Hearsay evidence is admissible at times

Hearsay evidence is admissible at times

Hearsay evidence is evidence tendered by an individual who relays evidence which he/she did not personally witness with his/her own eyes or senses, but heard from someone else.

Hearsay evidence is considered to be unreliable, problematic as the source of the evidence is not available for cross-examination, and often faulty as the witness may have mistakenly made an error in the interpretation of that communicated to him/her by the source of the information.

It is typically weak evidence, to be handled with caution, and includes statements of 3rd parties & documents.

The Law of Evidence Amendment Act (45 of 1988) tells us that hearsay evidence is “evidence, whether oral or in writing, the probative value of which depends upon the credibility of any person other than the person giving such evidence”.  It follows that hearsay evidence is generally inadmissible, but not always.

Schwikkard & van de Merwe, in Principles of Evidence (Second Edition; page 255) highlight that the fears associated with admission of hearsay, include “distrust of oral evidence reflected in the requirement that evidence is also problematic because the court is unable to observe the demeanour of the person who made the original statement.  Another reason given for the exclusion of hearsay evidence is that it is secondary evidence and consequently not the best evidence.

The recent Labour Appeal Court judgment in Exxaro Coal (Pty) Ltd v Gabriel Chipana & 2 others (LAC: JA161/17) provided a particularly competent commentary on the admissibility of hearsay evidence, in the context of disciplinary and arbitration hearings.

Section 3 of the Law of Evidence Amendment Act, says the judgment, “essentially means that if there is no agreement to receive hearsay evidence it is to be excluded unless the interests of justice requires its admission”.

Importantly, the judgment notes that “Hearsay evidence that is not admitted in accordance with the provisions of this section is not evidence at all.  This Court held ‘Section 3(1) of the Act has ushered our approach to the admissibility of hearsay evidence into a refreshing and practical era. We have broken away from the assertion–orientated and rigid rule–and–exception approach of the past. Courts may receive hearsay evidence if the interests of justice require it to be admitted’. This section still retains the ‘caution’ concerning the receiving of hearsay evidence, but changed the rules about when it is to be received and when not”.

So, what does this mean for us in disciplinary and arbitration hearings? Well, for starters, it confirms that hearsay evidence is indeed admissible ‘if the interests of justice require it to be admitted’.  Put differently, it is wholly incorrect to submit that hearsay evidence is always inadmissible.  However, caution must always be applied.

The judgment also tells us that “The provisions of section 138 of the LRA that give a commissioner a discretion to conduct an arbitration in a manner that she, or he, considers appropriate to determine a dispute fairly and quickly, and to do so with a minimum of legal formalities, does not imply that the commissioner may arbitrarily receive or exclude hearsay evidence, or for that matter any other kind of evidence”.

The judgment went on to quote S v Ndhlovu and Other which “referred to safeguards to ensure respect for an accused’s fundamental right to a fair trial. Cameron JA pointed out that safeguards, including the following, were important: “First, a presiding judicial officer is generally under a duty to prevent a witness heedlessly giving vent to hearsay evidence. More specifically under the Act, ‘it is the duty of a trial judge to keep inadmissible evidence out, [and] not to listen passively as the record is turned into a papery sump of “evidence”.’ Second, the Act cannot be applied against an unrepresented accused to whom the significance of its provisions have not been explained… Third, an accused cannot be ambushed by the late or unheralded admission of hearsay evidence. The trial court must be asked clearly and timeously to consider and rule on its admissibility. This cannot be done for the first time at the end of the trial, nor in argument, still less in the court’s judgement, nor on appeal. The prosecution must before closing its case clearly signal its intention to invoke the provisions of the Act, and the trial judge must before the State closes its case rule on admissibility, so that the accused can appreciate the full evidentiary ambit he or she faces.”

In the final analysis, professional advice should be sought when evaluating whether hearsay evidence is, or isn’t, admissible in a given set of circumstances.

The days of Recognition Agreements are pretty much over

Those old enough to remember the labour relations environment in the 1980’s will remember the emergence of Recognition Agreements. The then Labour Relations Act had no codification of trade union rights, or what we today refer to as ‘organisational rights’.  Way back then, emerging trade unions had to attempt to strong arm employers into ‘recognising’ them, and in so doing, grant the trade union stop-order, access, and shop steward rights.

And if union representation grew to majority representation, collective bargaining rights would be included in the Recognition Agreement.

It’s not far off the mark to say that prior to our current 1995 Labour Relations Act, trade unions entered into Recognition Agreements with employers, on the back of their significant membership numbers, and negotiating prowess.

Cue the introduction of the 1995 Labour Relations Act which simplified, and more importantly codified, the granting of trade union (organisational) rights, in obligating employers to extend such rights to trade unions, if they reached certain membership thresholds.

