Not reportable/Of interest to other judges

the labour court of South Africa,
held at cape town

case : C108/2022

In the matter between: 

TWO-A-DAY GROUP (PTY) LIMITED				Applicant
and					 		 
OVERBERG LABOUR UNION (“OLU”) 	 		First Respondent
(Unregistered Union)

CRAIG SMITH 
(Secretary General of First Respondent) 			Second Respondent

THE STRIKING UNION MEMBERS 
WHOSE NAMES ARE LISTED 
IN ANNEXURES A, B & C  				Third and further Respondents

SOUTH AFRICAN UNITED WORKERS 
LIBERATION MOVEMENT (“SAUWOLIMO”)			Final Respondent

Date of Hearing: 	 10 June 2022
Date of Judgment: This judgment was handed down electronically by circulation to the parties' legal representatives by email. The date and time for hand-down is deemed to be at 12h00 15 June 2022

Summary: (Strike interdict – return day – Industrial action amounted to an unprotected strike - Rule confirmed. Cost order apportioned equally)

JUDGMENT

LAGRANGE J 

Introduction

[1]	On 11 March 2022, an interim interdict was issued declaring a strike, which commenced on 4 March 2022 at the applicant’s premises, to be an unprotected one, and prohibiting the respondents, excluding the final respondent, from participating in the strike and from committing a variety of unlawful activity in support of the strike. The applicant is the Two-A-Day Group (Pty) Ltd (‘the company’).The office bearers of the first respondent, the Overberg Labour Union (‘OLU’) were also instructed to take positive steps to ensure that the order was complied with.
[2]	On 29 April 2022, which was when the matter was re-enrolled for final determination, the second respondent, Mr C Smith (‘Smith’) arrived at court and requested a postponement of the hearing so that the final application could be opposed. The postponement was granted, but costs of the postponement were stood over for later determination. Subsequently, on 20 May 2022, Smith filed an answering affidavit and the applicant filed a replying affidavit on 27 May 2022. 
[3]	Smith was not appearing in any representative capacity for any of the former members of OLU or other individual respondents. Even if he was still an office bearer of OLU he would have no right of representing them in court because the union was not registered and only office bearers or officials of a registered union have the right of appearance in Labour Court proceedings. Accordingly, the application is not opposed by any of the respondents except Smith in his personal capacity. The company might well have taken issue with his legal authority to oppose the confirmation of the rule, though of course he was entitled to oppose the application for an adverse cost award as one was sought against him together with the other respondents excluding the final respondent, the union SAUWOLIMO.
[4]	The issues the court is required to determine is whether the Rule handed down on 11 March 2022 should be confirmed as a final order and any cost award. Accordingly the court must consider if the strike was unprotected and if the interdict preventing the continuation or resumption of the strike should remain in place.
Summary narrative
[5]	For the purposes of the judgment it is only necessary to highlight those events which are relevant to the issues under consideration.
[6]	On 4 October 2021, the company and SAUWOLIMO, which was the recognised majority union at the time, concluded a wage agreement. On 6 December 2021 they concluded an addendum to the wage agreement on a three shift system to replace the former two shift system. The agreement was extended to all minority union members including CSAAWU and to all non-union members who accepted the agreement.
[7]	According to Smith, certain employees and especially seasonal employees were unhappy with the shift agreement and started to mobilize and organize their own union after resigning from SAUWOLIMO. The new union, which was unregistered was established at a meeting on 27 February 2022, at which it was resolved to elect leaders, adopt a constitution and start the process of registering the union. Smith claimed in his answering affidavit that he was elected at the meeting as the interim general secretary of the new union.
[8]	On 1 March 2022 Smith sent a number of resignation forms of SAUWOLIMO members to the company.
[9]	On 3 March 2022 three employees, whom Smith claims had raised questions about the applicability of a closed shop agreement between SAUWOLIMO and the company were suspended pending an investigation into alleged “sabotation/involvement not to work shifts from week 10” (sic). The company claims they were suspended pending an investigation into their disruption of official meetings.
[10]	Shortly before 10H00 on 4 March 2022, an email was sent to the company requesting a representative of the company’s HR department to receive a petition at 13H30 at the company’s main gate. The petition was allegedly from the majority of the workforce opposed to the “proposed” shift system.
[11]	The company alleges that the strike began at 13H30 that day at the entrance to the main administration building. It is common cause that management would not accept the petition and warned workers they were engaged in unprotected strike action and they would face disciplinary action if they did not return to their working areas. They remained on the premises, on the recommendation of Smith and other unidentified persons until 15H45 when the shift ended, without returning to work.
[12]	The company alleged that, before leaving the premises, striking employees went to two pack houses on the premises and physically intimidated non-striking employees, removing some of them from the workplace, which compelled the company to stop production. Smith does not dispute this.
