Pick n Pay Retailers (Pty) Ltd v Saccawu obo Mzazi (CA19/2015) [2016] ZALAC 56 (25 November 2016) per Savage AJA (Waglay JP and Landman JA concurring)

There is little doubt that there was a valid reason to dismiss the employee who failed to return to work on time after taking annual leave.  But the arbiter’s decision on the fairness of the reason for dismissal was held to be unreasonable, hence the order of reinstatement.  But the LAC disagreed with Rabkin-Naicker J’s order that it be with full retrospective effect.  So once again it is important to distinguish between the validity of the reason and the impact on the enterprise.  That is where fairness to both parties comes into play and progressive discipline needs to be adopted.

Comment: Once again it is difficult to understand why the word ‘sanction’ continues to be used.  It is not used in the LRA, which refers to reason and fairness and avoids the use of language suggestive of criminal conduct and procedures, bearing in mind that employers should not punish employees.  Is that not what the word ‘sanction’ suggests?

LAC summary:

“Employee dismissed in absentia for absconding from work.  At arbitration dismissal of employee found substantively fair but procedurally unfair in that no hearing convened on his return to work and two months’ compensation awarded for procedural unfairness.  On review the Labour Court found award unreasonable and set it aside, substituting it with a finding that the employee’s dismissal was procedurally and substantively unfair and ordering retrospective reinstatement within 14 days.  On appeal: judgment of Labour Court upheld with no order as to costs subject to substitution of order of retrospective reinstatement with an order of reinstatement without retrospective effect and a written warning valid for 12 months for unauthorised absence from work.”

Excerpts without footnotes

[1]   This is an appeal, with leave of the Court a quo, against the judgment and orders of the Labour Court (Rabkin-Naicker J) in which the award of the third respondent (the commissioner) was reviewed, set aside and substituted with a finding that the dismissal of the employee, Mr Luyanda Mzazi, was procedurally and substantively unfair and his retrospective reinstatement within 14 days ordered. This followed the commissioner finding at arbitration that the dismissal of the employee was substantively fair but procedurally unfair with two months’ compensation awarded to him.

. . . . .

[3]   The employee was employed by the appellant, Pick ’n Pay Retailers (Pty) Ltd, in June 2004. At the time of his dismissal, he was a storeman at the appellant’s Middestad branch in Cape Town.  The appellant’s leave policy, requires that annual leave be taken –

‘subject to…trading requirements and business needs …[and] the joint agreement of both management and the employee.  If agreement cannot be reached, then management will get together with the employee and his/her representative for [purposes of] reaching an amicable solution’.

. . . . .

[6]   On 15 January 2013 the disciplinary hearing was held in the absence of the employee. The written notice to attend the disciplinary enquiry recorded that the notice had been “issued in absentia” to the employee.  It stated that the hearing related to “absconding from your workplace since 22/12/12 without authorisation”.  Mr Yusuf Oyekunle, the assistant store manager at the Middestad branch, acted as initiator and presented the case of the appellant at the hearing.  He relied on the three telegrams sent to the employee, an absenteeism report and the appellant’s attendance register.  The minutes recorded that the employee had waived his rights to lead evidence at the hearing.

[7]   In his closing argument Mr Oyekunle reiterated that the telegrams had been sent to the employee who had been absent from work and who “…clearly has no interest to work and should be found guilty”. The chairperson proceeded to find the employee “guilty of absconding from the workplace”.

[8]   The aggravating factors relevant to sanction put up by Mr Oyekunle were the severe negative impact that absconding from the workplace has on the appellant’s business, the shortage of staff causing poor service delivery and the employee’s failure to respond to the telegrams sent to him. He stated that the employee’s behaviour could not be condoned and indicated that the employee “is not interested in his work”.  The employee was dismissed from his employment with immediate effect.

. . . . .

