Numsa v Element Six Production (Pty) Ltd (JS1106/14)[2017] ZALCJHB 35 ; [2017] JOL 37392 (7 February 2017) per Edwin Tlhotlhalemaje J.

The labour court found that by paying non-strikers a bonus the employer had breached s 5 of the Labour Relations Act (LRA).  That section is intended to protect employees against discrimination for exercising of a statutory right, such as a protected strike.  But no monetary award was made in favour of the protected strikers.  The perceived difficulties with the law were listed and included deterring striking, double pay, weakening collective bargaining efforts, potential violence and failing to address legitimate employee concerns.

Du Toit et al Labour Relations Law: A Comprehensive Guide 6th ed (LexisNexis 2015) pages 222, 223, 225, 289 and 357

Excerpts without footnotes

Introduction:

[1]   The Applicants approached the Court to contest the decision of the Respondent to pay a ‘token’ to some of its employees who had performed additional tasks during the course of a protected strike that took place in July 2014. The Applicants contend that the decision was discriminatory within the meaning of the provisions of sections 5 of the Labour Relations Act (The LRA)[1].

. . . . .

[3]   The above dispute arose out of the following common cause facts;

3.1   The Respondent produces abrasive super materials that are used as an input tool for the purposes of drilling, grinding and polishing. Its customers are in various industries including aerospace, oil and gas, and are mainly based in North America.  As at 2014, it had employed about 980 employees, with 180 of them falling outside the bargaining unit;

3.2   On 1 July 2014, members of NUMSA, UASA and SAEWA commenced a protected strike at the Respondent’s Springs’ plant in support of national demands tabled at the MEIBC. The protected strike ended on 28 July 2014, and employees resumed their duties on 29 July 2014;

3.3   The allegations of discrimination arose after a decision taken by the Respondent on 6 August 2014 to pay in accordance with certain criteria, what it considered to be a token of appreciation to those employees who had worked and performed additional tasks during the strike action;

3.4   Payments according to the Respondent were made to employees who

  • (a) worked for at least 10 days during the industrial action;
  • (b) were permanent employees and
  • (c) made a positive contribution to running production during the persistence of the industrial action;

[4]   The Respondent’s contention is that the above payments did not breach the provisions of section 5 of the LRA, and were not discriminatory on any specified or unspecified ground. It considered the criteria it had applied in making payments as objective and rational, which was not intended to be discriminatory, and further that the payment did not have any effect on the effectiveness of the strike, nor was it likely to have a detrimental effect on future strikes.

[5]   The Respondent disputed that NUMSA members were denied additional payments on the basis of their participation in protected industrial action. It contended that during the industrial action in question, there were several employees who had performed additional tasks as because they were not party to the industrial action, or they were not affected by the wage dispute before the MEIBC; or because they were not members of NUMSA; or that they chose to tender their services during the industrial action;

. . . . .

Evaluation:

[16]   The starting point is that the right to strike is a fundamental right enshrined in the Constitution[1] and regulated by the LRA[2]. It is accepted that not all employees may be willing to join a protected strike even if they belong to a trade union that had called for that strike.  There is nothing in the LRA or any other statutory provision that prohibits an employer from utilising the services of its non-striking employees to perform work ordinarily performed by striking employees, and rewarding them for going the ‘extra mile’.

[17]   The provisions of section 187(1)(a) and (b) of the LRA[3] specifically prohibit the employer from compelling non-striking employees to do work normally done by striking employees. Francis J in NUM v Namakwa Sands held that these provisions placed an indirect prohibition on an employer to ask non-striking employees to do the work of striking employees during a protected strike[4].  In the same token however, no consequences are visited upon an employer that has politely asked non-strikers to volunteer to perform work ordinarily performed by striking employees.

[18]   The lacuna in the LRA has created a conundrum, which unfortunately the drafters and legislators equally failed to address in the recent amendments to the LRA despite the contentious views and positions expressed in both FAWU & others v Pets Products and NUM v Namakwa Sands. The difficulties that arise when non-striking employees volunteer to perform the functions ordinarily performed by the striking employees are easily identifiable.  Whether these difficulties are imagined or real is a question of fact, and in some instances, of law.  Some of these difficulties are the following;

18.1   In very rare instances would ordinary (low ranking) non-striking employees volunteer to perform the tasks of striking employees without an expectation of some form of reward;

18.2   Non-striking employees who are asked to perform the tasks of those on strike in addition to their normal tasks can view this as an opportunity to supplement their salaries during the duration of the strike. This can induce them to refrain from joining strike actions, or abandon the strike midstream, or be deterred from taking part in strike actions in future[5].

