The Labour Court in National Union of Metal Workers of South Africa obo Members v SAA Technical (Pty) Ltd (2023) 44 ILJ 2000 (LC) has confirmed that even when lengthy CCMA facilitation precedes a mass retrenchment, parties that subsequently claim unfair dismissal are still required to refer the dispute to conciliation, in order for the Labour Court to be cloaked with jurisdiction to determine the matter.
The Labour Court reaffirmed the principle that an unfair dismissal dispute relating to retrenchment must be referred to conciliation first, in order for the Labour Court to be cloaked with jurisdiction to determine the substantive fairness of the dismissal.
The Court held that even in matters where the CCMA has been appointed to facilitate a pre-dismissal consultation between the parties in terms of Section 189A(3) of the Labour Relations Act, 1996 (LRA) it is still necessary for the dispute to be referred to conciliation after the fact of dismissal.
SAA, the Respondent in the matter, initiated a large-scale retrenchment process in April 2021. The CCMA was subsequently appointed to facilitate consultations between SAA and the employees, but in October 2021, 1193 SAA employees were ultimately retrenched due to operational reasons. In January 2022, NUMSA, acting on behalf of the employees, referred a statement of claim to the Labour Court challenging the substantive fairness of the employees’ dismissal.
In response to the claim, SAA took the point that the filing of the statement of claim constituted an irregular step, given that NUMSA did not seek to have the dispute conciliated at the CCMA, prior to approaching the Labour Court.
As such, SAA argued that the Labour Court did not have jurisdiction to determine the matter. In the hearing before Judge Prinsloo on 12 May 2023, the parties contested the correct interpretation of Section 189A(7) of the LRA, the main question being whether or not employees dismissed after CCMA facilitation are required to pursue conciliation at the CCMA before seeking the intervention of the Labour Court.
NUMSA argued that in cases where a facilitator is appointed to assist the parties in pre-dismissal negotiations, employees who are dismissed once the retrenchment process has been finalised may approach the Labour Court to challenge the fairness of their dismissals, without first approaching the CCMA or Bargaining Council to conciliate the dispute. Simply put, they argued that conciliation is not necessary where facilitation has taken place.
In further support of their argument, NUMSA referred to the matter of NUMSA v Bell Equipment (2011) 32 ILJ 382 (LC), in which the Court held that post-facilitation conciliation is not a requirement for a referral to the Labour Court in terms of Section 189A(7)(b)(ii), and found that an interpretation that it was required, would be absurd.
NUMSA implored the Court to follow the approach of the Court in Bell Equipment and to appreciate that when a facilitator is appointed, the parties benefit from a facilitation process “which is not identical to but not dissimilar from the conciliation process.”
Post-facilitation conciliation would, in NUMSA’s view, offer no benefit, as the parties would merely be discussing the same issues that they discussed during the facilitation stage.
In contrast, SAA argued that conciliation was still necessary after facilitation because the two processes are uniquely different. The facilitation process is aimed at ensuring that the requirements of Section 189(3) are met, and takes place prior to dismissal, while conciliation concerns a dispute regarding the fairness of the dismissal. Counsel for SAA argued that the retrenchment of the employees gives rise to a dispute of right, which is a fresh cause of action.
Similarly, in South African Equity Union obo Van Wyk v Lodestone Confectionary (Pty) Ltd t/a Candy Tops (Unreported, 26 May 2017, Case No. PS19/16), the Labour Court rejected the employee’s argument that they were not required to first refer a dispute relating to the substantive fairness of their dismissal to conciliation since their dismissal followed a CCMA facilitated process.
In rejecting NUMSA’s argument and finding that the interpretation contended for by SAA was correct, the Court acknowledged the conflicting judgments on the issue, but nevertheless held that a referral for conciliation “is indispensable and…is a precondition to the Labour Court’s jurisdiction over unfair dismissal disputes.”
In arriving at its conclusion, the Court appeared to follow the reasoning of the Labour Appeal Court in National Union of Metal Workers of South Africa v Driveline Technologies (2000) 21 ILJ 142 (LAC), and the Constitutional Court in Bell Equipment and National Union of Mineworkers of South Africa v Intervalve (Pty) Limited (2015) 36 ILJ 363 (CC), which confirmed that the referral of a dispute to the CCMA or bargaining council and the issuing of the certificate of the non-resolution of the dispute constitute the necessary jurisdictional fact for the Labour Court to have jurisdiction over unfair dismissal disputes, including unfair mass retrenchment disputes.
Lastly, the Court agreed with the submission of SAA that facilitation and conciliation are different processes. Facilitation is concerned with avoiding retrenchments and compliance with the provisions of Section189(3), while conciliation happens after dismissal when the fairness of the dismissal is challenged, with a view to resolving the dispute. At the facilitation stage, there exists no dispute, but only a contemplation of dismissal based on the employer’s operational requirements. Once dismissal has taken place, a fresh dispute arises that must be conciliated, and it is for this reason that facilitation cannot be equated to conciliation.
The judgment serves to highlight the importance of conciliation as an integral aspect of the procedural framework of the LRA, and to affirm the principle that conciliation must take place in all matters concerning unfair dismissal disputes, regardless of whether dismissal is preceded by lengthy CCMA facilitation in large scale retrenchments.