CCMAil
Revolutionising Workplace Relations
AUGUST 2014
TABLE OF CONTENTS
CCMA ARBITRATION AWARDS ....................................................................................................................................... 2
GAEK2685-14 Tracey-Lee Lategan v Evolving Management Solutions.
LP2654-14 Shonisani Raedani v Steyn Steel (PTY) LTD.
GAJB 9175-14 Sympathy Ngwenya v Cortac (PTY) LTD.
LP3153-14 Nkele Jane Khumalo v Kranskop Wimpy.
LABOUR COURT AND LABOUR APPEAL COURT JUDGMENTS ............................................................... 4
Labour Court: C368/2012/; C968/2012 Solidarity & Others v Department of Correctional Services and others.
Labour Court: J945/13 Naidoo v The Careways Group (Pty) Ltd & Another.
Labour Appeal Court: DA2/13 Ekhamanzi Springs (Pty) Ltd v Mnomiya.
Labour Appeal Court: CA9/13 South African Airways (Pty) Ltd v GJJVVl.
CONSTITUTIONAL COURT JUDGEMENTS ............................................................................................................ 9
CCT08/13 Grootboom v National Prosecuting Authority & Another.
CCT45/13 Mbatha v University of Zululand.
CCT10/13 Khumalo & Another v Member of the Executive Council for Education: KwaZulu Natal.
CCT51/13 Minister of Mineral Resources &Others v Sishen Iron Ore Company (Pty) Ltd & Another.
LABOUR WATCH ...................................................................................................................................................................... 15
Women in business - The reality of gender bias in the workplace ........................................................................................................ 15
A look at the automotive industry for 2014 ........................................................................................................................................... 17
Strikes turns violence: What can be done?........................................................................................................................................... 18
THE SOUTH AFRICAN ECONOMIC OUTLOOK .................................................................................................... 20
South africa at a glance: 2014 .............................................................................................................................................................. 20
THE INTERNATIONAL LABOUR MARKET ............................................................................................................. 22
Policy responses to youth unemployment: a global perspective .......................................................................................................... 22
LATEST CCMA CASE REFERRAL STATISTICS ..........................................................................25
EDITORIAL TEAM
Aaron Chicheke
Amanda Sibisi
Boitumelo Rakau
Egar Mokonyane
August 2014 – Page 1
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CCMA ARBITRATION AWARDS
By Egar Mokonyane
GAEK2685-14
Lategan v Evolving Management Solutions. Commissioner:
Ngwane
Dismissal – Determining whether dismissal is fair or not –
Determine appropriate relief including monies unlawfully
deducted
The applicant was employed as a Sales Executive since the 1st
day of February 2013 and earned R15 000.00 per month. Her
contract of employment had two types of sales targets that she
had to meet; monthly sales targets and project based targets. A
target of R 2.4 million per annum or R100 000.00 per month was
in her contract of employment. According to the applicant, she
had not received any form of counselling from her employer and
she managed to reach the minimum required target of R 1.4
million. Mr. Johannes Leepile was called as a witness and
testified to this fact. The employment relationship was
terminated on the 14th of March 2014 for absenteeism and poor
work performance.
Noted: That the applicant had a long history of absenteeism
and was issued with a verbal warning.
Also noted: That an amount of R 4500 was wrongfully
deducted from her pay.
Held: That the dismissal of the applicant was substantively
unfair, the respondent failed to comply with the requirements of
the Section 192(2) of the Labour Relations Act 66 of 1995
(LRA), prior to dismissing the applicant for poor work
performance. The respondents was ordered to compensate the
applicant a total of R 15 000 for the past month and a further R
4500 for monies deducted.
GAJB 9175-14
Ngwenya v Cortac (Pty) Ltd: Commissioner Kheswa.
Substantive dismissal – Failure to follow reasonable instructions
from supervisor
The applicant was instructed to work as a foot patroller on the
03rd of March 2014 and he did not indicate nor report that he
was sick or had any injuries.
The applicant’s employment relationship with the employer on
started in September 2007 and ended in 03 April 2014; he
earned a salary of R 3500.00 and worked as a security guard.
Noted: That the applicant had indeed signed a contract that
stated that he shall be required to perform lawful functions and
duties based on site requirements from time to time as
instructed by his superiors. Section 18 of the company’s
Disciplinary Code, was also signed in the contract and it states
that failure or refusal to carry reasonable instructions from a
superior shall amount to a summary dismissal.
Also noted: That the applicant had a sick note stating the he
was ill when the incident took place, however, the sick note was
for the 07th of April 2014 whilst the incident occurred on the 03rd
of April 2014.
Held: That the dismissal was substantively fair and the
application was dismissed.
LP2654-14
Raedani v Steyn steel (Pty) Ltd. Commissioner: Seopela
Unfair Dismissal – Determining whether the dismissal was fair or
not
The applicant was employed as a general worker on the 3 rd of
March 2011 and earned R 2700.00 per month. He was
dismissed on substantive grounds after five written warnings
were issued against him for failure to adhere to disciplinary
measures. The applicant was dismissed on the 03rd of April
2014 and referred the matter to CCMA.
Noted: That in terms of Section 192 (1) and (2) of LRA, if the
existence of the dismissal is established, the employer must
prove that the dismissal is fair. The respondent failed to
establish the fairness of the dismissal.
Also noted: That the applicant used the written warnings as a
disciplinary measure, there was no offence committed by the
applicant at the time of the disciplinary hearing.
Held: That the dismissal of the applicant was substantively
unfair and the respondent was ordered to compensate the
applicant a year’s salary.
The respondent was told to attend a disciplinary hearing on the
3rd of April 2014 where he was found guilty and subsequently
dismissed.
After the hearing he was aggrieved by the outcome of the
hearing and referred the matter to the CCMA challenging the
unfair dismissal.
August 2014 – Page 2
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Further noted: That requirement for private defense are that:
LP3153-14
Khumalo v Kranskop Wimpy: Commissioner: Phooko
Dismissal – Determine if the dismissal was fair – Misconduct Fighting on duty (captured on camera).
The applicant was employed by the respondent since 2007 until
16th of April 2014 and was earning R 2800-00 a month at the
time of his dismissal. The applicant was hired as a cleaner and
was dismissed on the 16th April 2014 following the allegations
of misconduct relating to fighting whilst on duty. The applicant
was aggrieved and referred a case of unfair dismissal to the
CCMA.
The applicant claimed that he had been verbally abused by one
of his collogues at work in full view of other staff members and
footage for the insults was recorded by the employer’s
surveillance camera. The applicant claimed that she acted in
self-defense by assaulting her colleague. She testified that she
had previously complained to management about her
colleague’s behavior, but nothing was done to remedy the
situation. She also testified that other employees who had
committed a similar offence were not dismissed, therefore, the
employer was inconsistent in applying its rules.
The respondent conceded that applicant used to complain about
the employee she had assaulted but, she never lodged a
grievance with the respondent.
Noted: That the respondent’s representative did not recall the
names and the incident in which employees were engaged in
fighting but has never subjected any employee to a hearing.
Also noted: That two more incidents of fighting happened in the
company and no one was dismissed.
(i)
there must be an unlawful act,
(ii)
commenced or imminent threat attached,
(iii)
a legally protected interest of the defendant
(iv)
an act of defense by the defendant directed against
the attacker which is necessary to avert the attack,
and
(v)
the means used for this purpose being reasonable in
the circumstances.
Further noted: That Neetling, Potgieter and Visser 2 ed 74-5
state that “the interest protected does not have to be exactly
commensurate with the interest infringed”.
Held: That the applicant was insulted and as such the insult was
unlawful, therefore, she had to avert those insults. The fact that
she used assault to ward off the insults may not be
commensurate with the unlawful act but as stated by Neethling
et al, with regards the act of private defense, the dismissal of the
applicant was found to be unfair. The commissioner accepted
that the applicant acted in self-defense.
Also held: That find that the respondent acted inconsistently
by dismissing the applicant. The commissioner found that the
applicant’s dismissal was substantively unfair. The respondent
was ordered to reinstate the applicant to her former position and
on the same terms and conditions that prevailed prior to the
dismissal. The respondent was also ordered to back pay the
applicant the sum of R 5600.00 for the period of two months she
was away from work.
August 2014 – Page 3
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LABOUR COURT AND LABOUR
APPEAL COURT JUDGMENTS
By Amanda Sibisi
Labour Court: C368/2012: C968/2012
Solidarity & Others v Department of Correctional Services
& Others: Judge Rabkin-Naicker
Grievance/(residual) unfair labour practices – Affirmative action
–Aims – Affirmative action measures aimed at advancing
substantive equality and accordingly overriding individual rights
to equality and dignity – Equal opportunity under constitution
and Employment Equity Act 55 of 1998 (EEA) not meaning that
people from designated group must apply on equal terms with
members of non-designated group-Affirmative actionDiscrimination.
The five applicant employees, all officers in the Department of
Correctional Services (“DCS”), each applied unsuccessfully for
promotional positions and claimed they had been unfairly
discriminated against on the basis of their race. Four of the
employees were coloured males. The other was a white male.
The respondents claimed that the employees were not selected
for the positions because appointing them would have been
inconsistent with the goals set by its employment equity plan,
which were based on national demographic statistics of the
various population groups (which are 79.3% African, 9.3%
white, 8.8% coloured and 2.5% Indian) which targets were to
be achieved in the period between 2010 and 2014. The
respondents denied that the employees had been unfairly
discriminated against.
Noted: That the Labour Appeal Court had found in Dudley v
City of Cape Town & Another [2008] 12 BLLR 1155 (LAC) that
failing to give preference to designated candidates does not on
its own constitute unfair discrimination. The Court also held that
it is generally not competent for designated candidates to
institute action under the EEA for alleged breaches by their
employers of obligations under that Act until they have
exhausted the administrative procedures provided for in
Chapter V. While, Dudley was distinguishable because the
employees in the present matter were not complaining that
members of the non-designated group had been preferred over
them, the Court was bound by the ratio of Dudley because the
applicants had not resorted to the enforcement procedures of
the EEA, the Court could, accordingly, not declare the DCS to
be in breach of the EEA, as the applicants had claimed.
Also noted: That the EEA prohibits discrimination on the basis
of, inter alia, race, but states that it is not unfair discrimination
to take affirmative action measures consistent with the
purposes of the Act. The Department of Labour’s equity plan
fell within the definition of “employment practice”, particularly
with regard to how it dealt with recruitment and selection. The
applicants contended in this regard that one of the objectives of
the EEA is to ensure that suitably qualified persons from
designated groups have equal opportunities, which means that
they must be afforded the same opportunities, not better
opportunities. This consideration applies more pertinently
where appointment decisions require a choice between
persons who all fall within designated groups.
Further noted: That the employees had faced a selection
process for particular posts in which regional demographics
were ignored. The Court noted further that when assessing the
fairness of equity plans, regard must be had to “the extent to
which suitably qualified persons from the different designated
groups are equitably represented within each occupational
category and level” in a workforce in relation to inter alia the
“demographic profile of the national and regional economically
active population”. This criterion is repeated in the applicable
Code of Good Practice and in administrative regulations. In this
case, the selection process was premised on the understanding
that the EEA permits employers to disregard regional
demographics when targets are set. According to the EEA,
however, both national and regional demographics must be
taken into account when setting numerical targets. Regional
demographics must be considered to ensure that all black
persons benefit from the restitutionary measures contemplated
by the EEA. Since the selection and recruitment process took
no cognisance of the regional demographics of the Western
Cape, it discriminated against the coloured applicant
employees.
