Xstrata South Africa (Pty) Ltd (Lydenburg Alloy Works) v Num obo Masha (JA 4/15) [2016] ZALAC 25 [2017] 4 BLLR 384 ; (2016) ILJ 2313 (LAC) (14 June 2016) per Murphy AJA (Davis and Musi JJA concurring)

The LAC disallowed the employer’s appeal and upheld the order of the Labour Court.  On review Shai AJ had confirmed the substantive unfairness of the dismissal but substituted retrospective reinstatement instead of compensation, as awarded by the arbiter.

In effect the arbiter found that reinstatement was not reasonably practicable after having regard to

  • (1) short service;
  • (2) dismissal took place a year before the award; and
  • (3) little initiative was shown when employed.

But the employer failed to prove that an ongoing employment relationship would be intolerable.

LAC summary:

Review of arbitration award –- reinstatement primary remedy for unfair dismissal unless reasonably impractical or employment relationship irretrievably destroyed – reinstatement not appropriate relief when it is not practically feasible – arbitrator misconstrued the nature of the enquiry he was obliged to undertake to determine the practicability of reinstatement.  Employer leading no evidence as to the impracticability of reinstatement – arbitrator committing reviewable irregularity by taking irrelevant considerations into account – Labour Court’s judgment upheld – Appeal dismissed with costs.

Excerpts without footnotes

“[8] In Mediterranean Textile Mills (Pty) Ltd v SACTWU and Others, [2012] 2 BLLR 142 (LAC) at para 28, this Court confirmed that reinstatement is the primary remedy under the LRA and involves placing an employee back in employment as if the dismissal had never occurred.  If the exceptions to the remedy of reinstatement do not apply, the Labour Court and arbitrators only have a discretion with regard to the extent to which reinstatement should be made retrospective.

An employer wishing to avoid reinstatement must satisfy the arbitrator that one of the exceptions to reinstatement applies, in this case to show that it would not be practicable.  The employer should lead evidence concerning relief in anticipation of a finding that a dismissal might be ruled unfair.

Xstrata did not raise or present any evidence in respect of any of the factors relied upon by the arbitrator or in opposition to an order for reinstatement.  The issue of the impracticability of reinstatement was not mentioned in the arbitration proceedings and no evidence was tendered to support such.

Xstrata submitted before us that the arbitrator nevertheless considered the totality of the evidence and correctly found that reinstatement would not be practical.  It argued that having found the employee was guilty of poor performance and in the light of a concession made by the employee that she needed continuing direct supervision, as she did not feel competent to work alone, it was, in its view, entirely reasonable for the arbitrator to find it was not “practical” to reinstate the employee.

[9] There are a number of obstacles in the way of accepting that submission.  While an arbitrator is bound to determine the true nature of the dispute between the parties, it was unreasonable for the arbitrator to raise the issue of poor work performance and make an adverse determination in this regard for the first time in the award.

This was not the case Masha had to meet.  At no stage prior to or even during the arbitration was Masha called upon to deal with her alleged incapacity.

The approach and principles applicable to a dismissal based on poor work performance differ in material respects from those applicable to a dismissal based on misconduct.  Misconduct and poor work performance are distinct concepts requiring different remedial procedures with different sanctions.

Consequently, the relevant evidence and arguments to be presented in each case are different.  When an employee is dismissed for poor work performance, the arbitrator must examine whether the employee was trained to perform the functions that he or she was tasked to do; whether such training was adequate; and whether the employee may benefit from further training or counselling.

The common cause evidence before the commissioner was that the initial mentoring that Masha received in relation to the completion of the route forms was incorrect; and she did not receive any training or counselling with regard to the completion of the new route forms.

It is therefore not surprising that Masha testified that she did not feel competent to do her job alone.

Having determined that the dismissal was substantively unfair on the grounds that the alleged misconduct had not been proved, it was problematic for the arbitrator to then seize upon an untested allegation of poor performance as the essential reason for refusing reinstatement.”