The LAC disallowed the employer’s appeal and confirmed the order of Le Roux AJ in the Labour Court.  On reviewing the award the LC found that the arbiter did not act unreasonably in regarding the employee’s conduct as a failure to work diligently and was not dishonest.  Apart from imposing a final written warning the employees were not retrospectively reinstated.  So employers need to be aware of a rational gradation of misconduct to appreciate its less serious nature, which taken with the lengthy periods of service and clean disciplinary records supported by a finding that ‘the trust relationship had not been damaged to the extent of making the continuation of the employment relationship objectively intolerable’.

LH Marthinussen v MEIBC (JA41/2014) [2016] ZALAC 26 (14 June 2016) per Murphy AJA (Davis and Musi JJA concurring)

LAC summary

Review of arbitration award – arbitrator finding that employee’s dismissal substantive unfair on the basis  that sanction of dismissal too harsh – arbitrator taking into account all relevant factors in arriving at his decision – award falling within the band of reasonableness – Labour Court’s judgment upheld – appeal dismissed with costs.

Excerpts without footnotes

[11] It is trite that decision-makers acting reasonably may reach different conclusions on the issue of sanction.  Provided the sanction falls within a reasonable range of options the court should be loath to interfere where the arbitrator has considered all relevant factors and not been influenced by capricious or irrelevant considerations distorting the outcome.  The record reveals that the arbitrator considered all the relevant evidence. 

Much of the appellant’s argument before us complained about the failure of the arbitrator to accept its interpretation on dishonesty and show deference to the employer’s prerogative on sanction.  As the court a quo pointed out, the notion advanced by the appellant that an arbitrator must accord deference to the employer’s decision as to sanction was rejected by the Constitutional Court in Sidumo and Another v Rustenburg Platinum Mines Ltd and Others.

However, the appellant also intimated that the arbitrator irrationally contradicted himself in finding initially that the conduct was dishonesty but then holding later that it was not.  The submission misrepresents the arbitrator’s reasoning. 

His finding was essentially that the dishonesty in this case was not of the egregious kind, where, for instance, the perpetrator deliberately steals from or blatantly defrauds the employer.  Truancy is a lesser form of dishonesty.  There is no incongruity in that reasoning. 

The arbitrator did not contradict himself or unreasonably substitute the offence.  He merely engaged in a rational gradation of the offence to reveal its less serious nature, which taken with the lengthy periods of service and clean disciplinary records of the respondents, supported his conclusion that the trust relationship had not been damaged to the extent of making the continuation of the employment relationship objectively intolerable. 

The severe sanction he chose to impose, 18 months suspension, implicitly took account of the harm caused to the employer and its need to enforce discipline.  The arbitrator thus evinced an understanding of the rule breached and the importance of that rule. 

He took account of the employer’s reason for imposing the sanction of dismissal and the prejudice to the employer caused by the conduct.  But he disagreed with the employer’s approach and reasonably refused to defer to it.  He rationally held that the potential effect of a dismissal and the long-service record of the employees justified a sanction less than dismissal. 

He then imposed the suspension without pay and a final warning valid for 12 months.  There was nothing improper or unreasonable about the manner in which the arbitrator exercised his discretion; nor did he misconceive the nature of the enquiry.