The Court added that restitutionary measures are part and
parcel of the healing process that followed the demise of
apartheid. The policy of successive governments was to divide
and rule black South Africans. The constitutional injunction to
heal the divisions of the past cannot contemplate conduct
which rubs salt into the wounds caused by a bygone era.
August 2014 – Page 4
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Bringing African, coloured and Indian communities together in a
constitutional democracy is not easy given the stratagems that
were used to divide them. The notion that “freedom is
indivisible” must guide the implementation of restitutionary
measures.
Further noted: That the single white applicant employee had
been recommended for appointment for a post for which he had
applied, but the post was re-advertised. When he reapplied, he
was not shortlisted because white males were considered “over
represented” at the level concerned. This particular applicant’s
claim had to fail because he was not a member of the
designated group, because white males were over represented,
because affirmative action measures aim to achieve
substantive equality and not individual rights to dignity and
equality and because the national commissioner of the DCS
has discretion to keep posts open so that suitably qualified
members of designated groups can be advanced in accordance
with the aims of the equity plan.
Held: That the respondents were ordered to take immediate
steps to ensure that both national and regional demographics
are taken into account when setting equity targets for the
various occupational levels of its workforce.
Also held: That this approach is contrary to the principle that
affirmative action is aimed at redressing the injustices of the
past because it places emphasis on individuals in their personal
capacities as the bearers of equality rights. The substantive
approach to equality endorsed by the Constitution protects
those who have suffered institutional and systematic
discrimination and goes beyond the removal of discriminatory
measures. Since there was no attack on the constitutionality of
the EEA, the Court was bound to find that affirmative action
measures are consistent with the purposes of the Employment
Equity Act 55, of 1998, if they satisfy the requirement of
substantive equality. The Court rejected the notion that the
“restitutionary” measures promoted by the EEA amount to no
more that confirmation of equal opportunity for designated
groups to compete with the prime beneficiaries of past systemic
and institutionalized discrimination. The applicants had not
submitted that a level playing field has been reached for the
enjoyment of equal opportunities. In rejecting the “equal
opportunities” argument, the Court followed SA Police Service v
Solidarity obo Barnard [2013] 1 BLLR 1 (LAC), in which the
idea that the implementation of employment equity measures
are subject to the individual’s right to equality and dignity was
rejected.
Cases Considered
Dudley v City of Cape Town & Another [2008] 12 BLLR 1155
(LAC).
SA Police Service v Solidarity obo Barnard [2013] 1 BLLR 1
(LAC).
Labour Court: J945/13
Naidoo v The Careways Group (Pty) Ltd & Another: Judge
Molahlehi.
Relief – Urgent interim relief – Remuneration – Deductions from
– Employer seeking to justify stopping suspended employee’s
pay on basis that it was setting off tax allegedly owed by
employee – “Deduction” unlawful as amount deducted
exceeded limit set by BCEA – Employer ordered to pay full
salary
Remuneration – Right to – Employer stopping pay of
suspended employee before outcome of agreed arbitration
proceedings – Failure to pay employee a breach of contract
and of the BCEA – Employer obliged to pay employees until
arbitration concluded.
After being informed that she was no longer wanted as the
second respondent’s Chief Executive Officer (CEO) due to
incompatibility with its major shareholder, a foreigner, the
applicant was barred from the workplace. However, she
received her salary for two further months, but it was then
stopped. The applicant launched an urgent application directing
the respondents to pay her salary in full until the conclusion of
arbitration proceedings she had instituted in terms of her
contract. The respondents contended that, apart from not being
urgent, the claim was for contractual damages and not based
on the Basic Conditions of Employment Act 75 of 1997, (BCEA)
as the applicant claimed, and that the applicant had
approached the Court with “dirty hands” because she had
evaded paying her personal income tax by instructing a
subordinate not to pay it.
Noted: That the applicant had stated in her founding affidavit
that her claim was based on a “consultancy
agreement/employment contract”. While the respondents had
focused on the term “consultancy agreement”, they had not
denied that the applicant was the second respondent’s
employee. The common law rule that employers are obliged to
pay their employees their agreed salaries, even if they are
suspended, is supported by the BCEA.
Held: That even if the respondents’ allegation that the
applicant had instructed her subordinate not to pay income tax
she owed were true, this would not entitle the respondents not
to pay the applicant’s salary. In any event, the submission was
nothing more than an allegation. The respondents’ claim that it
was entitled to set-off the amount the applicant owed in tax
from her salary also overlooked section 34 of the BCEA, which
limits amounts which may lawfully be deducted from
employee’s remuneration to 25% of their total salary.
Also held: That the respondents were ordered to pay the
applicant’s salary for the time it had been withheld, and to
continue paying her pending the outcome of private arbitration
to which the parties had agreed.
August 2014 – Page 5
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Labour Appeal Court: DA2/13
Ekhamanzi Springs (Pty) Ltd v Mnomiya: Judges Ndlovu
Judge of Appeal, Molemela and Sutherland (Acting)
Dismissal – At instance of third party – Employee dismissed for
falling pregnant out of wedlock and consequently being denied
access to workplace by employer’s landlord – Employer liable
for automatically unfair dismissal because it failed to exercise
rights against landlord.
Dismissal – Automatically unfair – Pregnancy – Employee
dismissed for falling pregnant out of wedlock and consequently
being denied access to workplace by employer’s landlord –
Dismissal automatically unfair because employer failed to
exercise rights against landlord.
The respondent was employed by the appellant to bottle
Aquelle spring water. The respondent’s plant was located on a
property belonging to a religious mission and to gain access to
the workplace the respondent employee had to cross the
mission’s property. The mission’s security guards were
instructed to bar entry to any persons who did not comply with
its code of conduct, one provision of which prohibited “amorous
relationships between any two persons outside of marriage”.
The respondent and a colleague were denied access because
they had fallen pregnant. The appellant denied that it had
dismissed either employee and claimed that it merely told one
of them to “sort the problem out” with the mission, and that the
other was not at the mission gate on the day she claimed to
have been denied access and had been dismissed. The Labour
Court dismissed the case of one of the employees because she
was not present at court, and ruled that the dismissal of the
respondent employee was automatically unfair because she
had been dismissed for her pregnancy.
Noted: That all persons have a constitutional right to equality,
and that the form of discrimination here at issue is reinforced in
the employment sphere; discriminatory dismissals are
pronounced automatically unfair and higher compensation is
allowed for in such cases. Employers are obliged to avoid
discriminating against employees directly or indirectly.
Protection against being discriminated against on the ground of
pregnancy is not a preserve of married women. An agreement
that denies pregnant employees access to the workplace is
accordingly prima facie unenforceable unless it can be justified
on grounds consistent with constitutional norms. The mission’s
code of conduct interfered with the employment relationship
between the appellant and its employees, and created a
situation in which breaches could lead to dismissal. Such
provisions blurred the line between the appellant’s terms and
conditions of employment and the mission’s code. However,
the employee was not a signatory to the mission’s code, which
had been imposed on her during the course of her employment.
The mission’s code was accordingly not binding on her. That
the mission happened to be landlord and a religious body did
not detract from the fact that the appellant was a private
company entitled to all the rights of a lessee – including the
services of its employees. As lessee, the appellant had legal
remedies to compel the mission to allow it full use and
enjoyment of the leased property. The appellant’s faint plea of
operational necessity could not serve as a defence because it
had failed to exercise its rights as lessee to protect its pregnant
employees. The employee had tendered her services, and the
appellant’s refusal to accept the tender constituted a breach of
contract.
Held: that the appeal turned on the court a quo’s findings that
the employee had discharged the onus of proving that she had
been dismissed and, if so, whether the appellant was obliged to
intervene when the mission denied the employee access to the
mission. The Court found that in its pleadings the appellant had
relied on the same defence in respect of both employees –
namely, that because they had been refused access to the
mission property, they had failed to report for work and were
deemed to have resigned. This position had been
opportunistically changed during the trial to a claim that the
employee was not present at the gate on the day in question.
The court a quo had correctly rejected the evidence to the
extent that it conflicted with the pleadings. In any event, the
issue of whether the employees had been told that they had
been dismissed at the gate was a red herring. The
incontrovertible fact was that their employment had ended due
to their pregnancy in spite of the fact that they wanted to work.
Further held: That the appellant’s acquiescence in the
mission’s discriminatory practice of barring unwed pregnant
women from the leased premises violated the appellant’s
constitutional duty to treat its employee fairly. The appellant’s
inertia was probably explained by the fact that its general
manager was the son-in-law of the mission’s head. This did not
amount only to unfair treatment of the affected employees, but
also to a breach of its common law duty to accept the
employees into service. The Court, accordingly, confirmed that
the employee had been dismissed and that her dismissal was
automatically unfair.
Labour Appeal Court: CA9/13
South African Airways (Pty) Ltd v GJJVV: Judges: Tlaletsi
(Deputy Judge President), Davis (Judge of Appeal) &
Coppin (Acting Judge of Appeal).
Discrimination – Age – Airline pilot paid less than younger
colleagues after reaching age of 60, put permitted to continue
all flying duties – Discrimination unfair as age not inherent
requirement of pilot’s job.
Discrimination – Defences – Defences to unfair discrimination
claims under Employment Equity Act 75, 1998 not confined to
those listed in Act, but employer must prove discriminatory
measure served legitimate purpose – Discrimination against
airline pilots on basis of age not justified.
Discrimination – Remedies – Employee receiving amount equal
to two years’ salary for unfair discrimination based on age –
EEA intending to differentiate between “compensation” and
“damages” – Former referring to restitution of patrimonial loss
and latter to solatium for injured feelings – Award merging two
resulting in employee receiving disproportionate amount as
compensation for unfair discrimination based on age.
August 2014 – Page 6
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Discrimination – Unfair – Airline concluding collective
agreement providing that pilots over former retirement age
could remain in service but would earn salaries lower than
younger colleagues – Discrimination unfair because age not
inherent requirement of job of pilot.
Practice and procedure – Appealable issues – Orders made by
Labour Court “sitting as arbitrator” under section 158(2)(b)
subject to appeal under Labour Relations Act 66, 1995 and not
to review.
Unfair labour practice – Benefits – Employer using employee’s
accumulated leave package to pay his salary while he was sent
home on standby duty – Deduction constituting unfair labour
practice.
Words and phrases – “Damages” and “compensation” (in EEA)
– Damages refers to monetary compensation for injured
feelings, compensation to patrimonial loss.
The respondent employee, an airline pilot with the rank of
senior captain, reached the respondent’s then retirement age of
60 while his trade union (the second respondent) was
negotiating an extension of pilots’ retirement age to 63. While a
collective agreement to that effect was being finalised, the
employee was told to remain at home. When the agreement
was signed several months later, the employee was told that he
could resume flying duties on its terms. These were that pilots
over 60 who elected to remain in service would be employed on
reduced salary scales and would forego notch increases until
they reached the new mandatory retirement age of 63. After
resuming flying duties, the employee learned that his
accumulated leave pay, which was due to him when he retired,
had been used to pay his salary during the period he had
remained at home. The employee objected to the fact that he
and his colleagues in similar positions would receive lower
salaries than their younger colleagues for doing the same work.
