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Strike action – Violence and damage to property

LABOUR LAW LETTER – OCTOBER 2013

This letter contains summaries of recent decisions of Labour Courts and Tribunals which are of practical relevance to business in order to keep clients updated. In doing this we do not necessarily agree with all these judgments.

Strike action – Violence and damage to property
The Labour Court granted an interim order interdicting and restraining the union and its members from continuing with an unprotected strike. The union and employees failed to comply with the order, and the strike continued, marred by violence, damage to property, intimidation and assault. The employer was compelled to approach the Labour Court again, and was granted a further interim order calling on the union and employees to show cause why they should not be held in contempt, committing the employees to prison, and fining the union R500,000. On the return day, the employer only pursued its claim for a penalty against the union. The court noted that: ‘The time has come in our labour relations history that trade unions should be held accountable for the actions of their members. For too long trade unions have glibly washed their hands of the violent actions of their members. In this context where the Labour Relations Act 66 of 1995, which has now been in existence for some 17 years and of which trade unions, their office-bearers and their members are well aware, makes it extremely easy to go on a protected strike, as it should be in a context where the right to strike is a constitutionally protected right.’ The court found that there was simply no justification for the type of violent action that the union and employees had engaged in. The union had failed to take sufficient steps to dissuade and prevent its members from continuing with their violent and unlawful actions and had denied that it had any responsibility for the actions of its members. This undermined the very essence of disciplined collective bargaining and the very substructure of the labour relations regime. Since the employer had suffered losses of more than R16 million as a result of the union and employees’ actions, a fine of R500,000 against the union was not unreasonable in the circumstances (In2Food (Pty) Ltd v Food & Allied Workers Union & others).

Employment relationship
The plaintiff approached the High Court alleging that he had entered into an oral agreement with the defendants in terms of which a joint venture was established to which the plaintiff would contribute his knowledge and expertise and the defendants would contribute the capital. He claimed that the defendants failed to pay his salary as an employee of R600,000 and unlawfully terminated the joint venture entitling him to damages in the amount of R1.5 million based on an employment contract. The court noted that there was a material flaw in the claims presented by the plaintiff. In essence the joint venture pleaded by the plaintiff was a partnership, which was inimical to the contract of employment. In law the relationship between partners is governed by the terms of the partnership agreement and partners cannot serve one another in an employer-employee relationship. Whatever the basis for the payment of R600,000 may have been, it certainly could not have been an employment contract. For this reason alone the plaintiff’s claim for R600,000 had to fail. The plaintiff’s reliance on section 83A of the Basic Conditions of Employment Act 1997 was also misplaced — all the considerations relied on by him to show the existence of an employment relationship, namely, provision of office accommodation, computers and business cards; working regular office hours; and reporting to the defendants, applied equally to a joint venture partnership. In fact, the managerial skills and expertise of the plaintiff were exactly what he brought into the partnership and it was his function to manage and promote the sales concept which he brought into the partnership. His claim was, therefore, dismissed (Abou-Zeid v Cyberlisting Services (Pty) Ltd t/a ifind & another).

Unfair labour practice – Meaning of ‘benefit’
Following the Labour Appeal Court decision on the meaning of a ‘benefit’ in section 186(2) of the Labour Relations Act 1995 in Apollo Tyres SA (Pty) Ltd v Commission for Conciliation, Mediation & Arbitration & others, the Labour Court, in a detailed analysis of the authorities on the interpretation of the word benefit, also concluded that the CCMA’s unfair labour practice jurisdiction in terms of s 186(2)(a) is not excluded simply on the ground that an employee’s claim to a benefit did not arise ex contractu or ex lege. It found that the protection afforded by the section is founded in equity or fairness and not legally enforceable right, and is aimed precisely at addressing the situation where the employee does not necessarily enjoy a legally enforceable right to the benefit, but where the employer’s refusal to confer it is found by a commissioner to be unfair. The true principle established in earlier LAC judgments was that the CCMA jurisdiction could not be used to assert an entitlement to new benefits, new forms of remuneration or new policies by an employer. In the matter before it the Labour Court found that, once the commissioner found that the employee had a contractual entitlement to a performance bonus, he had, as a separate issue, to determine whether the employer’s failure to exercise its discretion to award the full performance bonus was unfair. The commissioner did not determine this issue and this therefore amounted to a gross irregularity which justified the setting aside of his award. Had the commissioner properly applied himself to interpreting the plain wording of the bonus clause in the employee’s contract, the only interpretation he could reasonably have arrived at was that the clause provided for the payment of a variable annual incentive bonus based on the employee’s performance (Trans-Caledon Tunnel Authority v Commission for Conciliation, Mediation & Arbitration & others).

Dismissal – Theft and unauthorised possession
The Labour Court has once again reiterated that, generically, theft and unauthorised possession belong to the same genus of dishonesty. Both are premised on conduct of an employee which deprives the employer of the ownership of its goods. While theft has an element of intention, an employer is not required to prove a charge of theft with the rigour expected in criminal prosecutions – proof on a balance of probabilities suffices.
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Unauthorised possession dispenses with the requirement of intention and requires the consideration of three elements – (1) property belonging to the employer (2) which is found in the possession of the employee and (3) which the employee has no authority to possess. The court found that the most probable inference to be drawn from the evidence before the CCMA commissioner in this matter was that the employee had wrongfully concealed a bottle of mayonnaise in her bag with the object of depriving the employer of its ownership. This could constitute theft or unauthorised possession. As the courts have consistently emphasised honesty and integrity are integral in the employment relationship. Theft is so pernicious that it annihilates the sustainability of the employment relationship, the dismissal of the employee was therefore not unfair. The court, accordingly, reviewed and set aside the commissioner’s award and confirmed that the employee’s dismissal had been fair (Continental Oil Mills (Pty) Ltd v Singh NO & others).

P G Bam Attorneys

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