PRACTICE AND PROCEDURE

1. PRACTICE AND PROCEDURE • PETER LE ROUX

2. CCMA Guidelines on misconduct arbitration: • Guidelines come into effect on 1 January 2012. • Useful and detailed guidelines as to how arbitration should be conducted. • Aimed at arbitrators but will impact on how parties conduct arbitrations. • Seems to envisage a more active role for arbitrators. • Interesting guidelines dealing with procedural fairness, the assessment of evidence and determining the sanction to be applied. Current Labour Law

3. Justifying dismissal: • NEHAWU obo Motsoage v SARS [2010] 10 BALR 1076 (CCMA) • Madonsela v SARS [2011] 8 BALR 829 (CCMA) • It is important to lead evidence to show why dismissal was an appropriate sanction. • See also CCMA guidelines – paragraph 93 et seq. Current Labour Law

4. Con-Arb: • Rule 17(4) • If a party fails to appear or be represented at a hearing scheduled in terms of subrule (1), the commissioner must conduct the conciliation on the date specified in the notice. Current Labour Law

5. Con-Arb: • Inzuzu IT Consulting (Pty) Ltd v CCMA and Others [2010] 12 BLLR 1288 (LC) • If a party fails to appears at the con-arb the commissioner is not empowered to proceed with the arbitration. Current Labour Law

6. Con-Arb: • Pioneer Foods (Pty) Ltd v CCMA [2011] 8 BLLR 771 (LC) • Section 191(5A) provides that the council or Commission must commence the arbitration immediately after certifying that the dispute remains unresolved. • If no party has objected to con-arb, the Commissioner must conduct the conciliation on the scheduled date, even if a party fails to appear or be represented. • The Commissioner will then inevitably issue a certificate that the dispute remains unresolved. Current Labour Law

7. Con-Arb: • Pioneer Foods (Pty) Ltd v CCMA [2011] 8 BLLR 771 (LC) • The Commissioner must then commence the arbitration. • Having commenced the arbitration, the Commissioner retains the discretion to adjourn it to a later date. Current Labour Law

8. Jurisdiction of the Labour Court: • Cruse v Gijima AST (Pty) Ltd v CCMA (2010) 31 ILJ 1898 (LC) • Labour Court has jurisdiction to hear disputes regarding “collateral agreements” – in this case a contractual claim for severance benefits. Current Labour Law

9. Factual findings of arbitrators: • Sasol Mining (Pty) Ltd v Commissioner Nggeleni and Others [2011] 4 BLLR 404 (LC) • [7] Regrettably, the commissioner’s logic (or, more accurately, the lack of it) permeates many of the awards that are the subject of review proceedings in this court. Some commissioners appear wholly incapable of dealing with disputes of fact – their awards comprise an often detailed summary of the evidence, followed by an “analysis” that is little more than a truncated regurgitation of that summary accompanied by a few gratuitous remarks on the evidence, followed by a conclusion that bears no logical or legal relationship to what precedes it. Current Labour Law

10. Factual findings of arbitrators: • Sasol Mining (Pty) Ltd v Commissioner Nggeleni and Others [2011] 4 BLLR 404 (LC) • What is missing from these awards (the award under review in these proceedings is one of them) are the essential ingredients of an assessment of the credibility of the witnesses, a consideration of the inherent probability or improbability of the version that is proffered by the witnesses, and an assessment of the probabilities of the irreconcilable versions before the commissioner.” Current Labour Law

11. Factual findings of arbitrators: • See also: • Network Field Marketing (Pty) Ltd v Mngezana NO and Others [2011] 7 BLLR 699 (LC); • See paragraphs 55-56 of the CCMA guidelines. Current Labour Law

12. Costs order against CCMA in review proceedings: • Inzuzu IT Consulting (Pty) Ltd v CCMA and Others [2010] 12 BLLR 1288 (LC) • The CCMA as well as arbitrators and commissioners clearly ought to be protected against costs orders being granted in instances where bona fide mistakes have been made, or in instances where a measure of negligence has occurred. Current Labour Law

13. Costs order against CCMA in review proceedings: • Inzuzu IT Consulting (Pty) Ltd v CCMA and Others [2010] 12 BLLR 1288 (LC) • If a commissioner or arbitrator acts in a frivolous or vexatious manner, acts maliciously or mala fide, commits a gross dereliction of duty or is grossly negligent it would be unfair to deprive an aggrieved litigant of a costs order. Current Labour Law

14. Lifting the corporate veil: • Zeman v Quickelberge and Another (1) (2011) 32 ILJ 453 (LC) • Employee found to have been unfairly dismissed by the employer – a close corporation. The sole member was Q. • Shortly after date of award the CC, represented by Q, sold its assets to the Q Family Trust. When Sheriff attempted to execute a writ on the assets of the CC, he was informed that the trust paid no money for the assets because the trust had previously loaned the CC an amount of money equal to the value of the assets. Current Labour Law

15. Lifting the corporate veil: • Zeman v Quickelberge and Another (1) (2011) 32 ILJ 453 (LC) • The assets (ie. kitchen and restaurant equipment used to run a restaurant) were never taken possession of by the Trust and were simply left with the restaurant which had “the privilege to use the attached assets”. Q on behalf of the CC had guaranteed that the assets were free of any security or attachment from claims from third parties. • Q knew, or ought to have known, that when he signed the agreement transferring the assets to the trust, that a debt was owed to the employee. Current Labour Law

