Introduction

The protective ambit of the now repealed 1956 Labour Relations Act ("the 1956 LRA") did not extend to State employees. Separate legislation governed the employment relationship between the State and its workforce, the terms of which were not as favourable as the protection extended to employees covered by the 1956 LRA. In an effort to supplement the rights of State employees, our Courts have held that the public character of State employers rendered the decision to dismiss an exercise of public power, thus bringing it within the ambit of administrative law. Dismissed State employees also had a cause of action under labour law. In effect then, State employees enjoyed a dual cause of action upon dismissal. 

The defects associated with the old labour regime was that it resulted in overlapping and competing jurisdictions and the use of different courts to adjudicate what were essentially employment law disputes. This was because, depending on how a State employee chose to characterise his dismissal, it could be adjudicated in the old Industrial Courts or in the old Supreme Courts. The choice afforded to State employees invariably resulted in forum shopping, prevented the development of coherent employment relations jurisprudence and served as an obstacle to any definitive pronouncement on the legal principles applicable to dismissal disputes in the public sector.

However, confusion no longer abounds. The questions as to which forum State employees may turn to, and how they characterise their cause of action upon dismissal has been answered by the Constitutional Court ("the CC") in Chirwa v Transnet and Others ("Chirwa").

Factual background

Chirwa, an employee of Transnet was dismissed for poor work performance and referred an unfair dismissal dispute to the Commission for Conciliation, Mediation and Arbitration ("the CCMA"). When conciliation failed, she chose not to refer the dispute to arbitration, but instead instituted proceedings in the High Court ("HC"), alleging that Transnet had failed to comply with the mandatory provisions of the LRA in dismissing her. Its conduct was therefore in breach of her constitutional right to just administrative action as given effect to by the Promotion of Administrative Justice Act 3 of 2000 ("PAJA"). A central element of her claim was that her dismissal constituted administrative action for the purposes of PAJA. Chirwa was successful in the HC, which held that her dismissal did not simply amount to the termination of a contractual relationship, but the exercise of a public power which required that Transnet, in its capacity as a State employer, apply the rules of natural justice when it dismissed her. Her dismissal was declared a nullity and the HC ordered her retrospective reinstatement.

Transnet appealed to the Supreme Court of Appeal ("the SCA"). The judgment of the SCA made no definitive finding as to whether conduct by the State in its capacity as an employer is administrative in nature and should be reviewable under PAJA, as the SCA was split on this issue. It was thus left to the CC to determine which forum State employees should turn to when they are dismissed and how they should characterise their cause of action.

Jurisdiction

The CC found that State employees could no longer be afforded a dual cause of action for dismissal disputes since they were no longer in a position where they were unable to access processes aligned with natural justice principles. The adoption of the present Constitution, read together with the provisions of the current LRA, extended to all employees, including State employees, the rights not to be subjected to unfair dismissals and unfair labour practices.

The CC held that administrative review of public sector dismissals was undesirable because the scope for relief in the LRA is extensive, unlike the remedies afforded in administrative law review under PAJA. The latter can only result in the unlawful decision being set aside whilst the former creates different forums designed to cater for purpose-built employment focussed relief, none of which is available under PAJA, including compensation for unfair dismissal, reinstatement or re-employment. Further yet, the purpose of administrative justice as embodied in section 33 of the Constitution and given effect to in PAJA, is to ensure procedural and substantive fairness between the administration and the public, vis-a-vis the LRA's purpose of providing a comprehensive system of dispute resolution mechanisms tailored to deal with all aspects of employment law; "the one-stop shop" for all labour related disputes.

The CC held further that the LRA is the pre-eminent legislation in labour matters, over which only the Constitution takes precedence and dismissed, as incorrect, Chirwa's argument that both the High Court and Labour Court were empowered to adjudicate her dispute. The CC observed that when PAJA was promulgated, five years after the current LRA came into force, section 210 of the LRA remained untouched. The effect of section 210 is to herald the LRA as the pre-eminent legislation in labour matters that are dealt with by the LRA, save where the Constitution itself provides otherwise or a statute expressly amends the LRA. When the legislature enacted PAJA without altering the provisions of section 210 it was clearly intended that PAJA should not detract from the pre-eminence of the LRA and its specialised dispute resolution mechanisms. The CC observed that the LRA provides specific guidelines for dismissals for poor work performance and that Chirwa had access to these procedures, institutions and remedies to address the alleged procedural unfairness of her dismissal. She was not at liberty to "relegate the finely tuned dispute resolution procedures created by the LRA".  Consequently, the procedure to be followed when an employee alleges an unfair dismissal dispute is section 191 of the LRA. This procedure makes adequate provision for the resolution of the dispute which includes conciliation, arbitration and review by the Labour Court.  An unfair dismissal dispute, even in the public sector is thus a matter that must, under the LRA, be determined exclusively by the Labour Court. In the circumstances, the CC held that the HC did not have concurrent jurisdiction with the Labour Court. 

