Employment law update – Appeals against exception rulings

March 1st, 2012
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By Talita Laubscher

The applicant in Charlton v Parliament of the RSA [2011] 12 BLLR 1143 (SCA) was employed as the chief financial officer of parliament, which position he held until his dismissal on 13 January 2006 for alleged misconduct. He insisted, however, that he was dismissed for being a whistle-blower in relation to fraud perpetrated by members of parliament in respect of claims for travel benefits.

In about December 2002 Charlton informed Mr Mfenyana, the secretary to parliament, of the discovery of an alleged improper travel benefits claim by a member and, with Mfenyana’s approval, Charlton investigated the matter further. In April 2003 Charlton submitted a written report to Mfenyana and the senior presiding officers of parliament, namely the speaker of the National Assembly and the chairperson of the National Council of Provinces, that there was prima facie evidence of fraud having been perpetrated on parliament by, inter alia, certain travel agents. In the course of further investigations (carried out on the authority of Mfenyana and the senior presiding officers), Charlton formed the view that the fraud had been perpetrated on a large scale, that members had improperly benefited and that a member of staff in the parliamentary service was also implicated. The list of members involved numbered in the hundreds, and the South African Police Service, the Directorate of Special Operations (the ‘Scorpions’) and the National Prosecuting Authority also became involved with the investigation.

Charlton testified that up until April 2004 he enjoyed the support of parliament for his investigation of the travel fraud. By 31 March 2004 the investigation had identified fraud on parliament in the amount of R13 million perpetrated over a 15-month period.

After the 2004 elections, the senior presiding officers departed and Mfenyana was replaced by Mr Dingani. Charlton claimed that since then parliament’s support for the investigation declined substantially. In support of this claim, Charlton alleged that Dingani effectively frustrated his investigations into so-called ‘type 3 fraud’ to the amount of about R 35,7 million, which implicated prominent members and office bearers of parliament.

On 18 November 2005 parliament suspended Charlton without a hearing and a disciplinary inquiry into various allegations of misconduct took place between 12 and 21 December 2005. Charlton was dismissed on 13 January 2006.

Charlton challenged his dismissal in the Labour Court, contending, inter alia, that it was automatically unfair because he was dismissed for –

  • having made protected disclosures as envisaged in the Protected Disclosures Act 26 of 2000 (PDA);
  • having made disclosures that he was lawfully entitled to make in his capacity as chief financial officer;
  • having made disclosures where his decision to make them was a manifestation of conscience;
  • that his dismissal was substantively unfair, and
  • that his dismissal was procedurally unfair.

Parliament excepted to Charlton’s statement of case on six grounds, although only two were pursued. The Labour Court, per Ngcamu AJ, dismissed the exceptions, but granted parliament leave to appeal to the Labour Appeal Court (LAC). In July 2010 the LAC, per Patel JA (Waglay ADJP and Tlaletsi AJA concurring), upheld the exceptions and referred the dispute to the Commission for Conciliation, Mediation and Arbitration (CCMA) for arbitration. With special leave of the Supreme Court of Appeal (SCA), Charlton appealed to the SCA.

The SCA, per Van Heerden JA (Brand, Maya, Mhlantla JJA and Meer AJA concurring), noted that the LAC had held that ‘the first exception raised by parliament does not go to jurisdiction but is instead an attack on [Charlton’s] cause of action … . The court a quo … made a final determination that parliamentarians are both employers and employees for the purpose of the PDA. … To that extent, this decision is appealable’.

The SCA held that this reasoning was fallacious and that the LAC failed to appreciate that it was established law that the dismissal of an exception is generally not appealable. The qualification to this general principle relates to exceptions going to jurisdiction. It is further established practice that exceptions are dealt with in the Labour Court and LAC in the same manner as in the High Court. In terms of s 20(1) of the Supreme Court Act 59 of 1959, only ‘judgments’ and ‘orders’, and not merely ‘rulings’, are appealable. The judgment/order must therefore ­–

  • be final in effect and not susceptible to change by the court a quo;
  • be definitive of the rights of the parties; and
  • have the effect of disposing of at least a substantial portion of the relief claimed in the main proceedings.

Accordingly, except in very limited circumstances, the dismissal of an exception is not appealable. This is because the ruling is not final and binding and the aggrieved party can raise the same issue at the trial. The Labour Court should therefore not have granted leave to appeal and the LAC ought to have simply struck the matter from the roll.

In the circumstances, the SCA upheld Charlton’s appeal and replaced the LAC’s order with an order striking the appeal from the roll with costs.

Resignation

The applicant in De Villiers v Premier, Eastern Cape Provincial Government and Another [2011] 12 BLLR 1187 (LC) was employed as Head of Department: Roads and Transport. Her initial appointment was for a three-year period, but was extended for another three years to expire on 23 August 2011. De Villiers’ employment contract provided for termination of the contract in various instances, including on reaching the prescribed retirement age, on completing a term or extended term of office, ‘re-determination’ of the term of office, and premature retirement on request of the employee. It also provided, in clause 4.3, for voluntary resignation, in which event three months’ written notice was required.

In December 2008 De Villiers made a request for early termination due to a tense working environment, but she withdrew this request following a discussion with the second respondent. Her health deteriorated and on 31 January 2010 she addressed a letter to the second respondent giving ‘notice of termination of employment as required in paragraph 4.3’ of her employment contract. She stated further that ‘the termination be in terms of 4.1.5, namely re-determination’. The second respondent accepted her resignation, whereupon De Villiers said that what she actually wanted was an early retirement or ‘re-determination’ of term, as this was financially more beneficial to her. The second respondent persisted, however, that she had resigned and that it had accepted her resignation. De Villiers then launched an application in the Labour Court ordering the respondent to reconsider her application as being one for early retirement or re-determination.

The court, per Bhoola J, held that for all intents and purposes, De Villiers had resigned but, having realised the financial implications of this, sought to reverse it. The court confirmed that a resignation is a unilateral act that does not have to be accepted by the employer. There was accordingly no application for early retirement or re-determination and the application was dismissed.

Talita Laubscher BIur LLB (UFS) LLM (Emory University USA) is an attorney at Bowman Gilfillan in Johannesburg.

This article was first published in De Rebus in 2012 (March) DR 51.