So, the notion of employers ‘recognising’ trade unions, at least for the purposes of trade union rights, fell away.  The threshold of ‘sufficient representation’ was born, and any trade union which now acquires ‘sufficient representation’ in a workplace, is automatically entitled to the trade union organisational rights associated with sufficient representation, namely (1) access to the employer’s workplace (section 12 of the LRA) and (2) the obligation of employers to deduct and pay over union membership subscriptions monthly (section 13 of the LRA).

Trade unions were no longer required to be recognised by employers for these rights, as they were an automatic consequence of the union having membership which met, or exceeded, the sufficient representation threshold.  However, the ‘sufficient representation threshold’ was not defined, at least not in percentage terms.  What initially became apparent, for various reasons, was that sufficient representation was in the region of 30% of all eligible union members, with eligible union members being all employees, excluding senior management.

Since 1995, statutory amendments to the Labour Relations Act, pre-empted by evolving case law, has, in certain circumstances, lowered the sufficient representation to less than 30%.

The second union membership threshold dealt with in the Labour Relations Act, for purposes relating to trade union, organisational rights, is majority union representation, often described to be 50% plus one member within the ranks of eligible union members.

Once a trade union acquires majority representation, two further trade union, organisational rights, kick in, namely the right to appoint shop stewards (referred to as trade union representatives in the LRA) in terms of sections 14 and 15 of the Labour Relations Act, and the right to information disclosure, in terms of section 16 of the Labour Relations Act.

In practice, there are occasionally squabbles between employers and trade unions over the verification of actual trade union membership with the ranks of eligible union members, although disputes of this nature are typically short-lived.

So how does collective bargaining fit into this scenario.  Well, it could be argued that there is still some degree of ‘recognition’ of trade unions, when it comes to collective (wage) bargaining.  It has become, wisely, a norm for employers to agree to enter into collective bargaining arrangements with unions which acquire majority representation, even though there is no duty to bargaining in our law, per se.

Over time, collective recognition agreements are being phased out, as trade unions no longer require employers to recognise them for trade union, organisational rights, as these rights have been codified in the Labour Relations Act, once sufficient and/or majority representation has been achieved and verified.

The trend nowadays, is to conclude separate organisational rights and collective bargaining agreements.  This makes sense on many levels.  To begin with, organisational rights and collective bargaining rights, are fundamentally different, and unrelated.  There is no logical reason why they should stand together in the same collective agreement.

Secondly, in the separate agreements scenario, an organisational rights agreement can persist in the event that a trade union loses majority representation.  If both organisational and collective bargaining rights were both contained in a single collective agreement, a new collective agreement would need to be concluded, even though the union may none the less retain a level of sufficient representation.

Our anecdotal observations of organisational rights and collective bargaining agreements is that they are not regularly reviewed to reflect renewed best practice over time.  Indeed, this is perhaps even more pertinent to disciplinary procedures and codes.

Hearsay evidence is admissible at times

Theft of relatively low cost items still typically warrants dismissal

One of our multi-national clients recently lamented the fact that, by a country mile, they experience the highest number of theft-related and dishonesty cases in South Africa, than anywhere else in the world.  The unfortunate reality is that our consultancy deals with numerous theft and dishonesty related disciplinary and arbitration hearings on an ongoing basis.

One of the questions which frequently arises is, does the monetary value of the items or money stolen, influence the choice of sanction, and importantly, if the item is of minimal monetary value, does it mitigate against dismissing the culprit?

To begin with, it’s worth remembering what the Constitutional court had to say on sanction selection in Sidumo & COSATU v Rustenburg Platinum Mines Ltd & 2 others (CCT85/06). This judgment, amongst other things, said that “In deciding whether a dismissal is fair a commissioner need not be persuaded that dismissal is the only fair sanction – it is sufficient that the employer establishes that it is a fair sanction”.

In this vein, the Concourt judgment continued that the “Labour Appeal Court in Nampak Corrugated Wadeville v Khoza (held that) the determination of an appropriate sanction is a matter which is largely within the discretion of the employer.  However, this discretion must be exercised fairly.  A court should, therefore, not lightly interfere with the sanction imposed by the employer unless the employer acted unfairly in imposing the sanction.  The question is not whether the court would have imposed the sanction imposed by the employer, but whether in the circumstances of the case the sanction was reasonable.

When all is said and done, said the judgment “In approaching the dismissal dispute impartially a commissioner will take into account the totality of circumstances.  He or she will necessarily take into account the importance of the rule that had been breached.  The commissioner must of course consider the reason the employer imposed the sanction of dismissal, as he or she must take into account the basis of the employee’s challenge to the dismissal.  There are other factors that will require consideration.  For example, the harm caused by the employee’s conduct, whether additional training and instruction may result in the employee not repeating the misconduct, the effect of dismissal on the employee and his or her long-service record.  This is not an exhaustive list”.

It follows therefore, that the monetary value of goods or funds stolen must be considered as a mitigating factor when contemplating sanctions in dishonesty cases, but does it necessarily mean that they will save an employee from dismissal, even if the monetary value is low.