He approached the Labour Court (LC), claiming that he was the
victim of unfair discrimination, and also referred a further claim
to the Commission for Conciliation, Mediation and Arbitration
(CCMA) in respect of the reduction of his accumulated leave
pay. The parties agreed that the LC would deal with the latter
dispute, sitting as an arbitrator, at the same time as it dealt with
the unfair discrimination claim. The court held that the
employee had been unfairly discriminated against, and coupled
with that order an “award” declaring that he had been victim of
an unfair labour practice. The Court awarded the employee
compensation of R1.4m, equal to two years’ salary at the rate
of pay applicable to his last year of service and ordered the
appellant to repay the amount deducted from his accumulated
leave. The appellant contended that the court below had erred
by ignoring the terms of the collective agreement and that it
was the product of collective bargaining, and by not finding that
age was an inherent requirement of the job of an airline pilot.
Noted: That the EEA prohibits unfair discrimination on the
basis of, inter alia, age. Unfair discrimination cases involve a
two-fold inquiry: first, whether the employee had been
discriminated against; second, whether the discrimination is
unfair. Unlike the Constitution, the EEA does not expressly
permit justification of unfair discrimination on general grounds.
The Act prohibits discrimination and provides only two
defences: first that it is not unfair to take affirmative action
measures consistent with the objectives of the Act; second that
persons may be excluded or preferred on the basis of the
inherent requirements of the job. While these are complete
defences, the Act also recognises that there may be other
considerations which render the discrimination fair.
Consideration of the fairness of discrimination under the EEA is
not, therefore, confined to moral concerns and the impact of the
discrimination on the employee, but also includes such
considerations as the nature and purpose of the discrimination,
the proportionality of the measure, the nature of the right
infringed, and the relationship between the purpose of the
discriminatory measure and its purpose. The Act requires only
that the employee must prove that the discrimination was fair.
There is no closed list of factors that need to be taken into
account in considering the fairness of the discrimination, and
the interests of both the employee as well as the employer
must be taken into account.
Also noted: That only the employee had testified. His main
complaint was that pilots younger than he received higher
salaries for doing the same work. The Court noted that the
collective agreement had other discriminatory provisions. For
example, pilots over 60 were reduced in rank and status. The
appellant had properly conceded that these provisions were
discriminatory. Since the EEA creates a rebuttable presumption
that discrimination impacts on the dignity of the victim, the
Court accepted that these provisions might have caused pilots
over 60 to feel rejected and unappreciated. The appellant’s
contention that age was an inherent requirement of the job of
an airline pilot was unconvincing. Apart from the fact that no
evidence had been led to support this claim, it was inconsistent
with the fact that in terms of the agreement pilots over 60 were
permitted to fly. That the employee had a choice whether to
retire or continue in service on reduced terms did not alter the
fact that the employee was a victim of discrimination – the
exercise of a choice which results in discrimination can never
render the discrimination fair. Nor was the fact that the
discriminatory measures were the product of collective
bargaining a sufficient defence. The Court accordingly held that
the appellant had failed to discharge the onus of proving that
the discrimination served a legitimate purpose or that it was fair
in the sense contemplated by the EEA.
Further noted: That the amount exceeded that claimed by the
employee. The court a quo had not specifically explained how it
had arrived at the compensation awarded, but it was apparent
that its intention was to grant the employee an amount
equivalent to his patrimonial loss, as opposed to damages. The
EEA empowers the LC to award both damages and
compensation. However, there has been confusion over the
meaning of these terms, particularly in cases brought
simultaneously under the EEA the LRA. Since it was held that
compensation under the EEA includes both patrimonial and
non-patrimonial loss, such as a solatium, there has been a
tendency to give the term “compensation” in the EEA the same
meaning. However, unlike the LRA, the EEA uses both terms.
The intention must therefore have been to give them different
meanings. In law, the term “damages” refers to a sum of money
August 2014 – Page 7
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claimed or awarded as compensation for loss or injury. In
Aquilian actions, plaintiffs must prove damages to be entitled to
compensation. In the EEA, “damages” must accordingly refer to
monetary loss, and “compensation” must refer to an amount
awarded as a solatium. The Act recognises both forms of relief
because discrimination may give rise to both financial loss and
injured feelings. The purpose of an award of damages is to
place the claimant in the financial position he or she would
have been in had it not been for the unfair discrimination.
Compensation is meant to be a recompense for the insult,
humiliation or indignity suffered.
Further noted: That the damages awarded by the court a quo
were generous. The appellant had been ordered to pay the
difference in the total to “cost to company” of the employee’s
services over a period of two years, not merely the difference in
the salary the employee would have received had he not been
discriminated against. On the other hand, discrimination is
hurtful and demeaning, and the appellant, a parastatal, had
defended its position to the last. There is little authority for
amounts awarded in cases of discrimination based on age, and
judgments involving that issue had awarded a wide range of
damages. This was in part the result of the confusion over the
meaning of the word “compensation” in the EEA. Taking into
account the circumstances of this particular case, the Court
held that a solatium of R50 000 was just and equitable. The
compensation granted by the court a quo was reduced
accordingly.
Further noted: That the Labour Appeal Court refrained from
deciding whether the Labour Court was empowered to deal
with the dispute concerning the reduction of the employee’s
accumulated leave pay in terms of section 158(2)(b) of the
LRA. However, it rejected the employee’s submission that the
issue was not subject to appeal, but should be dealt with as a
review. The key to the proper interpretation of section 158(2)(b)
of the LRA lies in the word “order”.
appeal is not whether the judgment of the court below was
unreasonable, but whether it was right or wrong.
Held: That, having decided to award both compensation and
damages, the court a quo was required to balance the two to
ensure that the total amount was fair to both the employee and
the employer. The Labour Court had wrongly quantified the
amount in multiples of the employee’s salary. However, when it
comes to damages for non-patrimonial loss, courts are inclined
to be conservative. The Court held that the compensation
granted in this case was grossly excessive – not only because
it exceeded the amount claimed, but also because it bore no
reasonable relationship to the injury suffered. That being the
case, the amount awarded had to be determined afresh.
Also held: That the Court rejected the appellant’s claim that it
was entitled to deduct from the employee’s accumulated leave
to pay his remuneration in the period he remained at home
before resuming his flying duties, as well as the argument that
accumulated leave pay was not a “benefit” as contemplated in
section 186(2)(a) of the LRA. In any event, the employee had
remained in employment during the period concerned. He had
been asked to remain on standby pending the finalisation of the
collective agreement, and had tendered his services. The
employee was accordingly entitled to his full salary. The
deduction from his leave pay to make up his salary for that
period, accordingly, constituted an unfair labour practice. The
order that the appellant repay the amount deducted was,
accordingly, correct.
Further held: That the appeal was dismissed save to the
extent that order of compensation was reduced from R1.4m to
R50 000, and the appellant was ordered to pay the costs of the
appeal.
Nothing in the LRA specifically states that a determination by
the Labour Court sitting as an arbitrator under that provision is
an “award”. That the LRA specifies that the Labour Court sitting
as an arbitrator has the powers of commissioner does not
mean that the order issued has the status of an award; the
court’s decision remains an order. Section 145 of the LRA
provides for reviews only of arbitrations conducted under the
auspices of the CCMA. It follows that an order issued by the
Labour Court in terms of section 158(2) (b) of the LRA is
subject only to appeal. Grounds of review such as
“reasonableness” are irrelevant to such appeals – the test on
August 2014 – Page 8
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CONSTITUTIONAL COURT
JUDGEMENTS
By Aaron Chicheke
CCT08/13
Grootboom v National Prosecuting Authority & Another:
Judges: roneman, Jafta, Khampepe, Moseneke, Nkabinde,
Skweyiya, Zondo, Bosielo, Mhlantla.
Substantive Fairness in Dismissal - Absence without
leave/desertion
The applicant, a public prosecutor, was suspended from duty
and dismissed after being found guilty on charges of misconduct.
After the applicant referred a dispute for arbitration, the first
respondent (“the NPA”) agreed to “set aside” the dismissal and
convene a “pre-dismissal” arbitration on condition that the
applicant remained on suspension. The applicant was then
shortlisted a 12 month scholarship to study in the United
Kingdom. The NPA granted the request for a paid study but the
decision was overturned by the supervisor who insisted on
unpaid leave. To this end, the pre-dismissal arbitration was
postponed indefinitely until the employee returned from the
United Kingdom. However, the employee departed without
having signed the forms and two months down the line, the
applicant’s salary was stopped without notice. Upon enquiry, the
applicant was told that his employment had been terminated in
terms of section 17(5)(a)(i) (now section 17(3)(a)(i)) of the Public
Service Act 103 of 1994 (PSA) and he was advised to make
representations to the Minister if he wished to be reinstated.
When the applicant returned, he made an appeal to the minister
but without success.
Both the Labour Court and the Labour Appeal Court held that the
applicant had not been dismissed because his employment had
terminated by “operation of law”.
Held: That the LC had held that in terms of section 17(5)(a)(i) the
applicant was discharged by operation of law and that therefore
the respondents had not taken any decision that could be
reviewed and set aside in terms of Promotion of Administrative
Justice Act 3 of 2000 (PAJA).
Also held: That by going to the UK on a 12-month scholarship
without the NPA’s permission, the applicant had absented
himself as envisaged by section 17(5)(a)(i). The following were
the reasons put upfront:
“In this respect the applicant contended that the [NPA]
was aware that he would be leaving on a scholarship
to study outside the country. I have earlier in this
judgment indicated that a suspended employee has a
duty to inform his or her employer about his or her
whereabouts during the period of suspension and may
have to seek permission if he or she is to be away in
circumstances that he or she would not be able to
resume duty if he or she was so directed by the
employer. The fact that the employer had knowledge
about his whereabouts is irrelevant as what is key is
whether or not the absence was authorised. The facts
of this case indicate very clearly that the applicant
never received authority to be away for an excessive
period of one year. The criteria for [invoking] the
provisions of section 17(5)(a) of the [Act] [were] in my
view satisfied and thus the [NPA] was entitled to
[invoke] the provisions of that subsection.” (Para 13)
The applicant then sought special leave to appeal to the
Supreme Court of Appeal, which dismissed the application with
costs.
Noted: That a condition of the applicant’s suspension was that
he was prohibited from performing any functions for the NPA.
While the applicant may have been absent from his employment,
his absence was occasioned by his suspension. This meant that
he was absent with the permission of his employer. The
applicant’s situation was not altered by his departure to the UK
because at no stage had the NPA recalled him to his duties.
Below I quote the informed this decision:
“The applicant was employed by the NPA as a public
prosecutor. In 2005, he was placed on precautionary
suspension with pay. As part of the conditions of his
suspension he was prevented from coming to his place
of employment, communicating with his colleagues or
performing any functions or duties for the NPA during
his suspension. Whilst still on suspension and without
permission, he left for the UK on a scholarship. The
question is whether his conduct amounts to absenting
himself from his official duties without permission.”
(Para 41).
Court Order:
 The respondents’ applications for condonation are
dismissed.
 Leave to appeal is granted.
 The appeal was upheld.
August 2014 – Page 9
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
The orders of the Labour Court and Labour Appeal
Court were set aside.
Case References
Minister van Onderwys en Kultuur en andere v Louw (1995) (4)
SA 383 (A).
