Modise and others v Steve's Spar Blackheath (JA29/99 ) [2000] ZALAC 1 (15 March 2000)

[1] This is an appeal against a determination made by the industrial court in terms of sec 46(9) of the now repealed Labour Relations Act, 1956 (Act No 28 of 1956) ( “the old Act”) in a dispute between the appellants and the respondent. The dispute was whether or not the respondent had committed an unfair labour practice in dismissing the appellants. The appellants had contended that the respondent had committed an unfair labour practice in dismissing them whereas the respondent contended that it was entitled and justified in dismissing the appellants and it had not committed any unfair labour practice. The determination of the industrial court was that the respondent had not committed an unfair labour practice and the appellants’ claim was dismissed. No order as to costs was made. It is against this determination that the appellants appeal. Before considering the appeal, I propose setting out those facts of the matter which appear to me to be relevant in the light of the issues in the appeal.

[3] Although it appears from the record that it was in dispute whether the appellants had taken part in the strike, during argument it was clarified that the appellants were not denying that during the strike they were part of the group of workers who were on strike. The appellants’ point was that they were not willing participants in the strike. The strike had been organised by the South African Commercial, Catering and Allied Workers Union ( “SACCAWU”) of which some of the respondent’s employees were members. The appellants’ case is that they were not members of that union. The respondent maintains that they were.

[4] There is also a dispute between the appellants and the respondent on what the demand was which was sought to be enforced through the strike. The respondent contends that the demand was that it and other Spar stores in the region in which the respondent operated should bargain regionally with SACCAWU. In argument it was contended on the appellants’ behalf that the demand was that the respondent and the other Spar stores in the region should agree to form a regional bargaining forum in which collective bargaining would take place regionally.

[5] Following upon dicta by Goldstone J in Barlows Manufacturing Company Ltd v Metal and Allied Workers Union & Others 1990 (2) SA 315 (W) at 322H-I and by Golden JA in SA Commercial, Catering and Allied Workers Union & Others v Transkei Sun International Ltd t/a Wild Coast Sun Hotel, Casino & Country Club (1993) 14 ILJ 867 (TKA) at 874F-I, the respondent contended that, in so far as the demand was that it and the other Spar stores should bargain regionally with SACCAWU, that was a demand which was impossible to achieve because there was no regional bargaining structure in which regional bargaining could take place. On behalf of the appellants it was conceded that, if the demand was found to be the one contended for by the respondent, then such demand was incapable of achievement. For purposes of this judgement I will assume, without deciding, that the demand was the one contended for by the respondent. I will also assume, without deciding, that the dicta of Goldstone J and GoldenJA referred to above under the old Act that a demand which is incapable of achievement would render a strike illegal are correct.

[6] The respondent and other Spar stores had either refused or failed to comply with SACCAWU’s demand. Indeed, attempts by SACCAWU both before and after the referral of the dispute to conciliation to have meetings with the Spar Stores concerned had failed. SACCAWU had then applied for the establishment of a conciliation board in terms of sec 35 of the old Act. The statutory period of 30 days required in terms of sec 35 had lapsed without the dispute being resolved. SACCAWU had then conducted a ballot in terms of the old Act to determine whether the required size of its members participating in the ballot supported the calling of a strike. Such ballot was required to be conducted secretly in terms of sec 8 read with sec 65 of the old Act. Those participating in the ballot had to be members in good standing of SACCAWU.

[7] According to the respondent the strikers engaged in unacceptable conduct of various kinds during the strike with the result that on the 15^th November 1994 it sought an urgent interim interdict from the Witwatersrand Local Division of the then Supreme Court. A rule nisi with an interim interdict was granted by that Court on an urgent basis. The interim order interdicted the strikers from, inter alia, continuing with the strike pending the return day on the basis that the strike was illegal. The urgent application had proceeded without opposition. The record does not reveal any evidence that the rule was subsequently confirmed.

[8] It does not appear that the service of the Court order took the form of each striker being personally handed the order. As a result the evidence did not reveal that definitely each one of the strikers became aware of the contents of the court order. On the 16^th November the respondent issued an ultimatum for the strikers to return to work or face dismissal. Initially, the deadline for the strikers to return to work was 10h00. There is a conflict between the version of the appellants and that of the respondent on whether the ultimatum was subsequently extended. The respondent says it extended the ultimatum to the end of the day on the 16^th and told the strikers that they had to resume work the following morning failing which they would be dismissed. The appellants denied that there was such an extension of the ultimatum.

[9] The appellants’ version is that they were dismissed on the 16^th after the ultimatum had expired without them returning to work. The respondent says it issued letters of dismissal only on the 18^th November. The letters said that the strikers were dismissed with effect from the 17^th November 1994. The respondent said the dismissal followed the strikers’ failure to heed the ultimatum. It is common cause that the strikers did not report for duty on the 17^th November. It is also common cause that, unlike on the other days of the strike, namely from the 9^th upto the 16^th November when the strikers were outside the respondent’s premises, from the 17^th November onwards they were not outside the respondent’s premises. They were simply nowhere to be seen.

[10] The Appellants submitted that the court a quo erred in finding that they were willing participants in the strike. They submitted further that, in any event, even if they were willing participants in the strike, that strike was a legal strike and therefore their dismissal for participating in it was unfair. As to the second argument, if the appellants sought to rely on the contention that the strike was legal the onus was on them to prove that the strike was legal. However, they failed dismally to show that the ballot that was conducted was regular in terms of the Act. They could not show that it was secret. They could not show that those who voted in the ballot were eligible to vote nor could they show that those who voted were only those who were eligible to vote. For the reason that the ballot was not conducted in accordance with the old Act, the strike was, definitely, illegal in terms of the old Act. It may also have been illegal for the reason that the demand which it sought to enforce was incapable of achievement.

[11] In argument before us Counsel for the respondent sought to draw a distinction between a dismissal for striking and a dismissal for a failure to comply with an ultimatum. It appears that he did this in the belief that, if the workers were dismissed for failing to comply with the ultimatum, that would enable the respondent to escape such obligation to observe the audi alteram partem rule (“the audi rule”) as it might have had. I think the distinction is an artificial one on the facts of this case. The strikers were on strike. The respondent did not approve of their strike and wanted to bring it to an end. If the strikers stopped striking and returned to work, they could not have been dismissed. If they continued with the strike, they would be dismissed. In any event a reading of the respondent’s heads of argument reveals an acceptance that the dismissal was for participation in an illegal strike. It seems that the attempt to draw the distinction referred to above was an after thought.

