Prescription of awards: Effect of amendment LRA s145(9)

2 Comments

1. 

   GilesFiles on June 30, 2016 at 11:20 am

   Prof Darcy du Toit’s Weekly Comment in IR Network published on 11 May 2016 by LexisNexis [subscription required]

   “Debt” redefined: What does it mean for labour law?

   Excerpts

   The Labour Appeal Court recently decided that an arbitration award ordering an employee’s reinstatement is a “debt” in terms of section 10 of the Prescription Act, which prescribes after three years even where the employer prevents enforcement by taking the award on review, IR Network Weekly Comment 13 November 2015. 1 The court did so in light of its interpretation of the public policy considerations applicable to prescription. What it did not do, however, was to consider the constitutional context. But in Makate v Vodacom (Pty) Ltd [2016] ZACC 13 (26 April 2016) the Constitutional Court did this and came to a different conclusion – which, it is suggested, calls for a reassessment of the prescription of reinstatement orders.
   . . . . .
   Its reasoning was brief. The view that “every obligation irrespective of whether it is positive or negative, constitutes a debt”, it found, was questionable even in the context of pre-Constitutional case law and unsustainable in light of section 39(2) of the Constitution (above).

   The Prescription Act limits the right of access to court and, as such, must be narrowly interpreted – or, as the Constitutional Court has put it, “when legislative provisions limit or intrude upon those rights they should be interpreted in a manner least restrictive of the right if the text is reasonably capable of bearing that meaning” (para 91).

   This alone puts paid to the High Court’s assumption that “debt” must be given a wide meaning, and also disposed of the Labour Appeal Court’s reliance in Myathaza [2016] 25 LAC 1.26.2 also reported at [2016] 1 BLLR 24 (LAC)on the common law principle of “legal certainty” in understanding the scope of prescription. What is essentially an issue of convenience cannot prevail over the protection of a basic right.

   . . . . .
   The judgment concludes:

   “There is nothing … that remotely suggests that “debt” includes every obligation to do something or refrain from doing something apart from payment or delivery. It follows that the trial Court attached an incorrect meaning to the word “debt”. A debt contemplated in section 10 of the Prescription Act does not cover the present claim. Therefore, the section does not apply to the present claim, which did not prescribe” (para 93).

   Applying the same reasoning to an arbitration award ordering the reinstatement of an employee, it can also be said that this does not involve “an obligation to pay money, deliver goods, or render services”. If so, the last word in the Myathaza dispute, or others like it, may yet remain to be spoken.

2. 

   GilesFiles on December 27, 2016 at 6:14 pm

   Reported
   (2016) 37 ILJ 1413 (LC)