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Employment law update

Talita Laubscher BIur LLB (UFS) LLM (Emory University USA) is an attorney at Bowman Gilfillan in Johannesburg.

Monique Jefferson BA (Wits) LLB (Rhodes) is an attorney at Bowman Gilfillan in Johannesburg.

Affirmative action

In Naidoo v Minister of Safety and Security and Another [2013] 5 BLLR 490 (LC), the respondent had an employment equity plan (the plan) in place that provided for rigid targets based on the assumed demographics of the country as reflected in the 2001 census report. Although the census report reflected that 51% of the country was made up of women, the plan only set a 30% target for representation of females at the time. Furthermore, the plan contained a formula to be applied to determine numerical targets that created a ranking order, with African males being the most favoured. The effect of the plan was that African males were advanced in the workplace to the detriment of other categories in the designated groups.

Naidoo, an Indian female police officer, applied for the position of cluster commander: Krugersdorp. Following assessments, Naidoo received the second highest score. The candidate with the highest score was recommended for another cluster commander position, and Naidoo was recommended for appointment to the position of cluster commander: Krugersdorp because her position would address ‘gender equity’. The third-rated candidate for the position was A du Bruin and TS Maswanganyi, an African male, was rated fourth.

The recommendation to appoint Naidoo was, however, not accepted by the national selection panel, inter alia, on the basis of the inherent requirements of the job, the experience of the candidate in the environment, the fact that it would not enhance employment equity, and that it would not be consistent with service delivery objectives. The national panel was further of the view that there had been bias on the part of the provincial panel and thus the assessments carried out by the provincial panel were largely disregarded. Instead, the national panel decided that Maswanganyi had to be appointed.

Naidoo subsequently lodged a grievance, which was not addressed to her satisfaction, and she then instituted proceedings in the Labour Court (LC), contending that she was unfairly discriminated against since the plan created an absolute barrier to the advancement of females and the way in which the plan was applied, was arbitrary and unfair. The respondent argued that the appointment was not entirely dictated by the plan and it was entitled to take affirmative action measures consistent with the purposes of the Employment Equity Act 55 of 1998 (the EEA).

The LC, per Shaik AJ, noted that, in general, appointment decisions fall within the prerogative of management but that this prerogative is constrained by the law. Courts may therefore interfere with the exercise of this prerogative where

• it is exercised irrationally, capriciously or arbitrarily;

• amounts to unfair discrimination; or

• where the decision-makers fail to apply their minds.

The court noted that the EEA prohibits unfair discrimination but provides that it is not unfair to implement affirmative action measures whereby members of designated groups are preferred to achieve substantive equality. It accepted that the plan targeted persons from designated groups. However, the court found that it also created barriers that undermined the purpose of achieving a diverse workforce broadly representative of the South African community. Therefore, while the attainment of substantive equality and equitable representation might require groups within the designated category to be advantaged over others, this must always comply with the requirements of the Constitution.

In the court’s view, the use of national demographics was in conflict with the EEA, which requires goals to be based on the proportion of the economically active population who are suitably qualified. The effect of the formula in the plan to determine the numerical targets to be reached was that it made provision for the appointment of Indian females at lower levels, but it excluded Indian females entirely from higher levels. The distribution of Indian females at level 14 at the time was zero and the ideal distribution was zero, meaning that it was impossible for Naidoo and other Indian females to progress to level 14 and beyond.

The respondent argued that Africans were under-represented while the ideal of zero female Indians had already been achieved. However, the manner in which the targets were calculated would always produce a zero target for Indian females, which created an absolute barrier for Indian females.

Shaik AJ held that, in many respects, the numerical targets in the plan were quotas rather than targets. As the quota had been satisfied in the case of Indians, they were regarded as being over-represented and thus completely excluded from consideration. This did not create equitable representation within each occupational category and level as required by the EEA. Furthermore, the plan did not accord with s 9 of the Constitution as all groups other than African males would be discriminated against until the target in respect of that group had been achieved. This created a ranking order between members of designated groups, which is not provided for in the EEA.

Considering the basis on which the national panel rejected Naidoo’s recommendation for the post, the court found that there was no basis to conclude that Naidoo was incapable of performing the duties of the role concerned as she had the ability, potential, qualifications and experience to function in the position. The court accordingly rejected the respondent’s argument that the appointment of Maswanganyi was based on the inherent requirements of the job. The court also rejected the argument that Maswanganyi’s appointment was based on his ability in comparison to Naidoo’s ability and that the decision was based on the need for service delivery.

The overall effect of affirmative action measures in the plan was therefore severely limiting to women in general, in particular to Indians and Coloureds. The court held that no one group within the designated group should be preferred to such an extent that it results in disadvantage being suffered by other categories in the designated groups, since this has the potential for inter-group contestation and may create a new pattern of advantage.

In the circumstances, the court held that Naidoo was unfairly discriminated against and the court ordered her retrospective appointment to the position of cluster commander, together with payment of the difference in remuneration that she would have received had she been appointed instead of Maswanganyi. Compensation equal to 12 months’ remuneration was also ordered, as well as costs.

