This is the fourth article in a series of articles meant to advise litigants who may have to arbitrate before the CCMA after 1 January 2012, in the face of the new "Guidelines on Misconduct Arbitrations" ("the Guidelines") which were published by the CCMA during September 2011 and which became effective on 1 January 2012.
The purpose of this article is to examine those sections of the Guidelines which advise arbitrators on how to approach and assess substantive fairness in arbitration proceedings relating to misconduct.
An arbitrator's assessment of substantive fairness should be in accordance with the guidelines contained in item 7 of the Code of Good Practice: Dismissal ("the Code"), which obliges an arbitrator to conduct a series of factual enquiries to determine this question.
item 7 of the code
The Guidelines describe in detail the following distinct factual enquiries that flow from the provisions of Item 7 of the Code:
- Is there a rule?
- Was the employee aware of the rule?
- Did the employee contravene the rule?
- Is the rule or standard a valid or reasonable rule or standard?
- Was the dismissal an appropriate sanction?
is there a rule?
At the outset it is necessary to prove whether or not there was, in fact, an existing rule or standard in the particular workplace which the employee in question is alleged to have contravened. Should the existence of a rule be disputed, then the arbitrator may decide that dispute either based on the evidence presented, based on the credibility of the opposing witnesses, or the balance of probabilities. The arbitrator may also determine this issue by means of judicial notice: this means to accept something which is clearly well known or indisputable as a proven fact. A rule at the workplace forbidding theft or assault, for example, is clearly something which the arbitrator may automatically accept as proven, by means of judicial notice, without having to require the employer to specifically prove same.
The Guidelines provide that the existence of a rule or standard may be proved in the following ways:
- in terms of what is contained in a disciplinary code, collective agreement, contract or policy;
- by way of testimony (given by one or more witnesses to that effect);
- by way of inference from a contract, legislation or an established practice in the particular sector or establishment;
- accepted as a basic or "universal" rule of conduct applicable in all workplaces, such as the duties inherent to a contract of employment regarding performance, good order and trust; and/or
- in terms of any special rules that may flow from the particular industry or sector concerned, or the specific nature of the particular employer's operations.
The nature of the sector or workplace is a relevant consideration given that, for example, a stricter standard of compliance is required in a workplace which poses a high risk to safety or security, such as a mine or an airline.
If a rule is not specifically contained in a disciplinary code, but is also not specifically excluded as a ground for discipline, the Guidelines nevertheless permit an arbitrator to rely on such rule or standard, provided that:
- it is either proved by the employer, or conceded by the employee, that the employee knew or ought to reasonably have known that the rule or standard was applicable; or
- the arbitrator is able to infer that the rule or standard was applicable from the disciplinary code, contract, legislation or an established practice in the sector or particular establishment.
The source of a particular rule is also a relevant aspect to consider at further stages of the enquiry, such as when determining whether or not the employee was aware of the rule. It goes without saying that the enquiry into the alleged misconduct will not proceed any further if the existence of the rule itself cannot be proven at this first stage.
was the employee aware of the rule?
Item 3(1) of the Code requires that "[a]n employer's rules must create certainty and consistency in the application of discipline. This requires that the standards of conduct are clear and made available to employees in a manner that is easily understood" (our emphasis). Accordingly, should the employee dispute his or her knowledge of the particular rule, the employer will in turn have to refute this in order to prove the requirement that the employee was in fact aware of the existing rule.
If there is no disciplinary code in the particular workplace, it must then be determined whether the employee could reasonably be expected to have known of the rule or standard. The Guidelines stipulate that this question may be addressed either in terms of the evidence presented, or based on the expertise of the arbitrator. It is important to note that item 3(1) of the Code also determines that "[s]ome rules or standards may be so well established and known that it is not necessary to communicate them". This means that an employee is expected to at least be aware of the basic and self-evident rules of the workplace.
did the employee contravene the rule?
An employee may or may not concede to having contravened the rule or standard. If the employee does not concede to the contravention, this question must then be determined in terms of the evidence respectively lead by both parties. The contravention of an existing rule is a purely factual enquiry and the evidence lead by the opposing parties must thus relate to the facts of the particular matter.
