Details of hearing and representation
[1] This is an arbitration award in respect of disputes of unilateral change of terms
and conditions and unfair labour practice, which disputes were both referred to the
Labour Commissioner pursuant to section 86 (1) of the Labour Act 11 of 2007
(hereinafter referred to as the Labour Act). The parties hereto are Mr. Nimrod Zwarts
and Josef Rooi, whom I shall refer to as “applicants” save where it is necessary to refer
to them by their names.
The respondent is the Municipality of Keetmanshoop, a
juristic body duly established in terms of section 3 of the Local Authorities Act, Act 23
of 1992 (hereinafter referred to as the Local Authorities Act).
[2] During the arbitration hearing, both applicants were represented by Mr. Clement
Daniels of Clement Daniels Labour Consultants, while the respondent was represented
by Mr. Tim Probart from the law firm Rissik, Cox and Probart, situate at
Keetmanshoop. The applicants led evidence under oath during the proceedings and
did not call witnesses. The respondent called the incumbent Chief Executive Officer, a
certain Mr. Paul Vleermuis as its sole witness.
Preliminary issues
[3]It suffices to mention that prior to my designation as arbitrator in these matters, the
cases of the two applicants were assigned to Ms. Angeline Hagen and were thus
referred and dealt with as two disticnt disputes. With my desgnation as arbitrator
herein, the Labour Commissioner consolidated the two matters in line with Rule 30 of
the Rules Relating to the Conduct of Conciliation and Arbitration because the
applicants rights to relief depend on substantially the same question of law and facts.
[4] Against this background, at the outset of the arbitration hearing the respondent’s
representative, Mr. Tim Probart raised an objection with regard to the consolidation of
the two matters with case numbers SRKE 19-11 in respect of Nimrod L.M.A Zwartz
and SRKE 25-11 in respect of Josef Rooi.
He argued that on 1 July 2011, an
arbitration award was made by Ms. Hagen in terms whereof Mr. Nimrod Zwartz’s case
was accordingly dismissed.
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[5] He contended that the said award was issued as a result of non – appearance of the
applicant and his representative, and was based on the exact case number. He argued
that the last sentence of the said award clearly states that it is binding to both parties
and is not an advisory award. He submitted that it is trite law that the said award
could be varied or rescinded within 30 days from the date of issuance, which never
materialised and hence the only recourse which applicant has is in terms of Section
89 of the Labour Act which deals with appeals. Referring to an Article extracted from a
legal magazine De Rebus dated September 2004, he raised a defence of res judicata a
doctrine which means that if a matter or proceedings have come to an end by a
judicial decision, it is considered as having been finalized and no new case can be
entertained. He contended that in terms of the res judicata doctrine, the joinder of the
matter was irregular.
[6] In reply thereto, Mr. Daniels argued on behalf of the applicants that in terms of
Rule 28 of the Rules Relating to the Conduct of Conciliation and Arbitration an
application for a preliminary or interlocutory relief must be done in the prescribed
format within the prescribed time (Rule 28 (5)). He contended that the respondent’s
objection must be disregarded as it was not brought in line with the requirements of
Rule 28 of the Rules.
[7] He argued further that in any event, the arbitration award issued on 1 July 2011
pertains to unfair dismissal as a nature of dispute, which is materially different from
the instant case which is premised on a unilateral change of terms and conditions and
unfair labour practice. He argued that prior to the issuance of the award in question,
the parties had agreed to the suspension of proceedings on 13 June 2011. He handed
in copy of the suspension of proceedings which was entered into the record as exhibit
B to substantiate his averrments. Mr. Daniels argued further that in the notice of
suspension of the proceedings, the name of the applicant was explicitly cited thereon
and hence the then arbitrator, Ms. Hagen did not have authority to issue the award
she did issue.
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[8] He further stressed that the purpose for suspension of the arbitration proceedings
was to seek an amicable solution internally. To this end, he referred to Section 121 (d)
which deals with the powers of the Labour Commissioner and Section 122 (2) which
gives the Labour Commissioner a prerogative to amend or revoke the delegation to
conciliate and arbitrate in a particular matter at any time.
[9] He also referred to section 85(2) which states that arbitration tribunals operate
under the auspices of the Labour Commissioner.
He argued that the basis for
suspension was that the then arbitrator acted in an impartial manner.
It was his
argument that the Labour Commissioner has authority to consolidate matters and the
application to set aside the joinder was in any event not done in the prescribed form.
In addition to that, the award made by the arbitrator is not in terms of the dispute
referred to arbitration, and that the Labour Commissioner has power to revoke the
delegation at any time. He contended that the parties are in charge of the dispute and
hence had a prerogative to do so as manifested by their meeting with the Labour
Commissioner on the 13 June 2011.
[10] Mr. Probart countered that his objection was neither a preliminary nor
interlocutory application but an objection which can only be submitted at arbitration.
He however conceded that the arbitrator made an error in the preamble to the findings
by indicating that the nature of dispute was unfair dismissal. He argued that, in
essence, the award was made on 9 June 2010 and was only reduced to writing on 1
July 2010 before the matter could be suspended, thereby creating a binding effect
already on 9 July 2010, while the notice of suspension is dated 13 June 2010.
Ruling on the preliminary issue
[11] After considering, with circumspection, the arguments advanced by both parties’
representatives, to whom I am indebted for their industry in citing the relevant
authorities as far as the prelimanary issue is concerned, I ruled that the consolidation
was not irregular and that the matter was properly before this forum. My reasons for
this ruling are to be traced on the record.
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The Main Application
[12] Having disposed off the preliminary issue above, I then proceeded with the main
application, which deals with substantive issues referred to the Labour Commissioner,
to wit, unilateral change of terms and conditions and unfair labour practice. I now
proceed to summarise the versions of both parties during the arbitration hearing.
APPLICANTS VERSIONS
[13] JOSEF ROOI, - He stated that he was employed by the Namibian Police before he
joined the Municipality on 5 June 2000 in the capacity of Manager for Emergency
Services.
He testified that over the years he swelled through the ranks and was
eventually tranferred to the position of Manager for Local Economic Development
Services. He went on to state that it was at that stage that it was decided that the two
departments on the respondent’s establishment be consolidated, namely Local
Economic Development and Community Services and hence was appointed as
Manager for Local Economic and Comunity Development Services. He referred to a
letter dated 27 August 2009 which consolidated the two departments, entered into the
record as exhibit C.
[14] He testified further that being a Manager for LECDS, he was reporting directly to
the Chief Executive Officer and was responsible for both Local Economic Development
and Community Development. He stated that with the consolidation of the two
departments, he made a proposal to Council for consideration on the basis of the
workload to establish the Local Economic Development and Community Development
portfolio at a level of a department to be headed by a Strategic Executive Officer.
[15] He testified further that this was a new separate department on the establishment
of the Municipality of Keetmanshoop. He stated that after consideration approval was
granted for the establishement of the department titled Local Economic Development
and Community Development as per his proposal. He went on to state that the CEO
was in support with the creation of the new portfolio on the Municipality’s
establishment as aptly demonstrated by his proposal that he be elevated to the
position of the Strategic Executive to head the newly created position and to do away
with the position of the Manager so as to reduce the Municipality’s wage bill.
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[16] He handed in a copy of the proposal that he made to the Council, marked as
exhibit “D”. He stated further that he received a letter confirming the creation of the
position and an appointment to act in that capacity dated 10 May 2010, which was
handed in as exhibit “E”. He stated further that in the interim he was told that the
position would be advertised and he was a bit uncertain as to whether he would get
appointed permanently into the position but was assured by the CEO as well as
Councillor Titus that the advertising of the position was just a mere formality and
hence he would get the postion.
[17] He testified that at one stage he indicated that he would not apply for the position
but eventually did so after he was convinced that it was just a mere formality. He went
on to state that as a result of his application, he was shortlisted for interviews and
subsequently interviewed. In his testimony, he referred to the letter he received from
the respondent in which it was indicated that he was the successful candidate for the
position, as per letter dated 17 August 2010, which was admitted into the record as
exhibit ”F”. He stated that according to the letter, he was supposed to be on probation
for six months but was never assessed until he received another letter demoting him
from the position of Strategic Executive: LECDS.
He stated that the letter of his
appointment into that position was issued by the then acting CEO Mr. Blaauw.
[18] He stated further that he had never influenced anyone to appoint him in the
position from which he is now demoted. He also referred to another letter which he
received from the Council on 1 February 2011, which letter informed him about his
demotion from the position of a Strategic Executive. He added that the said letter
accused him of having colluded with some Council members to get appointed into that
position. The letter was admitted into the record as exhibit “G”. He testified further
that subsequent to that he engaged a lawyer to refer the matter to the Labour
Commissioner for arbitration.