[12] One of the grounds on which the appellants contended that their dismissal constituted an unfair labour practice is that the respondent did not observe the audi rule before it could dismiss them. They contended that they were entitled to be heard before they could be dismissed because the decision to dismiss them was one which adversely affected their rights and source of livelihood. In response to this argument, Mr Jammy, who appeared for the respondent both in this Court and in the Court a quo, submitted that there was no obligation on the part of the respondent to observe the audi rule. In any event, submitted Mr Jammy, should it be found that there was such an obligation on the respondent, such obligation had been discharged because, after the respondent had issued the ultimatum, there was an opportunity for the appellants to have come forward and said why they should not have been dismissed and as they had failed to make use of that opportunity they could not complain. Mr Jammy submitted further that our law has never imposed such an obligation.

[13] During argument I asked Mr Jammy what the basis was for his submission that in this case the respondent was not obliged to comply with the audi rule, if one were to assume that there was an obligation such as is referred to above in our law. Mr Jammy responded by saying that the basis for his submission was the same as the basis which the Appellate Division, as the Supreme Court of Appeal then was called, decided to reject the audi argument in National Union of Metal Workers of SA v Vetsak Co- Operative Ltd & others (1996) 17 ILJ 455 (A). The relevant passage is at 468E-G. I will return to this later in this judgement.

[14] On behalf of the appellants it was submitted that the appellants’ case was not that, in order to comply with the audi rule, the respondent had to adhere to any particular form of compliance with the rule. Their argument was simply that in one form or another the respondent should have complied with the rule. It was submitted that compliance with the audi rule would take such form as would be dictated by the practicalities and exigencies of the situation at the time. I deem it necessary, in considering this point, to review our case law to see what the attitude of our courts has been towards the application and observance of the audi rule in cases of dismissals of strikers. However, before I can do so, I propose to make a few general observations on the audi rule and the advent in our law of the concept of the justiciable unfair labour practice.

[15] The audi rule is part of the rules of natural justice which are deeply entrenched in our law. In essence the audi rule calls for the hearing of the other party’s side of the story before a decision can be taken which may prejudicially affect such party’s rights or interests or property. Historically, the audi rule is part of our administrative law and, as a general rule, has no application to private contracts. (see Embling v The Head Master, St Andrews College (Grahamstown) & Another (1991) 12 ILJ 277 (E); Damsell v Southern Life Association Ltd (1992) 13 ILJ 848 (C) at 859 E-H; Sibanyoni & Others v University of Fort-Hare 1985 (1) SA 19 (CK); Mkhize v Rector, University of Zululand & Another 1986 (1)SA 901 (D) at 904 F). (In passing I mention that the correctness of the conclusion in the last two decisions that the audi rule did not apply is, to say the very least, open to serious doubt because universities are public institutions which are funded, at least partly, with public funds and are governed by statute). However, there is one exception to the general rule that the audi rule does not apply to private contacts. That is where a private contract contains a provision which either expressly or by necessary implication incorporates the right to be heard. (see Lace V Diack & others (1992) 13 ILJ 860 (W); Lamprecht & Another v Mc Nellie 1994 (3) SA 665 (A) at 668B -J; Moyo & Others v Administrator of the Transvaal & Another (1988) 9 ILJ 372 (W) at 384E-J).

[16] About 20 years or so ago the concept of a justiciable unfair labour practice was introduced into that branch of our law which has come to be known as labour law. Had it not been for the introduction of a justiciable unfair labour practice in our law, the acknowledgement made above that, as a general rule, the audi rule has no application in private contracts would have marked the end of the enquiry on the audi argument in this matter. The introduction of the justiciable unfair labour practice in our law brought about a significant change in the law of employment in the private sector. Whereas under the common law an employer had a right virtually to hire and fire as he pleased, a serious inroad was made into that right under the unfair labour practice dispensation. Whereas under the common law an employer could fire for a bad reason or for no reason at all provided the dismissal was on notice, under the unfair labour practice dispensation, he became obliged not to dismiss even on notice - unless he could prove the existence of a good reason to dismiss. Whereas at common law an employer did not have to hear the employee’s side of the story before he could dismiss him, under the unfair labour practice dispensation the employer became obliged to hear the employee’s side before he could dismiss him. There must be few concepts, if there are any, in the history of our law which have brought about such fundamental change in our law as the introduction of a justiciable unfair labour practice has done in our employment and labour law. In due course this concept was to ensure that our employment law would undergo so fundamental a change that it will never be the same again. Fortunately, the change was for the better.

[17] Over the past two decades or so since the establishment of the industrial court and, later, of the old Labour Appeal Court, the application of the audi rule in the sphere of private contracts of employment in our law has been fully and irrevocably entrenched. Accordingly it can now be said with a sufficient degree of certainty that the audi rule applies to contracts of employment in South Africa which are subject to the Labour Relations Act even if such contracts do not contain a provision which, either expressly or by necessary implication, incorporates such rule. It is against this background that I propose to consider our case law over the past two decades or so.

In considering our case law the inquiry is whether or not in our law there is an obligation on an employer to observe the audi rule when contemplating the dismissal of strikers. This question needs to be considered because Counsel for the respondent submitted that in our law there has never been an obligation on an employer, who is faced with a strike, to observe the audi rule before it can dismiss strikers. In this regard I must mention that he did not make any distinction between legal and illegal strikers nor did he make one between strikers in the private sector and strikers in the public service. Not that I think he should have for I do not think that such a distinction would have any basis in law.

[19] For the reasons that follow I am unable to uphold the submission that in our law there has never been an obligation on an employer, who is faced with a strike, to observe the audi rule before it can dismiss strikers. When the audi rule was introduced, into our employment law in the private sector through the justiciable unfair labour practice the audi rule applied to all dismissals, irrespective of the reason for dismissal. It applied to dismissals for misconduct which at that stage in the development of our law encompassed both strikes which complied with statutory procedures [section 65 of the Labour Relations Act, 1956 (“the old Act”)] and those which did not comply with such procedures, to retrenchments - hence the duty to consult- and to dismissals for incapacity.