After evidence has been presented in this regard, the arbitrator must summarise and analyse it, and then determine the question based on the credibility of the witnesses, and/or on the balance of probabilities of two competing versions.
This factual enquiry in itself may involve an additional range of factual determinations, such as, for example, whether or not the employee is able to justify the contravention, despite the fact that the employer may have proved the contravention, or that the employee may have conceded to contravening the rule.
is the rule or standard a valid or reasonable rule or standard?
In accordance with the Code, it is not the arbitrator's role to "second-guess" the rules and standards set by the employer in the workplace. The determination of the rules themselves is the employer's prerogative and the intention is not that the arbitrator should interfere with this. Instead, in the process of enquiring into the fairness of the dismissal, the arbitrator should simply determine whether the particular rule is valid and reasonable.
The determination of validity entails considering whether the rule or standard is unlawful, or contrary to public policy. It would, for example, not be lawful (and thus invalid) to instruct an employee to do work clearly outside the agreed scope of his or her duties. The implication is that the "contravention" of an invalid or unlawful rule would be justifiable, such as when an employee refuses to comply with an unlawful instruction.
An arbitrator is also required to decide whether a particular rule is reasonable. This is, unfortunately, something of a subjective determination, and should thus be tempered by an acceptance that it is the employer's prerogative to determine rules for the workplace. The test for reasonableness must be distinguished from the test for fairness – the latter test only becomes applicable later in the analysis, in order to determine the fairness of dismissal as a sanction.
The Guidelines do not elaborate much on how reasonableness should be determined, except to state that it may involve a comparison with sectoral norms. An employer would thus have to justify a departure from the generally accepted standard of conduct expected from employees in his or her sector.
was the dismissal an appropriate sanction?
The question is whether, in the circumstances, it was fair for the employer to impose the sanction of dismissal, with reference to either the particular instance of misconduct itself, or to the cumulative effect of various instances of misconduct.
In light of all the relevant circumstances (as detailed in the diagram below), the arbitrator must, at this stage, make a value judgment about the fairness of the employer's decision to impose the sanction of dismissal. The Guidelines require that the following be kept in mind when making this value judgment:
- the interests of both the employer and the employee, for the purposes of making a balanced and equitable assessment;
- the employer's rules and standards must be considered in a serious light and the arbitrator should endeavour to understand the reasoning behind them;
- norms in the sector;
- the Code;
- the Guidelines; and
- the expertise of the arbitrator.
These multiple considerations at this stage can be illustrated as follows:
Arbitrators are obliged to take the Guidelines into account and, accordingly, parties are advised to be mindful of the Guidelines in relation to the manner in which an arbitrator assesses substantive fairness during the course of an arbitration relating to misconduct.
The determination of substantive fairness in accordance with item 7 of the Code, read with the Guidelines, clearly requires a comprehensive factual analysis, consisting of the various inter-related factual enquiries discussed above. Litigants are advised to be aware of the respective stages of the process and also of what each of these stages require, so that they may be able to prepare and present their case accordingly. Such knowledge will also place them in a position to evaluate whether or not the arbitrator is conducting the assessment in accordance with the Guidelines, and paying the necessary attention to the various factual determinations which need to be made.
By assessing the conduct of the arbitrator in determining substantive fairness with reference to the Guidelines, a party may be able to more easily prove that the arbitrator exceeded his powers, committed misconduct in relation to his duties and/or committed a gross irregularity in the conduct of the proceedings. In terms of Section 145 of the LRA, such grounds might constitute a defect in the arbitration proceedings, rendering the arbitration award reviewable.
With this in mind, the Guidelines should serve as an essential and practical yardstick against which to measure the assessment and determination of substantive fairness by arbitrators, after 1 January 2012.
*This is the fourth article in a series of articles on the new CCMA Guidelines for Misconduct Arbitrations. For the first article please see this article, for the second see this article, and for the third see this article.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.