[13]	The company claimed that on the following Monday, 7 March 2022, striking workers prevented non-strikers from reporting for duty and the strikers presented a petition disputing the implementation of the three shift system and claiming they were not given an opportunity to make an input on the risks associated therewith. The petition also demanded that the three shift system be placed on hold pending a proper consultation process. 
[14]	Management met with representatives of OLU and its members at the gate of the premises and issued a second oral ultimatum that the worker should return to work failing which disciplinary action would be taken against them. The company claimed that Smith and other individual respondents ignored the ultimatum and continued to intimidate night and day shift workers from reporting for duty. Smith alleges that workers were in fact given an ultimatum to accept the new shift system or be locked out, but the company maintains that they were simply given an ultimatum to return to work and in their strike action failing which they would have disciplinary action taken against them. The company concedes that it did attempt to gauge the extent to which employees who arrived in the buses were willing to comply with the agreement concluded with SAUWOLIMO, but says it did not compel any employee to sign a document as alleged by Smith. It claims that the buses arriving at the premises were carrying employees who wanted to work as well as those who wanted to participate in the strike and that strikers forced everyone off the bus, so the exercise could not be completed and the strikers prevented anyone from going to work. The company also disputes Smith’s ability to testify personally about this event. Anyone who wanted to work was admitted to the premises. Smith alleges that representatives of OLU attempted to engage with management, but management was unresponsive.
[15]	The company alleged that on 8 March violence erupted at the premises when buses transporting employees were pelted with stones and that employees on buses owned by the company were also forced to get out of the vehicles at the entrance to the premises. Suppliers had to return with truckloads of produce because of threats of violence to the drivers and entrances to and from the premises were barricaded by the strikers.
[16]	The company claims that it did have a meeting with representatives of OLU including Smith and other individual respondents with the assistance of the SAPS and a mediator. At the meeting it was agreed that the strike action would cease and the starting times of the new shifts would be subject to internal negotiations, but despite the agreement the strike continued. Smith simply denies that any meeting took place except one, apparently between worker leaders and community leaders. He says the latter threatened to shoot the representatives if they did not end their ‘protest’ action. 
[17]	Later that night a written ultimatum calling upon workers to in their strike action and tender their services unconditionally by 07H30 on 9 March 2022 was issued. No reference is made in the ultimatum about returning workers having to accept the new shift system. Smith states that the ultimatum was discussed with workers after another march to the premises “in the hope that management would respond to the issues raised in the petition”. He confirmed that workers decided that they “considered going back if the company addressed the issues raised in the petition”. Smith also claims that workers felt strongly that they were being unlawfully locked out by the company without following a proper procedure and without giving them an opportunity to raise their concerns about the new shift system.
[18]	It is common cause that a final ultimatum warning employees that they should return to work by 13H30 was issued in the morning of 9 March 2022. It also called upon them to cease any unlawful activity and that failure to comply with the ultimatum would amount to serious misconduct which could lead to summary dismissal.
[19]	On 10 March, the CCMA became involved. The company and Smith both claim that they were the party that was responsible for involving the CCMA. Whatever the case may be, no progress was made on that day and a letter was emailed at 11H00 to the respondents warning, amongst other things, that an urgent application would be brought if workers did not return to work by 16H00 that day. Smith claims that the attorneys were advised that the parties were engaged in mediation and the attorneys should await the outcome of the process before doing anything, which they agreed to. However, it appears that the company in fact advised the union in an email at 19H41 that evening that the application would be heard the following day at 12H00 in the labour court. Although discussions did continue between management and worker representatives until the early evening of 10 March, no settlement was reached that day. A a minute of the meeting recorded the possible terms of a settlement, but it still required the agreement of the parties, who were scheduled to meet the following day at 08H00.
[20]	Smith claims that the following day (11 March 2022) after working leaders had returned to the mediation process, the company’s attorney, Mr C Pokpas phoned to advise that the company would proceed with the urgent application if workers did not return to work by 12H00. The attorney disputes this and states that he merely phoned them at 07H40 that day as a courtesy to inform OLU and SAUWOLIMO that company was proceeding with the interdict at 12H00 that day and papers would follow shortly. An email sent to OLU and Smith at 09H23 confirms the attorney’s version of the discussion with Smith and had a copy of the urgent application attached to it.
[21]	According to the replying affidavit, the mediation only recommenced at about 11H00 on 11 March 2022 and no agreement was reached until news was received that the interdict had been granted around 11H40.