[20] In our law there has always been exceptions to the general rule requiring the observance of the audi rule in the sphere of administrative law. When the audi rule was introduced into the sphere of private contracts of employment in our law, there is no reason to suggest that it came without the same exceptions that we know it to have in our administrative law. By this I do not necessarily mean that the audi rule was introduced into our employment law in the private sector via our administrative law. A reading of the first cases of the industrial court reveals that the industrial court derived the audi rule from the good practices which some employers had already implemented, from some English cases and from the ILO Convention on Termination of Employment No 158 of 1982. The advent of the justiciable unfair labour practice did not introduce the audi rule in the law of employment in the public sector. The audi rule has always been applicable in certain circumstances where a public functionary contemplates taking a decision that could prejudicially affect the rights or interests or property of an individual. In my view the dismissal of public servants for striking would, generally speaking, have fallen within the sphere of application of the audi rule in the administrative law context. Obviously, even in the public sector there would have been exceptions where the employer could not have been said to be obliged to observe the audi rule.

[21] Furthermore, the submission by the respondent’s Counsel runs contrary to a number of cases which can be found within the breath and length of our law over the past twenty years or so where dismissals of strikers, both in the private sector and public sector, were found to be unfair (in the private sector) or unlawful (in the public service) on the basis that, although the employers in those cases had been obliged to observe the audi rule before they could dismiss their striking employees, they had failed to do so. (See Chemical Workers Industrial Union and Others v Electric Lamp Manufacturing of SA (PTY) Ltd (1989) 10 ILJ 347 (IC) at 351H-352C; BAWU & Others v Palm Beach Hotel (1988) 9 ILJ1016(IC) at 1024D-E; BAWU & Others v Edward Hotel (1989) 10 ILJ 357 (IC) at 374B-E; Shezi & Others v Republican Press (1989) 10 ILJ 486 (IC) at 488G-J; Black Electrical and Electronic Workers Union & Others v M D Electrical (1990) 11 ILJ 87 (IC) at 95 H-96A; Lebona & Others v Trevenna (1990) 11 ILJ 98 (IC) at 104F-G; Mathews & Others v Namibia Sugar Packers (1993) 14 ILJ 1514 (IC) at 1527B-J; NUMSA & Others v Lasher Tools (Pty) Ltd (1994) 15 ILJ 169 (IC) at 180A-D and 182C-D; Food and Allied Workers Union & others v Mnandi Meat Products & Wholesalers (1995) 16 ILJ 151 (IC) at 161E-G; Mayekiso v Minister of Health and Welfare & Others(1988) 9 ILJ 227 (W) at 230E-H; Mokoena & Others v Administrator of the Transvaal (1988) 9 ILJ 398 (W) at 404A-G; Mokoponele en andere v Administrateur, Oranje- Vrystaat en Andere 1989 (1) SA 434 (O)at 440D-442I; Zenzile & others v Administrator of the Transvaal & Others (1989)10 ILJ 34 (w) at 38I-41A; Administrator, Transvaal & Others v Zenzile & Others 1991 (1) SA 21(A); (1991) 12 ILJ 259 (A)at 265H-270B; Nkomo & Others v Administrator, Natal & Others (1991) 12 ILJ 521 (N) at 526F-528A; Zondi & Others v Administrator, Natal & Others (1991) 12 ILJ 497 (A) at 505B-D.) [ A reading of some of the cases emanating from the private sector reveals that in some of them the employers had attempted to observe the audi rule and in others the employers had made no attempt whatsoever to observe the audi rule. In others the employers had internal disciplinary procedures on which the industrial court based its finding but in others, the industrial court’s finding was based simply on its unfair labour practice jurisdiction.]

[22] Some of the cases I have included above are stay-away cases whereas others are normal strike cases. I have included stay-away cases because the difference between a normal strike and a stay-away is technical. If one accepts that generally speaking a strike is a collective refusal to work by workers for the purpose of compelling compliance with their demands, a stay-away would probably fit into that loose definition. I cannot see why it can be said that a worker who participates in a stay-away is entitled to the benefit of a hearing before he can be dismissed but one who participates in a normal strike is not entitled to a hearing before he can be dismissed. Such an approach would encourage stay-aways more than normal strikes. Under the old Act stay-aways in the form of strikes for political reasons were absolutely prohibited whereas normal strikes were only prohibited in certain circumstances.

[23] In addition to the above cases reference can also be made to Black and Allied Workers’ Union & Others v Prestige Hotels CC t/a Blue Waters Hotel (1993) 14 ILJ 963 (LAC). At 971 E, the old Labour Appeal Court held, albeit obiter, that the argument that an employer had an obligation to afford strikers a hearing before it could dismiss them had merit. However, the Court, per PC Combrinck J (sitting with assessors), stated that the audi rule would only apply to the dismissal of illegal strikers and not to that of legal strikers because the former would be committing misconduct by going on an illegal strike whereas the latter would not be committing any misconduct by going on a legal strike but would be doing what is permissible in our law. I have difficulty with this because it seems to suggest that those who obey the law are denied the benefit of the audi rule and those who do not obey the law are entitled to the benefit of the audi rule. There may be a temptation to say: If the strike is a legal or protected one, what is the need for the audi in such a case? The answer to this is that there are situations where, arguably, an employer may be entitled to dismiss legal strikers e.g. where the legal strike has taken too long a time may come when the employer may be entitled to dismiss the legal strikers. I can see no reason why in those circumstances the legal strikers can be said to have no right to state their case before they can be dismissed. Already sec 67(5) of the new Act contemplates that legal strikers may be dismissed where the reason for their dismissal is based on the employer’s operational requirements. In such a case it seems clear that under the new Act the employer would be obliged to comply with the consultation requirement of sec 189 of the new Act which is a form of the observance of the audi rule. I can see no reason why an employer would be obliged to observe the audi rule in the form of consultation if the reason for the dismissal of legal strikers is based on the operational requirements of the employer but would not be obliged to observe the audi rule in whatever form if the reason for dismissal is based on the notion that the strike, being illegal, constitutes misconduct.