Phenithi v Minister of Education & Others [2005] ZASCA 130;
2008 (1) SA 420 (SCA).
Brummer v Gorfil Brothers Investments (Pty) Ltd & Others [2000]
ZACC 3; 2000 (2) SA 837 (CC).
Van Wyk v Unitas Hospital & Another (Open Democratic Advice
Centre as amicus curiae) [2007] ZACC 24.
Von Abo v President of the Republic of South Africa [2009]
ZACC 15; 2009 (5) SA 345 (CC).
eThekwini Municipality v Ingonyama Trust [2013] ZACC 7; 2013
(5) BCLR 497 (CC) (eThekwini).
Radio Pretoria v Chairman of the Independent Communications
Authority of South Africa & Another [2004] ZACC 24; 2005 (4) SA
319 (CC).
Brummer above fn 12 at para [3] & Fraser v Naude & Others
[1998] ZACC 13; 1999 (1) SA 1 (CC).
Mankayi v Anglogold Ashanti Ltd [2011] ZACC 3; 2011 (3) SA
237 (CC).
Law Society of South Africa & Others v Minister for Transport &
Another [2010] ZACC 25.
Wary Holdings (Pty) Ltd v Stalwo (Pty) Ltd & Another [2008]
ZACC 12; 2009 (1) SA 337 (CC).
Investigating Directorate: Serious Economic Offences and others
v Hyundai Motor Distributors (Pty) Ltd and others In re: Hyundai
Motor Distributors (Pty) Ltd & Others v Smit NO & others [2000]
ZACC 12; 2001 (1) SA 545 (CC).
Gladstone v Thornton’s Garage 1929 TPD 116 as cited with
approval in Gumede v Mapumulo Bantu School Board and
Another 1961 (4) SA 639 (D).
Masinga v Minister of Justice, Kwa-Zulu Government [1995]
ZASCA 21; 1995 (3) SA 214 (A).
Brummer v Gorfil Brothers Investments (Pty) Ltd and others
[2000] ZACC 3; 2000 (2) SA 837 (CC).
Van Wyk v Unitas Hospital & Another (Open Democratic Advice
Centre as amicus curiae) [2007] ZACC 24.
Geldenhuys v National Director of Public Prosecutions & Others
[2008] ZACC 21.
National Education Health & Allied Workers Union v University of
Cape Town & Others 2003 (3) SA 1 (CC).
Aviation Union of South Africa & Another v South African Airways
(Pty) Ltd & Others 2012 (1) SA 321 (CC).
Shilubana & Others v Nwamitwa 2009 (2) SA 66 (CC).
to compile a Zulu dictionary was brokered by the University, the
Pan SA Language Board (PanSALB) and ISS in September
2002. Upon this agreement, the University temporarily seconded
the applicant and other staff to ISS. It was also agreed that ISS
would take over the staff as its own employees by no later than
31 December 2005, with the financial support from PanSALB.
However, PanSALB withheld payments to ISS because it had
failed to file financial statements in mid-2005. But the University
continued paying salaries with the hope that they will be
reimbursed by PanSALB. This never happened and PanSALB
stopped paying ISS. While this was happening, the applicant
continued attending meetings, addressing correspondence and
spending funds as chief executive officer and editor-in-chief of
ISS. Eventually, the University, which had not been reimbursed
by the PanSALB, stopped its funding of ISS in June 2008. The
applicant then approached the Labour Court for an order
compelling the University to pay his remuneration. He contended
that he was still the employee of the University of Zululand and
that he was not part to the tripartite agreement. He only signed
the agreement as a witness for ISS. He further contended that
the agreement was not explicit about the transfer of his
employment to ISS. The University only alluded to employing the
applicant from 1984 to the end of 2005 and his employment was
taken over by ISS in the beginning of 2006.
Labour Court agreed with the University that the applicant
ceased to be the employee in December 2005. The Labour Court
dismissed the application with costs. The applicant also failed to
convince the Labour Appeal Court and his appeal was
dismissed.
The applicant, having been refused leave to appeal to the
Supreme Court of Appeal, applied to the Constitutional Court for
leave to appeal. He contended that his right to dignity was
infringed. However, the Constitutional Court found no discernible
constitutional issue as highlighted below:
“No constitutional point can be located in the fact that
Mr Mbatha claims he is an employee of the University
under legislation that protects employment. His dispute
with the University raises no issue of interpretation or
disputed application of the statutory definitions, or any
contested claim about the courts' jurisdiction over
employees and employment disputes. It is a simple
factual dispute about who his employer was. If it were
otherwise, every dispute about an employee's true
employer could reach this court. That cannot be.” (Para
197)
CCT45/13
Mbatha v University of Zululand. Judges: Moseneke,
Cameron, Froneman, Jafta, Madlanga, Mhlantla, Nkabinde,
Skweyiya, Van der Westhuizen Jand Zondo.
Applicant instituting contractual claim for payment of
remuneration
Held: That the matter raised no constitutional issue because it
turned exclusively on a factual question. The majority therefore
denied the applicant leave to appeal as the matter did not raise a
constitutional issue. The reasons were as follows:
The applicant was appointed as a researcher by the University of
Zululand, the respondent, in August 1984. A tripartite agreement
“First, there is no jurisdiction. Mr Mbatha does not in
my view get past the initial obstacle. His case cannot
be entertained because it raises no constitutional
August 2014 – Page 10
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issue. He instituted a contractual claim against the
respondent University in the Labour Court for
reinstatement of his salary. The sole question all along
has been simply this: Is the University Mr Mbatha's
employer? He says Yes. The University says No. It
says a non-governmental organization it houses, ISS,
employs Mr Mbatha.” (Para 193)
Case References
Southern Africa
Alexkor Ltd & another v The Richtersveld Community & Others
2004 (5) SA 460 (CC).
Bato Star Fishing (Pty) Ltd v Minister of Environmental Affairs &
Others 2004 (4) SA 490 (CC).
Camps Bay Ratepayers' & Residents' Association & Another v
Harrison & Another 2011 (4) SA 42 (CC).
Chairperson of the Constitutional Assembly, ex parte: In re
Certification of the Constitution of the Republic of South Africa
Act 108 of 1996 (1996) (4) SA 744 (CC).
Chirwa v Transnet Ltd & others 2008 (4) SA 367 (CC)
Competition Commission of SA v Senwes Ltd 2012 (7) BCLR
667 (CC).
Competition Commission v Loungefoam (Pty) Ltd & Others 2012
(9) BCLR 907 (CC).
Competition Commission v Yara SA (Pty) Ltd & Others 2012 (9)
BCLR 923 (CC).
Cooper & Another NNO v Merchant Trade Finance Ltd 2000 (3)
SA 1009 (SCA).
Denel (Pty) Ltd v Vorster 2004 (4) SA 481 (SCA).
Dudley v City of Cape Town & Another 2005 (5) SA 429 (CC).
Equity Aviation Services (Pty) Ltd v Commission for Conciliation,
Mediation & Arbitration & Others 2009 (1) SA 390 (CC).
Fraser v Absa Bank Ltd (National Director of Public Prosecutions
as Amicus Curiae) 2007 (3) SA 484 (CC).
Fuel Retailers Association of SA v Director-General:
Environmental Management, Department of Agriculture,
Conservation & Environment, Mpumalanga G Province & Others
2007 (6) SA 4 (CC).
Gcaba v Minister for Safety & Security & Others 2010 (1) SA 238
(CC).
Grootboom v National Prosecuting Authority & Another (2014) 35
ILJ 121 (CC).
Ingledew v Financial Services Board: In re Financial Services
Board v Van der Merwe H & Another 2003 (4) SA 584 (CC).
Mankayi v AngloGold Ashanti Ltd 2011 (3) SA 237 (CC).
Mazibuko & Others v City of Johannesburg & Others 2010 (4) SA
1 (CC).
MEC for Education, KwaZulu-Natal & Others v Pillay 2008 (1) SA
474 (CC).
Minister of Safety & Security v Luiters 2007 (2) SA 106 (CC).
Mphela & others v Haakdoornbult Boerdery CC & Others 2008
(4) SA 488 (CC).
National Education Health & Allied Workers Union v University of
Cape Town & others 2003 (3) SA 1 (CC).
National Union of Metalworkers of SA & Others v Spinmet (Pty)
Ltd (1992) 13 ILJ 1459 (LAC).
National Union of Textile Workers & Others v Jaguar Shoes (Pty)
Ltd 1987 (1) SA 39 (N).
Nichol & Another v Registrar of Pension Funds & Others 2008
(1) SA 383 (SCA).
Pharmaceutical Manufacturers Association of SA & Another: In
re Ex parte President of the Republic of SA & others 2000 (2) SA
674 (CC).
Phoebus Apollo Aviation CC v Minister of Safety & Security 2003
(2) SA 34 (CC).
Radio Pretoria v Chairperson, Independent Communications
Authority of SA & Another 2005 (4) SA 319 (CC).
Rail Commuters Action Group & others v Transnet Ltd t/a
Metrorail & Others 2005 (2) SA 359 (CC).
S v Boesak 2001 (1) SA 912 (CC).
SA National Defence Union v Minister of Defence & Others 2007
(5) SA 400 (CC).
Slip Knot Investments 777 (Pty) Ltd v Du Toit 2011 (4) SA 72
(SCA).
Sonap Petroleum (SA) (Pty) Ltd (formerly known as Sonarep
(SA) (Pty) Ltd) v Pappadogianis 1992 (3) SA 234 (A).
SOS-Kinderdorf International v Effie Lentin Architects 1991 (3)
SA 574 (Nm).
Thermo Radiant Oven Sales (Pty) Ltd v Nelspruit Bakeries (Pty)
Ltd 1969 (2) SA 295.
United Kingdom
Smith v Hughes [1871] LR 6 QB 597.
CCT10/13
Khumalo and Another v Member of the Executive Council
for Education: KwaZulu Natal. Judges: Skweyiya, Moseneke,
Cameron, Froneman, Madlanga, Mhlantla, Nkabinde and Van
der Westhuizen
Application for leave to appeal against a decision of the Labour
Appeal Court upholding the Labour Court’s setting aside of the
applicants’ promotions as unlawful, unreasonable and unfair.
This judgment concerns a challenge by the Member of the
Executive Council for Education, KwaZulu-Natal (MEC), who is
the respondent, to the lawfulness of her own department’s
employment decisions. The applicants, Mr. Nkosinathi Lawrence
Khumalo and Mr. Krish Ritchie, were employees of the
Department of Education, KwaZulu-Natal (Department). An
advertisement for the post of Chief Personnel Officer (Human
Resources: Provisioning) was published in the Sunday Tribune
newspaper in March 2004. The two applicants applied for the
post. Mr. Khumalo, who was employed at salary level five at the
time, was shortlisted but Mr. Ritchie, who was at salary level
seven was not shortlisted. Mr. Khumalo was interviewed and
subsequently promoted, with effect from April 2004. Upon Mr.
Khumalo’s promotion, Mr. Ritchie lodged a grievance with the
Department complaining that he had not been shortlisted for the
post. The grievance was not resolved and then Mr. Ritchie
referred the dispute to the General Public Service Sectoral
Bargaining Council. At the arbitration Mr. Ritchie was granted a
“protected promotion”.