The short answer is, not necessarily.  But it may on occasion.  For example, the dismissal of an employee in a retails store who pleads guilty to stealing a few sprays of deodorant from a can of deodorant on the store shelf, would be substantively unfair (on grounds that the sanction is too harsh) if there were compelling mitigating factors such as long service, and a clean disciplinary record.

The Labour Appeal Court judgment, in Shoprite Checkers v CCMA & 2 others (LAC: JA08/2004) provides important insights into whether dismissal for the theft of small items.  This judgment quoted the  Labour Court in Standard Bank SA Limited v CCMA and others [1998] 6 BLLR 622 at paras 38 – 41 where Tip AJ said: “It was one of the fundamentals of the employment relationship that the employer should be able to place trust in the employee… A breach of this trust in the form of conduct involving dishonesty is one that goes to the heart of the employment relationship and is destructive of it.”

This judgment continued that the Standard Bank judgment “was followed by Mlambo J (as he then was) in Metcash Trading Limited t/a Metro Cash and Carry and another v Fobb and another (1998) 19 ILJ 1516 (LAC) at para 16 – 17 where the learned judge found that in relation to the consumption of one 250 ml bottle of orange juice “theft is theft and does not become less because of the size of the article stolen or misappropriated”.

The question of whether dismissal for theft, regardless of the value of the stolen items, in the context of prevailing high stock losses, was addressed by the Labour Appeal Court in Leonard Dingler (Pty) Ltd v Ngwenya (1999: 20 ILJ (LAC) – “Was dismissal of the respondent an unfair sanction? I am persuaded that this question falls to be answered in the negative. It is true that the respondent had a long record of service (7 years 10 months…) with no previous record of a disciplinary offence. On the other hand, Oosthuizen testified that the appellant experienced theft by its employees on a large scale. It follows that a measure of deterrence is called for”.

Lots of boxes to tick when proving poor performance

Lots of boxes to tick when proving poor performance

At the end of the day, managers and supervisors are paid to manage and supervise two things, employee conduct and employee performance.  From an employment law point of view, the conduct aspect of management becomes important when the employee’s conduct becomes misconduct.  Misconduct, is a blameworthy act or omission, which requires employers to trigger a disciplinary process.

On the other hand, the type of poor performance, addressed in the Labour Relations Act, is the non-blameworthy, incompetence specie of poor performance.  When all is said, and done, poor performance is either blameworthy, or not blameworthy.  Put differently, sometimes the employee is blameworthy for their poor performance, and sometimes they aren’t.

If it can be proved that the employee is blameworthy for their performance, a disciplinary procedure is followed, because the employer is able to prove that the employee was capable of better performance than they delivered, importantly, in circumstances where there were no extraneous factors causing the poor performance, over which the employee had no control.

In circumstances where it cannot be proved that the employee is blameworthy, or at fault for, his or her poor performance, there is no misconduct; rather, there is incapacity; meaning that the employee’s performance is poor, but for reasons beyond their control. The Labour Relations Act obligates employers to follow a counselling, not misconduct, procedure, in an incapacity-related, scenario of poor work performance.

In fact, there are even occasions where there are elements of both incapacity and misconduct in an employee’s poor performance.

The Labour Court recently (19 June 2019) passed judgment in the case of Moneyline Financial Services (Pty) Ltd v Tsientsi Chakane & 1 other (Case no: JR2454 /17).  This was a case which dealt with a dispute relating to the management of poor work performance.

The background to this case, as described in the judgment, was that “the respondent employees failed to achieve the performance targets between September 2016 and January 2017. On 12 October 2016, the first letter warning the respondent employees of poor work performance was issued in respect of the month of September 2016. On 9 November 2016, a second letter then serving as a final ultimatum was issued in respect of the respondent employees’ poor work performance for the month of October 2016. The respondent employees were afforded the opportunity to make written representations wherein they were to give reasons for failing to meet the performance targets. The applicant (the employer) found their explanation unacceptable. On 18 January 2017, the respondent employees were served with the notices to attend performance enquiries respectively”, and ultimately dismissed for poor work performance.

At the CCMA, the arbitration award held that the dismissals were substantively unfair as “the dismissal was not an appropriate sanction as training could have been a reasonable alternative. He accepted that the reasons proffered by the respondent employees for non-performance as genuine and plausible given the context of the industry they operated in”.

The employer took this arbitration award on review to the Labour Court, which dismissed the review application and upheld the arbitration award’s finding that the dismissals for poor performance were substantively unfair.