[25] In 1990 Prof Martin Brassey wrote an article titled : “The Dismissal of strikers” which appeared in (1990) 11 ILJ 213-240. At 225-226 Brassey wrote that individual hearings before strikers could be dismissed would be impractical and senseless but emphasised that “a hearing should nonetheless be given to the collective bargaining representative of the strikers and to those who bona fide believe that, as a result of whatever reason, their absence was justifiable.” With this I agree. (See also Martin Brassey’s arbitration award in Man Truck & Bus SA (Pty) Ltd v United African Motor and Allied Workers Union (1991) 12 ILJ 181 (Arb) at 192F-H where Martin Brassey, sitting as an arbitrator in a dispute of the dismissal of strikers, accepted that an employer must give strikers a collective hearing in the sense that their case must be put for them by their representatives.)

[26] In Current Labour Law, 1997, at 38 Cheadle expressed his views on whether strikers are entitled to be heard before they can be dismissed in the following terms :- “A good case can be made out that an employer should give employees or their trade union an opportunity to address the employer on sanction before dismissal. This can be effected by giving the trade union an opportunity to make representations on sanction or including in the ultimatum itself an invitation to employees to make such representations. This should be supplemented by an invitation to individual employees to approach the employer after dismissal if the reason for not working is not participation in the strike. This does not impose too heavy a burden on the employer - it is common labour relations practice and it goes a long way to ensure that the employees are fairly treated. There is also the argument that the Code of Good Conduct : Dismissal imposes a more stringent requirement than the general application of the rule developed by the courts under the old LRA. It is only in ‘exceptional circumstances’ that the employer may dispense with pre-dismissal procedures (para 4(4) of Schedule 8). Accordingly, the employer may have to go further than was expected of it under the old LRA.”

[27] As long ago as 1986 Edwin Cameron wrote an article entitled: “The Right to a Hearing before Dismissal - Problems and Puzzles.” It appeared in two parts in (1986) 7ILJ 183-217 and (1988) 9 ILJ 147-186. A reading of that article reveals that Cameron acknowledged that as a general rule or requirement a worker is entitled to an opportunity to be heard before he can be dismissed. Thus Cameron says at the top of p165: “The starting point is that every employee faced with a dismissal is entitled to a hearing...” Cameron then acknowledges that there are exceptions to this general rule. He gives these as the so-called crisis zone situations, a waiver or quasi waiver situation and situations where, although the denial of procedural justice is not condoned, the employee is nevertheless not granted any relief by reason of the employer’s failure to ensure procedural fairness (see pp 173-178 in the second part of the article). Cameron rejects the attempts evident in some cases to create further exceptions to the requirement for a pre-dismissal hearing by stating that an employer is exempted from giving a pre-dismissal hearing where there are many workers involved or where the workers act collectively (see bottom of page 176 upto the top of p177 of the second part of his article.) He rejects also the notion that no hearing is required in mass dismissals. (See p.170 of the second part of his article.) It seems to me that, upon a proper analysis of Cameron’s article, his view is that the situations where an employer would be exempted from complying with the general rule or requirement for a pre-dismissal hearing are the three exceptions to the audi rule that I have referred to above which Cameron acknowledges in his article as the true exceptions. Subject to what I say elsewhere in this judgement about a waiver and the article in general, I have no quarrel with Cameron’s views in this regard.

[28] In their book: A Guide to South Labour Law: 2^nd edition, Rycroft and Jordan say at 207 “ while circumstances might warrant an attenuated hearing, the right to a hearing is so fundamentally important in the context of industrial relations that only exceptional circumstances such as those referred to by Cameron will warrant dismissal without a hearing of any kind.” At 225 the learned authors say that, where a strike is not “legitimate”, this may provide the employer with a “substantively fair reason for terminating the employment relationship for good.” Then they continue and say: “Before it can do so, however, two requirements have to be met: the employer has to give the employees an opportunity to address it either through their union ... or through an elected committee so that they could debate their decision to strike’, and, secondly it is required to issue an ultimatum in order to give the employees sufficient time to consider the matter and return to work.”

[29] In their book: The South African Law of Unfair Dismissal, 1994, 2^nd ed, Le Roux and Van Niekerk discuss the dismissal of strikers from 293-316. There they do not deal with the issue of a hearing in the context of a dismissal of strikers. However, at 152-183 the learned authors deal with procedural fairness of dismissals. They acknowledge the existence of the general requirement for a fair hearing before an employee can be dismissed. Then at 174-176 they deal with exceptions to the audi rule. It is significant that they do not anywhere suggest that the dismissal of strikers is one of the exceptions where an employer does not have an obligation to have a hearing. On the contrary at 183 they make the point that the normal rules regarding procedural fairness “will, in all probability, apply to discipline for group misconduct”. Participation in an illegal or unprotected strike is, obviously, group or collective misconduct.

“The employment of a worker shall not be terminated for reasons related to the worker’s conduct or performance before he is provided an opportunity to defend himself against the allegations made, unless the employer cannot reasonably be expected to provide this opportunity.”
It is clear from the provisions of article 7 that international standards are such that the only basis on which an employer can escape the obligation to give a hearing where the reason for dismissal is based on the employee’s conduct, or performance is if he cannot reasonably be expected to give such a hearing in a particular case. There is no provision for another exception in the form of a dismissal for participation in a strike.

the benefits of which they would lose if they were dismissed. Goldstone J’s reasoning was followed by Coetzee J in Zenzile & Others v Administrator of the Transvaal & Others (1989) 10 ILJ 34(W). In the Zenzile appeal (1991 (1) SA 21 (A) ; (1991) 12 ILJ 259 (A)) the Appellate Division found it unnecessary to rely on the strikers’ membership of a pension scheme in order for it to decide whether the employer had been obliged to give the strikers a hearing before it could dismiss them. The Appellate Division said once the dismissal was for misconduct, there was such an obligation. It needs to be pointed out that the Appellate Division did acknowledge that there could be cases where the employees’ membership of a pension scheme could possibly be relied upon. In fact in Zondi’s case (supra) the Appellate Division did approve Goldstone J’s reliance on membership of a pension scheme as given in Mokoena and Mayekiso as a basis for the application of the audi rule in those cases. (See Zondi’s case (1991) 14 ILJ 497 (A) at 503D.)