August 2014 – Page 11
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Some months later, on 6 October 2005, the National Union of
Public Servants and Allied Workers (NUPSAW), on behalf of 11
other employees who had applied for the same post, addressed
a letter to the Superintendent- General complaining about
irregularities in the advertising and appointment process in the
Department. Mr. Khumalo’s promotion was cited as an example.
The complainants demanded an investigation into Mr. Khumalo’s
promotion and Mr Ritchie’s protected promotion and, depending
on the outcome, that they too be granted protected promotions.
A task team comprising four Department officials and three
NUPSAW members (Task Team) to investigate the complaint.
The Report by the task team noted that the documentation
relating to the appointment process could not be traced and that
those involved in the selection process presented with an “almost
total collapse” of memory. The report further stated that there
was “no uniformity on the advertised requirements of positions in
the eThekwini Region as well as the Department as a whole. Mr.
Khumalo did not meet the minimum requirements relating to
supervisory experience stated in the advertisement and he ought
not to have been shortlisted and interviewed. This then rendered
the process “unfair”. The report also unearthed more
irregularities. the expansion of the shortlist at the intervention of
the Regional General Manager; the refusal to shortlist a
particular candidate because he had not provided a matric
certificate but only a statement of his results; and the waiver of
the right to be interviewed by one of the shortlisted candidates
because the interview proceedings were running late. Regarding
Mr. Ritchie’s protected promotion, the settlement agreement was
not “prudent” given the circumstances.
In October 2008, some 20 months after the MEC received the
Task Team Report, she launched an application in the Labour
Court seeking to challenge Mr. Khumalo’s promotion and Mr.
Ritchie’s protected promotion. No explanation has been given
for her delay in launching the application.
This was an appeal against the judgment and order delivered by
the Labour Court which had declared unlawful, unreasonable
and invalid the promotion of Mr. Khumalo and the decision to
agree to grant Mr. Ritchie protected promotion. The Labour Court
set aside the impugned decisions and further directed the
Department to take necessary steps to fill the posts. In addition
the Court granted certain structural remedies.
The Labour Appeal Court dismissed the appeal against the
decision of the Labour Court. The parties petitioned the Supreme
Court of Appeal for special leave to appeal, which petition was
dismissed. They appealed to the Constitutional Court, which set
aside the decisions of both the Labour Court and Labour Appeal
Court and replaced the decision of the Labour Court with an
order dismissing the application. Below are the extracts from the
judgment:
“The Labour Court erred in overlooking the delay.
While the Court was correct to be cautious in
permitting the delay to non-suit the MEC, its simple
reference to promoting public accountability and the
balance of convenience, as the basis on which to
condone, is an inadequate consideration of the depth
of difficulties faced by a court when confronted with a
review in the labour context, following the passage of
an extensive and unexplained delay of this nature.
While the Court accurately acknowledged its ability to
ameliorate prejudice to Mr Khumalo in the remedy, it
did not adequately consider the fact that the MEC gave
no explanation for the delay or the extent to which the
delay constrained an accurate review. In the result, the
Court misdirected itself in overlooking the delay and
the grounds for this Court’s interference with its
exercise of discretion are established. The delay
should non-suit the MEC in relation to her application
for the review of Mr Khumalo’s appointment. (Para.
69).
Held: That with regards to Mr Ritchie’s protected promotion the
MEC was not entitled to bypass the provisions of the Labour
Relations Act 66 of 1995 (LRA) that regulate the review of
arbitration awards by framing her challenge against the anterior
decision of the Department to enter into the settlement
agreement. Her challenge ought to have been made against the
arbitration award, which application would have fallen out of the
time limits set by the LRA.
Also held: That the decisions of the Labour Court and Labour
Appeal Court was set aside and permitted the promotions to
stand.
Cases references
Kwa-Dukuza Municipality v SA Local Government Bargaining
Council & Others (2009) 30 ILJ 356 (LC).
MEC Department of Education KwaZulu-Natal v Khumalo &
Another 2011 (1) BCLR 94 (LC).
Khumalo & Another v MEC for Education: KwaZulu-Natal (2013)
34 ILJ 296 (LAC).
Fedsure Life Assurance Ltd & Others v Greater Johannesburg
Transitional Metropolitan Council & Others 1999 (1) SA 374 (CC)
Pharmaceutical Manufacturers Association of SA & Another: In
re Ex Parte President of the Republic of South Africa and Others
[2000] ZACC
Chirwa v Transnet Ltd and Others [2007] ZACC 23; 2008 (4) SA
367 (CC)
Pepcor Retirement Fund & Another v Financial Services Board &
Another 2003 (6) SA 38 (SCA)
Ntshangase v MEC for Finance, KwaZulu-Natal & Another 2010
(3) SA 201 (SCA)
Municipal Manager: Qaukeni Local Municipality and Another v
FV General Trading CC 2010 (1) SA 356 (SCA)
Njongi v MEC, Department of Welfare, Eastern Cape 2008 (4)
SA 237 (CC)
Weltevrede Kwekery (Pty) Ltd v Commission for Conciliation,
Mediation and Arbitration & Others (2006) 27 ILJ 182 (LC)
SACCAWU obo Manzana & Others v Pick ‘n Pay, Kimberley &
Others [2003] 10 BLLR 1065 (LC)
South African Broadcasting Corp Ltd v National Director of Public
Prosecutions & Others 2007 (1) SA 523 (CC)
August 2014 – Page 12
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Associated Institutions Pension Fund and Others v Van Zyl and
Others [2004] ZASCA 78; 2005 (2) SA 302 (SCA) (Van Zyl) at
para 46.
Sidumo and Another v Rustenburg Platinum Mines Ltd and
Others 2008 (2) SA 24 (CC)
Gqwetha v Transkei Development Corporation Ltd & Others
2006 (2) SA 603 (SCA).
Setsokosane Busdiens (Edms) Bpk v Voorsitter, Nasionale
Vervoerkommissie 1986 (2) SA 57 (A).
Gcaba v Minister for Safety and Security & Others 2010 (1)
BCLR 35 (CC).
CCT51/13
Minister of Mineral Resources and Others v Sishen Iron Ore
Company (Pty) Ltd and Another. Judge: JAFTA (Mogoeng ,
Moseneke, Madlanga, Mhlantla, Nkabinde, Skweyiya and
Van der Westhuizen concurring)
Application for leave to appeal against the judgment of the
Supreme Court of Appeal concerning the conversion of old order
mining rights.
This case concerns the interpretation and application of the
transitional provisions of the Mineral and Petroleum Resources
Development Act (MPRDA) which came into force on 1 May
2004. The matter comes before this Court as an application for
leave to appeal against an order issued by the Supreme Court of
Appeal. The applicants were the Minister of Mineral Resources
(Minister); the Director-General of the Department of Mineral
Resources (Director-General); the Deputy Director-General:
Mineral Regulation, Department of Mineral Resources (Deputy
Director-General); the Regional Manager, Northern Cape
Region, Department of Mineral Resources (Regional Manager);
and Imperial Crown Trading 289 (Pty) Limited (Imperial Crown).
The respondents were Sishen Iron Ore Company (Pty) Limited
(Sishen) and ArcelorMittal South Africa Limited (AMSA).
Sishen Iron Ore Company (Pty) Limited (Sishen) and
ArcelorMittal South Africa Limited (AMSA) held undivided shares
in an old order mining right under the 1991 Minerals Act (78.6%
and 21.4%, respectively). Sishen applied to convert its right to a
mineral right in terms of MPRDA. AMSA failed to convert its
share. The Department of Mineral Resource subsequently
granted a prospecting right in respect of the propertied to
Imperial Crown Trading (ICT), under the belief that AMSA’s
undivided share was open for reallocation.
Sishen applied to the North Gauteng High Court to review and
set aside the granting of the prospecting right to ICT. AMSA was
joined as a party and it sought an order declaring that, at the time
of converting its right, Sishen had been granted 100% of the
mining rights. The High Court found that Sishen had indeed been
granted the full mining right and it therefore set aside the grant of
the prospecting right to ICT. The judge concluded the main
aspect of the case as follows:
“…the old order mining rights offered to Sishen and
AMSA when the MPRDA came into force ceased to
exist. Their termination was triggered by different
events at different times. Sishen’s right was the first to
cease to exist when it was lodged for registration. Item
7(7) stipulated that an old order mining right ceased to
exist upon registration. AMSA’s old order mining right
ceased to exist at midnight on 30 April 2009 due to its
failure to convert within the period of five years.” (Para
70).
The State applicants and ICT appealed against the order to the
Supreme Court of Appeal. With regards to the mining rights the
judge stated that:
“Sishen is entitled to formally apply again for, and be
granted, the residual 21.4% undivided share of
AMSA’s unconverted old order mining right in the
Sishen Mine, subject to whatever conditions the
Minister deems appropriate, provided they are
permissible under the MPRDA.” (Para 122).
Noted: That the Supreme Court of Appeal held that Sishen
obtained conversion of its own and AMSA’s old order mining
rights in 2008. Therefore, AMSA’s share in right was not
available for reallocation.
Also Held: That, due to AMSA’s failure to convert its old order
mining right, Sishen became the sole holder of the mining right in
respect of the relevant properties.
The state parties and ICT then approached the Constitutional
Court.
Held: That in terms of Schedule 7 of the MPRDA, AMSA’s
undivided share in the old order mining right ceased to exist on
the date on which the period for conversion expired.
Also held: That Sishen could not have applied for and obtained
conversion of something more than its own old order mining
right, comprising its own undivided share. The majority held that
main judgment that the appeal by the first to the fourth applicants
against the order of the Supreme Court of Appeal must succeed.
In a separate concurrence Moseneke DCJ agreed with the
interpretation and conclusions of the main judgment. He,
however, sought to extend the reasoning of the main judgment.
He reasoned that that Sishen was entitled to formally apply again
for, and be granted, the residual 21.4% undivided share of
AMSA’s unconverted old order mining right, subject to whatever
conditions the Minister deemed appropriate and permissible
under the MPRDA. He held further that the conditions may
accommodate the State’s concerns about the detrimental effect
that a monopoly by Sishen could have on the local steel market.
He concluded that Sishen was the only party competent to apply
for and be granted the mining right in terms of section 23 of the
MPRDA.
Also held: The appeal was upheld in part and the orders of the
High Court and the Supreme Court of Appeal were overturned.
Case References
August 2014 – Page 13
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Minister of Minerals & Energy v Agri South Africa [2012] ZASCA
93.
Alexkor Ltd & Another v The Richtersveld Community & Others
2004 (5) SA 460 (CC).
Western Cape Provincial Government & Others: In Re DVB
Behuising (Pty) Ltd v North West Provincial Government &
Another 2001 (1) SA 500 (CC).
Mankayi v AngloGold Ashanti Ltd 2011 (3) SA 237 (CC).
Sishen Iron Ore Company (Pty) Ltd & Another v Minister of
Mineral Resources & Others [2011] ZAGPPHC 220 (High Court
judgment).
Oudekraal Estates (Pty) Ltd v City of Cape Town & Others 2004
(6) SA 222 (SCA) (Oudekraal).
Hyundai Motor Distributors (Pty) Ltd & Others v Smit NO &
Others 2001 (1) SA 545 (CC).
Phumelela Gaming & Leisure Ltd v Grundlingh & Others 2007 (6)
SA 350 (CC).