In so doing, the judgment emphasised what was held in Gold Fields Mining South Africa (Pty) Ltd (Kloof Gold Mine) v Commission for Conciliation Mediation and Arbitration and Others  [2014] 1 BLLR 20 (LAC); (2014) 35 ILJ 943 (LAC), namely that “In order to find that an employee is guilty of poor performance and consider dismissal as an appropriate sanction for such conduct, the employer is required to prove that the employee did not meet existing and known performance standards; that the failure to meet the expected standard of performance is serious; and that the employee was given sufficient training, guidance, support, time or counselling to improve his or her performance but could not perform in terms of the expected standards. Furthermore, the employer should be able to demonstrate that the failure to meet the standard of performance required is due to the employee’s inability to do so and not due to factors that are outside the employee’s control”.

The judgment continued that “In the present case, the applicant failed to show that the respondent employees were given sufficient training, guidance, support, counselling and reasonable time to improve their performance. The respondent employees had genuine concerns that were outside their control and could have been managed with the assistance from the applicant. Clearly, the commissioner correctly found that the applicant failed to explore alternative measures short of dismissal, like training. It follows that the applicant failed to show that the dismissal of the respondent employees was an appropriate sanction”.

Refusal to undergo a polygraph test may be grounds for dismissal

Refusal to undergo a polygraph test may be grounds for dismissal

Polygraph and truth verification tests have been around for some time. You won’t need to look far to find someone with an opinion on these tests, with those claiming that they are all but infallible, to those who doubt their accuracy.  Regardless, these tests are often administered by employers in the investigation of, primarily, dishonesty misconduct cases.

We know from years of case law that polygraph and truth verification tests, in their various guises, can be used as corroborating evidence, which supports more direct evidence, but that such test results will never be enough, on their own, to meet the burden of proof on a balance of probabilities.

But what if an employee refuses to consent to undergoing a polygraph, or truth verification, test?  Does this amount to misconduct? Is such refusal a dismissible offence?

This very issue was dealt with in a recent (22 May 2019) Labour Court judgment in Bidvest Protea Coin (Pty) Ltd v Mbongeni Ernest Ngcobo [Case number 260/17].

The judgment outlined the background facts – “In terms of the employment contract between the parties, the first respondent (the employee) consented to undergo a polygraph or truth verification test as and when requested to do so by the applicant (the employer). The applicant (employer) conducts these tests randomly and on any selected employees”.

So, first and foremost, the employee had signed a contract of employment which specifically, amongst other things, obligated the employee to undergo a polygraph or truth verification test, when requested to do so by his employer.

However, sometime later, the employee was selected randomly for such a test, and “On the scheduled day of testing, the first respondent was provided with the consent form to complete so that the testing could be conducted. He refused to complete the consent form in spite of being given an opportunity to consult his attorney. As a result, he was charged in a disciplinary hearing with breaching his employment contract and subsequently dismissed. He duly referred an unfair dismissal dispute to the third respondent which was arbitrated by the second respondent (arbitrator)”.

At arbitration, the arbitrator held “in his award, found that the consent form provided the first respondent with a choice to refuse to undergo the polygraph test. The arbitrator found that the first respondent, by virtue of his employment contract, was being coerced by the applicant to undergo the polygraph test. Therefore, according to the arbitrator, the first respondent had not refused to undergo the test in terms of his employment contract as it compelled him to do so but only refused to sign the consent form allowing the test to be conducted. The arbitrator held that the second respondent had not refused to undergo the polygraph test on 11 May 2017 and thus his dismissal was substantively unfair and reinstated the first respondent”.

The employer challenged the arbitration award, taking on review to the Labour Court, arguing that “the arbitrator ignored the fact that the first respondent had consented to undergo polygraph tests in terms of his employment contract and that his refusal to sign the consent form amounted to breach of his contractual obligations”.

The Labour Court agreed with the employer – “I agree that the arbitrator ignored the applicant’s evidence and/or did not properly weigh it up. This is because the applicant’s main witness had testified that the examiner could not conduct the testing without the consent form being signed as it is a prerequisite. The purpose of the consent form was to allow the examiner to amongst others, put sensors on one’s body. This had been explained to the first respondent. The arbitrator also ignored the fact that the first respondent had also in his employment contract, consented to undergo polygraph tests. I fail to understand on what basis the arbitrator found that the first respondent was coerced into being tested by the very same employment contract he had voluntarily entered into”.

Quite rightly, the judgment ordered that “The arbitration award issued by the second respondent (the arbitrator) is reviewed and set aside.  The arbitration award is substituted with an order that the third respondent’s dismissal was fair”.

This judgment reminds us that it is important to include compulsory polygraph tests, when requested, in contracts of employment are entered into at the commencement of an employment relationship.  In the absence of such up-front agreement, it is arguable that an employee can reasonably refuse to undergo such tests.

Yes, you can be dismissed on grounds of ill-health absenteeism

As uncompassionate as it may sound, employers are not obligated to employ an employee, who is habitually absent on grounds of ill health, indefinitely.  ‘Incapacity’ is one of the three species of dismissal in our law, with the other two being ‘misconduct’ and ‘operational requirements’ (retrenchments, in the main).