[19] He stated that a letter was also written to the respondent, informing it to reverse
its decision but to no avail. He referred to the letter which his legal representative of
record wrote to the respondent. The letter was entered into the record as exbihit “H”.
He further stated that to date no response has ever been received.
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[20] He stated that the demotion has affected him in that his financial position has
been ruined and his lifestyle has been destroyed. He stated that with the demotion his
salary has dropped from about N$ 176 000.00 per annum to about N$ 147 000 per
annum. He testified that he could recall certain appoinments made by the Council
and not the Management Committee, such as that of Mr. Hermanus Losper who was
appointed in the positon of Senior Traffic Officer. He stated that in that case the
successful person came at position number three (3) during the interview, but the
Council altered this by appointing Mr. Losper. He went on to say that a certain Mr.
Appolus was also appointed by Council.
[21] He stated that other colleagues by the names of Petrus Hamman and Epson
Jossop were also appointed by Council as Strategic Executive- Corporate Affairs
Department. He stated futher Mr. Andre Blaauw was also appointed by the Council in
the position he is currently serving. He tesified that in total there were about five (5)
employees affected by the decision to demote them, including Mr. Nimrod, L.
Mungunda, Sandra Polwin, Losper.
[22] He added that Ms. Mungunda resigned as a result of the demotion, and the other
two colleagues withdrew their cases against the respondent as they subsequently got
appointed in the positions that were initially anulled following another round of
interviews. He stated that apart from the Labour matter they have instituted against
the respondent, they have also laid criminal charges against the Municipality and are
contemplating civil litigation.
He stated that the criminal charges are premised on
section 51(5) of the Labour Act which compels the employer to restore such terms and
conditions of employment within 30 days following the alteration of the terms and
conditions of employment. He stated that he was seeking restoration in the position he
held prior to the demotion as a relief.
[23] Under cross examination the applicant was asked as to whether he has been
employed for eleven years and whether he has been attending many Council meetings
to which he replied that he only started attending meetings in year 2009 when he
became a member of management. He conceded that he was aware of the procdures
followed by Council especially the Local Authorities Act.
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[24] He was referred to the provisions of Section 14 (6) (a) (b) of the Local Authorities
Act whereby he was asked as to whether he was aware of same and he replied that he
only got to know the provisions during the arbitration proceedings. He was also asked
as to whether he had knowledge of the Standing Rules of the Municipality of
Keetmanshoop, which were handed in as exhibit “I” and the Minutes handed in as
exhibit “J” to which he replied in the affirmative.
[25] He was asked further as to whether he was aware of the provisions of section 21
(1) (b) of the Local Authorities Act and he replied that he only became aware during
the proceedings. It was further put to him that the CEO will testify that he could not
be elevated due to lack of the qualification and he denied this proposition. He was
also referred to the advertisement of the position which he occupied, copy of which
was handed in as exhibit “K”, and conceded that in terms of the advertisement he did
not qualify as he was not in possession of a three year B. Degree at the time of the
advertisement.
[26] He was then referred to his applicantion form which he confirmed to be his and
also conceded that at the time he had applied for the position he did not meet the
required minimum standard. He stated that although he did not meet the required
minimum standard, he had hope that he would get the position as a result of a
discussion that preceded the advertisement of the post.
He conceded further that
based on the content of the advert he did not qualify for the position. He was asked as
to what happened to other applicants and he stated that he did not know the number
of other applicants who applied for the same position.
[27] It was also put to him that there was a shortlist on which his name did not
feature and before the shortlist could be forwarded to the panel for interviews,
Councillor Blaauw instructed the CEO to put his name on the shortlist, which he
vehemently denied ever having been the case. It was also put to him that during the
interview him and Mr. Diergaardt obtained smilar scores of 74.1 each, and he replied
that he only learned afterwards that Mr. Diergaardt was recommended for the
position. He was asked as to whether he did attend the Management Committee
meeting of 11 August 2010, and he replied that he was not part of that meeting.
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[28] The copy of the draft minutues of that meeting were handed in as exhibit “M”. He
was asked as to whether he was aware of the fact that a fight erupted during the
Management Committee meeting of 11 August 2010, thereby resulting in the
postponement of the meeting indefinetely, which fact he denied knowledge of. He was
also referred to the minutes of the extra-ordinary meeting, which was then handed in
as exhibit “N”.
[29] He was asked as to whether the CEO did give him any information with regard to
his salary and he replied that he was not so sure. He was asked further whether he
was aware of the subsequent meeting held on 16 August 2010, at which meeting the
CEO and the Management Committee got suspended and he replied that the was not
aware of the minutes. He was asked as to whether he knew that something was fishy
about his appointment and he denied this.
[30] He was further asked as to whether he was aware of the disclaimer published in
the print media, in “The Namibian” and “Die Republikein” newspapers respectively, and
he replied that although he generally reads newspapers, he did not see the disclaimer
as he regularly now reads “The Sun” newspaper.
He was further referred to the
minutes of the meeting held on 18 August 2010, at which meeting his salary was
discussed and he conceded that he was part of that meeting.
[31] He conceded that the Keetmanshoop Municipality was established by Section 3 of
the Local Authority Act. He was asked whether it was correct that the appointment of
staff members in the Council is done by the Management Committee and not by
Council, which point he disagreed with saying that according to the law the correct
procedure is that Managment Committee ought to appoint but at any rate that was
not how the Municipality of Keetmanshoop operates in practice.
[32] He added that it was generally a practice that staff members were appointed by
the Council and not by the Management Committee in the respondent Council. During
re-examination he was asked as to how relevant was his Diploma qualification to the
position he had applied for and he replied that it was relevant taking into account the
experience. He stated that his Diploma was obtained following two years of studies.
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[33] NIMROD LOESAN MONRAY AHYAT ZWARTZ – He stated that he is employed by
the respondent for more than 11 years, having started as an Human Resources Coordinator in 2000 and later applied to be a Building Inspector in year 2004 where he
acted in the position of a Chief Technician on ad hoc basis and when the Strategic
Executive: Infrastructure and Technical Services (SE: ITS) was away on studies he
often did stand in duties in that role. He stated that the work of Strategic Executive
entails overseeing the entire infrastructure of the Municipality such as water, road and
buildings. He testified that apart from his employement with the Municipality, he also
has permission from Council to do private work as a draughtman.
[34] He stated further that after the then Strategic Executive for Infrastructure and
Technical Services completed his studies at the University of Stellenbosh he landed a
job at Exarro as a Mine Engineer, thereby resulting in the vacancy of the Strategic
Executive: ITS in 2008.
He stated that as a result, the position was advertised
externally as per exhibit “K”.
He testified that after applying for the position he
received a letter of appointment dated 17 August 2010. He testified further that no
interviews were held in his case as he was later told that he was he was just a sole
candidate. The copy of the letter of his appointment was entered into the record as
exhibit “P”. He also referred to another letter pertaining to an annual increment of his
salary dated 19 October 2010, which was also handed in as exhibit “G”.
[35] He stated that he later got another letter dated 1 February 2011, marked as
exhibit “R” in which he was informed about his demotion from the position of Strategic
Executive. He stated further that after receving the letter of demotion he approached
the local Law firm Lentin, Botma & Van der Heever which then wrote a letter to
Council urging it restore him in the position but to no avail. He stated that after that
he then approached his representative of record to refer the matter to arbitration. He
stated that he did not influence Council to appoint him in the position in any manner.
He testified further that he did not know who appointed him hence he was claiming to
be restored in the position of Strategic Executive: Infrastructure and Technical
Services coupled with an order for compensation for the loss of additional income he
would have earned had he not been demoted.
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[36] Under cross-examination he was asked as to whether the same position has
previously been advertised in 2009, and that he was not successful, and he replied in
the affirmative.
He was asked as to whether he had met any of the minimum
requirements stipulated in the advert and he replied in the negative. He was referred
to the Local Authorities Act whereby he was then asked whether he had prior
knowledge of the relevant legislation and he replied that he only got to know it during
the arbitration proceedings.
[37] He confirmed that he was never interviewed by the panel at all before his
appointment in that position. It was put to him that his shortlisting came as a result
of interference from Council members, and he denied this completely.
He however
conceded that he was aware of the fight which erupted during the Management
Commitee meeting of 18 August 2010. He further conceded that he was aware of the
disclaimer which was published in the local newspapers. He confirmed that he also
read the report in the Namibian Newspaper.
