Collective agreement invalid: Unconstitutional as well

City of Cape Town v Imatu (C884/2014) [2015] ZALCCT 58; [2015] 12 BLLR 1197; (2016) ILJ 147 ; [2015] JOL 34136 (LC) (17 September 2015) per Rabkin-Naicker J.

The Labour Court declared the Disciplinary Procedure and Code Collective Agreement (2010) purportedly concluded by Imatu, Samwu and Salga on 21 April 2010 under the auspices of SALGBC invalid in terms of SALGBC’s constitution and accordingly did not bind the City of Cape Town. The background facts are recorded in Salga v Imatu (JA46/2012) [2014] ZALAC 2; [2014] 6 BLLR 569; (2014) 35 ILJ 2811 (LAC) (4 March 2014)

Further issues were whether collective agreements:

that breach the constitution of a bargaining council can nevertheless be binding in terms of sec 23 of the LRA; and
entered into by parties to a bargaining council can be governed by both sections 31/32 and section 23 of the LRA?

The Labour Court remarked that the very purpose of establishing bargaining councils and concluding collective agreements was to regulate sectoral bargaining The binding nature of collective agreements concluded by parties to those councils is governed by specific provisions in the LRA, set out in Part C of Chapter 3 headed “Bargaining Councils”. The Labour Court held that there was a distinction between collective agreements concluded inside and outside bargaining councils, which are governed by sec 23 of the LRA. The former are clothed with statutory enforcement mechanisms provided for in sec 33A of the LRA. They are of a special type. They cannot ‘morph’ into sec 23 collective agreements. So the parties cannot enforce them ‘across a sector invalidating the inherent purpose of the conclusion of a collective agreement in a bargaining council’.

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GilesFiles on Oct 15, 2015 at 3:54 pm

Prof Darcy du Toit discusses this judgment in his latest Editorial Can an invalid (collective) agreement have any effect? published by LexisNexis on IR Network [subscription required] and these are excerpts.

While collective agreements fall within the broad definition of “contract”, they are contracts like no other. One of their unique features, showing the legislature’s purpose of safeguarding the process against certain technical challenges, is contained in section 206 of the LRA. It states that certain “defects” in the constitution of a bargaining council, or in the composition of its structures, will not invalidate a collective agreement or other acts by the council. Thus, shortcomings that might have rendered an ordinary contract null and void – say, where a trade union or employer’s representative to a council has not been properly appointed – will not affect the legal effect of a bargaining council agreement.

However, section 206 does not protect unconstitutional procedure by a council. Thus, where the chairperson of a council committee improperly curtailed the discussion at a meeting, its subsequent decisions were held to be invalid [See Plastics Convertors Association of SA v NUMSA (2015) 36 ILJ 256 (LC)].

This principle was illustrated in two more recent judgments relating to (purported) collective agreements entered into by the South African Local Government Bargaining Council (SALGBC). The agreements in question were a Wage Curve Agreement (giving effect to a job evaluation agreement; hereafter ‘WCA’) and a Disciplinary Procedure and Code Collective Agreement (‘DPCCA’). The dispute concerning the WCA culminated in the judgment of the Labour Appeal Court in South African Local Government Association v Independent Municipal Allied Trade Union and others [2014] 6 BLLR 569 (LAC), while that arising from the DPCCA led to the recent judgment of the Labour Court in City Of Cape Town v Independent Municipal and Allied Trade Union (Case Number C884/2014, 17 September 2015).
. . . . .
Where employers and unions consistently follow a particular disciplinary procedure, for example, it could be inferred that they are accepting a reciprocal duty to do so. This would be the case also if no written agreement exists. Where parties are acting in terms of a written agreement which they believe to be valid, but which afterwards turns out to be invalid, the inference should be even stronger.

It remains to be seen whether any of these questions will resurface in the future. For now, the main lesson of these judgments seems to be that parties to bargaining councils should exercise the greatest care to ensure that they adhere to agreed procedures and should formulate their agreements to say precisely what they intend them to say. At very least, this could help to avoid protracted, costly and possibly disruptive litigation that can only place South Africa’s collective bargaining system under even greater strain.

GilesFiles on Jan 11, 2016 at 11:21 am

Now reported: [2015] 12 BLLR 1197 (LC)
Headnote:
Bargaining Councils – Collective agreements – Bargaining council collective agreements must be concluded in terms of procedure required by council constitution, otherwise invalid and not binding on parties – SALGBC Disciplinary Procedure and Code agreement declared invalid because not properly ratified.

Collective agreements – Validity – Bargaining council agreements not adopted in terms of council’s constitution and therefore invalid cannot be deemed binding in terms of section 23 of LRA as “ordinary” collective agreements.

Local Government – Disciplinary Procedure and Code – Code invalid and not binding on parties as not properly adopted at inception.

GilesFiles on Feb 5, 2016 at 9:34 am

Now reported (2016) 37 ILJ 147; [2015] JOL 34136 (LC).

GilesFiles on Feb 5, 2016 at 9:35 am

See also pages 310, 319 and 327 in Du Toit et al Labour Relations Law: A Comprehensive Guide 6th ed, 2015 (LexisNexis)

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Collective agreement invalid: Unconstitutional as well

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