Department of Land Affairs & Others v Goedgelegen Tropical
Fruits (Pty) Ltd 2007 (6) SA 199 (CC).
Agri SA v Minister for Minerals & Energy 2013 (4) SA 1 (CC).
Xstrata South Africa (Pty) Ltd & Others v SFF Association 2012
(5) SA 60 (SCA).
Holcim South Africa (Pty) Ltd v Prudent Investors (Pty) Ltd &
Others [2010] ZASCA 109.
Bertie Van Zyl (Pty) Ltd v Minister of Safety & Security [2009]
ZACC 11.
Hoban v ABSA Bank Ltd t/a United Bank & Others 1999 (2) SA
1036 (SCA).
Canca v Mount Frere Municipality 1984 (2) SA 830 (Tk).
Pheko & Others v Ekurhuleni Metropolitan Municipality 2012 (4)
BCLR 388 (CC).
MEC for Education: Kwazulu-Natal and Others v Pillay 2008 (1)
SA 474 (CC).
Independent Electoral Commission v Langeberg Municipality
2001 (3) SA 925 (CC).
President of the Ordinary Court Martial and Others v Freedom of
Expression Institute and Others 1999 (4) SA 682 (CC).
Norgold Investments (Pty) Ltd v The Minister of Minerals &
Energy of the Republic of South Africa & Others [2011] 3 All SA
610 (SCA).
Agri SA v Minister for Minerals & Energy 2013 (4) SA 1 (CC).
August 2014 – Page 14
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LABOUR WATCH
WOMEN IN BUSINESS - THE REALITY OF GENDER BIAS IN THE WORKPLACE
Written by Amanda Sibisi
Introduction
Judging from the media buzz, women appear to be racing to
the top of the corporate ladder. Books trumpet the “end of
men” and wives taking over as breadwinners, articles tout
the success of female executives at General Motors and
Yahoo, charts show women earning the majority of
advanced degrees.
As beautiful as the picture may seem, one can be certain
the picture is not as rosy as it seems. Women are still
discriminated against in the workplace but the discrimination
has become harder to detect, hidden in subtle biases such
as mothers being seen as less dedicated to their work and
less deserving of raises or promotions. As Caryl Rivers
(2013) states, “It’s not people firing bullets dead at your
chest, the landmines are buried.”
According to TNS Research Surveys, 68 percent of women
surveyed believe gender discrimination exists in the
workplace. Labour legislation protects women and other
minorities from discrimination in the work place with
provisions in the Employment Equity Act 75 of 1997.
Where does gender bias come from?
There are employers who believe gender bias just
spontaneously occurs in the workplace, and that it can be
resolved through mandatory diversity training and a demand
that employees simply improve their interpersonal
relationships overnight.
Victims of gender discrimination lose motivation and morale
necessary to perform their jobs effectively. According to a
report written by Jodi L. Jacobson of the World Watch
Institute (2005), gender bias also leads to a loss in
productivity. Things that may lead to this loss of morale and
motivation could include jokes about an employee’s gender
that imply inferiority, offensive jokes of a suggestive or
sexual nature and jokes implying that an employee’s work is
sub-par due to his/her gender. Labour legislation prohibits
this type of workplace harassment, whether by superiors or
coworkers.
Promotions.
Stereotypical views regarding gender can cause
supervisors to engage in the illegal practice of passing a
person over for promotion due to gender. While this can
happen to both genders, supervisors most often pass over
women for promotion due to preconceived notions about
their roles and abilities. For example, a fire chief may
repeatedly pass over a female fire fighter for promotion, due
to resentment stemming from women applying to the force
or due to a belief that men inherently perform better in these
positions. Supervisors may pass over qualified males for
promotions in industries that employ a high percentage of
women compared to men, such as teaching positions or
those industries involving care of children.
Family Responsibilities
Unfortunately this is not that case, gender bias occurs
because of personal values, perceptions and outdated,
traditional views about men and women. Gender bias
begins as early as primary school education, and this is
long before entering the workforce. As Carolyn Butcher
Dickman (1993), the author of "Gender Differences and
Instructional Discrimination in the Classroom," writes, "Most
K through 8 teachers, almost all women, suffer from
inadequate preparation in science so that they fear teaching
science and lack confidence in their ability to do so."
Consequently, according to Dickman, "The quality of
teacher contacts varies between the genders. Boys receive
more teacher reactions of praise, criticism and remediation."
Women who have young children at home may experience
push-back when interviewing due to family responsibilities.
Although law prohibits a prospective employer from asking
about family responsibility outright, it often comes out during
the interview process anyway. This may provoke the hiring
manager to pass over a qualified female candidate if he
feels she will be torn between her home and job
responsibilities. If the woman makes it into the position, her
supervisor can view her employee file to see that she has
young children signed up on insurance or other benefits. He
then may choose to give her less responsibility or assign
menial tasks to her that do not fit her job description.
Although illegal, this practice still exists in offices today.
Implications of gender bias on the workplace
Destruction
Lost Productivity
August 2014 – Page 15
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Those discriminated against may feel such strong
resentment and loss of self-worth that they resort to
destruction as a way to get back at the discriminatory
employer or coworkers. Destructiveness may manifest itself
as physical violence against others, destruction of property
or propagation of malicious rumors about people in the
company and the company itself.
Eradicating gender bias
Non-discrimination Policies
In the workplace, it is vital that employers set out clear
company policies regarding their non-discriminatory rules.
Addressing clear points as to why people should not be
discriminated against based on gender helps co-workers to
understand the effects of such treatment and the
consequences of not obeying the rules.
Education
Start in the classroom by teaching children that gender
discrimination is not right. If girls are offered equal
opportunities both academically and in their careers, they
will grow up to enter the workplace assured that their talents
and abilities will not be overlooked.
Education at Work
Illustrating to men that there is a no-tolerance policy on
discriminating against women will prevent perfectly capable
women from being dismissed from promotion possibilities,
as in the case of Price Waterhouse v Hopkins 490 US 228.
Miss Hopkins was passed over for promotion based on her
appearance. The U.S. Supreme Court found in her favor
that she had been unduly treated. Under article VII of the
Civil Rights Act of 1964, she was awarded an undisclosed
settlement.
Case citation
Price Waterhouse v Hopkins 490 US 228
References
Dickman, C.B. (1993) Gender Differences and Instructional
Discrimination in the Classroom. Journal of Invitational
Theory and Practice, v2 n1 p35-42.
Rivers, C. & Barnett, R.C. (2013).The New Soft War on
Women: How the Myth of Female Ascendance Is Hurting
Women, Men and Our Economy.USA:Tarcher
August 2014 – Page 16
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LABOUR WATCH
A LOOK AT THE AUTOMOTIVE INDUSTRY FOR 2014
Written by Egar Mokonyane
The National Association of Automobile Manufacturers in
South Africa (NAAMSA) was established 50 years ago and
has strategically positioned itself as the main source of
information in the motor industry for sub-Saharan Africa.
Over the years NAAMSA has represented the new vehicle
manufacturers and now the membership include major
importers and distributers of new vehicles and local
manufacturers and assemblers. NAAMSA releases
monthly report on new car sales figures, consumer trends
and general fiscal health of the country.
The automotive industry had 29 904 employees in their 31
March 2014 pay week, compared to the same time in 2013,
the number of employees has increased by 47. Total
employees for the 28th of February 2014 pay week was
30003, and 129 jobs have been lost during the month of
February based on the 31st of January 2014 pay week of
30132 employees, thus, a total 228 jobs have been lost
during the first quarter.
The first quarter of 2014 for new car sales recorded a total
of 126 485 units which was a decline of 7377 (5.5%)
compared to new units sold of 133 862 in the first quarter
of 2013. Total industry commercial sales saw an increase
of 400 units for the first quarter of 2014 compared to the
first quarter of 2013, the percent gain is 0.7. In terms of
sales for quarter ending 31 March 2014, Light commercial
vehicles lead the pack with an increase of 14.1%, followed
by Passenger vehicles with a 2.5% increase; however,
Medium commercial vehicles recorded a decline of 7.5%
and a decline of 7.2% decrease for Heavy commercial
vehicles.
In July 2014, Light commercial vehicles recorded a decline
of 312 units which makes up 2% compared to the same
time in 2013, total sales was 15 081 for July 2014 and
15 393 for July 2013. Compared to the same time last year
(2013), Medium commercial vehicles sales showed a
decline of 128 units and Heavy commercial vehicles also
showed a decline of 33 units.
July 2014 has seen a lot of activities with a slower
economic growth, rising inflation and increase in interest
rates, this resulted into a decline in new vehicles
sales of 1.5% (891) to 57 670 compared to 58 561 in
2013. Export were also affected by the metal workers
industrial action by a total of 22 733 (16.1%) to the 27 137
for July 2013. Local car manufactures were forced to stop
production during the industrial action and production was
negatively affecting about 12 000 companies, including
Toyota Motor and General Motors units in South Africa.
Steel and Engineering Industries Federation of Southern
Africa, (SEIFSA) alluded that the industrial action is
coasting about R 300 million a day.
References
http://www.naamsa.co.za/
http://www.wheels24.co.za/News/Naamsa-SA-vehiclesales-to-bounce-back-20140804
http://www.moneyweb.co.za/moneyweb-southafrica/metalworkers-lower-wage-demand--unions
August 2014 – Page 17
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LABOUR WATCH
STRIKES TURNS VIOLENCE: WHAT CAN BE DONE?
Introduction
The right to strike for the purposes of collective bargaining is
one of the fundamental rights enshrined in Section 27 of the
South African Constitution (Brand, 2010). However, long and
violent strikes have recently become a prominent feature of
the South African labour market. Perceptions are rife that this
unwelcome feature could be the probable reason potential
foreign investors shun South Africa as an investment
destination. This in fact, is a course of concern. In the
aftermath of violent strikes, businesses have cautioned of the
impending dangers of job losses. Business have also
responded by appealing for policing and security during
strikes (Business Day, 2014).
This article tracks selected incidences of violence as they
happen during year 2014. Of particular interest are the
reported violent incidences that erupted during the recent
industrial action by mine and metal workers. With this
evidence, the article then takes a brief look at the proposals
that have been put forward as ways to avert the occurrence
of violence during industrial actions.
Cases of violence during industrial action
Evidence suggest that barely two days after industrial action
at Platinum Mine commenced, two miners sustained injuries,
after a confrontation with mine security at Amplats Khuseleka
shaft (SABC, 2014). Non-participating miners were prevented
from reporting for duty. As a result, another mine worker was
killed and six others wounded as they were attacked with
machetes on their way to work (Wall Street Journal, 2014). In
May 2014 four more miners were killed as they attempted to
go to work (The Guardian, 2014).
It is also on record that recently, during the industrial action in
the metals sector, the General Motors Co. (GM) and
Bayerische Motoren Werke AG halted production at their
South African plants. Apparently, this happed as more than
220,000 metalworkers disrupted car-component makers and
turned violent (Bloomberg, 2014). In another incident, Eye
Witness News reported that two steel and engineering
Written by Aaron Chicheke
companies in Germiston and Olifantsfontein were attacked.
These cases of violence and many other unreported
incidences should be a cause of concern. If they go
unchecked, they have a tendency of sprouting out of control.
