Wehncke v Rurf4cars (Pty) Ltd: Riding the wave into the amendments to s187(1)(c) of the LRA

The recent case of Solidarity obo Wehncke v Surf4cars (Pty) Ltd (JA63/11) [2014] ZALAC 6 (20 February 2014) concerned an alleged automatically unfair dismissal where the alleged reason for the dismissal was to compel the employee to accept a demand in respect of a matter of mutual interest.

On his employment with Surf4cars, Wehncke was provided a company vehicle, of which he had unrestricted use. There was, however, no written contract of employment which governed the relationship between the parties and/or the use of the vehicle.

Six months later, Wehncke was presented with a written contract, which made provision for payment, by him, of any excess on insurance claims if the vehicle was involved in an accident. As a result of the inclusion of this clause, Wehncke refused to sign the contract unless this term was removed. Due to his refusal to accept the term of his employment, he was dismissed.

Solidarity, on behalf of Wehncke, instituted proceedings in the Labour Court, claiming that the dismissal was automatically unfair.

The basis of Wehncke's claim was grounded in s187(1)(c) of the Labour Relations Act, No 66 of 1996 (LRA), which provides that a dismissal is automatically unfair if the reason for the dismissal is to compel the employee to accept a demand in respect of any matter of mutual interest between the employer and employee.

In adjudicating the matter, the Labour Court found that Wehncke had failed to prove that the employer had dismissed him in order to compel or persuade him to sign the contract of employment. The court found that there was consequently no demand from Surf4cars. As such, the Labour Court dismissed Wehncke's claim.

On appeal, the Labour Appeal Court noted that the reach of s187(1)(c) had been decided in Fry’s Metals v NUMSA & others [2003] 2 BLLR 140 (LAC) and CWIU & others v Algorax (Pty) Ltd [2003] 11 BLLR 1081 (LAC). These cases were decided on the basis that, in order for a dismissal to fall within the scope of s187(1)(c), the dismissal must be 'conditional'. What is meant by this is that the dismissal would be withdrawn, on the employee's acceptance or compliance with the demand.

In the case at hand, the dismissal was not conditional. The dismissal was final and irrevocable. While it was based on Wehncke’s unreasonable refusal to accept a term in the contract, there was no conditional offer to reinstate him should he accept the demand.

Wehncke's appeal succeeded on the following basis, not on the basis that his dismissal was automatically unfair:

When adjudicating an automatically unfair dismissal claim, which on the facts appears to be a matter that should have been referred to the Commission for Conciliation, Mediation and Arbitration (CCMA) for the arbitration, i.e. as a dismissal for misconduct, the Labour Court has the power to stay the proceedings and refer the matter for arbitration or, with the consent of the parties, arbitrate the matter itself.

In this matter, the dismissal was not arbitrated by the CCMA and as such, the Labour Appeal Court decided to refer the matter for arbitration.

Accordingly, the appeal against the Labour Court's ruling that the dismissal was not automatically unfair was dismissed. The court ordered that the matter be referred to the CCMA for arbitration, in terms of s158(2)(b).

It bears mentioning that, if the amendments to the LRA had been in effect, the outcome in relation to the Labour Appeal Court's determination on the dismissal might have been different. In terms of the amendments, s187(1)(c) no longer requires the employer to have intended to compel the employee to accept its demand–the requirement is merely that the employee was for rejecting the employer’s demand.