie. It was further argued that Engelbrecht only conceded to this fact on 28 July 2021.

[36] It was argued on Engelbrecht’s behalf that Martin correctly found that Engelbrecht had already conceded around 22 July 2021 to Orrie that he had been responsible for the incorrect rapid movement transactions, and not on 28 July 2021 as testified by Orrie. It was argued that the allegation that Engelbrecht persisted in his denials is simply not borne out by the evidence, and reference was made to the email of 23 July 2021.

[37] Having considered the submissions, and Martin’s finding in relation to charge 3, this Court is unable to find that Martin’s decision is one that a reasonable decision maker could not reach. In fact, it is clear from the evidence that Engelbrecht did in fact advise Orrie on 22 July 2021 and repeated in the email dated 23 July 2021 that he had been responsible for the incorrect transaction. What was disputed by Engelbrecht was that he used Situpa’s ID in recording the transactions.

[38] This Court therefore rejects Avis Budget’s grounds of review in respect of charges 2 and 3 on the basis that Martin’s findings fall within the bands of reasonableness and is not susceptible to be reviewed as per the test in review applications.

Further grounds for review

[39] Avis Budget also takes issue with Martin’s reasoning in reaching his conclusion on sanction, alleging that same is not altogether clear. It was argued that it appears that Martin’s finding that Avis Budget’s conduct in dismissing Engelbrecht was unfair based on the fact that the use of another employee’s agent identity number is acceptable or at least not a dismissible offence, relying on an alleged similar conduct by Mushi. It was argued that Martin does accept that Engelbrecht is guilty of charge 2 and that it was not for Martin to decide what the sanction should be for such misconduct, but whether Avis Budget acted fairly in imposing such sanction.

[40] This Court has difficulty to understand how it can be argued that Martin accepted that Engelbrecht is guilty of charge 2. Martin’s finding was that Avis Budget “had not overcome the evidentiary burden it bears to prove the allegations in charge 2”. Given this finding, and the incorrect reference by Avis Budget to what was found, there is no merit in the submission that Engelbrecht was dishonest in his denials, which indicated the absence of remorse. This Court also rejects the submission that Martin acted unreasonable in interfering with the sanction insofar as such submission is premised on the incorrect assertion that Martin found Engelbrecht guilty of charge 2.

[41] This Court also considered the submissions with regards there being no evidence led to support the claim that the use of another employee’s agent identity number being acceptable or at least not a dismissible offence, let alone that there were actual similarities between Engelbrecht and Mushi’s case. These submissions are not correct. Engelbrecht specifically posed questions to Orrie during cross examination, and Orrie was unable to confirm what Engelbrecht had put to him. It was incumbent on Avis Budget, having been presented with Mushi’s case, to present evidence to rebut the allegation, yet they failed to do so.

[42] Insofar as it was submitted on behalf of Avis Budget that Martin failed to consider material evidence in deciding whether dismissal was an appropriate sanction, these submissions are rejected. Martin’s findings on charges 2 and 3 had already been dealt with, and this Court can find no reason to interfere with Martin’s finding in relation to sanction, as adequately referred to in his award. Insofar as Engelbrecht admitted guilt to charge 1, Martin’s finding that the sanction of dismissal was inappropriate cannot be faulted, and most certainly cannot be said to be a decision a reasonable decision maker could not reach. In any event, the application for review, as stated above, was premised on Martin’s findings in respect of charges 2 and 3 rather than charge 1.

[43] Insofar as it was submitted that Engelbrecht escaped any sanction for his belatedly admitted misconduct in relation to charge 1, this may be so given Martin’s award. No evidence was however presented to Martin what the appropriate sanction for contravention of charge 1 on its own would be. What is abundantly clear is that the sanction of dismissal for the misconduct referred to in charge 1 would not have been an appropriate sanction. This Court is similarly not placed in a position to determine what the appropriate sanction should have been other than to note that the sanction of dismissal was not an appropriate sanction. This being the case, it is the Court’s finding that the issue of the appropriate sanction is best left for Avis Budget to determine when Engelbrecht returns to work, which sanction, if imposed, will be limited to a sanction short of dismissal. Should Engelbrecht be dissatisfied with the sanction imposed, if any, he will have the right to challenge that sanction in terms of section 186(2)(b) of the LRA as an unfair labour practice regarding a disciplinary sanction short of dismissal.