A copy of the published disclaimer,
extracted from “Die Republikein” newspaper dated 31 August 2010 was handed in as
exhibit “T”. Another copy of the disclaimer extracted from “The Namibian” newspaper
dated 18 August 2010 was handed in as exhibit “U”.
[38] He was asked as to whether he was aware of the letter addressed to the Chairman
of the Municipal Council of Keetmanshoop by the Permanent Secretary of the line
Ministry dated 20 August 2010 about irregular appointment of staff members and he
replied that he was not aware of such letter. Asked as to whether he was paid acting
allowances in respect of standing in for the then Strategic Executive: Infrastructure
and Technical Services at the time that he was away on study leave, he replied that he
was paid an amount termed as a “honorarium” for the work he performed.
[39] Under re-examination he was asked as to whether infighting within the
Keetmanshoop Municipality was a new thing and he replied that there have always
been tension among Councillors over the years.
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RESPONDENT’S VERSION
[40] PAUL VLEERMUIS – He testified that he is employed as a Chief Executive Officer,
for two (2) years and two months. He testified that prior to that he was an employee of
National Farmers Union for 7 years and RIISE for ten years. He stated that the
Keetmanshoop Municipality is a creature of statute, created in terms of section 3 of
the Local Authorities Act 23 of 1992. He testified that the Municipality is further
governed by the standing Rules made by the Minister responsible for Local Authorities
in Namibia.
[41] He stated further that the Municipality is not allowed to operate outside the
parameters of the enabling Act. He stated that any act performed outside the
parameters of the Act is illegal.
He stated that conventions of meetings of the
Municipality are regulated by Section 14 of the Local Auhorities Act. He also stated
that the Minister responsible for Local Authorities has powers to make Standing Rules
in terms of Section 14 (6) (b) where the Local Authority failed to do so, which are
binding and need to be adhered to.
[42] He testified that he was part of the meeting held on 3 September 2009. He went
on to state that the Management Committee comprises of three members whose duties
are to deliberate on issues after which they recommend to the Council. He testified
further that as a CEO he has a duty to constitute the Council meeting by sending
notices 72 hours prior to the date of meeting. He testified that other than that an
individual Councillor, with 50 per cent of signatures of the other Councillors which
has to go through the CEO can also arrange a meeting at any time.
[43] He stated that the motion of Councilors are dealt with in terms of Standing Rules
14 and 15. He stated further that in terms thereof, a Councilor who wishes to table a
motion has to do so six
(6) days in advance so as to afford other Councillors any
opportunity to object thereto. He added that staff appointments are dealt with in terms
of Section 27 of the Local Authorities Act and are done by the Managment Committee.
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[44] He stated that the wording of Section 27 is mandatory and hence no discretion
can be invoked as the word “shall” is used. He stated that in the unlikely event of a
situation where there is no Management Committee in place, no staff members will be
recruited.
He testified further that the Management Committee appoints all staff
members on the Municipality establishment except the Chief Executive Officer. He
testified that if the Municipal Council appoints anyone, it has acted ultra vires its
powers and hence such appointments will be null and void.
[45] He stated that when he assumed the position of the CEO, he deemed it necessary
to give prominent attention to the Local Economic Development by creating a separate
division hence it was against that background that he asked Mr. Rooi to write a
submission to that effect. He stated that he assured Mr. Rooi his support to head the
division conditionally upon its establishment. He testified that from the outset he
supported the idea of creating a fully –fledged department, which would be
consolidated with another division.
[46] He went on to state that ideally, it was thought that Mr. Rooi would be allowed to
serve on the position while completing his studies but the Council rejected this
proposal and opted for the advertisement of the position instead. He stated that after
the advert was placed, and the shortlisting completed, Mr. Brown, the Deputy Mayor
kept on coming to him to instruct him as to who should be shortlisted. He testified
that initially Mr. Zwartz could not be included in the shortlist in terms of the
requirements set forth in the advert as he did not have a B – degree qualification.
[47] He testified further that in 2009 the same position was advertised and when the
interview panel was about to commence the interview process, Mr. Brown popped in
the interviewing room whereby he demaded that the CEO must include Mr. Zwartz in
the interview shortlist. He added that in the instant case he was not part of the
interview panel, but learned afterwards that the two candidates for the position of
Strategic Excutive: Local Economic Development and Community Services had
obtained equal marks and that the interview panel had recommended a certain Mr.
Engelbrecht.
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[48] He stated further that after the interview, a meeting was held on 3 August 2010,
which could not reach a decision and then adjourned to 11 August 2010. He stressed
further that the Management Committee Meeting was scheduled for 10 O’ clock and
all Councillors attended the meeting, which was abnormal as they are not members of
the Management Committee. He stated that at this meeting all sorts of allegations,
ranging from ethnicity to discrimination surfaced and some people walked out of the
meeting before lunch.
[49] He stated that after lunch, the meeting resumed at 14h15 and two Councillors
traded blows and the meeting again went on break whereby it was later postponed
indefinetly.
He stated that the very same day, the Mayor, Councillor Losper came
back and he informed them that the Council meeting was going to start at around
16h00. He stated that during that meeting which started at 16h00, all issues
pertaining to staff appointments were skipped as one of the applicant, Mr. Josef Rooi,
was present and was one of the person earmarked for appointment.
[50] He stated further that as a result, a meeting was then held in camera at 18h30,
whereby his appointment was then discussed. He testified that in that meeting,
Councillor Coleman objected the issues of appointment being discussed as it was not
Councillors’ prerogative to appoint staff members. He went on to state that when his
objection was not considered, Councillor Coleman walked out of the meeting and
appointments were then made without finalising the salaries.
[51] He stated that it was on that particular day that Mr Rooi was appointed Strategic
Executive: Local Economic and Community Development Services and Mr Zwartz as
Strategic Executive : Infrastructure and Technical Services. He stated further that
Item 40 of Exhibit N (minutes of the extraordinary Council Meeting) was not discussed
on 11 August 2010 and his salary was not fixed on the same day as no salary was
attributed to appointments. He testified that on 12 August 2010, he was called to the
Office of the Councilors where he was asked to issue letters of appointments to Mr.
Rooi and Mr. Zwartz respectively and he urged the Councillors that it was not possible
at that point as certain issues were still to be ironed out such as salaries which were
not fixed.
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[52] He stated that he also managed to convince the Town Mayor not to call a press
conference as to do that would be to wash dirty linen in the open. He went on to say
that on that particular day, some Councillors walked away from the meeting.
He
stated further that on 16 August 2011, the Town Mayor addressed staff members of
the Municipality on intergrity, commitment and so forth.
He added that in the
afternoon of the same day, some Councillors started coming in and the Town Mayor
announced that the extraordinary meeting was now in session and that the CEO must
go get the attendance register.
[53] He testified that he was instructed to do so notwithstanding the fact that he was
calling on the Councillors not to proceed with the meeting as it was illegal. He stated
that the Councillors insisted to proceed with the meeting with three items
on the
agenda namely (1) the appointment of staff members, (2) dissolution of the
management committee and (3) the performance of the CEO.
[54] He referred to the minutes of the meeting of 16 August 2010, marked as exhibit
“W”. He stated that at that meeting the decision pertaining to the salary of Mr Rooi
was discussed. He further testified that he could not understand as to why the salary
was inserted in the minutes of the meeting held on 11 August 2010 as the issue of
salary was never discussed unless the minutes have been worked on later or
manipulated. He stated that in terms of Standing Rule 19, a motion of no-confidence
has to be tabled and the CEO has to stamp it and notify the parties 72 hours before
the dissolution of the Management Committee. He stated that the decision to suspend
the Managment Committee on 16 August 2011 was irregular and hence null and void
for want of compliance with Rule 12 and 19 of the Standing Rules.
[55] He also referred to the letter that he was given by Mr. Blaauw, addressed to Mr.
Rooi, informing him about his appointment, which he was instructed to edit. The copy
of the unedited letter was entered into the record marked as exhibit “X”. He stated that
while about to get the letter printed that day, he received a letter of his suspension,
whereafter he then packed and left. He stated that his suspension lasted from 17
August 2010 to 28 December 2010.
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[56] He stated that upon his return to the Office after his suspension was lifted, he
perused through the minutes of all meetings which took place in his absence, more
specifically the minutes of 18 August 2010. He stated that there was also no regular
meetings held on 18 August 2011 as this was done contrary to the Standing Rules. He
stated that he also found a letter dated 20 August 2010 from the Permanent Secretary
of The Ministry of Regional and Local Government, Housing and Rural Development
which clearly stipultes that Council had no mandate to recruit staff members.