Section 11 of Schedule 8 of the Labour Relations Act (Code of Good Practice: Dismissal), gives specific guidelines on what is expected of employers who dismiss employees on grounds of ill health or injury.  It’s worth looking at what this section tells us, it reads “Any person determining whether a dismissal arising from ill health or injury is unfair, should consider (a) whether or not the employee is capable of performing the work; and (b) if the employee is not capable – (i) the extent to which the employee is capable to perform the work; (ii) the extent to which the employee’s work circumstances might be adapted to accommodate disability, or, where this is not possible, the extent to which the employee’s duties might be adapted; and (iii) the availability of any suitable alternative work”.

Make no mistake, quite rightly, employers need to tread carefully when contemplating the dismissal of an employee on grounds of ill health or injury.  Let’s face it, we all get sick at times, and may befall an unavoidable injury, and we would want our employer to show some patience and compassion with us.  That, in a nutshell, is what the Labour Relations Act tells employers to do, before contemplating dismissal.

Whilst some employers have temporary and permanent risk benefits which are available to their employees in circumstances of this nature, it is not always the case.  Many employers do not have such risk benefits for staff, as cost to company remuneration structures become more common-place.  On the other hand, some employers simply can’t afford to offer such risk benefits to their staff.

So, if an employee is excessively absent, on grounds of ill health or injury, and there are no risk benefits, what are the options available to the employer?  Section 11 of Schedule 8 of the Labour Relations Act, largely provides the answer.

So, does case law, which help us understand how the relevant legislation and the Code of Good Practice, are to be interpreted and applied in practice.

The Supreme Court of Appeal, in Kievits Kroon Country Estate (Pty) Ltd v Mmoledi and Others (2014) 35 ILJ 406 (SCA), confirmed that “an employer is not expected to tolerate an employee’s prolonged absence from work for incapacity due to ill health. And it may, if it be fair in the circumstances, exercise an election to end the employment relationship”.

A recent Labour Appeal Court judgment (27 June 2019) casts more light on this subject.  It was the case of Parexel (Pty) Ltd v Chakane & others (Case number JA39/2018) which, amongst other things, noted that “It is self-evident that whether an employee is willing and able to work and when she may be in a position to do so are material considerations to which regard must be had when considering an employee’s incapacity, whether she has been absent from work for an unreasonably long period of time and whether alternatives to dismissal exist”.

The judgment continued that “The appellant (employer) was not required to hold the employee’s position open for her indefinitely when she had failed to provide any clear basis as to the reasons for and anticipated extent of her continued absence”.

The employer held an incapacity hearing to assess the viability of the ongoing employment of the employee, on grounds of incapacity.  In this regard, the Court held that “The appellant (employer) proceeded by way of an incapacity enquiry to determine whether the employee’s absence from work had been unreasonably long or not. Implicit in such a determination was a consideration of the reasons advanced by the employee for her absence and the extent of such absence. Since very distinct reasons had been provided by different doctors for the employee’s absence, the appellant requested the employee to provide it with a medical report indicating the reason for her extended absence, the prognosis for her recovery and if she was to recover, the period within such recovery could be anticipated. Yet, in spite of offers of assistance made by the appellant to the employee, no such medical report was provided by her”.

In the final analysis, employers must make reasonable accommodation of ill health or injury related employee absenteeism.  Indeed, the job specification and work environment, if possible, should be modified the accommodate the employee.  Suitable alternative positions should also be considered, if such options exist.

That said, employers are not obligated to endure prolonged ill health or injury absenteeism indefinitely.

Hearsay evidence is admissible at times

Concourt provides guidelines on an employer’s duty of good faith in derivative misconduct cases

All employees have a common-law obligation to their employers to promote and protect the interests of the employer, at all times.  This includes informing management of any planned or actual acts of misconduct they have knowledge of.  It could, for example, include knowledge of theft, pilferage and fraud.

That said, it’s widely known that employees are often ‘in the know’ when it comes to acts of misconduct committed by other employees, yet they don’t bring it to management’s attention.  The reasons for not doing so are varied.  An employee may consciously choose not to inform management of misconduct they are aware of, for fear of reprisals from the instigators. It is also quite possible that an employee will not divulge misconduct they are aware of, as they themselves have an axe to grind with the employer.

Regardless, employees have a positive duty to inform management of misconduct of which the employer may be unware; failure to do so is a material breach of such employee’s duty of good faith to their employer.

The CCMA and labour courts have dealt with derivative misconduct on numerous occasions.  Earlier this year, the CCMA in Thabiso Ngakane v Wilmar (Pty) Ltd [GAJB9538-18] noted that “While a dismissal on the grounds of derivative misconduct has been sanctioned by the Labour Courts, the onus remains with the employer to prove that the employee was guilty of such misconduct. In that regard the employer would need to produce evidence that there was a reasonable probability that the employee had information that would assist the employer in identifying those guilty of misconduct, and had withheld such information”.

