CGM Industrial (Pty) Ltd v Teleki and Others (LAC/A 7 of 5) [2008] LSLAC 4 (18 June 2008)

IN THE LABOUR APPEAL COURT OF LESOTHO LAC/A/07/05 HELD AT MASERU In the matter between CGM INDUSTRIAL (PTY) LTD APPELLANT AND MOLEFI TELEKI LELOKO SEROBANYANE THABANG LELEKA 1st 2nd 3rd RESPONDENT RESPONDENT RESPONDENT CORAM: HON. MR. JUSTICE K. E. MOSITO AJ. ASSESSORS: MRS. M. THAKALEKOALA MR. D. TWALA HEARD: DELIVERED: 13 JUNE, 2008 18 JUNE, 2008 SUMMARY Employment law — Employees retrenched — no prior consultation. Labour Court having found retrenchment unlawful for lack of consultation, but having ordered re-employment and as opposed to reinstatement — distinction between the two drawn. Appeal from the decision of the Labour Court - Jurisdiction of the Labour Court to order re-employment and not reinstatement as contemplated by section 73 of the Labour Code Order 1992 - Section 73 conferring a judicial discretion to be exercised by the Labour Court - Labour Court having no such jurisdiction and matter remitted to the labour Court for the exercise of the discretion conferred on it by the law. Costs ordered to be costs in the cause, including costs of the appeal. JUDGEMENT MOSITO AJ 1. This is an appeal against the judgment of the Labour Court handed down on the 18th day of October, 2005. 2. The facts giving rise to the application before the Labour Court and consequently, the present appeal are largely not in dispute. 3. At all times material to these proceedings, the respondents had been employees of the Appellant until they were purportedly retrenched on the 15th day of April 2004. Initially, there were ten such retrenchees who had been employed as internal security officers. 4. It was common cause before us that the said purported retrenchment of the respondents was unlawful in as much as the said retrenchees were not consulted prior to their aforesaid retrenchment. 5. The grounds of appeal filed before us were as follows:- (a) The President erred in concluding that consultation did not mean advanced notification of the pending retrenchments. Surely to have consulted with the employees would mean their pending giving retrenchments and hence caused the factory more losses. them advanced notification of (b) The President erred in deciding that the evidence of DW1 Mr. Mokone and DW2 Mr. Reddy was fabricated and he erred in concluding that CGM should have subpoenaed someone who was no longer in its employ yet it was the applicants who referred to him in their evidence. (c) The learned President made an error in judgment where he states :- "It is highly unlikely that the three Applicants could have refused the various opportunities which Mr. Mokone purports to have availed them to be accommodated. Evidence was led to show that they had in fact refused alternative opportunities. No malice was proved, why then were they not re-employed while the others were. (d) The President also made an error in judgment where he states that:- If it be true that the complainants were refusing to be absorbed into particular sections as suggested. It is highly unlikely that they would have hidden that from the two witnesses who were their colleagues who had an interest in seeing to it that they were engaged. The Honourable President does not mention what makes [it] highly unlikely that they would have hidden it from their colleagues. This assumption is not supported by evidence. (e) The court also erred in awarding the Respondents wages from the 8th November 2004 to the date of re-employment 2 1st November 2005 as:- (i) The settlement agreement was not because employment. refused they take up to implemented alternative (ii) They failed to mitigate their losses. (f) The appellant reserves the right to file further and additional grounds of appeal. 6. At the hearing of this appeal, this court asked the counsel for the parties whether, since it was common cause that the said retrenchments of respondents were unlawful for want of consultations, it was not correct that the only issue should have been one as to the kind of relief the Labour Court ought to have availed to respondents. The two counsel conceded, and quite correctly so in our view that, this ought to be the only issue. It was to that issue that the arguments were ultimately confined. 7. The court further asked counsel whether, regard being had to the provisions of Section 73 of the Labour Code Order NO. 24 of 1992, the Labour Court had jurisdiction to give the award it had given. Both counsel agreed that the Labour Court ought to have given an award as contemplated in Section 73 of the Labour Code Order No. 24 of 1992. It was on this aspect that it appeared the judgment of this court had to revolve on. The counsel were therefore invited to address this Court on that issue, which they did. In its judgment, after having correctly found the purported retrenchments to have been unlawful and procedurally unfair the Labour Court had proceeded to make the following award:- AWARD the that settlement agreement to DDPR According the complainants ought to have been reemployed by the 8th November 2004. We are