16. Lifting the corporate veil: • Zeman v Quickelberge and Another (1) (2011) 32 ILJ 453 (LC) • The Court finds that the inference was inescapable, that the sale was done for a fraudulent purpose and was, at the very least, an abusive of corporate personality. • Q, as signatory to the deed of sale, guaranteed that the assets of the employer were free of any claims from third parties. Alternatively he was grossly negligent or reckless in circumstances where he ought to have known that an attachment claim from third parties was in existence in the form of an arbitration award against him. Current Labour Law

17. Lifting the corporate veil: • Zeman v Quickelberge and Another (1) (2011) 32 ILJ 453 (LC) • Q was acting as a “puppet master”, and using the separate corporate personality of CC to avoid paying the debts of CC, and at the same time keeping the CC operating the restaurant as though nothing had happened. Current Labour Law

18. Lifting the corporate veil: • Zeman v Quickelberge and Another (1) (2011) 32 ILJ 453 (LC) • The corporate veil should be lifted and Q held personally liable for the debt of the CC. Current Labour Law

19. Challenging private arbitration clauses: • Bargaining Councils • Carlbank Mining Contract (Pty) Ltd v NBCRFI [2010] 11 BLLR 1142 (LC) • Contract of employment providing for private arbitration at the cost of the employer – arbitrator to be appointed by Tokiso. • Employee referred unfair dismissal dispute to the Bargaining council. • Employer argued that the dispute should be referred to private arbitration. • Arbitrator held that it should deal with the dispute and relied on section 191 of the LRA. Current Labour Law

20. Challenging private arbitration clauses: • Bargaining Councils • Carlbank Mining Contract (Pty) Ltd v NBCRFI [2010] 11 BLLR 1142 (LC) • Section 23(3) of the LRA states that – • “Where applicable, a collective agreement varies any contract of employment between an employee and employer who are both bound by the collective agreement.” Current Labour Law

21. Challenging private arbitration clauses: • Bargaining Councils • Carlbank Mining Contract (Pty) Ltd v NBCRFI [2010] 11 BLLR 1142 (LC) • Clause 5 of the bargaining council dispute resolution agreement provides that – •   “All disputes shall, if required by the Act [the LRA], be referred to the Council for conciliation and arbitration.” Current Labour Law

22. Challenging private arbitration clauses: • Bargaining Councils • Carlbank Mining Contract (Pty) Ltd v NBCRFI [2010] 11 BLLR 1142 (LC) • Section 191 provides that – • “(1) A contract of employment, … may not- • … • (b) permit an employee to be treated in a manner, or to be granted any benefit, that is less favourable than that prescribed by that collective agreement or arbitration award; or Current Labour Law

23. Challenging private arbitration clauses: • Bargaining Councils • Carlbank Mining Contract (Pty) Ltd v NBCRFI [2010] 11 BLLR 1142 (LC) • (c) waive the application of any provision of that collective agreement or arbitration award. • (2) A provision in any contract that purports to permit or grant any payment, treatment, benefit, waiver or exclusion prohibited by subsection (1) is invalid.” Current Labour Law

24. Challenging private arbitration clauses: • Bargaining Councils • Carlbank Mining Contract (Pty) Ltd v NBCRFI [2010] 11 BLLR 1142 (LC) • Clause 5 did not require an employee to refer the dispute to the bargaining council. It therefore did not impact on the contractual provision relating to private arbitration. • There was no waiver of a right.  Current Labour Law

25. Challenging private arbitration clauses: • Bargaining Councils • Carlbank Mining Contract (Pty) Ltd v NBCRFI [2010] 11 BLLR 1142 (LC) • The employee had not been treated less favourably. In this instance the benefit or treatment for the purposes of section 199(1)(b) is not to the right to refer a dispute to a bargaining council – it is to have an employment dispute expeditiously determined by an independent third party at no cost. The private arbitration agreement met this test. • See also MEC, Dept of Health v Van Der Walt [2011] 3 BLLR 258 (LC).But see SACWU obo Stinise v Dakbor Clothing (Pty) Ltd & others (2007) 28 ILJ 1318 (LC). Current Labour Law

26. Practice and Procedure: • Process-related unreasonableness: • Mzi Gaga v Anglo Platinum Ltd and Others (unreported JA44/10 dated 20/10/2011) “[44] Where a commissioner fails properly to apply his mind to material facts and unduly narrows the enquiry by incorrectly construing the scope of an applicable rule, he will not fully and fairly determine the case before him. The ensuing decision inevitably will be tainted by dialectical unreasonableness (process-related unreasonableness), characteristically resulting in a lack of rational connection between the decision and the evidence and most likely an unreasonable outcome (substantive unreasonableness). Current Labour Law

27. Practice and Procedure: • Process-related unreasonableness: • Mzi Gaga v Anglo Platinum Ltd and Others (unreported JA44/10 dated 20/10/2011) There will often be an overlap between the ground of review based on the failure to take into consideration a relevant factor, and one based on the unreasonableness of a decision. If a commissioner does not take into account a factor that he is bound to take into account, his or her decision inevitably will be unreasonable. The flaw in process alone will usually be sufficient to set aside the award on the grounds of it being a latent gross irregularity, permitting a review in terms of section 145(1) read with section 145(2)(a)(ii) of the LRA.” Current Labour Law