In yet another example, in NUMSA v Commissioner Leon Pillay & others [D02-17], the Labour Court described derivative misconduct as being  “a case in which the employer wants to rely on misconduct that is not directly related to the employee’s own wrongdoing, but is based on the employee not providing information that is needed to identify other wrongdoers in circumstances where speaking up is required to maintain the trust relationship, that constitutes a quite distinct ground of misconduct, applicable in a context where not speaking up can destroy an employment relationship”.

The notion of derivative misconduct most recently came to a head in at the Constitutional Court which last month, on 28 June 2019, delivered judgment in the long-standing dispute involving NUMSA obo Khanyile Nkanezi & others v Dunlop & others [CCT202/18].

In short, a violent, protected strike commenced on 22 August 2019.  Some perpetrators of violence could be positively identified, others could not.  The CCMA Commissioner in the arbitration award noted that “The situation that prevailed in Induna Mills Road during the course of the strike was highly relevant to the derivative misconduct issue. If any of the applicants were present in the group of strikers who . . . [committed the acts of violence] they would either have been perpetrators of principal misconduct or be liable for derivative misconduct on the basis that they knew who the perpetrators of the misconduct were and failed to disclose that information to the respondent”.

In the final analysis, the existence, or otherwise, of derivative misconduct on the part of strikers who participated in the protected strike, but who could not be identified as perpetrators of violence, became the subject matter of a CCMA arbitration hearing, subsequent Labour Court and Labour Appeal Court cases, and ultimately a Constitutional Court matter.

The Concourt identified the source of the concept of derivative misconduct in highlighting that “ Although not mentioned by name as derivative misconduct, the roots of the doctrine lie in an obiter dictum (non-binding statement) by Nugent J in FAWU – In the field of the industrial relations, it may be that policy considerations require more of an employee than that he merely remained passive in circumstances like the present, and that his failure to assist in an investigation of this sort may in itself justify disciplinary action” [Food & Allied Workers Union v Amalgamated Beverage Industries Ltd [1994] ZALAC 1].

When all is said, and done, the ‘takeaway’ from the Concourt judgment is that whilst a derivative duty to disclose exists “As we have seen, this duty was sourced in the contractual duty of good faith without any reference to an employer’s reciprocal good faith obligations. In accordance with the conclusion employees’ safety should have been guaranteed before expecting them to come forward and disclose information or exonerate themselves. That was not sufficiently done”.

In short, this means that derivative misconduct, in strike scenarios, and probably all others, requires employers to ensure that employees who disclose knowledge of misconduct on their colleagues, are safeguarded from harm.  This is perplexing for employers, as it now suggests that employees have a valid defence to derivative misconduct allegations, which relies solely on fear of intimidation or harm, regardless of the circumstances.

When the Labour Appeal Court considers a dismissal sanction too harsh

When the Labour Appeal Court considers a dismissal sanction too harsh

We know that too severe a sanction in a disciplinary hearing amounts to substantive unfairness.

The dilemma facing employers in the selecting of a sanction, and more especially the sanction of dismissal, was highlighted in the recent (13 June 2019) Labour Appeal court judgment in Hosea Mushi v Exxaro Coal (Pty) Ltd Grootgeluk Coal Mine (Case number JA62/2018.

The facts of the case were quite straight forward, with the background perhaps best summed up in the judgment – “The appellant had been employed by the respondent, Exxaro Coal (Pty) Ltd, at Grootegeluk Coal Mine for 24 years when he was dismissed. On 10 March 2015 at around 22h50, he was on duty driving an oversized coal haul truck, the wheel size of which exceeded the height of two adults. He reported to his foreman that the shovel operator was loading the truck in an unsafe manner. The foreman instructed the appellant to continue loading and undertook to observe the loading process. Shortly thereafter the foreman informed the appellant via radio that he would board the truck at the loading area. The appellant refused to let the foreman board the truck at this area. As the foreman walked towards the loading area the appellant moved the truck forward causing the foreman to have to move out of the way.

At the ensuing disciplinary hearing, the appellant admitted that he had behaved improperly, but not that he had undermined the authority or threatened the life of the supervisor. The disciplinary code, which was stated to be a guideline, provided for a final written warning for misconduct of the nature committed. The appellant was nevertheless dismissed from his employment on 29 April 2015, for having refused to obey an instruction of a foreman, unsafe acts committed while driving the truck and improper behaviour in operating the truck after the foreman was proceeding towards it”.

So there you have it.  Unfair said the employee, who referred an unfair dismissal claim at the CCMA where “the parties agreed that the misconduct committed was not in dispute and that the issues for determination by the arbitrator were the appropriateness of the sanction and the issue of consistency since the foreman had not been disciplined”.

I short, the arbitrator agreed, with the arbitration award stating that “‘The three charges are mutated of one another. The number of the charges by mutating them does not make the act to be more severe than it would ordinarily be. In any event, there is no dispute about the fact that it is not a dismissible offence at first instance. The respondent is not correct when it argues that it has a zero-tolerance attitude towards an offence of this nature.’