[57] A copy of the letter was entered into the record marked as exhibit “Y”. He stated
further that with his retrun to Office on 28 December 2010, Councillor Titus
submitted three motions, including the appointment of applicants subsequent to the
delivery of notice in writing, with motions attached. The motions and notices were
handed in as exhibit “Z”. He stated that the motions were made in terms of Rule 15,
as there were no objections. The minutes of the ordinary meeting were handed in as
exhibit “AA”. He stated that the minutes were adopted and confirmed as per exhibit
“BB”.
[58] He stated that Councillor Elago noted an objection as per exhibit “CC”. He stated
that the objection so noted was irregular as it was late and also made after the Council
has already made the decision. He stated that subsequently, the appointments of
applicants were revoked. He stated that Council never appointed staff members, but
in 2008, the minutes reflect that Council did appoint on recommendation of the
Management Committee as per minutes marked as exhibit “EE”. He testified further
that he was able to retrieve the minutes of 2007 where Mrs. Bosman was appointed by
the Management Committee.
[59] He testified that the minutes of 11 August 2011 were not confirmed at subsequent
meetings and hence non – confirmation thereof renders the minutes nugatory. He
stated that the appointments of Messrs Rooi and Zwartz were not in compliance with
the Local Authorities Act. He stated that it is unlikely that applicants did not know
that their positions were in jeorpordy as it has been a household debate.
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[60] He stated that if there has been previous illegal acts, this cannot be used as a
justification for the continuation of illegal acts, since a creature of statue cannot
operate outside the parameters of the very Act which created it.
[61] Under cross examination, he was asked as to whether he supported the
recommendation of Mr. Rooi as Strategic Executive to which he answered in the
affirmative. He was asked as to whether he would be happy if Council had approved
Mr. Rooi in the position and he replied that he would have supported him on condition
that he would strive to get qualifications so as to excel not only in the Municipality of
Keetmanshoop but nationally. He further stated that Mr. Rooi was a competent
employee and only the qualification which he does not have which was a stumbling
block.
[62] He was asked as to whether all appointments in the Keetmanshoop Municipality
have been made by the Management Committee and he replied that to his knowledge
all appointments made during his time were done by the Managment Committee. He
also stated that if any appointment was done was an exception, and unfortunetly the
Act does not allow exception. He was asked whether the 32 casual employees were
appointed by the Council or the Managment Committee and he replied that to his
knowledge the Management Committee was involved.
[63] He was also asked as to whether Mr. Blaauw was appointed by the Council or by
the Managment Committee and he replied that he did not know as this happened prior
to his arrival.
He was asked as to whether this was a practice that the Council
appointed the people and not the Management Committee to which he replied in the
affirmative.
[64] He also conceded that there have been prior upheavals that ended in newspapers,
even the previous CEO has once threatened to resign as a result of these infightings.
He stated that in his observation, infightings were created by political differences as
well as deviation from Standing Rules.
16
[65] He was asked as to whether the position of Senior Manager: LECD was ever
created and whether Josef Rooi was formally appointed into that position and he
replied that he was formally informed by way of a letter after which he then replied
that he was not happy with the salary and that is when the position of Senior Manager
LECDS was created which he held when he traveled to Finland.
[66] He denied that the position of Manager LECDS has been abandoned and there
was no resolution to that effect. He was asked as to whether it was a practice at the
Keetmanshoop Council that people in acting capacities be given preferrential
treatment
when it comes to promotions and he replied that he
does not know
whether that was the practice. He conceded that according to the minutes of the
meeting held on 11 August 2010 the issue of salaries was discussed but he personally
still had reservations. He also conceded further that according to the minutes of 16
August 2010, salaries were not discussed.
[67] He was referred to a letter published in “Die Republikein” newspaper and asked
whether this was a formal means of communication to express the disapproval of their
appointments and he replied that it was not a formal way of communication but the
purpose was merely to show that there has been issues surrounding the appointments
of the two applicants. He was further asked as to whether Ms. Cloete who was
promoted together with the applicant was also demoted and he replied that she was
not demoted for reasons unknown to him.
[68] He confirmed that the promotion of Ms Cloete was never anulled. He also further
conceded that from the look of things it appears that the appointment of Ms Bosman
was done by the Council and not by the Managment Committee. He was also referred
to Rule 17 of the Standing Rules and asked whether the resolution to promote the
applicants was done within 6 months and hence the motion to rescind that motion
was not valid in terms of Rule 17 of the Standing Rules, to which he conceded.
17
CLOSING ARGUMENTS
APPLICANTS CLOSING ARGUMENTS
[69] Mr. Daniels, appearing on behalf of both applicants, submitted that the applicants
were lawfully promoted / appointed in their respective positions on 17 August 2011.
He contended that the Local Authorities Act, in terms of section 27 thereof, provides
that all appointments, other than that of the Chief Executive Officer, in a local
authority should be done by the Management Committee of the Council. This was
however not the practice at the respondent. He argued that the applicants testified
that all appointments were made by the respondent’s Council on recommendation of
the Management Committee.
[70] He contended further that although this was heavily disputed by the CEO and Mr.
Probart, conclusive evidence in the form of Council Minutes were provided in support
of the contention that Council indeed made all the appointments. He submitted
further that evidence was led that in addition to the applicants, Council has appointed
42 casual employees in 2009, and a certain Ms. Annemarie Bosman (NATIS
Supervisor); Mr. Lukas Apollus (Traffic Officer); Mr. Berty Reynecke (SE: FED); Mr.
Andries Blaauw (SE: CAHR) and Ms. Milly Cloete (Superintendent) between 2007 and
2010 as per Exhibits “N”, “EE” and “FF” respectively.
[71] He argued that despite Mr. Probart’s promises that he would call witnesses to
prove that appointments were made by the Management Committee and that the
appointments made by Council was an exception to the rule, no such testimony ever
materialized. He contended that even Mr. Vleermuis, despite earlier strong denials,
admitted under cross-examination that Council indeed appointed some staff members.
[72] Mr. Daniels referred to an extract from Mr. Vleermuis’s testimony as follows:
“Mr Daniels: So would you then say that the practice in Council or the practice at the
Municipality of Keetmanshoop was that the Council made appointments?
Mr Vleermuis: Yes, by the Council as reflected by the Minutes, yes.
Mr Daniels: Yes, and it is not just an exception that Mr. Apollus was appointed but it was
a practice that the Council appointed people.
Mr Vleermuis: Yes, as the Minutes reflect.”
18
[73] He submitted further that although Mr. Vleermuis and Mr. Probart insisted that
the authority of the Management Committee in terms of section 27 is peremptory, it is
clear that the Management Committee may delegate any function in terms of the Local
Authorities Act as can be seen from the provisions of section 31(3), which reads:
“31(3) A management committee may delegate or assign, in writing and with prior
approval of the and on conditions determined by the municipal councilor town council
concerned
(a) Any power conferred on it by the Act; or
(b) Any power which has been delegated to it under subsection (1) to any member of the
municipal or town council, to the chief executive officer or any staff of the municipal or
town council concerned or to any two or more persons conjointly.”
[74] It was further Mr. Daniels’s submission that the Management Committee
exercises all its functions under the authority of the Council of the respondent. He
made reference to the case of Van der Heever v Municipal Council of Walvis Bay (NLLP)
2002 (2) 306 NLLP
where the Labour Court held that since all members of the
Management Committee are members of the Municipal Council by virtue of section 26
of the Local Authorities Act, it is not necessary for the Applicant to complain to the
Management Committee before resorting to the Municipal Council as the lesser body
reports to the ultimate authority, the Council, on its duties, functions and exercise of
its powers.
[75] He contended further that Mr. Probart tried in vain to show that a certain
Councilor Brown tried to influence the interview panels to shortlist the applicants. He
argued that it is however clear from the testimony of the applicants that Mr. Brown
did not act under their influence and Mr. Vleermuis testified that it was the practice of
the respondent that persons serving in acting positions are automatically shortlisted
for interviews. He argued that there was also no evidence that the applicants
unlawfully influenced the Council to appoint them to their promotional positions. He
submitted that in fact the statement of Councilor, Fiina Elago shows that the
appointments of the applicants were correct in terms of the respondent’s practice and
procedures as per Exhibit “CC”.
19
[76] He contended further that Mr. Vleermuis also admitted under cross-examination
that the “Motion” of Councilor Titus of 05 January 2011, tabled at the meeting of 25
January 2011, purporting to rescind the respondent’s resolution of 11 August 2011
was invalid and therefore of no force and effect in terms of Rule 17 of the Standing
Rules and Orders.
