CONCILIATION FOR UNFAIR DISMISSALS DISPUTES ALSO COVERS AUTOMATICALLY UNFAIR DISMISSAL CLAIMS, SOUTH AFRICA

By Yonela Sicam Tuesday, May 12, 2020
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In a unanimous judgment handed down on 6 May 2020, the Constitutional Court confirmed that the Labour Court has jurisdiction to adjudicate an automatically unfair dismissal claim even if the dispute referred to conciliation was for an ‘ordinary’ unfair dismissal. The Court also restated and applied the requirements for a defence of lis pendens (i.e. same proceedings pending in other proceedings).

As a result of this decision, the preliminary points raised by Ngululu Bulk Carriers (Pty) Ltd (Ngululu) at the Labour Court were dismissed, and the matter was remitted to that Court to be heard on the merits. In addition, Ngululu was ordered to pay costs.

Background

The matter involved two unfair dismissal disputes that were referred by the Association of Metalworkers and Construction Union (AMCU). The first dispute arose after 476 of Ngululu’s employees were dismissed for failing to report to work while embarking on an unprotected strike (strike dismissals). This prompted AMCU to refer an unfair dismissal dispute to the relevant bargaining council. Conciliation was unsuccessful and a certificate of non-resolution was issued.

Meanwhile, Ngululu took the decision to re-employ some of the dismissed employees. None of AMCU’s members were re-employed, which resulted in AMCU lodging the second dispute of selective re-employment (selective re-employment dismissals).

At the same bargaining council, AMCU argued that selective re-employment constitutes an unfair dismissal contemplated in section 186(1)(d) of the Labour Relations Act, No. 66 of 1995, as amended (LRA). Conciliation was again unsuccessful, and a certificate of non-resolution was issued. Ngululu took this matter on review to the Labour Court, arguing that the bargaining council did not have the jurisdiction to conciliate the matter.

Following two unsuccessful conciliations in respect of their two unfair dismissal disputes, AMCU approached the Labour Court. AMCU’s first contention was that the strike dismissals were not just unfair but automatically unfair because the reason for the dismissals was the employees’ affiliation with a trade union, which reason would be in contravention of the LRA. AMCU’s second contention was that dismissed employees had been selectively re-employed, to the exclusion of its members which constituted an unfair dismissal.

Ngululu raised a preliminary point in respect of each claim. In respect of the strike dismissals, it raised the issue that the Labour Court lacked jurisdiction to entertain the matter because the dispute that was conciliated was in respect of an unfair dismissal and not an automatically unfair dismissal.

The thrust of Ngululu’s contention was that conciliation for an unfair dismissal dispute was different from conciliation for an automatically unfair dismissal dispute and the two types of unfair dismissal disputes required separate and different conciliation processes. Accordingly, this automatically unfair dismissal dispute, raised for the first time at the Labour Court, still needed to be conciliated before the court could adjudicate it.

In respect of the selective re-employment dismissals, Ngululu raised the lis alibi pendens defence, contending that the issues raised by this second claim were the subject matter of Ngululu’s review application that was pending before the Labour Court.

Both of Ngululu’s contentions were upheld by the Labour Court which subsequently refused to grant leave to appeal. AMCU then petitioned the Labour Appeal Court but were once again unsuccessful.

Determined to forge ahead, AMCU approached the Constitutional Court which vindicated their persistence. In a judgment written by Jafta J, the Constitutional Court agreed with AMCU’s submissions, reasoning as follows:

  • The strike dismissals

Section 191 requires dismissed employees to refer disputes about the fairness of a dismissal to conciliation. Once conciliation fails, the employee may either ask the relevant bargaining council to arbitrate the dispute or approach the Labour Court for adjudication.

The Constitutional Court emphasised that what is being conciliated is the dispute between the parties and not the causes of action or claims which may arise from that dispute. Furthermore, it is not the reasons for the dismissals that are referred to conciliation but instead the fairness thereof.

The Labour Court’s reasoning was flawed because it characterised an automatically unfair dismissal dispute as being separate from an unfair dismissal dispute that was referred to conciliation.

In doing so, the Labour Court overlooked that, fundamentally, the unfairness of the dismissal is what is referred to conciliation, regardless of whether the unfairness concerned was automatic or otherwise.  Accordingly, when the dispute was conciliated for its unfairness, it was also conciliated for the purposes of an automatically unfair dismissal claim.

The Court further emphasised that judicial precedent is a principle of our law that obliges lower courts to follow decisions of higher courts, for as long as those decisions remain in operation.

  • The selective re-employment dismissals

For a lis pendens claim to succeed, it must be shown that there is pending litigation between the same parties, based on the same cause of action and in respect of the same subject matter.

The Labour Court erred in upholding Ngululu’s defence because only one of the above requirements was met. The review application that Ngululu relied upon to raise this defence was directed at challenging the bargaining council’s ruling and the certificate of non-resolution, and therefore had nothing to do with the unfairness of the selective re-employment dismissals.

This case is an important one for employers and employees engaging in the LRA’s dispute resolution mechanisms. Effectively, this judgment has found that when a dismissed employee refers an unfair dismissal claim for conciliation, that referral would apply in respect of both an automatically unfair and an unfair dismissal - the employee is not obliged to disclose when referring a dispute to conciliation whether he or she believes that the dismissal was automatically unfair or merely unfair.

This is because at conciliation, the employee is not required to frame his or her case. Employers must therefore keep in mind that an ‘ordinary’ dismissal claim at conciliation may mutate into an automatically unfair dismissal claim at the Labour Court.