convinced that the respondents [a reference to present Appellant] are responsible for the failure to implement that agreement. This court now orders three complainants on a date not later than the 21st November 2005. It is further ordered that the three complainants be paid wages they would have earned from 8th November 2004 to the date of reemployment. Such payments are to be made to the Office of the Labour Commissioner not later than 21st November 2005. There is no order as to costs, (emphasis is ours). respondent reemploys the 9. It must be pointed out that the Labour Court made the said award notwithstanding that in their originating application, the applicants (now respondents) had asked for an order in the following terms: (a) Declaring the purported retrenchments of complainants unfair (b) Ordering reinstatement of complainants to their former positions without loss of remuneration, seniority or other entitlements of benefits, © Further and or alternative relief. 10. Section 73 of the Labour Code Order No. 24 of 1992 provides that: (1) If the Labour Court holds the dismissal to be unfair, it shall, if the employee so wishes, order the reinstatement of the employee in his or her job without loss of remuneration, seniority or other entitlements or benefits which the employee would have received had there been no dismissal. The Court shall not make such an order if it considers reinstatement of the employee to be impracticable in light of the circumstances. (2) If the Court decides that it is impracticable in light of the circumstances for the employer to reinstate the employee in employment, or if the employee does not wish reinstatement, the Court shall fix an amount of compensation to be awarded to the employee in lieu of reinstatement. The amount of compensation awarded by the Labour Court shall be such amount as the court considers just and equitable in all circumstances of the case. In assessing the amount of compensation to be paid, account shall also be taken of whether there has been any breach of contract by either party and whether the employee has failed to take such steps as may be reasonable to mitigate his or her losses. (Emphasis is ours). 11. The first question is whether the Labour Court had jurisdiction to order that the Appellant reemploys the three respondents on a date not later than the 2 1st November 2005, and that, the three respondents be paid wages they would have earned from 8th November 2004 to the date of reemployment and that such payments be made to the Office of the Labour Commissioner not later than 2 1st November 2005. In our view, the Labour Court had no such jurisdiction. 12. There are two reasons for our aforesaid view. The first reason is that, the Applicants before the Labour Court had not asked for re­ employment. They had clearly asked for reinstatement. Re­ employment and reinstatement are two different concepts in employment law. Re-employment is, on the one hand, the process of contracting whereby the employer and the employee enter into a fresh contract of employment. Re-employment does not necessarily result from a dismissal of the employee. When the parties enter into re-employment, there may or may not be new terms and conditions of such a new contract of employment. On the other hand, reinstatement is a process of contracting whereby an employee is put back into his or her job without loss of remuneration, seniority or other entitlements or benefits which the employee would have received had there been no dismissal. The Applicant had therefore asked for the latter and not the former relief. It is trite law, for which no authority need be cited that, a Court has no jurisdiction to grant an order which none of the parties has asked for. The situation would probably be different where a statute enjoined such a Court to grant such an order in such circumstances. 13. The second reason is that, the Labour Court has no jurisdiction to grant an award in terms different from those contemplated by section 73 where it has, as in casu, found the dismissal of employees to be unfair. 14. The Labour Court had a judicial discretion to exercise in terms of section 73 of the Code as outlined above. This, the Labour Court did not do. It instead ordered re-employment as opposed to reinstatement as contemplated by Section 73. In so doing, the Labour Court erred. That Court has to be given an opportunity to exercise that judicial discretion conferred upon it by the law. 15. Both counsel agreed that the appropriate course in this case should be to remit this matter to the Labour Court with an order that, given the circumstances presented by the "pleadings" and evidence before the Labour Court, the said court should exercise its judicial discretion as contemplated by the said Section 73. It is accordingly so ordered. This discretion should be exercised within thirty days of this judgment. 16. Costs shall be costs in the cause, including costs of this appeal. 17. My assessors agree. K. E. MOSITO AJ. JUDGE OF THE LABOUR APPEAL COURT FOR APPELLANT: FOR RESPONDENTS: ADV. L. SEPHOMOLO ADV. N. RUSSELL