[22]	The parties to the agreement which was concluded were the company and SAUWOLIMO though it appears that other individual worker representatives also signed it. According to what Smith said from the bar on the return day, these signatories were representatives of OLU, though it was nowhere stated in any of the affidavits. Clause 3 of the agreement permitted the parties to look at alternative starting times for day shift employees which they intended to agree on within 30 days failing which the starting time would revert to 06H45.
[23]	On the first return day, Smith was somewhat unclear about the status of OLU. However, in his answering affidavit he stated that OLU was disbanded after the settlement was reached and an agreement was reached with another newly registered union, the Agricultural, Food Fishing & Retail Industry Workers Union (‘AFRIWU’) which absorbed the previous members of OLU. He further claimed that it was now the recognised majority union with more than 60% of the workforce signed up as its members. However the company denies both that AFRIWU is a majority union and that it has been recognised by the company yet. 
[24]	In a letter sent by AFRIWU to the company barely a week after the settlement about “New Shift Patterns” the union clearly spoke to alleged ongoing unhappiness with the new shift arrangements on the part of workers it represents.
Evaluation 
Did the respondents, excluding the final respondent, embarked on unprotected strike action?
[25]	From the affidavits it is apparent that an agreement in the form of an addendum to the wage agreement between SAUWOLIMO and the company on the introduction of a three shift system was agreed to. Not only did it apply to SAUWOLIMO’s members, but also to minority unions and non-members who acceded to the agreement. 
[26]	Section 65(3)(a)(i) of the Labour Relations Act, 66 of 1995 (‘the LRA’) prohibits a strike or lockout by any person if that person is bound by an arbitration award or collective agreement that regulates the issue in dispute. Clearly shift hours were regulated by the collective agreement concluded in December 2021 between SAUWOLIMO and the company. Section 23 (2) of the LRA states:
“A collective agreement binds for the whole period of the collective agreement every person bound in terms of subsection (1) (c) who was a member at the time it became binding, or who becomes a member after it became binding, whether or not that person continues to be a member of the registered trade union or registered employers' organisation for the duration of the collective agreement.”
[27]	Accordingly, even if the third and further respondents had resigned their membership of SAUWOLIMO and joined OLU as Smith claimed, they remained equally bound by the shift agreement as the members of SAUWOLIMO who did not resign.
[28]	However, Smith argues that the industrial action was not a strike, but a lockout. The first point to make is that it was the respondents, excluding SAUWOLIMO, who were plainly unhappy with the agreement on the three shift system. As the collective agreement had been concluded it was binding on the individual respondents for the reasons mentioned. Secondly, even on Smith’s own version of what transpired on 4 March 2022, workers had signed a petition to suspend the implementation of the new shift system and did not return to work after 12h30 that day. There is no suggestion on the affidavits that the failure to return to work was purely because workers wanted management to respond to the petition, not because management prevented them from returning to work unless they individually undertook to comply with the new shift system. Thirdly, the written ultimatum issued on the night of 8 March 2022 simply required employees to tender their services unconditionally. The only way to understand this is that management required workers to return to work without any setting any preconditions before they did so. Fourthly, Smith did not dispute that the workers who did not return to work on the afternoon of 4 March 2022 removed employees who were working from certain workplaces, which is irreconcilable with the notion that the company was implementing a lockout. Lastly, Smith stated that when workers discussed this ultimatum they decided they would only ‘consider’ returning to work if the company addressed the issues raised in the petition. The text of the petition called specifically for the company “to act responsibly and stop their unilateral actions to implement the so-called new employment conditions”. By characterising the new shift system as unilaterally imposed and to cease implementing it, the petitioners were effectively refusing to accept the outcome of the collective bargaining process concluded between the company and SAUWOLIMO.
[29]	Everything mentioned above points to the fact that the respondents, excluding SAUWOLIMO, disputed the implementation of the new shift system and were demanding management to stop implementing it and sought to compel management to agree to this demand by refusing to work, all of which amounts to a strike.
[30]	The only conclusion to be drawn from the affidavits is that the individual respondents were participating in unprotected strike to try and reverse the consequences of the collective agreement on the three shift system, by which they were bound. As such, they were participating in unprotected strike action.
Should the rule interdicting the strike nonetheless be discharged? 
[31]	Smith argued that the strike was now in the past and that the interdict should not even have been issued in the first place because the dispute had been settled before the initial interdict was hand granted. 