[77] He submitted further that, as the un-contradicted evidence show, the respondent
Council made appointments on recommendation of the Management Committee and
that the applicants were appointed in their promotional positions by the Council. It
was his further submission that the respondent is estopped from denying the
lawfulness of the appointments of the applicants.
[78] He contended that the principle of estoppel has been held to be applicable in
labour law.
He relied on the decision of the Appellate Division of South Africa in
Chamber of Mines of SA v NUM 1987 (1) SA 668 (A) where it was held that there was no
reason for concluding that the principle of estoppel, as it is based on considerations of
elementary fairness, should be regarded as a trespasser in the field of labour law.
[79] He further cited the decision in Maluti Transport Corporation Ltd v MRTAWU &
Others (1999) 9 BLLR 887 (LAC), where the South African Labour Appeal Court cited
with approval the decision in the Chamber of Mines case and confirmed that the
principle of estoppel is based on elementary principles of fairness.
[80] He contended that a person who has not authorized another to conclude a juristic
act on his or her behalf may in appropriate circumstances be estopped from denying
that he or she had authorized the other so to act. He argued that the effect of a
successful reliance on estoppel is that the person who has been estopped is liable as
though he or she had authorized the other to act. It was further Mr. Daniel’s
submission that in the present matter the applicants acted on letters from Council,
accepted their appointments and served in these positions without any performance or
other work related problem for a period of approximately six months until their unceremonial and unlawful demotion on 01 February 2011.
20
[81] He contended that the applicants relied on previous practice of Council that all
appointments were made by Council. He argued that the applicants testified that they
are already suffering hardships due to their unlawful and unilateral demotions and
are severely prejudiced by their demotions.
[82] It was further Mr. Daniel’s contention that the respondent’s representative of
record, Mr. Probart tried very hard to show that the applicants should have been
aware that there was something wrong (“fishy”) with their appointments in August
2010. He contended that in this regard, Mr. Probart referred to certain newspaper
clippings and an alleged brawl in the Council meeting. He submitted that the
applicants testified that it was never communicated to them that the respondent had a
problem with their appointments.
[83] He argued that in fact there were constant or regular in-fighting in the Council of
the respondent that sometimes spilled into the media as per Mr. Vleermuis’s
testimony. He quoted from the testimony of Mr. Vleermuis, verbatim as follows;
“Mr Daniels: And the appointment of the applicants was not the only contentious
issue that led to strive or in-fighting within the Council?
Mr Vleermuis: No it was not the only issue.
Mr Daniels: There were other issues?
Mr Vleermuis: Those were not the only issues.
Mr Daniels: Even your suspension as CEO was also a contentious issue?
Mr Vleermuis: Thank you for reminding me.”
[84] He submitted that according to Mr. Vleermuis, newspaper articles are not the
formal means of communication within the respondent. He contended that the so
called “disclaimer” anyway appeared in the newspapers on 30 August 2010 and for six
months, until 1 February 2011 nothing was communicated to the applicants
concerning their appointments. He argued that it therefore came as a big surprise to
them to find letters of demotion, containing wild allegations, while no performance
assessments or disciplinary hearings were conducted.
21
[85] He contended that the concept of unfair labour practice has been introduced in
the Namibian labour law by Chapter 5 (sections 48-51) of the Labour Act of 2007. He
argued that in terms of these sections, any unilateral alteration of a term or condition
of employment by an employer is regarded as an unlawful practice. To this end, he
submitted that a demotion is an unfair labour practice if it is done without the
consent of an employee, because it changes his conditions of employment.
[86] He argued that a demotion generally occurs if the change to the employee’s terms
or conditions of employment is such that they result in a material reduction of the
employee’s remuneration, responsibility or status. However, demotion can also mean a
reduction of dignity, importance, responsibility, power or status even if salary and
benefits are retained. (Ndlela v SA Stevedores Ltd (1999) 13 ILJ 663 (IC); A-B v SA
Breweries Ltd (2001) 22 ILJ 495 (CCMA) and Department of Justice v Wepenar (2001)
22 ILJ 2082 (BCA))
[87] He further argued that the respondent has at no stage denied that the contents
and effect of the letters of 01 February 2011 amounted to the demotion of the
applicants and a reduction in their salaries and benefits. He submitted that in fact the
first applicant was demoted to the non-existing position of Manager: LEDCS. He
further contended that Mr. Vleermuis admitted that he had no problems with the
performance or conduct of the applicants in their promotional positions.
[88] He further submitted that applicants have shown on the balance of probabilities
that their demotion on 01 February 2011 amounted to a unilateral change in their
conditions of employment and therefore an unfair labour practice. He respectfully
submitted that the respondent has not rebutted the evidence of the applicants that
their demotions amounted to an unfair labour practice. He therefore respectfully
submitted that the applicants are entitled to be restored in the position they held prior
to 01 February 2011 and that they be compensated for their loss of income. He
submitted that the applicants have also prayed in their particulars of claim that the
actions of the respondent be declared an unfair labour practice.
22
[89] He submitted that the applicants are entitled to a costs order in terms of section
86 (16), because the respondent has vexatiously persisted in defending this matter,
contrary to the advise by two legal practitioners that its action was unlawful in terms
of section 50 and 51 of the Labour Act.
RESPONDENT’S CLOSING ARGUMENTS
[90] Mr. Probart, argued on behalf of the respondent that the Chief Executive Officer of
the Respondent, Mr Paul Vleermuis, established in his evidence in chief, which was
also conceded by both Applicants, that: (1) the Respondent was properly constituted
as a Local authority in terms of the Local Authorities Act No. 23 of 1992 (“The Local
Authorities Act”), (2) that the Respondent was further subject to the Standing Rules
and personnel rules approved by the Respondent’s Municipal Council. He contended
that that the applicants also conceded that Respondent was a creature of statute and
may not act outside the parameters of the Act and if it did so such actions would be
ultra vires.
[91] He submitted that Section 27(1) (b)(i) of the said Local Authorities Act peremptorily
states that:
(b) the power to appoint other staff members of the local authority Council in
posts on the fixed establishment of the local authority Council, as approved by
it, and as may be considered necessary for the performance of the work
incidental to the functions of the local authority Council shall (emphasis
added) vest –
(ii) in the case of a Municipal Council or Town Council in the Management
Committee.
[92] He also contended that the Management Committee was irregularly disbanded by
Council on 16th August 2011. He added that in the event of there being no
Management Committee in existence all appointments (other than that of the Chief
Executive Officer) are to be held in abeyance until such time as a Management
Committee had again been established.
23
[93] He submitted that the appointment of both Applicants were made by the
Municipal Council of Respondent and not the Management Committee as prescribed
by Section 27(1) (b)(ii) of the Local Authorities Act. He submitted that the Applicants
countered this evidence by adducing evidence that the Keetmanshoop Municipal
Council had in fact made various prior appointments of staff members and that some
of these employees were still in the employ of the Respondent and that these
appointments still stand and were not “annulled” by Council and that their
appointments were not made in insolation but that Respondent had in fact made other
appointments in contravention of Section 27 of the Local Authorities Act.
[94] He argued that further evidence was adduced that the Mayor’s motions to annul
the promotions and concomitant increased benefits were irregular as it did not
conform to Rule 17 of the Standing Rules and hence the Town Council’s decision in
correcting the promotions were in fact invalid. He submitted that given the relief
sought by both Applicants and the facts and contentions set out in the Particulars of
Complaint and the evidence adduced before the above Honourable Tribunal the matter
has resolved itself into the determination of the following issues:
1. Whether the appointments of Applicants in contravention of Section 27 of the Local
Authorities Act were invalid, ultra vires and therefore void.
2. Whether the conduct of the Respondent Council in making a number of prior
appointments established a pattern or mode of conduct which would bind Council
to the appointments made and therefore render the said appointments legal and
that the Respondent is therefore prevented or estopped from denying the illegality
of the said appointments of the Applicants as they continued to hold their
respective positions without sanction until 1st February 2011.
[95] As regards the law, he looked at the doctrine of ultra vires appointment, where he
cited Rose Innes: Judical Review of Administration Tribunals in South Africa at page 91
where it is stated as follows:
“Administration is thus the exercise of power which is conferred upon specifically
designated authorities by statute, and which, however great the power which is
conferred may be, and however wide the discretion which may be exercised, is a
24
power limited by statute. The Administration can only do what it has statutory
authority to do, and must justify all its acts by pointing to a statute.