[33] In the light of the rationale for the finding of the Appellate Division in Zenzile, I am of the view that, where the dismissal is for misconduct, as would be the case where the employer’s reason for dismissal is that employees have participated in or are continuing with, an illegal strike, an employer is obliged to observe the audi rule before it can dismiss strikers. However, I do not think that, where the basis for the decision to dismiss is not misconduct, there would be no such obligation. On the contrary, I think that there still would be such an obligation. In regard to public service, this view would be supported by cases such as Administrator, Natal & Another v Sibiya & Another 1992 (4) SA 532 (A) and; Minister of Water Affairs v Mangena & others (1993)14 ILJ 1205 (A)

“The rule does not require that the decision of the public body should, when viewed from the angle of the law of contract, involve actual legal infraction of the individual’s existing rights. It requires simply that the decision should adversely affect such a right. No more has to be demonstrated than that an existing right is, as a matter of fact, impaired or injuriously influenced. Here the contract of service created reciprocal personal rights of the respective parties. Of immediate significance for the respondents was their right to receive regular remuneration in exchange for their services. The existence of that right was linked to and depended upon the duration of the contract. The appellants’ right under the contract to give notice terminating it cannot alter the fact that the decision to give notice palpably and prejudicially affected the existing rights of the respondents. In approaching the Court below, the respondents in no way challenged the appellants’ contractual right to give them notice. They did no more than to assert their claim to be treated in a procedurally fair manner before the appellants exercised such right.”

“The classic formulation of the audi rule encompasses not only ‘existing rights’ but also “the property’ of an individual when it is prejudicially affected by the decision of a public official. The word ‘property’ would ordinarily tend to connote something which is the subject of ownership. In my view, however, the concept of ‘property’ to which the audi rule relates is wide enough to comprehend economic loss consequent upon the dismissal of a public sector employee. To workers in the position of the respondents (and more particularly the first respondent, an elderly individual with eight dependants) the immediate financial consequences of dismissal are likely to be very distressing.”

[35] Although all the above remarks by Hoexter JA as to when the audi rule applies were made in relation to the dismissal of employees in the public sector where their employer would be exercising public power when dismissing them, in my judgement they apply equally to the dismissal of employees in the private sector whose employment was governed by the Labour Relations Act, 1956 after the introduction of the justiciable unfair labour practice in our law. I say this because it was when the industrial court sought to give content to the unfair labour practice provisions of the old Act that it decided to introduce the requirement of a hearing before dismissal

[36] In the light of all of the above it, therefore, seems to me that it can be said with a sufficient degree of certainty that, in the context of dismissal, an employer is obliged to observe the audi rule where his decision may adversely affect an employee’s rights. In this regard, it is sufficient, it seems to me, if, as Hoexter JA said in Sibiya’s case, an existing right is, as a matter of fact, impaired or injuriously influenced. It can also now be accepted that in our law an employer’s decision to dismiss an employee is a decision of that kind in that it adversely affects an employee’s right to regular remuneration in exchange for his services. An employer’s decision to dismiss is a decision that causes the kind of economic loss to the employee that attracts the application of the audi rule.

[37] For the overwhelming majority of workers in this country their job is about all they and their families depend upon for a living. If you take away their job, you almost take away their whole being and you subject them, their families and, sometimes, their communities to famine and starvation. The latter point is easily demonstrated in dismissals of large numbers of workers in the mines. In my judgement basic justice between employer and employee dictates that a decision with such implications for those affected by it and their families should not and cannot be taken without the worker(s)or their union or representatives concerned being afforded an opportunity to be heard in one way or another .

[38] I think it is necessary at this stage of this judgement that I make one thing crystal clear. That is that, when I say, as I have done above, that there is a general rule or requirement that, when an employer contemplates the dismissal of his striking employees, he should observe the audi rule or he should give them an opportunity to state their case, I am not referring to any special obligation on the part of the employer or to any special right which attaches to strikers by virtue of their being strikers per se. What I am referring to is the basic general rule which everyone accepts exists in labour law which says that an employer is obliged to give an employee a hearing or an opportunity to state his case before he can dismiss him.

[39] The above general rule is my point of departure. I then reason that a striker is an employee and, therefore, he, too, is entitled to a hearing before he can be dismissed. I take the view that, when an employee goes on strike, he does not lose the basic right to a hearing which he otherwise has. Indeed, if going on strike made him lose such a right, then the law would be treating him worse than it does, an employee who has stolen from his employer because such an employee would still be entitled to a hearing before he can be dismissed. If that is how our law treated an employee who may well be seeking to participate in the process of collective bargaining - for a strike is an integral part of the collective bargaining process- which our law seeks to promote, then, in my judgement, that would make neither logic nor sense. Fortunately I think on this point our law