[32]	In light of the discussion of the evidence above, it seems that a settlement might have been imminent when the interdict was issued, but it was only finalised after the interdict was handed down by the court. From the minutes of the mediation meeting held the evening before the interdict was handed down, it was anticipated that an agreement might be reached early the following day and that it was imperative that it should be reached by 08h00 on 11 March 2022. However, the mediation process only resumed an hour before the interdict application was enrolled for hearing because the respondents arrived very late for the meeting, which had been scheduled to start at 08h00. It seems highly improbable that the meeting would have started so late when the interdict hearing was only an hour away, if the dispute was to all intents and purposes settled the night before.
[33]	A more plausible interpretation of the evidence is that it was the granting of the interdict which nudged the respondents to conclude the settlement agreement. Even so, that was some time ago. Is there any risk that the dispute might flare up again? Two matters give cause for concern. Firstly, the terms of the agreement anticipated further debate about the shift hours. There was no evidence before the court on the return day that the matter had finally been put to bed. Further, the letter from AFRIWU, a week after the settlement was concluded is indicative of ongoing discontent. Lastly, it appears that the very formation of OLU was almost solely due to disaffection by SAUWOLIMO’s members with the terms of the shift agreement, which SAUWOLIMO had concluded. According to Smith, it would appear that the ‘divorce’ between SAUWOLIMO and its disaffected members is final. Considering all these factors, I do not think it can be confidently said that the grievances about the terms of the three shift system are now resolved and unlikely to flare up again. In the circumstances, this is not a situation in which the rule should be discharged.
Costs
[34]	The company points out that the strike at the heart of the harvesting season cost it several million rands, inter alia, on account of perishable fresh produce which could not be timeously processed. It lays much of the blame for the strike on Smith and OLU. It also points out that in an email sent the company and its attorneys on 27 April 2022 entitled “Intention to settle the court case C108/2022”, SAUWOLIMO had tendered to pay the legal costs of the company, “providing it is below an amount that I would be able to pay off within 12 calendar months”. He indicated his willingness to engage in discussions with the company or its legal representatives on the issue. The company did not accept this qualified tender and by the time the return date arrived, Smith had not yet filed an answering affidavit. At the hearing, he then requested an opportunity to file an opposing affidavit and the costs of the respondent hearing were held over.
[35]	As discussed it is most likely the settlement agreement only occurred when it did because the interdict was obtained. On the other hand, there was clearly a serious engagement between the parties in the days leading up to the interdict and the prospect of a settlement was tangible and not merely a remote possibility. Thus this was not a case where there was simply no attempt to engage with issues. Further considerations are that there were undisputed allegations of intimidatory conduct and malicious damage to property which accompanied the strike. It took more than a week to restore things to normal and the strike was over an issue already embodied in a collective agreement concluded with a recognised majority union. It caused the company considerable loss and the company gave strikers a number of ultimatums to return to work. A cost award would convey the message that unprotected strike action which proceeds unabated and without heed to repeated calls by the employer, is not without risk just because the interdict was complied with after the damage of the strike has been inflicted.
[36]	The company argues that the sole object of Smith opposing the confirmation of the rule was to avoid an adverse cost order. It also argues that Smith did not represent a registered union that had an ongoing relationship with the company and the normal principles applicable to cost orders under section 165 of the LRA do not apply.
[37]	Smith ought to have filed an answering affidavit timeously so the matter could have concluded on 29 April, and his failure to do so resulted in an unnecessary postponement. Ordinarily, I would be inclined to make an order of costs against him for the postponement he occasioned. However, I note his genuine attempt to try and resolve the cost issue before the hearing and I accept that he was having difficulty reconciling the fact that he was no longer an office bearer of OLU, which in any event could no longer speak for the third and further individual respondents, because of its dissolution. Even though he is clearly quite articulate and not legally ignorant, I accept that he might have been confused what he ought to do in the somewhat unusual circumstances. Had he been legally advised, he might have confined his opposition only to the cost award and the matter could have been disposed of on the first occasion. In view of his uncertain representative status, in my view, it would be unfair on this occasion to mulct him with the costs of the postponement.
[38]	Nonetheless, for the reasons mentioned, Smith and the remaining respondents should be held responsible for the costs of the initial application, which ought not to have been necessary. As the conduct was essentially collective, it would be more appropriate if the individual were equally responsible for their share of the costs.
Order
[1]	The rule issued on 11 March 2022 is confirmed.
[2]	The Second, Third and Further Respondents, excluding the First and Final Respondents are each severally liable for an equal portion of the Applicant’s costs of the application.
Lagrange J
Judge of the Labour Court of South Africa

Appearances:

For the Applicant:		J Whitaker instructed by Maserumule Attorneys Inc.

For the Second Respondent:		In person.