Scope of section 157 (1) and (2) of the LRA

The majority viewed the provisions of section 157 (1) and (2) as being reconcilable having regard to the primary objects of the LRA. They noted that prior to the enactment of the LRA different statutes governed labour relations. These myriad statutes created inconsistency, unnecessary duplication of resources, overlap of private and public sector activities and jurisdictional problems. It was against this background that the drafters of the LRA proposed "a comprehensive framework of law governing the collective relations between employers and employees in all sectors of the economy," the intention being that the LRA would be "one Act for all sectors."

The purpose of s 157(1), therefore, is to give effect to the declared object of the LRA to establish specialist tribunals with exclusive jurisdiction to decide matters arising from it. The majority similarly interpreted section 157(2) in light of its historical context, the effect of which is to empower the Labour Court to deal with disputes arising from the Bill of Rights that arise from employment and labour relations.

According to the majority, the only way to reconcile the provisions of section 157(2) and harmonise them with those of section 157(1) and the primary purpose of the LRA, is to give section 157 (2) a narrow meaning, i.e. the application of section 157 (2) must be confined to those instances where a party relies directly on the provisions of the Bill of Rights. The majority accordingly held that the Labour Court had exclusive jurisdiction to deal with Chirwa's claim as she had relied on a breach of the provisions of the LRA and she should therefore seek the remedy in the LRA. She could not avoid the dispute resolution mechanisms provided for in the LRA by alleging a violation of a constitutional right in the Bill of Rights for it could not have been the intention of the legislature to allow an employee to raise what is essentially a labour dispute under the LRA as a constitutional issue under the provisions of s 157 (2). To hold otherwise would frustrate the primary objects of the LRA and permit an astute litigant to bypass the dispute resolution provisions of the LRA. Even if Chirwa sought to challenge the dismissal by relying on a constitutional issue other than one implemented through PAJA, which Chirwa did by relying on section 195 of the present Constitution, it would be necessary for her to exhaust all remedies under the LRA before raising such an issue in a different forum.

Administrative action

In deciding whether or not the conduct of Transnet in dismissing Chirwa constituted administrative action, the CC relied on the decision in President of the Republic of South Africa and Others v South African Rugby Football Union and Others 2000 (1) SA 1 (CC) ("SARFU") which stated that the determination of whether an action should be characterised as administrative action or not depends primarily upon the nature of the power. Relevant factors include the source of the power, its subject matter and whether it involves the exercise of public duty. In applying the factors in SARFU, the CC held that Transnet's conduct in terminating Chirwa's employment contract did not constitute administrative action, but was more concerned with employment relations. This was owing to the fact that the subject matter of the power involved was the termination of a contract of employment for poor work performance and the source of the power was the employment contract between the parties.

The CC held that historically recourse was had to administrative law in order to protect employees who did not enjoy the protection that private sector employees enjoyed. With the advent of the new constitutional order, section 23 guarantees to every employee, including public sector employees, the right to fair labour practices. Therefore it is no longer necessary to treat public sector employees differently and subject them to the protection of administrative law.  

Thus public sector employees who seek to pursue civil remedies which arise from an employment law dispute may only do so in circumstances where they can distinguish Chirwa from the facts of their case, or they must contend that Chirwa is wrong in principle, since it contradicts the CC's earlier judgement in Fredericks, where it was held that if an employment law dispute raises a constitutional issue, s 157(1) of the LRA cannot be interpreted to confer exclusive jurisdiction on the Labour Court and by so doing deprive the High Court of its jurisdiction to adjudicate constitutional disputes. 

What is clear from Chirwa, at this stage is that public sector dismissals do not constitute administrative action and that to the extent that PAJA and the LRA insofar as the rights to just administrative action and fair labour practices are concerned, these claims should as a matter of policy be adjudicated under the LRA. Thus in the event of a conflict between PAJA and the LRA, the LRA prevails. It is only where the LRA provides no remedy that employees may rely directly on the Constitution, by contending that the protection afforded by the LRA falls short of the constitutionally required standard.

Written by Nadira Deonarain and Reghana Tulk, Bowman Gilfillan.