Suggestions to avoid violence during industrial action
Different suggestions have been put across as solutions to
mitigate and prevent the occurrence of violence during
industrial action. However, these suggestions could be biased
depending on the contributor’s affiliation and vested interests.
For instance, employers and businesses are of the view that
labour market rigidities are the root causes of violence and
unemployment in the country. Thus, their prescriptions to the
government are more inclined towards the implementation of
labour policies that allows them to easily hire and fire
workers. This had put the business community on collision
course with the main federation in the country, the Congress
of South African Trade Unions (Cosatu). To demonstrate the
extent of this labour market flexibility debate, provided below
is an extract from the Business Day (2014).
“Reforming labour law has been a recurring debate
ever since the labour law framework took shape in
1996. The debate is usually about “labour market
flexibility” and has time and again been shut down
by the Congress of South African Trade Unions
(Cosatu), which frequently quotes International
Labour Organisation studies showing that workers
in South Africa are relatively easy to hire and fire.
Cosatu has also used its alliance with the African
National Congress (ANC) to ensure reforms to
labour law are sufficiently watered down so as not to
reduce hard-won workers’ rights.”
This time, the ANC should be relieved to know, the debate is
not about hiring and firing at all, but rather about giving effect
to the principle of democracy in industrial relations. A growing
body of critics — led by John Brand, a mediation expert at
Bowman Gilfillan — has begun to point out that the causes of
labour-market conflict and long and violent strikes is the
absence of ordinary democracy in industrial relations.”
August 2014 – Page 18
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Furthermore, it is believed that the decision to embark in
industrial action is imposed on workers, which is an indication
of lack of democracy in the work place. This lack of
democracy have seen the minority militant workers violently
forcing other workers to participate in industrial actions. To
avoid this from happening, it has been suggested that strike
balloting should be made compulsory. The Vice President of
South Africa, Cyril Ramaphosa is one of the prominent
figures who is rallying behind the compulsory balloting of
workers. In addition to this intervention, the following
measures can also be considered:



Training of negotiators so that they can be tactical and
proactive during negotiations.
Advancement of mutual gain negotiations where all
parties to the negotiating table recognise other parties
as legitimate entities with diverse national interests.
Strengthening collective bargaining by respecting
organisational rights as enshrined in the national
statutes.
Conclusion
South Africa is at cross roads as far as the labour market is
concerned. There is a problem and there is need to act fast.
Solutions have to be found and effectively implemented
without delay. Forums have to be formed, whose intention is
to seek viable solutions that accommodate all interest parties
within the labour market. Any delays in this regard will see
dire effects on the whole economy. These effects could
include continuous credit rating downgrades, falling foreign
direct investment, jobs losses and falling production, among
others.
References
Paton, C. (2014, February 13). Effective action can be taken
to reduce long, violent strikes. Business Day. Retrieved from
http://www.bdlive.co.za/opinion/2014/02/13/effective-actioncan-be-taken-to-reduce-long-violent-strikes.
Whittles, G. (2014, 07 August). Numsa strike violence
continues. Eye Witness News. Retrieved from
http://ewn.co.za/2014/07/07/Numsa-strike-violence-continues.
Brand, J. (2010). Strike Avoidance – How to Develop an
Effective Strike Avoidance Strategy – presented by John
Brand at the 23rd Annual Labour Law Conference – August
2010. Retrieved from
http://www.lexisnexis.co.za/pdf/Workshop_3_3_Strike_Avoida
nce_presented_by_John_Brand.pdf.
Crowley, K. and Vollgraaff, R. (2014, July 5). GM, BMW Halt
South African Plants as Metals Strike Turns Violent.
Bloomberg. Retrieved from
http://www.bloomberg.com/news/2014-07-05/gm-bmw-haltsouth-african-plants-as-metals-strike-turns-violent.html.
Maylie, D. (2014, May 12). Four Killed in Violence amid South
Africa's Platinum-Mine Strikes. Wall Street Journal. Retrieved
from http://online.wsj.com/articles/four-killed-in-violence-amid1399897818.
Reuters. (2014, May 19). South African platinum firm Lonmin
'bleeding' after months-long strike. The Guardian. Retrieved
from
http://www.theguardian.com/business/2014/may/19/lonminplatinum-miner-south-africa-strike-wages-bleeding.
SABC. (2014, January 24). Rustenburg hit by violence during
platinum belt strike. Retrieved from
http://www.sabc.co.za/news/a/a03dfc8042acff18baebfa56d5ff
bd92/Rustenburg-hit-by-violence-during-platinum-belt-strike.
August 2014 – Page 19
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THE SOUTH AFRICAN
ECONOMIC OUTLOOK
SOUTH AFRICA AT A GLANCE: 2014
Written by Egar Mokonyane
THE World Bank recently revised their economic growth
outlook for South Africa downwards from an earlier forecast
of 2.7% to 2%. The bank has further revised its economic
forecast outlook from 3.4% to 3% for the year 2015. The first
quarter for South African economy contracted by 0.6%. The
World Bank forecasted the South Africa’s current account
deficit would improve slightly but remain large. The three
year forecasts are for a deficit of 5.9% in 2014, 4.7% in
2015, and 5% in 2016.
In 2014, South African Reserve Bank SARB) downwardly
revised its growth forecasts to 2.1% from 2.6%. South
Africa’s Gross Domestic Product (GDP) decreased by 0.6%
in the first quarter when compared to the same quarter of
2013, The PPI for final manufactured goods was 8,7% in
May 2014 (compared with 8,8% in April2014). From April
2014 to May 2014 the PPI for final manufactured goods
increased by 0,2%. The 8.7% annual rate was contributed
by food products, beverages, tobacco products, coke,
petroleum, chemical, rubber, plastic products, metals,
machinery, equipment and transport equipment.
Despite the highest inflation of 6,6% in May 2014, and GDP
of 1.6, South Africa is still the biggest economy in Africa.
South Africa’s total number of employed people has
increased to 8 507 000 in the first quarter of 2014 from 8 495
000 in the fourth quarter of 2013, however, Unemployment
Rate increased to 25.50 percent in the second quarter of
2014 from 25.20 percent in the first quarter of 2014 with a
total number of 5153.91 Thousand in the second quarter of
2014 from 5066.96 Thousand in the first quarter of 2014.
South Africa began 2014 with the longest industrial action in
the mining sector which took five months to resolve, a lot of
small businesses suffered as their business relied on mine
workers. During these tough times, Workers Association
Union (WAU) was formed and it opposed the length of time
taken to resolve the industrial action. The secretary of WAU
said that they sit around while the employee are leaded to
poverty and the economy of the country is taken down. The
other factor that affected the economy was the metal
industry where the industrial action lasted for four weeks.
There have been patches of protects by the communities in
different parts of the province.
Nersa has granted permission to Eskom to increase
electricity in 2015 by a tariff between 10% and 13%. This
increase will be way above the Inflation. Struggling small
businesses and cash strapped consumers will find it difficult
to make payments for their electricity, and the supply will be
cut. Consumers will find themselves digging deeper in their
pockets just to buy basic commodities as they will be
affected by the electricity hike.
While the price of fuel remained unchanged for the past two
months, The Gauteng motorist are still faced with the ever
growing E toll bill and the price of petrol. Living and working
on Gauteng has become a lot more expensive than in other
provinces due to the burden of E toll tariffs, car rental,
courier and delivery companies will have to incorporate the
cost of E toll in their pricing structures, however, all their
increases affect the end consumer.
Unemployment in South Africa is sitting at 25.5% which has
increased from 25.2% for the first quarter of 2014. The
unemployment rate for Women has increased from 27% in
quarter 1 for 2014 to 27.5% in quarter 2 for 2014, while the
Males unemployment increased from 23.7%(Q1:2014) to
23.8% (Q2:2014). The adult unemployment has increased
from 15.6 %( Q1:2014) to 16.3% (Q2:2014), the youth
unemployment remained unchanged at 36.1% for the first
two quarters of 2014 based on Stats SA’s quarterly labour
force for quarter 2 2014. The Government has introduced
the youth tax incentive that came into law on the 17th of
December 2013 and came into effect on 01 January 2014.
The unemployment incentive is accessible to people aged
18 to 29, where employers will get rebates of R 1000 per
month for every employee, however, the government went
further to protect the people who are above 29 years of age
and are currently employed by participating companies by
an Act that contains so-called ‘anti-displacement’ rules,
August 2014 – Page 20
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these rules are designed to guard against the dismissal of
non-qualifying employees that will constitute unfair labour
practice, there is a cash penalty of R30 000 and a
disqualification from the programme should a company be
found guilty of such an offence.
Despite the current unemployment rate, higher interest rate,
industrial actions and political challenges, South Africa has
welcomed the commitment from President Barack Obama in
supporting the continuation and enhancement of the African
Growth and Opportunity Act (AGOA). With this in place
South Africa can enjoy duty-free market access to the United
States for qualifying sub-Saharan African countries and they
have extended preferences on more than 4 600 products.
This is a great opportunity for all SMME’s who are into
production of goods, South Africa has exported about
60 000 automobiles a year using Agoa.
BRICS countries - Brazil, Russia, India, China and South
Africa, met at their sixth summit on the 15th of July 2014
where they agreed to start a New Development Bank which
is expected to be operational in 2016 with a combined cash
injection of $100 billion bank and a currency reserve fund.
References
South Africa GDP Annual Growth Rate
http://www.tradingeconomics.com/south-africa/gdp-growth
South Africa.
http://www.africaneconomicoutlook.org/en/countries/souther
n-africa/south-africa/.
http://www.timeslive.co.za/local/2014/03/04/platinum-strikecripples-small-businesses-and-families.
http://beta2.statssa.gov.za/publications/P0302/P03022014.p
df.
http://www.thesait.org.za/news/154445/The-basics-of-thenew-Employment-Tax-Incentive.htm.
http://www.southafrica.info/news/international/us060814b.htm#.U-N9iE3lrIU#ixzz39iEZOP3r.
http://www.southafrica.info/news/international/us060814b.htm#.U-N9iE3lrIU.
http://www.aa.co.za/on-the-road/calculator-tools/fuelpricing.htmll
August 2014 – Page 21
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THE INTERNATIONAL
LABOUR MARKET
POLICY RESPONSES TO YOUTH UNEMPLOYMENT: A GLOBAL PERSPECTIVE
Written by Aaron Chicheke
Introduction
The transition into the labour market is hallmark to life-long
employment experiences for any aspiring young person.
This is a crucial stage for any youth as it marks one’s
financial independence, earning potential, change in social
status, application of learning, and it sets precedent for one’s
career advancement. However, the high and ever increasing
levels of youth unemployment in South Africa have
delineated the vast majority of youth from these exhilarating
experiences. This is totally unfair for the South Africa’s
young generation, considering that some countries around
the world are faring well, especially after the global
economic recession.
The South Africa labour market context
South Africa currently faces a huge unemployment problem.
According the Statistics South Africa (StatsSA) (2014),
approximately 5.1 million people of the ages between 15-64
years in South Africa are without jobs and about 15 million
people are not economically active. Of the unemployed
people, 36.1 percent are the youth compared to just 15.6
percent for the adults.1 It is astonishing to witness that five
years post the economic recession, such a sizable number
of the youth remains without jobs. Sadly, young women are
even more vulnerable compared to their male counterparts.
To this end, about 40 percent of young women are
unemployed compared to only 33 percent for young men.
