Road Traffic Management Corporation v Tasima (Pty) Ltd

• Jurisdiction: http://justis.com/jurisdiction/166,South Africa
• Citation: 2021 (1) SA 589 (CC)

Road Traffic Management Corporation v Tasima (Pty) Ltd
2021 (1) SA 589 (CC)

2021 (1) SA p589

Citation	2021 (1) SA 589 (CC)
Case No	CCT 27/19 and CCT 86/19; [2020] ZACC 21
Court	Constitutional Court
Judge	Mogoeng CJ, Cameron J, Froneman J, Jafta J, Khampepe J, Madlanga J, Mhlantla J, Mathopo AJ, Theron J and Victor AJ
Heard	August 4, 2020
Judgment	August 4, 2020
Counsel	A Franklin SC (with A Redding SC and K Hopkins) for the applicant in case No CCT 86/19 and the respondent in CCT 27/19.; P McNally SC (with A Rowan) for the applicant in case No CCT 27/19 and the respondent in CCT 86/19.

Flynote : Sleutelwoorde

Labour law — Contract of employment — Transfer — Upon transfer of business as going concern — Role of legal causa in establishing whether business transferred as going concern — Proper approach to determination of effective date of transfer — Labour Relations Act 66 of 1995, s 197.

Headnote : Kopnota

Section 197 of the Labour Relations Act 66 of 1995 regulates the automatic transfer of employees of a 'business' that is 'transferred' as a 'going concern'.

The respondent (Tasima) had obtained declaratory relief in the Labour Court (the LC), upheld on appeal to the Labour Appeal Court (the LAC), to the effect that the contracts of employment of certain of Tasima's employees were automatically transferred to the appellant, the Road Traffic Management Corporation (RTMC) under s 197. The LAC however disturbed the LC's finding that the effective date of transfer was the actual date of handing over the business, instead holding that it was the date of the Tasima I[*] order, ie the date that the transfer was ordered (see [109]).

Here, in a majority decision ([1] – [136]) the Constitutional Court granted RTMC leave to appeal the LAC's s 197 order, and Tasima leave to cross-appeal the LAC's finding as to the effective date of transfer. At issue were:

•

Whether s 197's jurisdictional requirements were met.

Held, a legal causa was a prerequisite for the application of s 197, and here it was the Tasima I order. What was ordered to be transferred was eNaTIS and related services as they stood after 9 November 2016. For the purposes of s 179, these constituted a 'business' (see [39], [44], [50], [62] and [65] – [66]); and one that was 'transferred' (see [86] – [93]) as a 'going concern' (see [102] – [106]).

•

Whether the effective date of transfer was determined with reference to the physical handover of a business or the legal causa for the transfer of a business.

Held, The relevance of the legal causa in the determination of the effective date of transfer was that it determined the date on which the obligation to transfer arose. This would ordinarily be the effective date of transfer but it may, for equitable reasons, be necessary in exceptional instances — as in this case — to distinguish between the date on which the obligation to transfer arises in terms of the legal causa and the effective date of transfer. Therefore, because of Tasima's non-compliance with this court's order in

2021 (1) SA p590

Tasima I, the effective date of transfer was the date on which the RTMC physically took control of the eNaTIS and services. (See [111] – [113] and [122].)

Cases cited

Southern Africa

Administrator, Cape, and Another v Ntshwaqela and Others1990 (1) SA 705 (A): referred to

Allpay Consolidated Investment Holdings (Pty) Ltd and Others v Chief Executive Officer, South African Social Security Agency and Others2014 (1) SA 604 (CC) (2014 (1) BCLR 1; [2013] ZACC 42): compared

Aviation Union of South Africa and Another v South African Airways (Pty) Ltd and Others2012 (1) SA 321 (CC) ((2011) 32 ILJ 2861; 2012 (2) BCLR 117; [2011] ZACC 39): dicta in paras [45] and [113] applied

