For a time, the jurisprudence of a number of the superior courts, considering the provisions of s 189A(18) of the Labour Relations Act 66 of 1995 (LRA), indicated that the Labour Court (LC) can neither decide on the procedural fairness of small scale dismissals based on the operational requirements by the employer or to which s 189A is applicable. In Regenesys Management, the Constitutional Court (CC) handed down a landmark judgment wherein, among other things, the court considered and clarified the scope of the LC’s jurisdiction in these instances. Added to this, the court also clarified another pertinent issue which is whether compensation as provided for under s 189A(13)(d) may be granted as a self-standing remedy.
In 2015, the employer embarked on a restructuring exercise which resulted in the retrenchment of certain employees. The two parties embarked on a conciliation process before the Commission for Conciliation, Mediation and Arbitration for conciliation, which was unsuccessful. Thereafter, the employees approached the LC on the basis that their dismissals were both substantively and procedurally unfair. The erstwhile employees also sought relief either in the form of reinstatement under s 189A(13)(c) or compensation under s 189A(13)(d). The LC deemed the dismissals to be substantively and procedurally unfair and ordered the employer to reinstate employees with retrospective effect and awarded compensation to one employee.
The employer appealed to the Labour Appeal Court (LAC), which upheld the LC’s decision regarding substantive unfairness and reinstatement. The court, however, found that the court a quo had erred in adjudicating the procedural fairness aspect of the retrenchment, for the reason that s 189A(18) does not afford the LC jurisdiction in such matters.
Section 189A(13) provides:
‘(13) If an employer does not comply with a fair procedure, a consulting party may approach the Labour Court by way of an application for an order –
(a) compelling the employer to comply with a fair procedure;
(b) interdicting or restraining the employer from dismissing an employee prior to complying with a fair procedure;
(c) directing the employer to reinstate an employee until it has complied with a fair procedure;
(d) make an award of compensation, if an order in terms of paragraphs (a) to (c) is not appropriate.’
Section 189A(18) provides:
‘(18) The Labour Court may not adjudicate a dispute about the procedural fairness of a dismissal based on the employer’s operational requirements in any dispute referred to it in terms of section 191(5)(b)(ii).’
The matter was taken to the CC.
The CC held that the purpose of s 189A(13) is two-fold. The primary purpose ensures that an employer who embarks on a dismissal for operational requirements exercise, without complying with a fair procedure during the consultation process, does not do so with impunity. This is found in subs (13)(a) – (c). The secondary purpose provides for the payment of compensation to an employee whose rights to a fair consultation process were violated. This is found in subs (13)(d). Therefore, the court concluded that compensation under subs (13)(d) can be claimed as a standalone remedy and only if it is unsuitable to grant any order of reinstatement in terms of s 189A(13)(a), (b), or (c); and the employee complies with the 30-day time limit prescribed by s 189A(17) or obtains condonation for bringing an application in terms of s 189A(13) if it is not within the stipulated time frame.
Turning to the second issue, the CC found the LC has jurisdiction to adjudicate large scale retrenchment disputes about the procedural fairness of dismissals for operational requirements which are referred to the court in terms of subs (13). The court ruled that subs (18) does not depose the LC’s authority to resolve the procedural fairness of dismissals on the grounds of the employer’s operational requirements, where s 189A is not relevant, and which are referred to by way of s 191(5)(b)(ii).
The Labour Court, however, lacks jurisdiction to preside over a s 191(5)(b)(ii) dispute, on account of subs (18), about the procedural fairness of a dismissal for operational requirements for which s 189A is relevant because the LRA provides for a special process and special remedies in subs (13) for said disputes. With everything considered, the CC affirmed the LC’s decision and consequently set aside the decision of the LAC.
This decision clarifies that the ambit of s 189A(13) is not restricted to ensuring fairness during the course of the consultation process, it also serves to ensure that a remedy exists where a consultation process was completed in violation of the employees’ right to procedural fairness.
The CC took a broad approach to the question of the LC’s jurisdiction by only prohibiting the court from adjudicating claims of procedural unfairness of a dismissal for operational requirements brought by way of s 189A, by virtue of subs (18).
Tinotenda Ruvimbo Mparutsa LLB LLM (UJ) is a legal researcher in Johannesburg.
This article was first published in De Rebus in 2024 (Nov) DR 47.
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