The youth unemployment situation is further exacerbated by
the fact that the unemployed youths’ probability of getting
employment is 22 percent less than that of unemployed
adults.
On the contrary, youth unemployment in Germany has been
falling since 2005 and continued to fall during the recession
(Crowley, Jones, Cominetti and Gulliford, 2013). The
Netherlands has managed to maintain a stable and low level
of youth unemployment for the last decade and
Youths are those individuals between the ages of 15 and
34 years and adults are those between the ages of 35 and
64 years.
1
Australia has experienced a decade of low youth
unemployment rates. However, these countries have been
Outperformed by Canada, which created close to 1.6 million
net new jobs since 2006. Driving this job creation was the
remarkable strength of the Canadian labour market that
particularly became evident after the global recession
(Department of Finance Canada, 2014).
Despite the fact that youth unemployment in South Africa is
exceptionally high, it remains a global phenomenon. Youth
unemployment differs from country to country and mostly
depends of various factors such as education system, labour
market institutions and the strength of the national economy.
To this end, this analysis focuses on global youth
unemployment with the intention to provide a deeper
understanding of youth unemployment dynamics and
various policy responses. Therefore, it is envisaged that
these global policy interventions could provide South Africa
with important tools to help it curb the deep rooted youth
unemployment challenge facing the country.
Youth unemployment from a global perspective
A report by the International Labour Organization (ILO)
estimated that about 74.5 million young people aged 15–
24 around the world were unemployed in 2013 (LIO, 2014).
This number is almost 1 million more compared to the
previous year. This placed the global youth unemployment
rate at 13.1 percent, which is almost three times as high as
the adult unemployment rate. Recently, there has been
uproar in the South African media, with the National Union of
Metalworkers of South Africa (NUMSA) raising concerns that
South Africa ranks third in terms of youth unemployment,
after Greece and Spain (City Press, 2014). From a global
perspective, the figure below shows that youth
unemployment in the NEMA countries remains the highest in
the world and continues to rise. However, youth
unemployment in the developed countries and the European
Union, and the Sub-Saharan shows some improvement over
the period between 2010 and 2014.
August 2014 – Page 22
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dealt with in greater detail. However, this does not mean that
these interventions are not relevant in promoting youth
unemployment. With regards to the labour market, the
Canadian Government took important steps. These steps
are more directed at supporting the development of a skilled,
mobile and inclusive workforce within an efficient labour
market. Below are the key labour market initiatives that were
introduced by Canada.
Improving labour market information
Despite the growing concerns about sprouting global youth
unemployment, the Canadian labour market has exhibited
exceptional performance in terms of youth unemployment
reduction. The Canadian labour market since 2006
outperformed its Group of Seven (G-7)2 counterparts in
terms of new jobs created in the country in 2013,
(Department of Finance Canada, 2014). This suggests that
Canada’s economy was the strongest amongst the G-7
economies post the global economic recession.
While this analysis takes a global perspective, it is mainly
focused on the Canadian labour market. This is on the
backdrop of the country’s outstanding performance. To this
end, important lessons could be drawn from the youth
unemployment eradication strategies that they have put in
place.
Recognising that effectively matching job seekers with
available job opportunities is critical in supporting economic
growth and fostering an efficient labour market, the
Canadian Government introduced timely and thorough
labour market information facilities. These facilities were
meant to enhance job search efforts by providing Canadians
with information about existing job opportunities, the skills
requirements and their respective locations. Furthermore,
the Canadian Government introduced an efficient and
responsive Employment Insurance (EI) system, along with a
proactive approach to employment services and skills
certification. This further improved the matching process
between job seekers and employers. In particular the
following measures were introduced:


Canada’s policy responses to youth unemployment
The Government of Canada has created an environment
that encourages new investment, economic growth and
ultimately job creation. To this end, Canada leads the G-7
with the lowest overall tax rate on new business investment.
The Government of Canada introduced several measures to
ensure an enabling environment. The macroeconomic
interventions introduced ranges from tax reductions, creation
of tariff-free zones, trade agreements, research and
development, access to venture capital to infrastructural
development. However, since the focus of this analysis is on
the labour market, these interventions are not going to be



The G-7 is a group of countries is a working coalition of the
world’s largest economies. These countries include: The
United States, Canada, Great Britain, Japan, Germany,
France and Italy.
2
Economic Action Plan 2012 provided $21 million
(R244.9 million) over two years to enhance the content
and timeliness of the job as well as labour market
information provided to Canadians who are searching
for employment.
Government initiatives such as the Working in Canada
and Job Bank websites were introduced to provide job
seekers, workers as well as those who are new to the
labour market with information related to postings,
labour market conditions, and wages and salaries,
among others. The Economic Action Plan 2014 further
proposes to build on these initiatives by modernizing
the Job Bank and launching an enhanced Job Matching
Service.
The Canadian Government also works with its
provincial and territorial counterparts through the Forum
of Labour Market Ministers to find innovative and
practical strategies to enhance labour market
information.
The Government has also launched a new, national EI
pilot project to ensure that EI claimants always benefit
from accepting work while receiving EI benefits. These
changes will make the EI program more fair, efficient
and responsive to regional economic conditions.
To leverage the knowledge of employers, the
Government of Canada launched the Sectoral
Initiatives Program in 2012. The aim of the program
was to support partnership-based projects that develop
employer-driven labour market information, national
August 2014 – Page 23
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occupational standards, and certification and
accreditation regimes, in order to address skills
shortages in key sectors of the economy.
Lessons for South Africa
The structural nature of unemployment in South Africa
suggest that employment opportunities actually exist in the
country but those who are unemployed do not have the
necessary skills and expertise required. This is probably the
reason there is a large number of youth without jobs. What
can be brought home from the Canadian labour market
analysis is that labour market information is important for an
efficient labour market. This may sound irrelevant but the
fact that the Canadian Government opted to put more effort
in ensuring that information is available and accessible
suggests that labour market information is critical. There
might be other factors at play that could have contributed to
Canada’s success, such as macroeconomic policy. Yet,
labour market information availability and accessibility may
have played a mediating role.
Therefore, what this entails for South Africa is that there is
need to step up efforts to enhance labour market information
availability and accessibility. This can happen at three
stages. Firstly, intensive efforts should be made to ensure
that labour information regarding skills on demand and
institutions that offer the required qualifications is made
available to matriculants as they transit from high school to
tertiary education. This will assist them in choosing courses
that equips them with the right skills. Secondly, information
regarding job openings, apprenticeships, training and the
associated requirements should be made available to the
youth as they graduate from higher learning institutions.
Finally, information should be provided to those who have
lost their jobs so as to reduce the time they spend before
getting another job.
References
Assaad, R and Levison, D. (2013). Employment for Youth –
A Growing Challenge for the Global Economy. Background
Research Paper. Commissioned Paper for the High-Level
Panel on Post-2015 UN MDG Development Agenda
Employment and Economic Growth. Retrieved from
http://www.post2015hlp.org/wpcontent/uploads/2013/06/Assaad-Levison-Global-YouthEmployment-Challenge-Edited-June-5.pdf.
Sapa (2014, March 17). SA youth unemployment third
highest in world – Numsa. City Press. Retrieved from
http://www.citypress.co.za/news/sa-youth-unemploymentthird-highest-world-numsa/.
Department of Finance Canada. (2014). The State Of The
Canadian Labour Market. Jobs Report. Retrieved from
http://www.budget.gc.ca/2014/docs/jobs-emplois/pdf/jobsemplois-eng.pdf.
ILO. (2014). Global Employment Trends 2014. Retrieved
from
http://www.ilo.org/3C8864B5-F2E5-44F4-ACED37FF748D6D8B/FinalDownload/DownloadId1BFD990309BB37C40C8647B047216147/3C8864B5-F2E544F4-ACED-37FF748D6D8B/wcmsp5/groups/public/--dgreports/---dcomm/--publ/documents/publication/wcms_233953.pdf.
O'Higgins, N. (2001). Youth unemployment and employment
policy: a global perspective. MPRA Paper No. 23698.
Retrieved
from
http://ideas.repec.org/p/pra/mprapa/23698.html.
Crowley, L., Jones, K., Cominetti, N., and Gulliford, J.
(2013). International Lessons: Youth unemployment in the
global context. The Network Foundation. Retrieved from
http://www.theworkfoundation.com/DownloadPublication/Re
port/329_International%20Lessons.pdf.
These strategies will ensure that there is constant
communication from employers to the universities and other
training institutions regarding the critical skills they require.
This will enable the universities and training institutions to
more be responsive to skills demand. The question here is
whose responsibility this should be? Thus, if labour
information is to be improved, joints efforts and collaboration
should stem from the Department of Labour, Department of
Education and Employer Bodies, Universities and other
training institutions, among others.
August 2014 – Page 24
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LATEST CCMA CASE
REFERAL STATISTICS
By Amanda Sibisi
Introduction
The Commission for Conciliation, Mediation and Arbitration
(CCMA) deals with a multitude of matters using a variety of
processes including collective bargaining, conciliations and
arbitrations. These matters are captured on the CCMA’s
Case Management System (CMS) and a report is
developed by the Operations and Information department
on a monthly basis. The information below is based on the
matters of interest contained in the report.
Sectors
According to the reports provided by the Operations and
Information department there had been a great consistency
in the sectors that have had the highest number of referral
over the past six months, these being the
Business/Professional Services, Retail, Safety/Security
(Private) Domestic and Building and Construction sectors.
The Business and Professional services, which has
consistently had the highest number of referrals for the first
half of the year with 179621 referrals from January to date.
This comes as no surprise due the varied number of
industries that fall into the Business/Professional Services
sector from artists and galleries to funeral parlours.
Non-attendance at conciliation
An interesting finding from the reports provided by the
Operations and Information department was the steady
increase of non-attendance by both the applicants and the
respondents throughout the year with an increase of 1630
parties not attending conciliations in April 2014.
The report tallies the referrals for the financial year up to
the month that it is reporting on, therefore it was of no
surprise to see a drastic decrease in the number of nonattendances between March and April 2014, a decrease of
16796.
The number of increased non-attendances to the
conciliation process correlates with the increased number
of referrals received by each region. Therefore, one can
presume that the increase can be contributed to the fact
that there were more cases referred to the CCMA and thus,
there was an increased chance of parties not attending the
process.
Conclusion
The Retail and Security sectors also had substantial
referrals to the CCMA, with 13907 and 11848 referrals per
sector respectively. This is consistent with the vastness of
both these industries. One would expect that they would
have a high referral rate due to the number of
organizations within the sectors as well as the number of
employees employed by those organizations.
The CCMA is handling a multitude of cases with the
majority of cases were dismissals, 80354. The other
matters that were referred to the CCMA were Unfair Labour
Practices (9022), Matters of Mutual Interest (2918), Other
LRA 2848 and Collective Bargaining (2275). This is
consistent with the matters that the CCMA is most likely to
deal with and the matters that the CCMA is privy to handle
in terms of jurisdiction.
The Domestic sector and Building and Construction sectors
were also in the top 5 sectors with the highest referrals for
the first half of the year with each sector having 9306 and
8691 cases referred to it respectively.
It was interesting to find that the CCMA dealt with 1 case
that was related to the Unemployment Insurance Fund
(UIF) as matters of that nature are not within the jurisdiction
of the CCMA.
August 2014 – Page 25
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