30 July 2018 by and Employment Alert

Armchair critics: Trade Union warned not to frustrate retrenchment process

The provisions of s189 of the Labour Relations Act, No 66 of 1995 (LRA) require an employer and other consulting parties to, among other things, engage in a meaningful joint consensus-seeking process. This implies that the parties must engage in good faith to reach consensus on the issues listed in s189(2) and (3) of the LRA. But what happens when another consulting party frustrates the consultation process to the extent that the employer is unable to meaningfully consult over all of the issues required in s189(2) and (3)?

This question was recently considered in the matter of Association of Mineworkers and Construction Union and Others v Tanker Services (JS148/16) [2018] ZALCJHB 226.

One of the unions, AMCU, alleged that its members’ dismissals were procedurally unfair because the company had failed to consult with the union over all of the issues listed in s189(2) and (3) of the LRA before taking the decision to retrench. This was in addition to AMCU’s claim that the retrenchments were also substantively unfair. In response, the company contended that the union was uncooperative and obstructive throughout the consultation process and intentionally sought to delay the consultation process at every turn. As such, the company submitted that it was entitled to implement the retrenchments in these circumstances.

The disruptive behaviour of the union included, inter alia, accusing the company of being corrupt, failing to respond to any written invitations for submissions, failing to confirm attendance at consultation meetings resulting in postponements, alleged inability to access computer and other resources and refusing to continue with a consultation meeting because of another union’s actions.

The question before the Labour Court (LC) was whether the company had, in the circumstances, discharged the onus of establishing that the retrenchments were procedurally fair in light of the union’s conduct.

The LC relied on the established legal principle that where a consulting party is responsible for frustrating a retrenchment process to the detriment of its members, it is not for that party to subsequently claim that the company had failed to comply with the provisions of s189. The LC also referred to the ‘correlative duty’ on a union as the other consulting party to cooperate in an attempt to reach consensus before the employer exercised its right to take the final decision.

The LC held that a union that fails to engage with the employer and seeks to protract the consultation process is not entitled to adopt the position of an armchair critic and then subsequently claim that the consultation process was inadequate. In this case, the LC found that the union elected to be a passive but obstructive participant in the consultation process and accordingly had to accept its ill-advised decision to delay the consultation process as far as possible.

In conclusion, the LC found that the company did everything that was reasonably required to consult with the union and was thwarted at every turn. It was accordingly reasonable for the company to draw the process to a close.

This case reinforces the principle that a company must do everything reasonably possible to meaningfully consult on all issues set out in s189(2) and (3) of the LRA. However, a company cannot be held at

ransom by the other consulting party who deliberately seeks to frustrate and delay the consultation process. It also stresses the importance of adequately documenting all engagements during a consultation process in the event that the company is required to produce evidence of its good faith efforts at a later stage.

*CDH represented the company at the Labour Court proceedings.

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