Chemical Energy Paper Printing Wood & Allied Workers Union on behalf of Members v Hydro Colour (Pty) Ltd (2011) 32 ILJ 1677 (LC): dictum in para [8] applied

Chirwa v Transnet Ltd2008 (4) SA 367 (CC) ((2008) 29 ILJ 73; 2008 (3) BCLR 251; [2008] 2 BLLR 97; [2007] ZACC 23): dictum in para [66] applied

City Power (Pty) Ltd v Grinpal Energy Management Services (Pty) Ltd and Others (2015) 36 ILJ 1423 (CC) (2015 (6) BCLR 660; [2015] ZACC 8): dictum in para [14] applied

Communication Workers Union v Mobile Telephone Networks (Pty) Ltd (2015) 36 ILJ 1819 (LAC) ([2015] ZALAC 8): referred to

COSAWU v Zikhethele Trade (Pty) Ltd (2005) 26 ILJ 1056 (LC): dictum in paras [34] – [35] applied

De Reuck v Director of Public Prosecutions, Witwatersrand Local Division, and Others2004 (1) SA 406 (CC) (2003 (2) SACR 445; 2003 (12) BCLR 1333; [2003] ZACC 19): dictum in paras [3] – [4] applied

Department of Transport and Others v Tasima (Pty) Ltd2017 (2) SA 622 (CC) (2017 (1) BCLR 1; [2016] ZACC 39): applied

Department of Transport and Others v Tasima (Pty) Ltd and Others 2018 (9) BCLR 1067 (CC) ([2018] ZACC 21; 2018 JDR 1122): applied

Eke v Parsons2016 (3) SA 37 (CC) (2015 (11) BCLR 1319; [2015] ZACC 30): dictum in para [29] applied

Fakie NO v CCII Systems (Pty) Ltd2006 (4) SA 326 (SCA) ([2006] ZASCA 52): dictum in para [8] applied

Finishing Touch 163 (Pty) Ltd v BHP Billiton Energy Coal South Africa Ltd and Others2013 (2) SA 204 (SCA) ([2012] ZASCA 49): referred to

Franmann Services (Pty) Ltd v Simba (Pty) Ltd (2013) 34 ILJ 897 (LC): referred to

Harsco Metals SA (Pty) Ltd v Arcelormittal SA Ltd (2012) 33 ILJ 901 (LC): dictum in para [25] applied

Horn v LA Health Medical Scheme 2015 (7) BCLR 780 (CC) (2015 JDR 0895; [2015] ZACC 13): referred to

Independent Electoral Commission v Langeberg Municipality2001 (3) SA 925 (CC) (2001 (9) BCLR 883; [2001] ZACC 23): dictum in para [11] applied

Khumalo and Another v Member of the Executive Council for Education: KwaZulu-Natal2014 (5) SA 579 (CC) (2014 (3) BCLR 333; [2013] ZACC 49): dictum in para [30] applied

Mashongwa v Passenger Rail Agency of South Africa2016 (3) SA 528 (CC) (2016 (2) BCLR 204; [2015] ZACC 36): applied

2021 (1) SA p591

Matatiele Municipality and Others v President of the RSA and Others2006 (5) SA 47 (CC) (2006 (5) BCLR 622; [2006] ZACC 2): dictum in para [67] applied

MEC for Education, KwaZulu-Natal, and Others v Pillay2008 (1) SA 474 (CC) (2008 (2) BCLR 99; [2007] ZACC 21): dictum in para [32] applied

Mohamed and Another v President of the Republic of South Africa and Others (Society for the Abolition of the Death Penalty in South Africa Intervening)2001 (3) SA 893 (CC) (2001 (7) BCLR 685): referred to

National Education Health and Allied Workers Union v University of Cape Town and Others2003 (3) SA 1 (CC) ((2003) 24 ILJ 95; 2003 (2) BCLR 154; [2002] ZACC 27): applied