If public
authority exceeds its powers it acts unlawfully”.
“… an ultra vires act or proceedings is null and void ab initio. Consequently the
act or an order made pursuant to such proceedings is unenforceable and nobody is
bound to obey it, but may ignore with impunity”.
[96] He made further reference to the case of Trust Bank of Africa Ltd v Eksteen
1964(1) SA 74 (A) where Harcourt J stated the following (at 82H):
“Where the Legislature has, upon general principles of public policy, forbidden
the doing of an act by or imposed the duty upon a public body or individual or
has declared certain acts to be null and void or of no force and effect, the
object of the Legislature cannot be permitted to be stultified by the private
conventions of the parties to a particular action or by a mistake, be it negligent
or otherwise, of the party on whom the statutory duty rests or against whom a
statutory prohibition operates or of the parties who purported to perform the
acts made null and void or of no force and effect.”
[97] He went on to quote the learned Judge at 81(G) where he stated further that acts
in contravention of the legislation are:
“Invalid, null and void ab initio and are not to be given any force or effect
since they are in defiance of such provisions which were enacted in the public
interest and as a matter of public policy”.
[98] The learned representative made further reference to the case of Mgoqi v City of
Cape Town & Another; In Re: City of Cape Town v Mgoqi & Another (2006) 9 BLLR
873(C) where the Honourable Court dealt with a matter with very similar facts to the
matter in casu. The facts of which he summarized as follows:
(i) A few days before Mgoqi, Cape Town’s Municipal Manager, fixed term
contract was about to expire, the Executive Mayor extended his contract
for another year;
(ii) Elections were held shortly thereafter and a new Mayor was appointed;
(iii) The question to be decided by the Court was whether Mgoqi’s
25
appointment was valid as the relevant legislation, the Municipal
Systems Act No. 32 of 2000, peremptorily states that the power to
appoint a Municipal Manager vests exclusively in the Council and may
not be delegated;
(iv)
It was trite that the former Mayor therefore did not have the legal power
to amend (extend) Mgoqi’s contract of employment;
(v) The Honourable Court held that the Mayor had exceeded her powers by
purporting to amend Mgoqi’s contract and her decision was ultra vires;
(vi) The extension of Mgoqi’s contract was accordingly invalid.
[99] He argued that by applying the above principles to the facts serving before this
Honourable Tribunal, it is abundantly clear that the Council of the Respondent had no
authority to appoint Applicants to their respective new posts on 17 th August 2010 and
that such act was ultra vires, void ab initio and invalid.
[100] As regarding the doctrine of estoppel as a defence to the relief sought, he
contended that the effect of the doctrine of estoppel is that a party will be prevented or
estopped from denying liability if the third party can prove and specifically in the
matter in casu, that:
1. The Respondent made a representation by words or conduct that the Council had
the necessary authority to represent the Respondent in making the appointments
(Universal Stores v OK Bazaars (1929) LTD, 1973(4) SA 747 (A) at 761).
2. That the Applicants acted upon the correctness of the facts as represented
(Standard Bank of SA LTD v Stama (PTY) Ltd 1975(1) SA 730 (A) at 743)
3. That Applicants so acted to their detriment (Peri Urban Areas Health Board v Brest
N.O. 1958 (3) SA 783(T) at 790, Aulotec LTD v Du Plessis 1965(2) SA 243).
4. That the person (Council) who made the representation could bind the Respondent
by means of the representation CJ Mathebula t/a Nxolwane Bottle Store v
University of the North (1998) 3 All SA 477(T) Further decisions setting out the
grounds for estoppel are: Aris Enterprises (Finance) (Pty) Ltd v Protea Assurance
Co Ltd 1981(3) SA 274(A) South African Broadcasting Corporation v Coop and
Others 2006(2) SA 217 (SCA)
26
[101] He submitted that both Applicants failed the 2nd leg of the test adumbrated
above as they were at all material times aware that they were both disqualified from
applying for the respective positions as they did not meet the minimum academic
requirements of a B. Degree in their respective fields and they therefore knew, from
the very outset, that their applications were fatally defective. He submitted further that
their elevation to the new posts was contentious before and after 11 th August 2010
and that on the 11th August 2010 they were aware of the fight that broke out in
Council’s chambers resulting from, inter alia, the discussions relating to their
appointments;
[102] In addition, it was further his contention that the corridors of the Municipality of
Keetmanshoop were abuzz with the occurrences of 11th August 2010 and that the
print media contained various reports and a disclaimer by the Management Committee
immediately after their appointments. He also argued further that the Management
Committee had been disbanded on 16th August 2010 and that only the Management
Committee was in law entitled to make the said appointments.
[103] He argued that if however it should be established by the above Honourable
Tribunal that both Applicants were able to comply with the requirements of estoppel
they would still be confronted by an insurmountable obstacle in the form of the
principle that estoppel will not be upheld if its effect would be to render enforceable an
illegal or invalid act (Trust Bank van Afrika Bpk v Eksteen 1964(3) SA 402 AD @ 411
H-412B, Strydom v Die Land + Landbou Bank van Suid Afrika 1972(1) SA 801 AD at
815 B – 816 B Eastern Cape Provincial Government and Others v Contract props 25
(Pty) Ltd 2001(4) SA 142 (SCA) paragraphs (11) – (12) at 148 E – H.
[104] He referred to Prof Fourie in LAWSA, ESTOPPEL BY REPRESENTATION, Vol 9
(First Re-issue at P 283 paragraph 449 & 468) where the learned author formulated
the following further general principles with regard to estoppel:
“Estoppel is not allowed to operate in circumstances where it would have a result
which is not permitted by law. A defence of estoppel will therefore not be upheld if
its effect would be to render enforceable that what the law, be it the common low or
statute law, has in the public interest declared to be illegal or invalid”.
27
[105] He referred to the decision in the Eastern Cape Provincial Government & Others v
Contract props 25 (Pty) Ltd which dealt with a lease agreement concluded by the
Department of Education as Lessee and Contract props 25 as Lessor in contravention
of Section 4(1) of the Provincial Tender Board Act 2 of 1994 which provides, inter alia,
that only the Tender Board may conclude lease agreements. The Appeal Court held as
follows at page 148J & 149A:
“The fact that Respondent was misled into believing that the department had the
power to conclude the agreement is regrettable and its indignation at the stand now
taken
by
the
department
is
understandable.
Unfortunately for
it,
those
considerations cannot alter the fact that leases were concluded which were ultra
vires the powers of the department and they cannot be allowed to stand as if they
were intra vires”
[106] He contended further that the well-established legal principles relating to the
language of the Local Authorities Act, its nature and scope, the mischief it seeks to
prevent etc., are all relevant considerations but are however overwhelmed and
rendered nugatory in the light of the above case law, the quoted literature and the preemptory language of Section 27 of the Local Authorities Act. He submitted that
estoppel, in any form, can play no role whatsoever as estoppel cannot be used to make
legal what otherwise would be illegal. It was thus his final submission that that both
applicants must fail in their claims for reinstatement of their positions and financial
benefits and their claims should therefore be dismissed.
ANALYSIS OF EVIDENCE AND ARGUMUNTS
[107] In the preceding pages, I tried, to the best of my abilities to summarize the
respective evidence and arguments of both parties herein as put before me during the
arbitration hearing which took place on the date and at a place hereinbefore
mentioned. Therefore, in line with the issues for determination, it is these evidence
and arguments which I intend to weigh herebelow in an effort to decide the issues for
determination.
28
[108] While all efforts have been made to attach weight to every little detail placed
before me, in my analysis below I shall confine myself only to the salient facts and
arguments of the parties in such a manner that I consider so for expediency and
convenience purposes.
[109] In a nutshell, the case I have to decide centres on the promotions of the two
applicants into the positions of Strategic Executives in August 2010 respectively. It is
common cause that these promotions were made contrary to the provisions of the
Local Authority Act which provides that appointments on the establishment of the
municipal or town council shall be made by the Management Committee and not by
the Council.
[110] It is also common cause that the said Local Authorities Act is the enabling piece
of legislation in terms whereof the respondent municipality was created. It is further
common cause that on 1 February 2011, both applicants received letters which have
the effects of revoking their appointments in the above mentioned positions and after
unsuccessful attempts to resolve the matter internally, they deemed it necessary to
refer their respective cases to the Labour Commissioner as provided for in the Labour
Act. Essentially, the arguments of the applicants are that their terms and conditions of
employment have been unilaterally altered and that their demotion was tantamount to
unfair labour practice.
