On 9 March 2011 Landman AJA delivered a unanimous judgment (Mlambo JP and Tlaletsi JA concurring) in Volkswagen SA (Pty) Ltd v Koorts NO [2011] JOL 27166 (LAC).   The LAC disallowed the employer’s appeal against the decision of the Labour Court (Bhoola AJ) and upheld the award of the private arbitrator who found that the dismissals were substantively unfair and awarded compensation and reinstatement.

The LAC confirmed that parties to a private arbitration agreement cannot impose conditions that would have the effect of empowering the Labour Court to treat a review as one in terms of section 145 of the LRA and not section 33 of the Arbitration Act 42 of 1965.

Unfair reason to terminate

In dealing with the fairness of the reason for termination of employment Landman AJA remarked:

“What if the employer is correct that the employees went to the locker room to play cards or even gamble, during down time and without permission to absent themselves from their workplaces, would the employees be defrauding their employer?   They would be paid in any event when there is down time.   They have not caused the down time.   They may be punished if they left their work stations during down time without permission but they would be entitled to their wages.   They had not, on the facts, engaged on a frolic of their own which would have entitled their employer to have regarded them as being absent from its service”. Para [45]

“This matter has been made more difficult by the intrusion of an excess of emotion.   First the employees have been taxed with: deliberately abandoning their work, ‘stealing company time’, and dishonestly taking remuneration’”.  Secondly the charges, which I have set out above, are not found in the disciplinary code although it was conceded that the code is a guide and that additional offences may be formulated”.  [para 33]

Summary of facts

VW believed some employees were playing cards and gambling in a locker room and unbeknown to the employees installed a video camera and started video surveillance of everyone who entered and exited the locker room.   Selected employees were alleged to have infringed three attendance rules.   At a disciplinary enquiry and after the employees had given their evidence the video tapes were screened and admitted into evidence.   It was decided that the allegations had been proven and the employment of the employees was terminated.

Employer’s allegations

“It is alleged that you committed serious misconduct, in breach of the trust necessary to sustain the employment relationship in that:

  • You dishonestly and deliberately abandoned your workstation during normal working hours, and without having any prior authority to do so for periods/approximating to the time specified below.
  • You dishonestly took money in the form of remuneration for the period during which you were not working, to which you knew you were not entitled.
  • You dishonestly and deliberately attempted to mislead the Company by providing false information when you were requested to explain your conduct.

In respect of group leaders:

  • You undermined the authority entrusted to you in your position as a Group Leader by participating in and/or condoning conduct in breach of the standards which you are required to uphold.”

The dispute was submitted to private arbitration where it was concluded that the dismissals were substantively unfair.   Compensation was awarded to two employees and the others were reinstated with retrospective effect.