Moksha Naidoo BA (Wits) LLB (UKZN) is an advocate at the Johannesburg Bar.

No transfer of authority to transfer employee

The Minister for Public Service and Administration and Another v Kaylor (LAC) (unreported case CA18/12, 11-6-2013) Davis JA (Tlaletsi ADJP and Coppin AJA concurring).

The respondent employee was, in 2009, appointed as a chief director: business development at the Public Administration Leadership and Management Academy (PALMA) in Cape Town.

Sometime towards the latter part of 2010 the second appellant, the director general of PALMA, issued a directive whereby the respondent was instructed to take up the position of chief director: quality assurance in Pretoria.

The respondent appealed to the first appellant for proper consultation before the decision to transfer her was finalised. In response to this, the respondent met with the second appellant to discuss issues regarding her proposed relocation and also the restructuring of the organisation, in terms of which the respondent was to take up the position in Pretoria.

Unhappy with the outcome of her meeting with the second appellant, the respondent referred a dispute concerning a unilateral change to terms and conditions of employment to the relevant bargaining council. In the absence of any settlement being reached at conciliation, the respondent successfully obtained an interim order staying the enforcement of her transfer pending the finalisation of an application to review the transfer directive issued by the second appellant.

The respondent launched her review application in terms of s 158(1)(h) of the Labour Relations Act 66 of 1995, which provides:

‘The Labour Court may –

(h) review any decision taken or any act performed by the State in its capacity as employer, on such grounds as are permissible in law.’

The court a quo, per Steenkamp J (Kaylor v Minister of Public Service and Administration and Another (2013) 34 ILJ 639 (LC)), found that, in reviewing a decision involving the state as an employer, the doctrine of legality applied. In terms of this doctrine, public officials could only exercise powers and perform duties that have been conferred on them by law. Furthermore, any application of such powers must be exercised in a manner that is not arbitrary, unreasonable, irrational or procedurally unfair.

Applying this to the merits at hand, the court found that the second appellant did not properly consult with the respondent prior to issuing the transfer directive and, secondly, in terms of the relevant sections in the Public Service Act 30 of 2007 (PSA), it was only the first appellant who was authorised to make the appointment in casu. While the PSA allowed the first appellant to delegate this power to the second appellant, the court did not find any evidence that such delegation had taken place.

Having made these findings, the court a quo set aside the transfer directive. The court further ordered the second appellant to engage in meaningful consultation with the respondent and to consult with the first appellant and heads of other departments outside of PALMA to offer the respondent a suitable alternative position, which could be in another governmental department situated in Cape Town. Should the second appellant be unsuccessful in finding the respondent an alternative position, the court ordered the parties to enter into retrenchment consultations.

On appeal the Labour Appeal Court (LAC) examined both the merits of the matter as well as the findings made by the Labour Court.

On the first finding, that is, whether there was a duty on the second appellant, before issuing the transfer directive, to consult with the respondent and if so found, whether proper consultation had taken place, the LAC held:

‘It is not permissible in terms of the LRA [Labour Relations Act 66 of 1995] for an employer, such as first and second appellant, to decide to place an employee in a new post without any meaningful consultation. See Nxele v Chief Deputy Commissioner, Corporate Services, Department of Correctional Service and Others (2008) 29 ILJ 2708 (LAC) at para 61 and 69, where Zondo JP (as he then was) said: “A decision to transfer an employee that is made before the employee can be heard is generally speaking unlawful and invalid in law”.’

Turning to the merits of the case the LAC held: ‘In short, there was no consultation which was sufficient to justify the conclusion that the appellants had acted fairly and in a manner which is permissible in law, which term incorporates the right to procedural fairness and the concomitant right to be consulted in such circumstances.’

With regard to the legal position concerning who was authorised to transfer the respondent and whether such authority had been delegated to another, the LAC held:

‘The power to appoint public servants to departments in the public service and transfer employees from one post or position to another post or position in the same or any other department is a power which, in terms of the Public Service Act, resides with the “executive authority”, which as was already noted, means the Minister responsible for the particular department. In terms of s 42A(1)(a) of the Public Service Act, first appellant may delegate to second appellant any powers which had conferred upon him by the Act. In terms of s 42A(7), any delegation of such a power shall be in writing.’

Did the second appellant obtain the necessary authority from the first appellant when issuing the transfer directive?

In answering this question the LAC concurred with the findings of the court a quo, in concluding there was inadequate proof to accept that the first appellant delegated his authority to the second appellant when the latter issued the directive.

The LAC therefore confirmed the findings of the court a quo and, in doing so, dismissed the appeal. However, on the issue of remedy, the LAC held the Labour Court ‘overreached the scope’ of the relief it ordered. The LAC found that there was nothing before the court a quo for it to accept that the second appellant was authorised to offer the respondent employment in other departments. The LAC replaced the remedy with an order that the second appellant engage in consultations with the respondent in seeking an alternative position for her and further consult with the first appellant with regard the possibility of the respondent being placed in other governmental departments.

Note: Unreported cases at date of publication may have subsequently been reported.

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