18.3   Ultimately, the exercise of a right to strike with a view of advancing and addressing employees’ legitimate concerns might be rendered ineffective if not nugatory. In the alternative, if in the end, the striking employees’ demands are met, the non-striking employees who fall within the bargaining unit, and who had performed the tasks of those on strike in addition to their own, would end up benefitting twice, i.e., an increase in salary as a result of the sacrifices made by their colleagues, and secondly, from an extra income derived from the strike action.  This clearly cannot be fair;

18.4   The practice has the effect of weakening the employees’ collective bargaining effort, or at most causing discord and disunity amongst members of a union, thus undermining the right to strike and invariably tilting the scales of the power play in favour of the employer;

18.5   The consequences that flow from such disunity may be dire for non-striking employees, given the common knowledge that strikes normally tend to turn violent whether in, at or near workplaces and beyond. It is not uncommon for strike violence to spiral into communities and employees’ places of residence, and employers and the courts would be remiss in not acknowledging these far-reaching consequences;

18.6   When non-striking employees perform the tasks of striking employees, employers can withstand a protracted strike and continue with business as usual as long as the strike continues. Such practices undermine the legitimacy of protected strike actions, and can be used as a strategy by employers to negate and dilute the intended effects of the protected strike action embarked upon by employees;

18.7   The effect of such practices is to side-track employers from addressing legitimate concerns of the striking employees as long as production and business continues as normal during the strike. It can also degrade the status of collective bargaining as a constitutional tool to resolve disputes[6], defeat the purpose of the LRA as identified in its section 1[7], and undermine the rights of employees to freely associate and take part in the lawful activities of their unions;

18.8   The provisions of section 10 of the Basic Conditions of Employment Act[8] equally escaped the attention of the drafters during its recent amendment in regards to these contentious issues. These provisions allow employers to require or permit employees to work overtime, provided there is an agreement.  However, these provisions do not address the issue whether such overtime work, albeit permitted and consented to, should cover work ordinarily performed by striking employees.

[19]   The issue of onus has to be considered within the context of the difficulties identified above. Section 10 of the LRA stipulates that an employee who alleges that a right or protection conferred by section 5 has been infringed must prove the facts of the conduct, and the employer who engaged in that conduct must then prove that the conduct complained of did not infringe those provisions.

[20]   The parties are at odds in regards to how the test pertaining to onus ought to be applied. The Applicants’ approach is that to the extent that they had demonstrated that the Respondent’s conduct of paying non-striking employees for performing tasks that would ordinarily have been performed by the striking employees infringed on their rights or protections conferred by section 5, the onus had shifted to the Respondent to demonstrate that it had no malicious intent in discriminating against them.

[21]   The Respondent however took a different view to that in NUM v Namakwa Sands and FAWU in respect of the nature of the onus placed upon it, contending that the correct test is that as proposed by Brassey.  In this regard, the argument was that in determining whether there was contravention of section 5(2)(c)(iii) and 5(2)(c)(iv) of the LRA , it was required of a party to demonstrate ‘discriminatory conduct that was actuated by an illicit reason’. 

Thus, according to the Respondent, in order to determine whether the payment was unfairly discriminatory, there should be an enquiry into whether rational and objective criteria were used in assessing who the beneficiaries of the payment were and whether the Respondent intended to unfairly discriminate against striking workers.  This approach was to be used in conjunction with the test set out in section 10.

[22]   The question of the onus in this case needs to be understood within the context of the employees’ case, which was that they were discriminated against on the basis of their participation in the lawful activities of their trade union, and further having exercised their rights to strike. In Mbana v Shepstone & Wylie [9] the Constitutional Court held that within the context of employment law, the test for unfair discrimination is comparable to that laid down Harksen [10], and reiterated that the

  • first step is to establish whether the respondent’s policy differentiates between people.
  • The second step entails establishing whether that differentiation amounts to discrimination.
  • The third step involves determining whether the discrimination is unfair.

Thus, if the discrimination is based on any of the listed grounds in section 9 of the Constitution, it is presumed to be unfair.

[23]   In this case, I have no reason to deviate from the test and approach adopted in FAWU & others v Pets Products and NUM v Namakwa Sands in regards to the issue of onus, more so since that approach is in line with the test formulated in Harksen.

On the facts of this case, I accept that the Applicants have discharged the onus placed on them by demonstrating that there was indeed differentiation which amounted to discrimination, and that and in return, the Respondent has not been able to demonstrate that its conduct did not infringe on the rights of the Applicants as they had contended, nor have it demonstrated that the discrimination was fair.