[40] As could be expected, it was not in all the strike dismissal cases over the past 20 years or so that the courts were prepared to find dismissals of strikers unfair or unlawful by reason of employers not observing the audi rule when contemplating such dismissals. There were cases where the courts refused to make such findings even when employers had failed to give strikers a hearing or to observe the audi rule. Most emanated from the private sector while only two or three emanated from the public service. Some of the cases are: Lefu & others v Western Areas Gold Mining CO (1985) 6 ILJ 307 (IC); Langeni & others v Minister of Health & Welfare and others (1988) 9 ILJ 389 (W), Moyo & others v Administrator of the Transvaal & Another (1988) 9 ILJ 372 (W); NUMSA & others v Elm Street Plastics t/a Adv Plastics(1989) 10 ILJ 328 (IC); MWASA & others v Perskor (1989)10 ILJ 44I (IC); FAWU & others v Hercules Cold Storage (Pty) Ltd (1989) 10 ILJ 457 (IC); FAWU & others v Hercules Cold Storage (Pty)Ltd(1990)11 ILJ 47 (LAC); FAWU & others v Willowton Oil and Cake Mills (1990) 11 ILJ 131 (IC); PPWAWU & Convencor (1990)11 ILJ 763 (IC); MAN Truck and Bus (SA) (Pty) Ltd v United African Motor and Allied Workers Union (1991) 12 ILJ 506 (Arb); NUMSA v G.M Vincent Metal Sections (Pty)Ltd (1993) 14 ILJ 1318 (IC); NUMSA V G.M. Vincent Metal Sections (Pty)Ltd 1999 (4) SA 304 (SCA);Metal and Allied Workers Union & others v BTR Sarmcol - A Division of BTR Dunlop Ltd (1995) 16 ILJ 83 (IC); NUMSA & others v Boart MSA (1995) 16 ILJ 1098 (IC); National Union of Metal Workers of SA v Vetsak Co-operative Ltd & others (1996) 17 ILJ 455 (A); Plascon Ink & Packaging Coating (Pty)Ltd v Ngcobo & others (1997) 18 ILJ 327 (LAC)). In Majola & others v D&A Timbers (Pty)Ltd (1997); 8 ILJ 342 (LAC) McCall J refrained from deciding the fairness of the dismissal on the basis of argument based on the audi rule

[41] Having listed above such cases as I have been able to find which occurred over the past twenty years or so where the courts refused to find dismissals of workers unfair or unlawful on the basis that the employers had failed to afford strikers a hearing, I must hasten to point out that the majority of those cases did not hold that in general an employer does not have the obligation to give a hearing when contemplating the dismissal of workers. Indeed, in the majority of those cases the courts acknowledged the general rule but found grounds of justification for the employer’s failure to give the workers a hearing.

[42] In the following cases which are among those referred to above, the courts held either that the strikers had waived or abandoned their right to a hearing or that a hearing would have been pointless or would have served no purpose or that in the particular circumstances the employer could not reasonably have been expected to give the strikers a hearing: Rikhotso; Lefu; Elm Street Plastics; Perskor; Hercules Cold Storage (industrial court judgement); Conventacor; MAN Truck & Bus (SA) (Pty)Ltd v United African Motor and Allied Workers Union (arbi); Plascon - Ink & Packaging. Among the cases included in the above list are cases where the courts dealt with the matters on the basis that the striking employees had been afforded an opportunity to be heard but had not utilised it and not on the basis that the employers did not have the obligation under discussion. (See Nehawu & others v Administrator of Natal & others (1989) 10 ILJ 675 which was overruled in Zondi’s case supra; Hercules Cold Storage (Pty)Ltd (LAC judgement); Boart MSA (supra).)

[43] Among the cases referred to above, there are some where the basis for the courts’ conclusion that the employers’ failure to afford the employees a hearing before dismissal did not violate the employees’ right to a hearing was that the employees had waived or abandoned their right to a hearing. That is possible in our law and I have no quarrel with the principle. However, by and large, it is with the application of that principle to most, if not, all of the cases referred to above where this was relied upon that I have difficulty. In Man Truck (supra), for example, which was an arbitration, the arbitrator accepted that an employer had an obligation to give its striking employees a collective hearing in the sense that their case must be put for them by their representatives. However, he held that in that case the employer had not been so obliged because the representatives of the workers had refused to meet with the management. From this the arbitrator inferred that they had waived their right to be heard.

[44] Provided that the meeting that the representatives of the workers refused to attend was a meeting whose purpose was for the employer to hear why the workers should not be dismissed, I have no quarrel with the conclusion that, in such a case, the strikers cannot be heard to complain that they were not heard before dismissal. If, however, they were invited to a meeting whose purpose did not include that, then I cannot see how they can be said to have waived their right to be heard. They may well be happy not to attend a particular meeting for whatever reason, good or bad, but they may be more than keen to attend one the purpose of which is to give them an opportunity to make representations why they should not be dismissed. It is not apparent from the report what the purpose was of the meeting which the workers’ representatives refused to attend.

[45] Another case where it was said that striking employees had waived or abandoned their right to be heard was National Union of Metal Workers of S.A. & others v Elm Street Plastics t/a Adv Plastics (1989) 10 ILJ 328 (IC). At 338 A - D in that case it was held that there was an obligation on the employer to give the strikers a hearing before they could be dismissed. However, it was emphasised that there would be no such obligation in a case where the workers could be said to have “abandoned their entitlement to a pre-dismissal hearing”. It was said that strikers could be said to have abandoned their entitlement to a hearing where the nature of their conduct was such that their employer was justified in regarding it as a repudiation of their contracts of employment or where the strikers’ conduct established that no purpose would be served by holding a hearing or where such a hearing would be “utterly useless”. In that case the industrial court held that by engaging in an illegal strike the employees had repudiated their contracts of employment and were, therefore, not entitled to a hearing. The industrial court also sought to justify its finding that the workers were not entitled to a hearing by stating that by their conduct the strikers had made it plain that a hearing would be pointless - and that they had waived their right to a hearing (p. 338A - J).

[46] Counsel for the respondent sought to rely on the passage at 338C -F in Elm Street Plastics. In that passage the industrial court said there is no obligation on an employer to give strikers a hearing before it can dismiss them where the circumstances indicate that the workers have abandoned their entitlement to a pre-dismissal hearing. I have no quarrel with this statement as a matter of law. This is the argument of a waiver. I would simply caution that whether in a particular case it can be said that workers have waived their right to be heard before dismissal is an issue that would have to be decided in the light of three important considerations. The one is that the party who pleads a waiver must prove it. The second is that a waiver is not lightly inferred. The third is that the requirements for a waiver, as they are known in our law, would have to be proved. The onus to prove a waiver is on the party alleging it.

[47] In Laws v Rutherford 1924 AD 261 at 263 Innes CJ said in effect that, where conduct is relied upon to found a waiver of a right, such conduct must be “plainly inconsistent with an intention to enforce such right”. (See also Hepner v Roodepoort -Maraisburg Town Council 1962 (4) SA 772 (AD) at 778 F-G) In this regard, to state what in my view is the obvious, going on, or, participating in, a strike is not conduct plainly inconsistent with an intention on the part of strikers to enforce their right to be heard should the employer contemplate their dismissal. The conduct relied upon would have to be conduct other than striking per se.

