Member Article

Section 189 of the Labour Relations Act, 1995 (the "LRA") provides that an employer, after giving notice that it is contemplating dismissals on the grounds of its operational requirements, must enter into a consultation process with regard to the proposed dismissals. Section 189(2) provides that this consultation process must be a “meaningful joint consensus-seeking process” in which an attempt must be made to reach consensus on a range of issues, including measures to avoid or minimise the need to dismiss employees.

In 2002, the LRA was amended by the insertion of section 189A in order to reinforce this duty to consult in the instance of “large scale retrenchments” where employers who employ more than 50 employees contemplate dismissing more than a prescribed number of employees. In terms of this section, an employer or a union that is party to a consultation process envisaged in section 189 may apply for the appointment of a facilitator to assist the parties during the consultation process. Section 189A(13) creates an expedited remedy for employees who feel that their employer has not complied, or is not complying, with its obligation to consult properly. This section allows the employees or their trade union to apply to the Labour Court for an order to:

• compel the employer to comply with fair procedure; 
• interdict the employer from dismissing an employee prior to complying with fair procedure; 
• direct the employer to reinstate an employee until it complies with fair procedure; or
• order the payment of compensation to an employee.  

There are numerous cases where dismissals based on an employer’s operational requirements have been held to be procedurally unfair due to the employer’s failure to consult properly. But the obligation to consult properly in terms of section 189, as reinforced by section 189A, applies to employee parties as well. 

Two recent decisions serve as examples. In Tirisano Transport and Services Workers Union (TASWU) and others v Putco (Pty) Ltd, various trade unions brought an application in terms of section 189A(13) of the LRA, seeking the reinstatement of retrenched Putco employees, a 30-day extension of the consultation process and, alternatively, a compensation order. The unions argued that there had been no meaningful engagement on all the topics on which consultation is required. It argued that this was because a national bus strike had taken place during the consultation process, Putco had failed to respond to all the issues raised by the unions, and the unions had been unable to interrogate the Department of Transport regarding underfunding and subsidy problems. 

Putco’s case was that it had sought to consult comprehensively on all topics, but the unions had consistently obstructed proper consultation. The court embarked on a detailed analysis of the process followed and came to the conclusion that it was the conduct of the unions that led to a proper consultation process not taking place. This included the unions’ frequent delaying of the process; failure to attend consultation meetings during the bus strike despite undertaking to do so; forcing Putco and the Commission for Conciliation, Mediation and Arbitration to reschedule consultation meetings; and, when they did attend the consultation meetings, the failure to engage meaningfully on most of the substantive topics that required discussion. 

Throughout the consultation process, Putco had provided all requested information, answered all queries timeously, provided detailed proposals on all the aspects included in section 189, and provided the unions with sufficient time to consider and respond to them. In addition, Putco agreed to a one-week extension of the consultation process despite its dire financial situation, which had worsened as a result of the national bus strike. Ultimately, however, it was forced to retrench the affected employees without completing the consultation process.

In deciding that Putco’s decision to retrench was fair and dismissing the unions’ section 189A(13) application, Whitcher J emphasised the lengths to which Putco went to consult meaningfully on all consultation topics and to reach consensus. Also emphasised was the consistent failure on the part of the unions to provide substantial reasons for not attending consultations or even demonstrate why the information and time periods provided by Putco were insufficient. 

In Association of Mineworkers and Construction Union ("AMCU"), Mashiane and 30 others v Tanker Services (Pty) Ltd, the union, AMCU, implemented similar tactics to delay the section 189 consultation process in lieu of meaningful participation and solution building. In this matter, the employer went to such an extent to attempt to comply with the consultation process and to accommodate the union that it extended the initial consultation period some 60 days beyond its initial end date. Van Niekerk J ultimately found that the union’s behaviour was passive and obstructive. It failed to engage meaningfully in any of the consultations, or even in writing, and its actions were specifically directed towards the protraction of the process. As a result, the unilateral dismissal of the affected employees was found to be fair.

In both cases, the court approached the matter through a consideration of the actions and behaviour of the employer in comparison to that of the union. In both, the employer was able to demonstrate that, although burdened by the dire financial circumstances, they were nevertheless committed to ensuring a fair and meaningful consultation process as prescribed by section 189 of the LRA, and that the consulting unions had employed obstructive and adversarial delaying tactics. 

Comment

While employers remain under the obligation to comply with the consultation processes prescribed by section 189 of the LRA, the court has frowned upon the abuse of the consultation process by unions, which leads to a situation where, as aptly stated by van Niekerk J in the AMCU v Tanker Services decision, "the union overplayed its hand and must now accept the consequences of its ill-advised decision to delay the consultation process as far as possible." 

These cases are a lesson for employers as well. Where employers are faced with a situation where the conduct of the employees or their unions constitutes, or is threatening to constitute, an attempt to delay or obstruct the consultation process, the court will assist. However, it is up to the employer to assist itself first. Prior to approaching the court, it is incumbent on the employer to build an evidential basis to show that the union consulting parties are not complying with their duty to consult properly. This would include keeping detailed minutes or recordings of meetings and consultations, recording the failures of the union consulting parties in correspondence, and, retaining any other evidence that will assist in illustrating the lengths to which the employer has gone to ensure a fair and proper consultation process.