My conclusions are fortified by the following;

23.1   It was common cause that the strike action was protected, and was in pursuance of demands tabled at the MEIBC to which the Respondent was a member. The strike action had ultimately resulted in an agreement being reached at the level of the MEIBC.  To the extent that the employees had participated in that strike, they had done so in pursuance of the lawful activities of their trade union, and in the exercise of their rights as conferred in both section 64 of the LRA, and as entrenched in section 23(2)(a) and (c)  of the Constitution;

23.2   In anticipation of the strike, employees had increased productivity, and equally ‘went the extra mile’, with a view of enabling the Respondent to meet the demands of its customers. It is accepted that the employees were paid their normal overtime pay in this regard, however, like their non-striking colleagues, they also went the extra mile.  I did not understand the Respondent’s case to be ‘extra mile’ both sets of employees went to varied in degrees to justify the differentiation;

23.3   As a consequence of the striking employees’ extra effort before the strike, the Respondent was able to meet the demands of its customers for at least three weeks. On the Respondent’s version, the volunteers performed additional tasks in the last few days of the strike.  Not much turns on the contention that volunteers went the extra mile in performing additional tasks in the first few days of the strike action without inducement or promise of a reward, as they had simply understood the position the Respondent found itself in;

23.4   When the surplus stock started to deplete, the Respondent then called upon the volunteers to work on a revised shift system in order to ensure that production continued. Amongst those volunteers were members of NUMSA who fell within the bargaining unit;

23.5   As a consequence of the shift work performed by the volunteers, this had assisted the Respondent to prevent a total supply failure, a gap in the supply line, and enabled it to meet all its supply obligations;

23.6   Significant with the re-arrangement of the shift system as adopted by the Respondent is that it enabled and induced non-striking employees to volunteer, and it is improbable that employees would have volunteered to work shifts without an expectation of some form of reward;

23.7   On 6 August 2014, and about a week after the strike had ended, the Respondent took a decision to pay what it considered a token to those employees who had not embarked on strike action, and who in its version had ‘gone the extra mile’;

23.8   When NUMSA complained about this differentiation, the Respondent justified it on the basis of ‘fair or objective’ criteria applied in making the payments. Significant with the alleged criteria is that those that qualified must have worked for at least 10 days during the industrial action.  If this was the case, this then leads to the question that if there were employees who had volunteered in the early days of the strike, and had done so without inducement or expectation of a reward, why would they be rewarded when it was the Respondent’s case that the shifts were re-arranged only to cater for the last week of the strike when stocks depleted?

23.9   Significantly also, the criteria that those that were paid must have been permanent employees and had made a positive contribution to running production during the persistence of the industrial action cannot by all accounts justify the differentiation, in that the striking employees were equally permanent employees and had equally contributed positively to the running of production in that they had gone the extra mile prior to the strike. Thus even on the test of onus favoured by the Respondent, there was no rational or objective criteria utilized to reward non-striking employees;

23.10   More worrying with these additional payments is that despite the Respondent’s contention that it had merely shown ‘goodwill and appreciation’ towards the non-striking employees, it has refused to disclose to NUMSA how much was paid to those employees, other than contenting that the criteria for payment was objective and fair. The veil of secrecy surrounding these payments, especially since they were purportedly not akin to overtime pay, leads to an inference that they were not merely made as a token;

23.11   Significant also with these payments is that they were made in similar circumstances as in FAWU, where there is neither a term or condition of employment prevailing at the Respondent or a practice that employees were to be remunerated for work done over and above the normal contractual entitlements. Such payments in line with the difficulties pointed out in this judgment at paragraph 18 have created doubt as to their bona fides, and notwithstanding Mr. Tshabalala’s contentions that as far as he knew that might not be the case, it is not far-fetched to conclude that union members would in future think twice prior to joining strike actions in the future;

23.12   Given the conclusions reached above together with the difficulties as indicated elsewhere in this judgment, it is concluded that the payment of a ‘token’ made to non-striking employees in this case constituted differentiation, which amounted to discrimination within the confines of section 5 of the LRA. That discrimination was unfair in that the striking employees, contrary to the provisions of section 2(c)(iii) and (vi) were prejudiced for their participation in the lawful activities of their trade union, and the exercise of their right to strike.

[24]   The difficulties in granting the Applicants any form of relief in such circumstances have been identified in both authorities referred to in this judgment. In FAWU, it was held that to grant any form of relief would be to condone or compound the illegitimate conduct of the Respondent (i.e., of rewarding non-striking employees for work done during a protected strike).  The Court in this regard deemed a declaratory order prohibiting repetition of similar conduct as appropriate.

To the extent that the Applicant may have sought payment of the additional payments made to non-striking employees, a further difficulty is that these amounts are unknown, partly as a result of the Respondent’s reluctance to disclose them immediately after NUMSA had raised its concerns, and partly as a result of the Applicants not having done anything to quantify those amounts even after the Respondent had made a discovery in respect of some of them[11].

Other than the difficulties raised in both FAWU and NUM v Namakwa Sands, it would therefore neither be competent nor appropriate for the court to grant any monetary relief in this case.  To that end, and in view of the conclusions reached in respect of the discriminatory conduct complained of, a declaratory order is deemed to be appropriate.