[48] It seems to me that in Elm Street Plastics the industrial court decided that the employer’s failure to afford the strikers’ a hearing was justified because by their conduct the strikers had abandoned their entitlement to a pre-dismissal hearing. The conduct on the part of the workers which the court relied upon there for that conclusion was given as “participating in mass action (strike), the purpose and nature of which is plain (amounting to a repudiation of their contract of employment.)” Although an employer may think it plain that, when workers participate in a strike, they repudiate their contracts of employment, this can simply be no basis for denying strikers the right to be heard before they can be dismissed because if they are granted an opportunity to state their cases they may show that their conduct does not constitute repudiation in the sense that they no longer want to continue with their employment contracts.

[49] As the industrial court also relied on certain views expressed by Cameron in his article, I turn to deal with some aspects of that article. At 176-178 of his article Cameron discussed a waiver and quasi-waiver as some of the exceptions to the requirement for a pre-dismissal hearing. After emphasising that in law a waiver occurs when a person, with full knowledge of a legal right, abandons it, he expressed the view that in the employment context it would be unrealistic to apply the full requisites of the legal doctrine of a waiver before an employee’s conduct could be said to exempt an employer from the hearing requirement. He said all that should be required “is that the employee should indulge in conduct which establishes that the employer can no longer reasonably or fairly be expected to furnish an opportunity for a pre-dismissal hearing.”

[51] With regard to (a) I prefer the view which Cameron expressed earlier in his article where he criticised the “no difference” approach to pre-dismissal hearings. If one rejects the no difference approach, one would find it difficult to say an employer need not afford workers a pre-dismissal hearing if they are repudiating their contracts of employment because, while on the face of it, it may appear to the employer (before the benefit of a hearing) that the employees are repudiating their contracts of employment, as I have said above it may well be that, if he afforded them the benefit of a hearing, he could be persuaded that they were not repudiating their contracts of employment. He might never get to know that unless he affords the employees the benefit of a hearing.

[52] In regard to (b) namely the proposition that an employer should be exempted from the requirement of a pre-dismissal hearing where a hearing would be pointless I would prefer the view which Cameron expresses at 162 of his article in the context of commenting on the so- called “open and shut” approach. There he emphasised that to say a hearing will not be necessary because it appears that there are no facts to be established assumes, wrongly said Cameron, that the central reason for a hearing is to establish facts. A hearing is also concerned about what sanction should be imposed in the light unacceptable conduct. Even if the facts are known, a hearing may bring a completely different understanding or perception about the conduct complained of.

[53] The only situation which I am able to envisage where it can be said that an employer’s failure to give a hearing may be justified on the basis that a hearing would have been pointless or utterly useless is where either the workers have expressly rejected an invitation to be heard or where it can, objectively, be said that by their conduct they have said to the employer: We are not interested in making representations on why we should not be dismissed. The latter is not a conclusion that a court should arrive at lightly unless it is very clear that that is, indeed, the case. However, in my view, the

latter scenario falls within the ambit of a waiver. Accordingly the normal requirements of a waiver must be present. What I say in this judgement about the “pointless” approach and the “utterly useless” approach must be understood subject to what I have just said. There is no justification for creating an additional exception to the audi rule in order to escape the normal consequences attendant upon a failure to meet the requirements of established exceptions to the audi rule e.g. waiver I can see no difference between this “pointless” approach and the “no difference” approach. Cameron rejected the “no difference” approach in the same article. The “pointless” approach seems to be the same approach as the “utterly useless” approach. Sometimes the pointless or utterly useless approach is applied where it is thought that the employer was in possession of, information relating to, or, knew, why the employees were striking (see McCall J in Plascon Ink & Packaging Coating (Pty) Ltd V Ngcobo & others (1997) 18 ILJ 327 (LAC) at 339I - 340G). The utterly pointless useless approach is one where it is said that, an employer is not obliged to afford workers the benefit of being heard where a hearing would have been utterly useless. I think the reasoning adopted by the Appellate Division in rejecting the no difference approach would justify the rejection of the “pointless” or “utterly useless” approach.

employers had taken the attitude that all the information relevant to the inquiry was to be found in the staff files. Because of this they did not give the workers a hearing. In regard of this approach HoexterJA had this to say at 539 F-G in Sibiya: “But given the opportunity of a hearing, the respondents might have been able to call attention to relevant suggestions as to a solution of the problem of the redundant workers which had not occurred to the appellants. In my view, this was a case in which elementary fairness required that the respondents should have been accorded a hearing before the appellants took their decision to dismiss the respondents.” (See also Hoexter JA in the Zenzile appeal 1991 (1) SA 21 (A) at 37 B-C where he said as a matter of principle if the dismissal is disciplinary or punitive in nature, then “even if the offence cannot be disputed, there is almost always something that can be said about sentence and if there is something that can be said about it, there is something that should be heard...”)

[55] In the light of this I am of the view that the conclusion reached in Elm Street Plastics that the workers had abandoned their entitlement to a hearing before they could be dismissed was without any factual basis. Finally on Elm Street Plastics I need to point out that Elm Street Plastics acknowledged the existence of the general obligation or requirement for an employer to give workers a hearing if their dismissal is contemplated. The passage relied upon by Counsel for the respondent relates to those exceptions where it is recognised that the audi rule does not apply. In the end the case of Elm Street Plastics does not assist the respondent.

[56] Another case on which respondent’s Counsel relied was Media Workers Association of South Africa & Others v Perskor (1989) 10 ILJ 4 41 (IC). In particular Mr Jammy relied on the passage appearing at 455C-D of that case. There the industrial court acknowledged the existence of the general rule that an employer must afford an employee a hearing if he contemplates his dismissal. The acknowledgement of this general rule by the court in that case does not support the submission which Mr Jammy made in his argument that there is no such rule. However, the court held in that case that a hearing would have served no purpose. The industrial court gave no reasons for its conclusion that a hearing would have served no purpose. I have already expressed my views about this approach above and will not repeat them. Just as the industrial court in Perskor gave no reasons for its conclusion that a hearing would have served no purpose, Mr Jammy also made no submissions on why a hearing could not have served any purpose in this case. To my mind a hearing in this case could have served a purpose because the union and the workers could have made representations on why they believed that the strike was a legal strike and why, even if it was not legal, they should not be dismissed.