President of the Republic of South Africa v Democratic Alliance and Others2020 (1) SA 428 (CC) (2019 (11) BCLR 1403; [2019] ZACC 35): dictum in para [17] applied

Road Traffic Management Corporation v Tasima (Pty) Ltd (2019) 40 ILJ 1036 (LAC): partially confirmed on appeal

Road Traffic Management Corporation v Tasima (Pty) Ltd (2019) 40 ILJ 1785 (LAC) ([2019] ZALAC 33): referred to

Road Traffic Management Corporation v Tasima (Pty) Ltd [2017] ZAGPPHC 94: referred to

Rural Maintenance (Pty) Ltd v Maluti-A-Phofung Local Municipality (2017) 38 ILJ 295 (CC) (2017 (1) BCLR 64; [2016] ZACC 37): dictum in para [39] applied

SA Transport and Allied Workers Union v Member of the Executive Committee: Gauteng Roads and Transport (2015) 36 ILJ 3155 (LC): referred to

SATAWU and Others v Garvas and Others2013 (1) SA 83 (CC) (2012 (8) BCLR 840; [2012] ZACC 13): applied

Schutte and Others v PowerPlus Performance (Pty) Ltd and Another (1999) 20 ILJ 655 (LC) ([1999] 2 BLLR 169): applied

Tasima (Pty) Ltd v Road Traffic Management Corporation (2017) 38 ILJ 2385 (LC): referred to

Tasima (Pty) Ltd v Road Traffic Management Corporation [2019] ZALCJHB 27: referred to

Tasima (Pty) Ltd v The Department of Transport GP 44095/2012: referred to

TMS Group Industrial Services (Pty) Ltd t/a Vericon v Unitrans Supply Chain Solutions (Pty) Ltd (2015) 36 ILJ 197 (LAC) ([2014] ZALAC 39): referred to

Unitrans Supply Chain Solutions (Pty) Ltd v Nampak Glass (Pty) Ltd (2014) 35 ILJ 2888 (LC): referred to

Van Wyk v Unitas Hospital (Open Democratic Advice Centre as Amicus Curiae)2008 (2) SA 472 (CC) (2008 (4) BCLR 442; [2007] ZACC 24): referred to.

England

Cheeseman v R Brewer Contracts Ltd[2001] IRLR 144: referred to

Institute of Chartered Accountants in England and Wales v Customs and Excise Commissioners[1997] STC 1155 (CA) dictum at 1166c – f applied

Kelman v Care Contract Services Ltd[1995] ICR 260 (EAT): referred to.

European Union

Suzen v Zehnacker Gebaudereinigung GmbH Krankenhausservice [1997] IRLR 225: referred to

Spijkers v Gebroeders Benedik Abattoir CV [1986] 2 CMLR 296 (ECJ): referred to.

2021 (1) SA p592

Legislation cited

The Labour Relations Act 66 of 1995, s 197: see Juta's Statutes of South Africa 2019/20 vol 4 at 1-149 and 1-150.

Case Information

A Franklin SC (with A Redding SC and K Hopkins) for the applicant in case No CCT 86/19 and the respondent in CCT 27/19.

P McNally SC (with A Rowan) for the applicant in case No CCT 27/19 and the respondent in CCT 86/19.

An appeal from the Labour Appeal Court (hearing an appeal from the Labour Court).

Order

In CCT 27/19:

1.

The Road Traffic Management Corporation's application for leave to appeal is granted.

2.

The appeal is dismissed.

3.

Tasima (Pty) Ltd's application for leave to cross-appeal is granted.

4.

The cross-appeal is upheld.

5.

The order of the Labour Appeal Court in case No JA 77/2017 is set aside and substituted with the following:

'The appeal in respect of paragraph 63.1 of the order of the Labour Court is dismissed with no order as to costs.'

6.

There is no order as to costs in this court.

Under CCT 86/19 (Tasima (Pty) Ltd v Road Traffic Management Corporation):

1.

Tasima...