Does a certificate of outcome cure a dispute’s jurisdictional issues?

In November 2003 the employer gave notice of contemplated retrenchment of 350 employees. A CCMA facilitator was appointed in terms of s189(A)(3) of the Labour Relations Act, No 66 of 1995 (LRA). On 31 March 2004, 72 employees were retrenched and on 30 June 2004, an additional 95 employees were retrenched.

During the course of 2004 and 2007 the union brought two applications to the Labour Court challenging the dismissals. Both applications were withdrawn.

Conciliation

In 2008 the union referred the dispute to a bargaining council for conciliation based on the unfair dismissal of 105 employees (from the 2004 dismissals) and the employer’s failure to re-employ the retrenched employees.

Section 191(1)(b)(ii) of the LRA dictates that an employee has 90 days after the act or omission in which to refer a unfair labour practice dispute to a council or the commission. At the conciliation the employer claimed that the union had not referred the dispute timeously. No ruling was made on this and the commissioner issued a certificate that the dispute remained unresolved.

Arbitration

The union referred the dispute to arbitration. In April 2009 a pre-arbitration meeting was held. During this meeting, the union alleged, for the first time that in January 2004 and March 2004 there had been an agreement (referred to as the recall agreement) reached between the employer and the union stating that the retrenched employees would be granted preferential re-employment.

During the arbitration proceedings the employer again raised the jurisdictional issue as a point in limine.

The commissioner in the arbitration proceedings stated that she was not entitled to consider the jurisdiction issue as a certificate had been issued and this decision had not been set aside by the Labour Court. The commissioner in any event found that the union had not proven the existence of the recall agreement and dismissed the referral.

Rehearing

The union took this arbitration award on review to the Labour Court. The application was, however, not decided because there was no record of the proceedings and the dispute was thus referred back to the bargaining council to be reheard.

At the re-hearing the employer once again raised the issue of jurisdiction. The employer stated that the alleged unfair labour practices had taken place in 2004, and was only referred in 2008 The commissioner ruled that an important consequence of the issuing of an outcome certificate is that it cures all defects of jurisdiction.

Labour Court

The employer then brought an application to the Labour Court to review and set aside the certificate of outcome on the basis that in the union’s referral it deliberately misinterpreted the date of the breach of the alleged agreement, claiming it occurred in 2008 when, on a different version, it happened in 2004. Thus the 90 day period had lapsed and the bargaining council lacked jurisdiction.

The Labour Court had to determine whether the bargaining council had jurisdiction to hear the matter, and whether the certificate of outcome indeed cures all defects regarding jurisdictional issues.

The Labour Court found that both commissioners incorrectly relied on Fidelity Guards Holdings v Epstein [2000] 12 BLLR 274 (LAC). This case stated that in the event that a certificate of outcome has been issued, it cures any jurisdictional defect that may have existed on account of a late referral without an application for condonation.

The Labour Court relied on the decision in Bambardier Transportation (Pty) ltd v Mtiya [2010] 8 BLLR 840 (LC) where the court found that a certificate of outcome is nothing more than a document issued by a commissioner, and that such a certificate cannot confer jurisdiction on the CCMA. This approach was followed in numerous cases since then - the most recent being SAMWU v Ngwathe Local Municipalities [2015] 9 BLLR 894 (LAC). In SAMWU the court found that previous courts misinterpreted the Epstein judgment to mean that the issuing of a certificate of outcome prevents a dispute regarding a jurisdictional issue.

The court found that the union’s referral was outside the 90 day period to refer the unfair labour practice dispute. Since the referral was made with no application for condonation, the bargaining council did not have jurisdiction to hear the matter.

The Labour Court set aside the arbitration reward and the referral by the union was dismissed based on lack of jurisdiction.

Conclusion

This case clears up the uncertainty that the Epstein case created surrounding the effect of a certificate of outcome issued by a commissioner. A certificate of outcome does not have the power to cure a defect in a dispute regarding jurisdiction.

Furthermore, the case illustrates that an application for condonation is crucial if the 90 day period in which to refer the dispute has lapsed.