[17]   In the arbitration award, the commissioner rejected the employee’s version, finding that he had taken leave without authorisation and that he had committed misconduct. The commissioner took account of the employee’s key position, his lengthy period of unauthorised leave, the fact that it was taken at the busiest retail time of the year and his failure to reach an agreement with Mr Oyekunle regarding leave in January or occasional leave.  This led the commissioner to conclude that the misconduct committed was serious, had implications for the appellant’s operations and undermined the trust relationship.  Although the commissioner found that the employee had no intention to abscond which “placed his conduct in a different light” to what was found at the disciplinary hearing, given his lengthy absence from work and his lack of contact with his employer, the appellant “had no choice” but to assume that he was not returning to work.  The dismissal of the employee was accordingly found to be substantively fair.

[18]   Turning to the procedural fairness of the dismissal, the commissioner found that the appellant “should have dealt with the situation differently when the applicant eventually returned to work” and given him a hearing on his return to work:

‘The fact that the applicant did return to work, and reported for duty, meant that there was no intention to abscond.  This placed his conduct in a different light.  While the absence of the applicant was lengthy, the applicant also had a long service history with the respondent.  The respondent is a large employer with a sophisticated and well resources HR department.  The applicant was entitled to the very basic principle of fairness…to state [his] side of the matter, and to defend himself against allegations of misconduct.’

[19]   The employee was awarded two months’ compensation for procedural unfairness.

Judgment of Labour Court

[20]   On review, the Labour Court took account of the fact that the commissioner found that the employee had not absconded from work, which was the offence he had been charged with, as well as the commissioner’s finding that this placed the employee’s conduct “in a different light”. The Court found that “it can be assumed” that the commissioner’s finding that the employee should have been provided with a proper opportunity to explain his conduct on his return meant that had such opportunity been provided “this may have prevented his dismissal”.  Furthermore –

‘The issue of [the employee’s] clean disciplinary record, the reason for his need to return to the Eastern Cape to unveil tombstones for his parents and [his] relatively long employment history with the company were all considerations that should have been addressed by the Commissioner in the process of coming to a decision regarding the substantive fairness of the dismissal.  They were not.  Further, the reasoning that a disciplinary hearing may have put [his] absence in a different light, highlights the flaw in this approach.’

[21]   The Court found that the decision that the dismissal was substantively fair was one that a reasonable decision-maker could not reach. No issue was taken with the commissioner’s finding that the dismissal had been procedurally unfair.  As a result the order made was that:

‘(1)       The award under case number WDC T2454 – 13 is hereby reviewed and set aside and substituted as follows:

‘(a)       The dismissal of Mr L.  Mzazi was procedurally and substantively unfair;

(b)        The third respondent is ordered to retrospectively reinstate Mr Mzizi within 14 days of this order.   ”

(2)       There is no order as to costs.’

. . . . .

Evaluation

[23]   It is now trite that whether a commissioner’s finding was one which a reasonable decision-maker could not reach on the material before him is to be determined in light of Sidumo v Rustenburg Platinum Mines Ltd and Others (Sidumo)[1] and with reference to Herholdt v Nedbank Ltd [2] and Gold Fields Mining SA (Pty) Ltd (Kloof Gold Mine) v CCMA and Others.[3]

[24]   While ordinary principles of contract permit a contracting party to terminate a contract if the other party is unable to perform, in an employment context, the question remains whether it was fair for the employer to exercise that election.[4] The material before the commissioner clearly showed that there was no agreement that the employee could take leave in December. The appellant’s leave policy expressly required such agreement in writing, of which policy the employee was aware, and in being absent from work without authorisation the employee conducted himself in breach of the appellant’s rule.

[25]   In determining whether the appellant’s decision to dismiss was fair in Theewaterskloof Municipality v SALGBC and Others,[5] echoing the Constitutional Court in Sidumo, it was recognised that the commissioner must balance

“the reason why the employer imposed the dismissal against the basis of the employee’s challenge of it. That requires a proper understanding of both, which must then be weighed together with all other relevant factors in order to determine whether the employer’s decision was fair.”[6]

The relevant circumstances to be considered include the elements of the Code of Good Practice with the task of the commissioner being neither to consider sanction afresh nor to defer to the employer’s decision.[7]

[26]   In considering the fairness of the employee’s dismissal, the commissioner had regard to the employee’s position and his lengthy period of unauthorised leave at a busy time of the year to find that the misconduct was serious and undermined the trust relationship with the appellant.