[57] In FAWU & others v Hercules Cold Storage (Pty)Ltd 1998 19 IJL 457 (IC) the industrial court also followed the approach adopted in Perskor. While in Hercules Cold Storage the industrial court acknowledged the existence of the general obligation on an employer to observe the audi rule, it held that no purpose would have been served by giving the workers a hearing in that case. Unlike in Perskor, in Hercules the industrial court purported to give a reason why a hearing would have served no purpose in that case. It said the strike had been organised by a trade union and all an employee could have said in a hearing would have been how he had voted in the strike ballot and that he was expected to take part in the strike. In my judgement this reasoning is based on speculation and can be no basis for relieving an employer from the general obligation to observe the audi rule when contemplating the dismissal of workers. In that case, like in this one, it is clear that the union involved had taken some steps to try and make the strike a legal one. An employee could well have come to a hearing and argued that he only took part in the strike in the reasonable belief that it was a legal strike and that, if the strike was not legal, he would not continue as that could put his job at risk which he did not want to do.

[58] Another case which Mr Jammy referred to in support of his submission is National Union of Metalworkers of SA v Vetsak Co-operative Limited and others (1996) 17 ILJ 455 (A). In particular he relied on the passage appearing at 455C-D. At 468E-G in Vetsak the Appellate Division considered a contention that the company “committed an unfair labour practice by failing to give each worker a hearing before the decision was finally taken to dismiss him.” The Appellate Division dealt with this argument in the following terms:- “The workers acted collectively. Vetsak responded collectively. On the Saturday, the day after the ultimatum was issued, the workers met to discuss their response. That response was to refuse to heed Otto’s appeal on the Monday morning urging them to return to work. To insist on a separate hearing for each worker in those circumstances would be to require Vetsak simply to go through the motions. On the facts of this case there was no duty upon Vetsak to accord each worker a further separate hearing before the dismissals were put into effect.”

[59] It is clear from the passage at 468 E-G in Vetsak that the argument which the Appellate Division was called upon to deal with was not the same as the argument which this Court has to deal with in the present appeal. There the argument was that the employer should have given the strikers individual hearings. Here the argument is that the respondent should have complied with the audi rule in whatever form the circumstances permitted. Also at 468 E it is stated that the unchallenged evidence was that it was only when the workers failed to make further representations or to return to work that the employer commenced with dismissals. This suggests that the employer had invited the workers to make representations why they should not be dismissed and that they had failed to make such representations. If that is what happened, then, in my view, that was compliance by the employer with the audi rule. Accordingly it was not open to the workers to complain afterwards that they had not been heard when they, themselves, had failed to take up an invitation to be heard. No such invitation was extended to the strikers in this case. The fact that the conduct of the workers is collective is no basis for denying the workers the right to be heard. I note, as shown elsewhere in this judgement, that in his article Cameron also rejects the notion that the collective nature of the workers’ conduct exempts an employer from giving workers a hearing. (See end of p 176 to top of p.177 of second part of Cameron’s article).

[60] Mr Jammy also referred to NUMSA V G.M. Vincent Metal Sections (Pty) Ltd 1999 (4) SA 304 (SCA). G.M. Vincent is one of a number of cases which arose out of a country-wide strike which was called by NUMSA in the metal industry in 1992. At 318A-D the Supreme Court of Appeal dealt with the argument that the dismissal of the strikers in that case was unfair because the employer had not afforded the strikers a hearing before “implementing the ultimatum” to return to work or be considered as dismissed.

(a)      the employees in that case had made no effort to comply with the ultimatum, but, in stead, had decided to ignore it; for this reason Melunsky AJA was of the view that the holding of separate hearings or even a collective hearing would have been a pointless and unnecessary exercise;
(b)      there would have been practical difficulties in the holding of hearings,
(c)      the holding of hearings would have rendered the ultimatum ineffective because they would have resulted in substantial further delay in bringing matters to a head.

[62] I have a few observations to make in relation to the decision in G.M. Vincent. The first is that the Supreme Court of Appeal did not decide that an employer is not, as a general rule, obliged to observe the audi rule when it contemplates the possible dismissal of strikers. It said even if there may be situations where fairness demands that, the case before it was not such a case. Accordingly the decision in G.M. Vincent is no authority for the proposition that an employer has no obligation to observe the audi rule when contemplating the dismissal of strikers. The second is that the Supreme Court of Appeal did not deal with a scenario where it is contemplated that the hearing could precede the issuing of an ultimatum. The third observation is that it is clear from the reasons given by Melunsky AJA that he had a formal hearing in mind. In this appeal the reference to a hearing is not intended to necessarily refer to a formal hearing but is intended to include any acceptable form of the observance of the audi rule.

[63] The fourth observation I wish to make about G.M. Vincent is that the Supreme Court of Appeal was not referred to those Public Service judgements which have long affirmed the obligation on an employer to observe the audi rule when contemplating the dismissal of strikers which have been referred to above. Some of those cases are its own judgements. That the Supreme Court of Appeal was not referred to such cases is to be inferred from the fact that such cases are not included in the list of cases recorded in the report as the cases that Counsel referred the Court to. Also the Supreme Court of Appeal was not referred to the articles of Professors Martin Brassey and Cheadle which I have referred to above in this judgement which clearly support the view that an employer does have the obligation to give strikers a hearing when he contemplates their dismissal.

[64] The last observation relates to the conclusion that it would have been a pointless and an unnecessary exercise for the employer in G.M. Vincent to afford the strikers a hearing. My difficulty with this conclusion is that this was a case where the union had taken various steps prescribed by the old Act for making a strike legal. For that reason, it is not difficult to imagine that, given a hearing, at least some of the strikers or their union could have presented argument to the effect that the strike was legal and that, therefore, they were entitled to participate in the strike and that they should, therefore, not be

South Africa: Labour Appeal Court

Modise and others v Steve's Spar Blackheath (JA29/99 ) [2000] ZALAC 1 (15 March 2000)