South Africa: Labour Appeal Court

MINISTER OF LABOUR                                                    First appellant
THE DIRECTOR GENERAL OF LABOUR                     Second appellant

and

SCHOEMAN, JOHANNES CORNELIUS BOSMAN               First respondent
THE PRESIDENT OF THE INDUSTRIAL COURT             Second respondent
MR A E JACOBS N.O.                                                    Third respondent
ADV M GROBBELAAR N.O.                                        Fourth respondent
ADV JM JACOBS N.O.                                                    Fifth respondent

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[3]      The appellants raised, as a point in limine, the defence that the first respondent was not an employee within the meaning of the PSLRA. On the merits, the appellants maintained that they had complied with such duty as was imposed on them by the dictates of fairness to consult with the members of the industrial court over their careers.

[5]      The present appeal is against both the judgments on the point in limine and on the merits and against the award of compensation. The first respondent has cross-appealed against the award of compensation.

[6]      The appellants also seek an order reviewing and setting aside the decision of the industrial court on the grounds of appearance of bias. The appellants say that the perception of bias is created by the tone and content of the judgment read in the context of the circumstances under which the hearing proceeded and the manner in which the hearing was conducted. These circumstances include the fact that a member of the court complained before other members of the same court that members of the court, including one of those members who had to decide the matter (i.e. the permanent member), had been treated unfairly and the fact that the witnesses who gave evidence on behalf of that member were members of the same court, including the president of that court.

[8]      Apart from the question of the appropriateness of the compensation awarded, two issues arose in this appeal, namely:

(a)      Is the first respondent an employee within the meaning of the PSLRA?
(b)      Did the Department consult timeously and properly with the members of the industrial court, including the first respondent, in respect of the phasing out of the industrial court?

[9]      A negative answer to the first question will dispose of the appeal and render it unnecessary to decide the second question.

[10]     For the industrial court to have jurisdiction in respect of the dispute referred to it by the first respondent under sections 18 and 24 of the PSLRA, it was necessary for the first respondent to establish that he was an employee within the meaning of section 1(xi) of the PSLRA. That section defines “employee” to mean:-

“an officer or employee as defined in section 1(1) of the Public Service Act, and includes, for the purposes of sections 18, 22(2)(a), 23, 24 and 25, as well as section 22 in so far as it pertains to the said sections, a person who was such an officer or employee, but does not include -

[11]     The appellants contend that the first respondent falls within the exclusion in paragraph (a) in that he is a person employed in terms of the Act which is “an Act other than the Public Service Act or Correctional Services Act”.

[12]     The industrial court is a creature of the Act. It was created by section 17(1)(a) of the Act. In terms of section 17(1)(b), members of that court “shall be appointed by the Minister”. Members are appointed “on such conditions as [the Minister] may with the concurrence of the Minister of Finance determine”. (Section 17(1)(c)). Members of the industrial court are, therefore, appointed in terms of the Act. They are, as a consequence, “persons employed in terms of an Act other than the Public Service Act”. They are not, therefore, employees within the meaning of section 1(xi) of the PSLRA.

[14]     The first respondent, who appeared in person, contended that he is an employee as defined in the PSLRA. As I understood the argument it proceeded on the basis that the phrase “but does not include” qualifies, and, therefore, applies to former employees. And so, he argued, the exclusionary clause has no application to persons who are still in employment. The first respondent was constrained to concede that had the phrase “and includes, for the purposes of sections 18, 22(2)(a), 23, 24 and 25, as well as section 22 in so far as it pertains to the said sections, a person who was such an officer or employee,” been omitted from the definition, he would been hit by the exclusionary clause. He contended, however, that the inclusion of this phrase require that the remainder of the definition be given an interpretation which it would otherwise not have had.

[16]     Apart from the aforegoing, if the exclusionary clause were to apply to former and not present employees, an anomaly would result. A member of the industrial court would be an employee as defined in the section while still in employment. Once the same member leaves his/her employment, he would cease to be an employee as the exclusionary clause would then be applicable as he would be a person employed in terms of an Act other than the Public Service Act or the Correctional Services Act. Yet the very purpose of including former employees within the definition of an employee was to protect former employees who might have a cause for complaint against their former employer. The legislature could not have intended such an anomalous result.

[18]     In view of the conclusion I have reached on the point in limine, it is not necessary to decide the second issue. A necessary consequence of upholding the appeal is the dismissal of the cross-appeal.

[19]     Mr Brassey, who, together with Mr Van der Riet, appeared on behalf of the appellants, pressed for the costs of the review against the first respondent. Mr Vorster, who appeared on behalf of the fourth and the fifth respondents, did not ask for costs.

[20]     It is trite that the award of costs is a matter which is largely within the discretion of the court. In regard to the costs of the issues which have not been decided, the court may, in the exercise of its discretion either direct that neither party pay such costs or award those costs to the party who was substantially successful. Read v South African Medical and Dental Council 1949 (3) SA 997 (T) at 1026-1028, and BEF Pty Ltd, Cape Town Municipality and others 1990 (2) SA 337 (C) at 346B-347D. In the latter case, Grosskopf J, as he then was, after reviewing the relevant authorities, concluded at 347B:

[21]     It seems to me that there is no reason both either in principle or logic why the principles applicable to an award of costs on unresolved issues should not be applicable to the award of costs in regard to review proceedings which were not decided. Where the court is called upon to decide both the review and an appeal, and the court takes a firm view of the appeal, the court cannot be required to determine the review merely in order to settle liability for costs. In my view the court has a discretion either to order that the costs of the review be costs in the cause or to make no order in respect thereof.

[22]     Relevant considerations in the present case include the following: counsel for the appellants did not seek an award of costs against the fourth and fifth respondents; the appellants would in any event have brought the review proceedings with or without the opposition by the first respondent; the opposition by the first respondent did not significantly increase the costs; having regard to the fact that the appellants rely, for their review, on perceived bias as opposed to actual bias, I cannot, without deciding the review, conclude that the first respondent’s opposition to the review proceedings was without merit; and not having decided the review, I am unable to say which side is right.

[24]     As for the costs of the appeal, the general rule that the costs should follow the result must apply.

[25]     In the event, I make the following order:

(a)      The appeal is upheld and the order of the industrial court is set aside and there is substituted therefor the following order:

(1)      The point in limine is upheld.
(2)      The application is dismissed.
(3)      No order is made as to costs.

(b)      No order is made on the application for review.
(c)      The first respondent is ordered to pay the costs of the appeal and the cross-appeal, such costs to include the costs consequent upon the employment of two counsel.

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Ngcobo AJP

I agree,

Date of hearing:         16 February 1999
Date of judgment:        23 February 1999

Appearances:

For the appellant:       MSM Brassey SC, (with him JG Van der Riet) instructed by Cheadle Thompson & Haysom

For the first respondent:        Adv JCB Schoeman (appeared in person)

For the fourth and fifth respondent: L. Vorster SC instructed by the State Attorney