Employees be aware: A discussion

July 1st, 2019

Steenkamp and Others v Edcon Ltd (CC) (unreported case no CCT29/18, 30-4-2019) (Basson AJ (Mogoeng CJ, Cameron J, Dlodlo AJ, Froneman J, Goliath AJ, Khampepe J, Mhlantla J, Petse AJ and Theron J concurring))

The matter concerns the leave to appeal against the judgment of the Labour Appeal Court (LAC) refusing the applicants condonation for the late filing of an application in terms of s 189A(13) of the Labour Relations Act 66 of 1995 (LRA). Prior to this application, the applicants brought an application before the Constitutional Court (CC), which was dismissed on the grounds that the dismissal pursuant to the notice defaulting s 189A(8) of the LRA did not result in the invalidity of the dismissal. Subsequently the applicants brought an application in terms of s 189A(13) of the LRA before the Labour Court (LC) claiming compensation in terms of s 189(13)(d) on the basis that their retrenchments were procedurally unfair. Because the applicants were out of time – as the LRA requires such application to be brought within 30 days – they applied for condonation. The reason for the delay was that the applicants pursued an overturned legal strategy. On this basis, the LC granted condonation for the applicants and granted leave to appeal to the LAC. The LAC overturned the decision of the LC and dismissed a condonation application on the basis that a ‘failed legal strategy is doom’ and cannot be a solid ground to grant condonation.

The CC was called on to decide on two issues, first, whether it was appropriate for the LAC to overturn the decision of the LC wherein they launched their procedurally unfair dismissal claim years outside the 30 days statutory prescribed time period and where the cause of action relied on was found to be flawed. Secondly, whether compensation for procedural unfairness can be claimed as self-standing remedy in the context of s 189A(13)(d) of the LRA.

In dealing with the first issue the court singled out two requirements for granting condonation, namely where the interests of justice demand it and where the reasons for non-compliance with the time limits have been explained to the satisfaction of the court. The court held that in assessing whether it would be in the interests of justice to grant or refuse condonation, the court must take all factors into consideration. The court took into account not only the broader objects of the LRA but the nature, purpose and functioning of s 189A(13) of the LRA. It referred to the case of Toyota SA Motors (Pty) Ltd v Commission for Conciliation, Mediation and Arbitration and Others (2016) 37 ILJ 313 (CC) where it was stated that the primary object of the LRA is expeditious resolution of disputes in the context of labour disputes. In giving effect to this primary object, the LRA imposes strict time limits within which various applications and referrals must be launched. The court noted that non-adherence to the time limits may be condoned, provided that –

  • the explanation for non-compliance is compelling;
  • the case for attacking a defect in the proceedings would have to be cogent; and
  • the defect would have to result in a miscarriage of justice if it were to stand.

The court further held that consideration as to whether the delay was a result of a deliberate, wilful decision not to comply with a lawful and binding award in terms of the LRA was also a crucial factor. The court emphasised that because the procedure in s 189A(13) is supposed to be speedy and pre-emptive, granting condonation is restricted.

The court looked at the nature, purpose and function of s 189A(13), which provides for consultative framework. It held that for the purpose of this section even a short delay of five months is considered too long. This is because the purpose of this section is remedial in nature and ‘intent no doubt is to allow for early corrective action so that the process failure will not escalate into a substantive injustice’. The court found that the delay would make the purpose of the process fruitless, which is to allow the LC to intervene with a consultation process and to make an appropriate intervention to remedy procedural flow. The section grants the LC power to make an order compelling the employer to comply with a fair procedure. In a situation/circumstance where employees are already dismissed, the court can order reinstatement of such employees to allow for the consultation process to run its course. However, in an instance where these orders are not suitable, the court where appropriate may order compensation in terms of subs (d).

With regards to the issue of whether compensation can be claimed as a self-standing remedy, the court held that it cannot. The court reasoned that compensation is an exceptional remedy, which is granted only where the primary remedies provided in s 189A(13)(a) – (c) are inappropriate. The court concluded that the main purpose of the section and its remedies is to ‘get the retrenchment process back onto a track that is fair’. It follows that even the remedy of compensation must be read in the context of the short term remedies and in light of the jurisdictional restriction provided for under s 189(A)(13). Compensation in terms of s 189(A)(13)(d) cannot be the primary relief. The court concluded that the LC did not exercise its discretion judicially and the interference of the LAC was justified.

The CC set a precedent that compensation cannot be a self-standing ground and dependent on the inappropriateness of remedies provided in s 189A(13)(a) – (c). This case is also important in that it emphasised the imperative of relying on the LRA rather than the common law grounds. What is clear from this judgment is that relying on correct grounds in the lower court is essential as the court would be reluctant in granting condonation for non-adherence to the stipulated time period.

Ntombifikile Zulu LLB LLM (Business Law) (UKZN) is a registrar at the KwaZulu-Natal Division of the High Court in Pietermaritzburg.

This article was first published in De Rebus in 2019 (July) DR 21.

De Rebus