[111] The above set of facts precipitates the following issues for consideration: (1)
whether applicants’ promotions into their respective roles were valid and enforceable,
(2) whether applicants’ subsequent demotions were unlawful and hence a unilateral
alteration of terms and condition by the employer and (3) whether the respondent’s
conduct in revoking applicants’ promotions amounts to unfair labour practice that the
doctrine of estoppel can be invoked in the circumstances.
[112] As a result therefore, it is my intention to proceed analyzing the three issues in
seriatim (i.e. on a one by one basis) with a view to determining whether applicants are
entitled to the relief sought.
29
The legality of the promotions
[113] It is evident from the record that applicants applied for positions following an
advertisement of the positions in print media and were duly notified of their
appointments as per exhibits F. and P. respectively. In the case of Mr. Zwartz, it was
testified that he had not been subjected to an interview as he was the sole candidate
for the position. The said promotions were made by the respondent Council contrary
to the provisions of Section 27 (1) (b) of the Local Authority Act, Act 23 of 1992. The
relevant portion of the said Act reads as follows:
“27
Appointment of town clerks of municipal councils and town councils, village
secretaries of village councils and other staff members of local authority councils
(1) Subject to the provisions of this section and of any regulations made under section 94A(1) (d)
(a)
a municipal council and a town council shall appoint, on the recommendation of its
management committee and after consultation with the Minister, a person as the town
clerk of such municipal council or town council, as the case may be, and a village council
shall so appoint a person as the village secretary of such village council, who shall in
each case be the chief executive officer of the local authority council in question and who
shall, subject to the control and directions of the local authority council, be responsible for
the carrying out of the decisions of the local authority council and for the administration of
the affairs of the local authority council;
(b)
the power to appoint other staff members of the local authority council in posts on
the fixed establishment of the local authority council, as approved by it, and as may be
considered necessary for the performance of the work incidental to the functions of the
local authority council, shall vest(i)
in the case of a municipal council or town council, in the management committee;
(ii)
in the case of a village council, in the village council;
[Para (b) substituted by sec 18(1) (a) of Act 24 of 2000.] [my underlining]”
30
[114] Further, section 18 (a) of the Local Authorities Amendment Act, Act 24 of 2000,
which substituted the Section 27 (1) (b) (i) reads as follows:
“18 (1)
“(b) the power to appoint other staff members of the local authority council in posts on the
fixed establishment of the local authority council, as approved by it, and as may be
considered necessary for the performance of the work incidental to the functions of the
local authority council, shall vest –
(i)
in the case of a municipal council or town council, in the management committee;
(ii)
in the case of a village council, in the village council.”
[115] From the foregoing provisions of the Local Authorities Act, as amended, it is evidently
clear that the duty to appoint staff members on the establishment in the case of a Municipal
Council, like the respondent in this regard is a prerogative of the Management Committee and
not the Municipal Council. The intention of the Legislature is clear as can be clearly discerned
from both section 27 (1) (b) (i) and (ii) of the principal Act and section 18 (1) (b) (i) and (ii) of the
amendments thereto. From these provisions, it can be gleaned that the only Council which is
vested with powers to appoint staff members is a Village Council and not a Municipal or Town
Council.
[116] Moreover, the provision contains words which make this obligatory or mandatory. In this
regard, I am in concurrence with the arguments of the respondent’s representative that the
word “shall” used in the section in question is peremptory in its formulation, thereby making it
mandatory and not discretionary a requirement to have all permanent appointments on the
establishment of a municipal or town council done by the Management Committee. It is my
view that had parliament intended that the municipal council or town council could appoint
staff members on the establishment, it would have done so explicitly as it had done with village
council, in the case of a village council, or at least use the words such as “may” which is
permissive and denoting discretion. The long and short of what I have said above is that if the
Municipal Council or Town Council appoints anyone on its fixed establishment, it will be doing
so contrary to the enabling Act and hence such action will be ultra vires its powers.
[117] A creature of statute, like the respondent Municipal Council, derives its powers from the
very statute creating it and hence it can only perform acts which fall within the four corners of
the very statute which creates it. Consequently, if it traverses the powers conferred on it, no
protection can be expected from the same law which is its life blood.
31
[118] In my view therefore, the fact that applicants were promoted by the Municipal Council as
opposed to the Management Council clearly indicates that the appointments were fatally
defective from the word go and hence a contravention of the Local Authorities Act.
The legality of demotions and unfair labour practice
[119] Having delved on whether applicants’ appointments were lawful, I now turn to
the next inquiry pertaining to the legality of their demotions. The question that needs
to be answered here is whether an employee who is appointed unlawfully can be
demoted at any time after having served in that position for a certain period of time
and after having adjusted to a new lifestyle after his or her promotion. Demotion, as
defined by J V Du Plessiss and M A Fourie in their book entitled A Practical Guide to
Labour Law 6th Edition at 305, is the reverse of promotion, meaning that an employee
is moved to a lower rank or level. The learned authors go on to state that the unfair
conduct of an employer relating to demotion is an unfair labour practice.
[120] Unfair conduct implies a failure to meet an objective standard and may be taken
to include arbitrary, capricious or inconsistent conduct, whether negligent or
intended. The learned authors point out further that demotion as a disciplinary
measure is allowed only in circumstances where a dismissal is justified but, because
of mitigating factors, the employer decides not to dismiss the employee. It is this
evidently clear that our law has not yet authoritatively decided a question as to
whether unlawful promotion can be reversed through demotion. However, one needs
to be objective if regard is to be had to the peculiar circumstances of each case. The
instant case is unique in its own way, more so when due consideration is placed on
the manner in which the affairs of the respondent Municipal Council are run.
[121] From the evidence adduced, it is apparent that the applicants’ irregular
promotions were not an isolated incident, as there was uncontested evidence on
record that certain staff members were also promoted by the Municipal Council and
none of them were demoted apart from the applicants and the lady who resigned upon
receiving the letter of demotion. The incumbent CEO conceded on record that a good
number of appointments on the establishment of the Municipality of Keetmanshoop
were made by the Council.
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[122] These appointments, includes that of a certain Ms. Cloete who was promoted
alongside the applicants but never received any letter of demotion when the applicants
got their unceremonious demotions on the 1st February 2011. To make matters even
worse, no evidence was placed on record by the respondent to rebut claims that a
certain Ms. Annerie Bosman, Mr. Lukas Appolus, Mr. Berty Reynecke, Mr. and
Andries Blaauw were also appointed by the Council instead of the Management
Committee.
[123] From the above observation, any reasonable person will be inclined to believe
that the illegal appointment of staff members at the respondent Municipality has
always been an order of the day until the Permanent Secretary of line Ministry wrote
them a letter dated 20 August 2010 in which he stressed that it was the Management
Committee’s prerogative to appoint staff members and not the Council. If one is to
read that letter carefully, the Permanent Secretary did not per se order the Council to
demote the employees who were so wrongfully appointed, but instead directed that the
matter be referred to the Management Committee to finalize the appointments.
[124] Due to its importance here and the influence this letter may have in my final
decision, I wish to quote it here verbatim:
“APPOINTMENT OF STAFF MEMBERS IN VACANT POSITIONS: KEETMANSHOOP
MUNICIPALITY
It has come to the attention of the Ministry that there is tension amongst your Council
Members as a direct result of appointments of staff members by your Council.
I want to bring to the attention of your council that in terms of Section 27 (b) (i) of the Local
Authorities Act, 1992 (Act No. 23 of 1992) as amended, the appointment of staff members
on the staff establishment of the Council other than the Chief Executive Officer is the
prerogative of the Management Committee.
In other words this is the Management Committee legal mandate and not a delegated
function.
This effectively means that the decision of the Management Committee with regard to
appointments of the category of staff is final, and is not subject to Council’s approval.
33
The involvement of the council in matters of staff appointments is illegal and without
force.
You are kindly directed to refer this matter to the Management Committee and allow it to
finalize the appointments accordingly.” [my underlining]
[125]
The
above
quoted
letter
clearly
manifests
the
Permanent
Secretary’s
disenchantment with the manner in which the affairs of the respondent’s municipality
were run upon learning that appointments of certain staff members to the
establishment of the respondent Municipality were done by the Council. Although the
said letter did not per se specify as to whom these staff members were, it is at least
explicit insofar as it is referring to tension which was brewing among Council Members
as a result of appointments of staff members by the Council contrary to the provisions
of the enabling statute.
[126] A reasonable inference which can be drawn from the letter of the Permanent
Secretary is that the line Ministry was not aware all along that appointments to the
establishment of the respondent municipality have been made by the Council, or at
least aware that the Municipality was not run as per the provisions of the enabling
legislation. Therefore it is my view that only after the infightings arose did the line
Ministry become aware of these sorts of irregularities.