In finding the sanction of dismissal imposed on the appellant to be inappropriate, the arbitrator had regard to the fact that the appellant had not been charged with gross insubordination, there were no aggravating circumstances present to prove that progressive discipline was inappropriate, the appellant had a long period of service, a clean service record and had shown remorse for his conduct. The dismissal was found to be unfair and the appellant was reinstated retrospectively into his employment with the respondent, with no loss of remuneration and back pay awarded in the amount of R77 398.72. A final written warning was imposed on the respondent operative from the date of his reinstatement, to expire on a date as prescribed by the respondent’s disciplinary code”.

A Labour Court review, however, disagreed with the Commissioner, and held that “The Court took the view that it did not matter that the misconduct committed by the appellant had not been termed “gross” insubordination and that since the appellant had admitted endangering the life of the foreman, it was inconceivable that dismissal was not a fair sanction. The award of the arbitrator was therefore set aside on review on the basis that it was so unreasonable that no other reasonable arbitrator could have come to the same conclusion. The award was substituted with an order that the dismissal of the appellant was fair, with no order as to costs made”.

The Labour Appeal Court, in turn, disagreed with the Labour Court, holding that “While health and safety issues, particularly in the mining industry, is of paramount concern, no evidence was put up to show that the foreman’s life was endangered as a result of the appellant’s conduct. The appellant admitted that he had erred in his conduct and showed remorse for it. The arbitrator’s finding that the three charges related to the same misconduct did not amount to an irregularity in the conduct of proceedings when regard is had to nature of the misconduct, which the parties had agreed to be common cause. In addition, the failure to charge the appellant with “gross” misconduct did not alter the nature or degree of the misconduct committed on the facts of this matter. Nevertheless, the arbitrator had regard to the material before him in the manner he was required. This included that the respondent had a clean disciplinary record, long service and the disciplinary code recommended a final written warning for the type of misconduct committed. Endorsing the concept of corrective or progressive discipline, the arbitrator arrived at the conclusion that the imposition of the sanction of dismissal was too harsh”.

30+ years of labour relations consulting observations in SA

Our labour relations consultancy is in its 25th year, and this has inclined our team to reminisce over our journey, and prompted me to recall the trends and developments over time.  Labour relations is seldom viewed dispassionately.  It is a field which spans a multitude of collective and individual workplace interactions and experiences, from constructive relationship building initiatives to often sizzling adversarialism.

My graduation from UCT in the early 1980’s coincided almost exactly with the dawn of the present-day employment law, and labour relations regime which prevails today.  This itself may sound strange, especially if one recalls that apartheid was still at its height, and the release of nelson Mandela, and the dawn of a new democratic South Africa was over a decade away.  Even so, as early as the mid 1980’s, the concept of fairness in discipline and dismissal was already becoming prominent, as espoused by UNISA’s Professor Nic Wiehahn, a colourful character who was also renowned from his colourful neckties at the time.

It was also the time at which the so-called emerging Black unions began to increase in prominence, and display competent and powerful leadership, with Cyril Ramaphosa’s National Union of Mineworkers leading the way.  Organised labour was still none the less highly oppressed by the P W Botha Nationalist government.  At the time, and quite understandably, organised labour would put employers under enormous pressure to send a ‘telegram’ to the Minister of Police, to demand the release of union officials who had been detained without prosecution, for simply being union officials.

Over time, the then ‘Personnel Department’ morphed into being referred to in various ways, including the ‘Human Resources Department’, the ‘Human Capital Department’ and more recently, “People and Culture’, all of which are labels to describe the team within an organisation charged with various responsibilities including staff administration, training and development, recruitment and selection, employee wellness, and of course, labour relations.

In our view, the trade union landscape his significantly changed over time.  There is no doubt that the evolution of COSATU in the mid-1990’s brought greater cohesion to the realm of organised labour.  Alignment with the ANC added impetus to COSATU’s breadth of influence.  But it didn’t last.  Even though union membership in the Public sector remains high, the split within COSATU, resulting in the formation of rival union federation SAFTU, it has negated the role of trade unions in the Private sector, which currently has about one in eight employees being union members. Overall, only about twenty five percent of employees are union members.

Another consequence of the split in COSATU is the increase in numbers of trade unions, of a lesser size.  This in turn has led to an increase in union rivalry, and by and large, generally less effective trade unionism.

Trade unions have, from the very beginning, suffered from a glut in competent leadership, due primarily to the fact that competent trade union leaders are frequently fast-tracked into governmental positions.

No analysis of the SA labour relations landscape would be complete without a look at the CCMA, and bargaining Council dispute resolution centres.