[44] This Court has also considered the submissions on behalf of Avis Budget regarding the credibility of Engelbrecht insofar as he initially stated that he pleaded guilty on charge 1, and later changed his version to confirm that he pleaded not guilty. In this Court’s view, nothing turns on this issue. What is important is that Engelbrecht conceded during the arbitration proceedings that he is guilty of charge 1 and that he ought to have pleaded guilty to charge 1 at the disciplinary hearing. Insofar as the remaining submissions regarding Engelbrecht’s credibility are concerned and Martin’s failure to consider the matter accordingly, this Court rejects same insofar as it was argued that Martin’s failure to do so amounted to a reviewable irregularity.

[45] This Court similarly rejects the submissions regarding Martin’s failure to consider the alleged threat to Orrie with assassination in considering the order of reinstatement. The onus to produce this evidence rested with Avis Budget, and despite numerous references being made by Orrie that witnesses will be called to present such evidence, they were never called. There was no reason therefore for Martin to consider these allegations in the absence of direct evidence having been placed before him. The finding of retrospective reinstatement is therefore not reviewable.

[46] It was lastly argued on behalf of Avis Budget that there is a lack of impartiality. Various reasons were referred to in substantiation. This Court fails to find that these grounds, as relied on, establish sufficient cause to arrive at a conclusion that there is a reasonable suspicion that Martin was not impartial. As such, these submissions are rejected.

Conclusion

[47] Avis Budget failed to show that the decision Martin arrived at is one that a reasonable decision maker could not reach and the application to review the arbitration award is therefore dismissed.

Costs

[48] In terms of the provisions of section 162(1) of the LRA, I have a wide discretion when it comes to the issue of costs. I am mindful of the dictum of the Constitutional Court in Zungu v Premier of the Province of Kwa-Zulu Natal and Others[7] when it comes to the issue of costs in employment disputes. In the matter before me, both parties sought costs.

[49] I have however considered the fact that no sanction was issued in respect of charge 1, and that the imposition of a sanction, which will be short of dismissal, is to be dealt with when Engelbrecht is reinstated. I have also considered that there will be a continued employment relationship between the parties. It is for these reasons that this Court deems it fair not to make an order for costs, and for each party to pay its own costs.

[50] In the premises, I make the following order:

Order

1. The application to review the award is dismissed.

2. Avis Budget is ordered to comply with the arbitration award by reinstating Engelbrecht by no later than 14 November 2024.

3. The backpay of R221,160.00, as awarded in the arbitration award, must be paid to Engelbrecht, with interest at the legal rate of interest from 30 November 2022, by no later than 14 October 2024.

4. Engelbrecht is further entitled to institute legal proceedings to claim the salary he would have received from the date of reinstatement, as per the award, i.e., 1 December 2022, to 14 October 2024. This Court is unable to order Avis Budget to pay this amount without Avis Budget having been afforded the opportunity to raise a defence, if any, as to why Engelbrecht may not be entitled to the full amount.

5. Avis Budget is entitled, upon Engelbrecht’s return to work on 14 October 2024, to impose a sanction short of dismissal in respect of charge 1. In doing so, proper procedures must be followed, and Engelbrecht has the right to challenge any sanction that may be imposed as an unfair labour practice regarding a sanction short of dismissal in terms of section 186(2)(b) of the LRA.

6. No order is made as to costs.

C de Kock

Acting Judge of the Labour Court of South Africa

Representatives:

For the Applicant: Mr P Maserumule From: Puke Maserumule Attorneys For the Third Respondent: Adv M van der Berg Instructed by: Cato Attorneys

[1] Act 66 of 1995 (as amended).

[2] (2007) 28 ILJ 2405 (CC).

[3] Id at para 110.

[4] (2013) 34 ILJ 2795 (SCA) at para 25.

[5] Fidelity Cash Management Service v Commission for Conciliation, Mediation and Arbitration and Others (2008) 29 ILJ 964 (LAC) at para 102.

[6] See Campbell Scientific Africa (Pty) Ltd v Simmers and Others (2016) 37 ILJ 116 (LAC) at para 32; Anglo Platinum (Pty) Ltd (Bafokeng Rasemone Mine) v De Beer and Others (2015) 36 ILJ 1453 (LAC) at para 12.

[7] (2018) 39 ILJ 523 (CC).