Establishing jurisdiction in respect of unfair labour practices relating to the provision of 'benefits'

• Jurisdiction: South Africa
• Citation: (2019) 31 SA Merc LJ 29
• Author: Newaj, K.
• Pages: 29-53
• Published date: 27 November 2019
• Date: 27 November 2019

ESTABLISHING JURISDICTION IN RESPECT

OF UNFAIR LABOUR PRACTICES RELATING

TO THE PROVISION OF ‘BENEFITS’

K NEWAJ*

Lecturer, Department of Mercantile Law, University of Pretoria

Abstract

This article considers the factors to be taken into account by arbitrators

in determining whether or not they have jurisdiction to consider

disputes referred to the Commission for Conciliation, Mediation and

Arbitration as cases of unfair labour practices relating to the provision

of benefits. While the Labour Appeal Court’s decision in Apollo Tyres

South Africa (Pty) Ltd v CCMA sought to resolve the controversy

surrounding benefits disputes, it is opined that the court erred in

merging the enquiry into establishing whether the subject matter of the

dispute constitutes a ‘benefit’ with the enquiry into fairness of the

employer’s conduct. This article delineates these two enquiries, and

provides a clear indication of the factors that must be considered by

arbitrators in establishing whether the matter at issue constitutes a

‘benefits’ dispute as envisaged by section 186(2)(a) of the Labour

Relations Act 66 of 1995. The article further seeks to provide a

definition of ‘benefits’. In order to address these objectives, three

fundamental principles which have dominated the inquiry by the

judiciary in its attempt to resolve the uncertainties surrounding this

area of the law, are discussed. These are: whether ‘benefits’ fall within

the statutory definition of ‘remuneration’; whether a wide

interpretation of the term ‘benefits’ will erode the divide between

disputes of right and disputes of interest; and an evaluation of what

constitutes a pre-existing benefit.

I INTRODUCTION

Section 186(2)(a)of the Labour Relations Act 66 of 1995 (‘LRA’)

provides protection against unfair labour practices. One of the listed

unfair labour practices is an unfair act or omission that arises between an

* BCom (Law) NMMU HDip (Labour Law) WITS LLB UNISA, LLM University of

Pretoria, LLD University of Pretoria. Lecturer, Department of Mercantile Law, University of

Pretoria.

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(2019) 31 SA Merc LJ 29

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employer and an employee involving unfair conduct by the employer

relating to the provision of benef‌its to an employee.

1

There has been some controversy over the years on how to interpret

the word ‘benef‌its’ as contained in section 186(2)(a) of the LRA.

2

Initially, the courts adopted a narrow approach to the interpretation of

this concept, seeking to keep benef‌its out of the ambit of the def‌inition of

remuneration in section 213 of the LRA. Furthermore, within the

conf‌ines of this narrow approach, the courts found that the benef‌it being

claimed had to be a pre-existing benef‌it which came into existence either

through a contract or through legislation. The rationale for this narrow

interpretation of benef‌its was to protect the divide between disputes of

right and disputes of interest.

Extensive criticism was levelled against this narrow approach

3

and

many saw the broad reasoning adopted by the Labour Appeal Court

(‘LAC’) in Apollo Tyres South Africa (Pty) Ltd v CCMA

4

(‘Apollo Tyres’)

as a def‌initive solution to the benef‌its dilemma.

5

The LAC, largely

supporting the Labour Court (LC) decision in Protekon (Pty) Ltd v

CCMA & others

6

(‘Protekon’) f‌irstly, found that benef‌its and remunera-

tion are analogous. Secondly, while the court appreciated earlier deci-

sions in which the need to protect the divide between disputes of right

and disputes of interest were expressed, the LAC was of the view that

these concerns need not persist, as fairness should be the determining

factor in categorising the dispute as one of right or interest.

7

Thirdly,

while the court agreed that section 186(2)(a) of the LRA applied to

1

Section 186(2)(a).

2

There have been opposing views from the courts over the years. Signif‌icant cases that

illustrate the divergent views giving rise to the controversy, are Schoeman & another v Samsung

Electronics SA (Pty) Ltd (1997) 18 ILJ 1098 (LC); Protekon (Pty) Ltd v CCMA & others [2005] 7

BLLR 703 (LC); Apollo Tyres South Africa (Pty) Ltd v CCMA [2013] 5 BLLR 434 (LAC), among

other cases.

3

Smit, ‘The residual unfair labour practice’ (2000) 4 TSAR 636. See further Grogan,

‘Unfair conduct: The meaning of ‘‘benef‌its’’’(1998) 14 (March) ELJ 14 where he states: ‘If

everything that amounts to ‘‘remuneration’’ under this expansive def‌inition is not a ‘‘benef‌it’’

hardly anything remains that can be described as such.’

4

[2013] 5 BLLR 434 (LAC).

5

Ebrahim, ‘The interpretation to be accorded to the term ‘‘benef‌its’’ in section 186(2)(a)

of the LRA continues: Apollo Tyres South Africa (Pty) Limited v CCMA (DA1/11) [2013]

ZALAC 3’ (2014) 17(1) PER/PELJ 604 held that the court (referring to Apollo Tyres) rightfully

rejected the decision in Schoeman as it appreciated the need for a purposive approach to the

LRA. See also Tchawouo Mbiada, ‘The meaning of a benef‌it in terms of the LRA: The end of

the road?’ (2014) 35 ILJ 99 where it was agreed that the decision in Apollo Tyres was welcomed

as it def‌ined in unambiguous terms the meaning of a benef‌it.

6

[2005] 7 BLLR 703 (LC).

7

Apollo Tyres para 28.

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