The CCMA is probably approaching nine hundred labour disputes being referred to it every working day.  About seventy five percent of those cases are ‘resolved’ or ‘conciliated’, either because one or both parties are fearful of losing at arbitration, or the employer is willing to pay the ex-employee a settlement sum so as to avoid the nuisance factor associated with arbitration.

The introduction of minimum wage legislation and the recent appointment of the CCMA to address the non-payment of salaries, will probably see one thousand labour disputes being referred every working day, in the not too distant future.

Employers still lose nearly fifty percent of all arbitration hearings.  This percentage is almost certainly skewed by the SMME sector who fare far more poorly than larger, more sophisticated employers.  We remain of the sincere view that there is no reason why employers should have poor outcomes at the CCMA, if they apply the fundamentals of our discipline and dismissal protocols.

Perhaps the biggest challenge facing employers in the labour relations space is that they frequently don’t know what they don’t know.  This results in often fatal flaws being made in, for example discipline cases, which cannot then subsequently be reversed. It must still be borne in mind that approximately eighty percent of all labour disputes are discipline related, and competence in managing discipline, misconduct cases, requires close attention and training.

And finally, increasing employment law continues to decrease labour flexibility.  Some would also argue that our employment law regime is over regulated, and too job security, than job creation focussed; you can go ahead and put our firm in that camp.

Discipline post resignation, yay or nay?

Our courts have rendered contradictory judgments regarding whether, or not, employers are allowed to schedule disciplinary hearings after an employee has resigned.  In the Public sector, due to a prevailing collective agreement, the position is quite clear, an employee may resign at any time prior to a disciplinary hearing being finalised, at which time the disciplinary hearing stops.  This enables, wrongly in our view, employees to avoid possible sanction for misconduct, serious or not.

But that’s the Public sector.  The position in the private sector has been less clear.  On 24 May 2019, the Labour Court, in Tristyn Naidoo & Sedayshum Naidu v Standard Bank SA (Ltd) & 1 other (Case number J1177/19) was once again required to answer this question.

In this instance, the applicant’s challenged the jurisdiction of the respondent “to continue with the disciplinary hearing post their resignation” and to interdict the respondent from proceeding with their scheduled disciplinary hearing post their resignation.

Both applicants had been employed as equities traders up until their resignation.  On 4 March 2019, the applicants were issued with notices of precautionary suspension, which noted that “the nature of the allegations against the applicants was serious and that if proven, could impact on the trust relationship between them” and the respondent.  After having attended various meetings with forensic investigators, the applicants were issued with notices to attend a disciplinary hearing on 16 and 22 May 2019.  Two allegations of “gross misconduct”, and one of “dishonesty” were levelled against the two applicants.  The applicants tendered their letters of resignation the same day “with immediate effect”.

Later that day, the applicants received identical correspondence from the employer’s Head of Human Resources, amongst other things, stated that “the Bank is not amenable to accepting your immediate resignation and will still hold you to your 28 days’ notice period as contractually obligated and will be continuing with our internal process.  The disciplinary enquiry will therefore proceed as scheduled ..”.

The applicants replied to this by stating that “it is trite in law that my resignation is a unilateral termination of the employment contract and is therefore not subject to Standard Bank’s acceptance or approval.  In light of the fact that this is an effective termination of the employment relationship, Standard Bank cannot proceed against any person who is no longer an employee of the company”.

The applicants then approached the Labour Court, which was required to determine whether “the applicant’s immediate resignation had the effect of immediately terminating the employment relationship and whether Standard Bank has the right to hold the applicants to their notice periods and if so, whether it can proceed with the disciplinary enquiries against them despite their resignation with immediate effect”.

In reviewing the effect of resignation in case law, the Court began by referring to Sihlali v SA Broadcasting Corporation Ltd (2010) 31 ILJ 1477 (LC), which held that resignation is a unilateral termination of a contract of employment by the employee.  This view was reiterated in Toyota SA Motors (Pty) Ltd v CCMA & others (2016) 37 ILJ 313 (CC), which held that “Where an employee resigns from the employ of his employer and does so voluntarily, the employer may not discipline that employee after the resignation has taken effect.  That is because, once the resignation has taken effect, the employee is no longer an employee of that employer and that employer does not have jurisdiction over the employee any more”.

The Labour Court held that Standard Bank “has no power to discipline the first and second applicant’s subsequent to their resignation with immediate effect, and Standard Bank was interdicted from continuing with the disciplinary enquiries.

The Court acknowledged that the applicants were in breach of their contracts of employment.  However, the remedy available to the ‘employer’ is to either “hold the employee to the contract and seek an order of specific performance requiring the employee to serve the period of notice.  Alternatively, the employer may accept the employee’s repudiation, cancel the contract and claim damages”.

The judgment noted, in essence, that holding disciplinary hearings after an immediate resignation, was a form of employer “self-help .. and this Court can’t sanction” such self-help.

So, there we have it, in cases of immediate resignation, an employee does not work out their notice period, and the resignation takes effect immediately.