NUM & NUMSA v Eskom Holdings (Pty) Ltd, [2011] 1 BLLR 102 ; (2010) ILJ 2570 ZALAC 16, 24 August 2010.

Note: SCA overturned the judgment in:

Eskom Holdings Ltd v Num (840/2010) [2011] ZASCA 229; 2012 (2) SA 197 (SCA); [2012] 1 All SA 278 (SCA); [2012] 3 BLLR 254 (SCA); (2011) 32 ILJ 2904 (SCA) (30 November 2011)

“Significantly, the learned judge elided past the express wording of section 74 to rely exclusively on section 72 in order to come to the conclusion that the CCMA does not have the necessary jurisdiction.    There is no reason provided for failing to reconcile section 72 with section 74.    Yet, the express wording of section 74 would appear to facilitate the resolution of a dispute concerning a party, who wished to negotiate a Minimum Service Agreement (MSA), the absence of which precluded the party from participating in the strike because it is said that the party is engaged in an essential service”. (para 24)

“Once the MSA has been concluded however, then the dispute will be resolved, in that the relevant party could participate in a strike, free of the prohibition of section 65(1)(d) because of the existence of the MSA.    In other words, the failure of the parties to agree to a MSA has given rise to a dispute, the consequences of which are to preclude a category of workers from participating in a strike.    Section 74 provides for a clearly defined mechanism to deal with such an impasse”.   (para 25)

On 24 August 2010 Davis JA (Patel JA & Hendricks AJA concurring) in the Labour Appeal Court allowed an appeal by the trade unions and declared that the CCMA has the necessary jurisdiction to resolve disputes arising for a failure to agree on the terms of a minimum service agreement – see NUM & NUMSA v Eskom Holdings (Pty) Ltd,

The issue in dispute required an interpretation of sections 72 and 74 of the Labour Relations Act 66 of 1995 (LRA).   Basson J in the Labour Court (Eskom Holdings (Pty) Ltd v NUM [2009] 1 BLLR 65) held that that the only competent forum was the Essential Service Committee (ESC) and that the

‘LRA did not provide that the failure to agree on the terms of a Minimum Service Agreement (MSA) was a dispute on a matter of mutual interest which could be referred to conciliation to the Commissioner for Conciliation, Mediation and Arbitration (CCMA)’.

Facts as stated in paras [3] – [5] of the LAC judgment:

“Respondent (Eskom) operates in an industry that was designated as an essential service in September 1997.    Respondent and appellants (NUM and NUMSA) have been unable to conclude a MSA.    In June 2007, appellant sought to refer the failure to agree on the terms of a MSA as a dispute on a matter of mutual interest to the CCMA for conciliation, failing which a referral of the dispute to compulsory arbitration”.

“Respondent raised an objection to the referral of the dispute to conciliation on the basis that the CCMA lacked jurisdiction to entertain the dispute.    The relevant CCMA commissioner decided that the CCMA did have the necessary jurisdiction to conciliate the dispute”.

“Appellant then applied to review this ruling.    When the matter came before Basson J, it was agreed that the following legal question was to be determined:

“Do the disputes arising within a designated essential service, which may be referred to the CCMA for conciliation and, if unresolved, to arbitration, include a dispute over a failure to conclude an agreement on the terms of a minimum service agreement?”

The court a quo upheld the review application on the basis that the CCMA lacked the necessary jurisdiction to deal with the dispute.    In order to answer this question, it is necessary to turn to the applicable legislation”.

Legal position

Davis JA outlined the legal position regarding the fundamental right to strike and dealt with the argument of counsel for the trade unions (para 16):

“Mr. Kennedy, who appeared on behalf of the appellant, submitted, in effect, that the court a quo had been beguiled by a formalistic approach to collective agreements.    The arbitration of an interest dispute was essentially a substitute for the collective bargaining process which results in the collective award.   Accordingly, the arbitration award which is the outcome of an interest dispute, is the substantive equivalent of a collective agreement.    On this basis therefore, section 72 could be read to include the ratification of an award.    This approach would prevent the surprising conclusion that the legislature deliberately chose not to provide a dispute resolution mechanism for disputes over MSA’s”.

Right to strike

In para [18] Davis JA dealt with this fundamental right:

“This Court has recognised that the constitutional right to strike should not, in the absence of express limitations, be restrictively interpreted.    Chemical Workers Industrial Union vs Plascon Decorative (Inland) (Pty) Ltd (1999) 20 ILJ 321 (LAC) at paras 27 – 28.    In this judgment the Court referred to the emphasis placed by the Constitutional Court on the importance of the right to strike.    See in re:  Certification of the Constitution of the Republic of South Africa 1996 [10] BCLR 1253 (CC) at para 66.   Cameron JA (as he then was) then went on to say at para 28:

“This is of course not to say that striking should be encouraged or unprocedural strikes condoned but only that there is no justification for importing into the LRA, without any visible textual support, limitations on the right to strike which are additional to those the legislature has chosen clearly to express”.


Davis JA concluded with the following in para 26]:

“In summary, by seeking to reconcile section 65, 70 and 74, no additional limitations are placed on the right to strike, save where these are expressly so provided by the LRA.    In addition, the interpretation that I have adopted gives clear effect to the wording of the various sections rather than, in effect, eliding over the implications of section 74 to resolve the problem exclusively in terms of section 72”.