[127] In my view, it is this letter, amongst others which prompted the Council to write
the letter to both applicants declaring their appointments null and void. What is
perplexing is the fact that the same Council, which has no power to appoint in terms
of the Act, is the one which declared the applicants’ appointments null and void
contrary to the directive by the Permanent Secretary that the matter be referred to the
Management Committee to finalize the appointments. To demonstrate this rather
perturbing feature of the events characterizing applicants’ demotions I wish to quote
from one of the letters addressed to applicants on 1st February 2011:
“Mr. Zwartz we herewith regrettably wish to inform you that Council has declared your
appointment as Strategic Executive, Department of Infrastructure & Technical Services
34
null and void and unenforceable with immediate effect, meaning effectively you will retain
and remain in your previous position as a Building Inspector.” [my underlining]
[128] From the above paragraph, it is clear that the Municipal Council of the
respondent has been in a habitual practice of sidelining not only the Local Authorities
Act, but directives given to it by persons in a position to regulate or cause it to comply
with the provisions of the Local Authorities Act. Consequently, it is my sincere belief
that unfair labour practice has been committed time and again, and at any rate there
have been inconsistent treatment of the employees in the respondent’s municipality.
[129] While I am in agreement with the arguments advanced by respondent’s
representative of record that applicants’ promotions were ultra vires, I am equally at
pain to point out that had the respondent been consistent in its practice, a situation
like the instant one could not have occurred. Consequently, it is my view that the
situation was precipitated by the respondent’s ignorance in complying with the letter
and spirit of the Local Authorities Act. The inference I made above can be
substantiated with an extract from the letter addressed to Mr. Rooi which reads as
follows:
“…..Council has appointed you in ignorance of the powers of Management Committee and
contrary to the statutory procedural requirements for such appointments.” [My
underlining]
[130] The crucial question here is, if the Council has been ignorant of the powers of
the Management Committee, can its ignorance be imputed to the applicants? The
answer to this will certainly be negative. A striking feature of this case is that the
respondent has not shown consistency in remedying the wrong after noticing that it
has acted ultra vires its powers. In Edgars Stores (Namibia) Limited v Laurika Olivier,
unreported judgment of the High Court of Namiba, Parker J held that in labour law,
fairness lies at the root of its rules and practice.
[131] The Learned judge, considering different punishment meted out against an
employee who has committed a conduct similar to that of other employees who got a
lesser punishment, the learned judge stated as follows:
35
“In Labour Law, fairness is at the root of its rules and practice. It cannot be seriously
argued on any pan of scale that the sort of conduct of some employees of the appellant
that abounds the present record and which appellant’s disciplinary hearings deal with on
different occasions in the recent past is so different in nature from the 1 st respondent’s
conduct that the participants in conduct in the past should be treated differently from the
1st respondent.”
[132] In the present case, the respondent decided only to demote applicants, while
knowing well that there were other persons on the respondent’s establishment who
have been appointed or promoted in similar fashion. While I am cognizant that the
respondent’s conduct in promoting applicants was not in conformity with the enabling
legislation, I hold that the best the respondent could do in the circumstances was to at
least come up with a resolution which has the effect of condoning all its previous
irregular conducts and at the same time deciding that all future appointments or
promotions will be done according to the letter and spirit of the Local Authorities Act.
[133] This in my view, would be in the interest of maintaining harmonious labour
relations within the Council. It is therefore my view that the respondent Council has
committed unfair labour practice in that it only singled out the two applicants among
the many people whom it promoted contrary to the provisions of the Local Authorities
Act. Had it declared all previous unlawful appointments null and void, one would at
least say somehow fairness did prevail, but in the instant case, respondent failed to
give adequate reasons as to why only the two applicants were affected.
The applicability of estoppel to this case
[134] It was vigorously contested by applicants’ representative that the respondent
must be estopped from denying that the applicants’ promotions were lawful. Mr.
Daniels submission was that the applicants acted on letters from Council, accepted
their appointments and served in these positions without any performance problem.
36
[135] Mr. Probart on the other hand submitted a host of decided cases dealing with
estoppel, and I am indebted to him for his industry in this regard. Among these cases,
the case of Mgoqi drew a special interest to me as it dealt with more or less a similar
situation. In the Mgoqi’s case, the Executive Mayor extended the fixed contract of the
town’s manager shortly before it expired for five years. Few days elections were held
and the mayor was replaced. The appointment of the town’s manager was done
contrary to the relevant legislation which provides that the power to appoint vests
exclusively in the Council and may not be delegated. In deciding the issue before it,
the court held that the Mayor had exceeded her powers by purporting to amend
Mgoqi’s contract and her decision was ultra vires.
[136] Although the facts appear to be analogous to the instant case in that the case
deals with ultra vires action, the Mgoqi’s case is somewhat different in the sense that
the performance of ultra vires actions has not been a practice in the Cape Town’s
Municipality. Here one is dealing with a case where the Municipality has been in
habitual violations of the enabling statute as conceded by the Chief Executive Officer
that there were several other employees on the respondent’s establishment who have
been appointed by the Council. Consequently therefore, it is my view that applicants
also believe that they were entitled to such appointments since this is the way things
have always been done.
[137] In my view therefore, even if I were to uphold the demotions of the applicants
herein, it will serve no purpose as there are still other employees who have been
unlawfully appointed but since their competence is not in question, it will be
destructive to order that all previous unlawful appointments should be reversed as
this has a potential to bring labour unrest within the respondent Council.
[138] I wish to draw guidance from Professor Yvonne Burns, in her book entitled
“Administrative Law Under 1996 Constitution 3rd Edition at 92 where she wrote as
follows on the doctrine of estoppel:
“It is a rule of common law that estoppel cannot be raised to prevent or excuse the
performance of a statutory duty or discretion. It cannot be denied, however, that in some
instances it could be in the public interest to allow public authorities to be estopped. For
37
example, the court upheld a plea of estoppel when a committee attempted to repudiate a
sale purely on the basis of non-compliance with internal formalities which the committee
itself should properly, have observed (see Roodepoort Settlement Committee v Retief 1951
(1) SA 73 (0).”
[139] Therefore, my understanding of the above is that at common law courts have
been loathe at permitting the plea of estoppel where to do so would result in the
violation of a statutory provision. However, with the coming into operation of the
Constitution such as ours that contains a Bill of Rights, one need not look at the plea
of estoppel in its rigid form, the doctrine must be developed in accordance with the
spirit, purport and object of the Bill of Rights (see Eastern Metropolitan Substructure v
Peter Klein Investments (Pty) Ltd 2001 (4) SA 470 (D) 478.
[140] The proposition of the respondent’s representative is that estoppel be applied
strictly in its rigid form as provided for under common law. In my view, as I have
stated above, this will not work as it will in turn result in the condonation of the
respondent’s previous illegal acts which in itself is also a furtherance of the violations
of the enabling statute. The solution to the problem, in my view, is to balance the
scales by restoring the two applicants into their illegally acquired positions, and
ensure that in future there shall be no further violations of the relevant statute
through tight compliance procedures.
[141] The rationale behind the above proposition is that by restoring applicants in
their positions no healed wounds will be opened through intimidation of other
employees who have been appointed or promoted unlawfully by the Council and it will
further
assist
in
harmonizing
the
already
strained
relationship
among
the
respondent’s employees.
Award
[142] Having come to the above conclusions, I now wish to order as follows:
1. That the respondent’s conduct in demoting applicants from the positions which
they held before the 1st February 2011 is tantamount to unfair labour practice
38
as defined in Chapter 5 of the Labour Act as similar treatment has not been
extended to other unlawful promotions on its establishment.
2.
That respondent is ordered to restore or reinstate applicants in the positions
held before the 1st February 2011, with effect from the 1st November 2011.
3. The respondent is further ordered to pay applicants the difference between the
salaries earned subsequent to their demotions and the salaries they would have
earned had they not been unfairly demoted.
4. Taking into account the importance and complexity of the matter, as well as the
relationship between the parties, I do not consider a costs order to be justified
and as a result, no order as to costs is made.
[143] This award is final and binding on both parties hereto, and any affected party is
at liberty to file it with the Labour Court in accordance with Section 87 (b) (i) of the
Labour Act (Act No. 11 of 2007)
Dated at Windhoek this 6th day of October 2011.
_________________
Moses Shitaleni Iinane
Arbitrator
Office of the Labour Commissioner
39