The commissioner found that the appellant in dismissing the employee had “no choice” but to assume that the employee was not returning to work.  This was so in spite of evidence that the appellant had failed to send notice to the employee at the address it had for him on record; and that Mr Oyekunle was aware that the employee had sought to take annual leave and then occasional leave yet made no reference made to this at the disciplinary hearing.

[27]   With an emphasis on corrective and progressive discipline, the Code of Good Practice recognises that dismissal for a first offence is reserved for cases in which the misconduct is serious and of such gravity that it makes continued employment intolerable. For leave without authorisation to justify summary dismissal for the first offence, the material before the commissioner must exist to show that the misconduct was of such a serious nature as to justify dismissal the imposition of the most severe of available sanctions.

[28]   Although it was suggested that the employee’s absence caused operational strain over the busy festive period given his position as storeman, no evidence showed that it caused harm of such a serious nature that it warranted summary dismissal for the first offence.[8] This was more so when the employee had a lengthy period of service and a clean disciplinary record. While he was clearly wilful and displayed disregard for the appellant’s rules, the employee was not dishonest in his misconduct, which was shown to have caused inconvenience but no proven loss or damage to the employer.  Regard was not had by the commissioner to the fact that as a large employer, the appellant had the resources to make contingency plans, that such plans were made and that the employee ultimately returned to work at the conclusion of what he considered to be the leave days due to him.  [9]

[29]   The commissioner also had no regard to whether discipline for the same or similar disciplinary infractions had been applied consistently by the appellant.[10] Ms Gertse received a written warning for taking leave without authorisation in circumstances in which it concerned the breach of the same rule, although her misconduct was distinguishable in severity in that her leave had been agreed but her leave form not authorised by signature. Furthermore, the commissioner did not have regard to the appellant’s evidence of its failure to comply with its own procedure in sending telegrams calling on an employee to return to work to the incorrect address.  The fact that the appellant did not comply with its own procedure made it irrelevant whether the employee would have complied with the instruction to return to work if the correct address had been used.

[30]   For these reasons, I am satisfied that the Labour Court’s finding cannot be faulted that the commissioner’s decision that the dismissal of the employee was substantively fair was not one that a reasonable decision-maker could reach on the material before him.

[31]   The commissioner failed to have appropriate regard to the material before him and the relevant circumstances as they applied to this matter. The breach of the employer’s rule in the circumstances of this matter warranted the imposition of a sanction short of dismissal given the relevant facts, consistency in the manner of application of the rule and the response to its breach, the employee’s clean disciplinary record and long service.

[32]   As a result, the award was unreasonable and permitted interference on review to the effect that the dismissal of the employee was too harsh and that the imposition of a sanction short of dismissal was both fair and appropriate in the circumstances. Given the nature of his misconduct, the employee should however receive a final written warning valid for 12 months from the date on which he is reinstated into his employment with the appellant for unauthorised absence from work.

. . . . .

[35]   Having regard to the nature of the employee’s misconduct, the reasons for the finding that the sanction of dismissal was unfair, the disciplinary warning to be imposed on the employee and the effect of the reinstatement order on the appellant, the view I take of the matter is that an order of reinstatement without retrospective effect is fair in the circumstances of this matter.

[36]   The appellant does not appeal against the finding of procedural unfairness but contends that the Labour Court erred in conflating procedural and substantive fairness. I am not persuaded that there is merit in this ground of appeal.  The commissioner noted that the fact that the employee returned to work placed his conduct “in a different light”.  This indicated a recognition that, while the employee had been dismissed on the basis that he “is not interested in his work”, his return to work did not bear this finding out.  The Labour Court, in finding that the employee may have prevented his dismissal had he been provided with an opportunity to explain his conduct on his return, did not conflate procedural and substantive fairness in this or any other manner such as to justify the appeal being upheld.