South Africa: Fishing Without A Hook

Last Updated: 24 March 2016
Article by Suemeya Hanif and Alfred Selman

Most Read Contributor in South Africa, September 2016

Despite a recent court ruling, the status of enforcement awards issued by the Commission for Conciliation, Mediation and Arbitration ("CCMA") in terms of the amended section 143 of the Labour Relations Act 66 of 1995 ("LRA") remains a vexing issue.

The recent Labour Court cases of MBS Transport CC CCMA v Three Others and Bheka Management Services v Jonathan Kekana and Two Others, while arising from different facts, essentially required a determination of the same point and were therefore heard by the court at the same hearing.

In a nutshell, the factual milieu (as the court put it) of the two cases was that they were brought before the Labour Court on an urgent basis in order to stay the enforcement of the awards that were issued and certified by the CCMA.

In both applications, the Sheriff had attached the employer's goods, but had not yet removed them. The employers sought an order staying the enforcement awards, pending the outcome of their respective review applications.

Amended section 143 of the LRA

The relevant provisions of the amended section 143 of the LRA read as follows:

"143(1) An arbitration award issued by a commissioner is final and binding and it may be enforced as if it were an order of the Labour Court in respect of which a writ has been issued, unless it is an advisory arbitration award" (our emphasis).

"143(3) An arbitration award may only be enforced in terms of subsection (1) if the director has certified that the arbitration award is an award contemplated in subsection 1."

"143(5) Despite subsection (1), an arbitration award in terms of which a party is required to pay an amount of money, must be treated for the purposes of enforcing or executing that award, as if it were an order of the magistrate's court."

Beyond the court's powers

The court considered whether it had jurisdiction to stay the writs issued by the CCMA. After considering relevant case law, the court held that an application to set aside a writ can only be made to the court that issued the writ. The court further held that section 157(1) of the LRA specifies the matters over which the Labour Court has exclusive jurisdiction, whereas section 157(2) confers upon it concurrent jurisdiction with the high court in respect of certain matters. The court, therefore, concluded that the granting of a stay of a writ by the CCMA or by the magistrate's court falls outside the Labour Court's powers.

The court also considered whether the CCMA had the power to issue writs. It found, on a plain reading of section 143 of the LRA and rule 40 of the Rules for the Conduct of Proceedings before the CCMA, that it is clear that the CCMA is not statutorily given the authority to issue writs and the certification of an award and its subsequent execution through the Sheriff is in fact beyond its legal powers or authority.

In the circumstances, the court held that the proper course to follow is for litigants to issue the writs of execution in satisfaction of the arbitration awards in the Labour Court.

Not the law's intention

In our view, the court's reasoning and findings present some confusion and difficulty relating to how these amendments are to be interpreted and applied.

Firstly, the court's finding that the CCMA does not have statutory authority to issue writs, on the face of it, appears to be uncontroversial. This finding is based on the assumption that the awards certified by the CCMA in terms of the amended section 143(1) of the LRA are in fact writs. However, they are not. An award issued in terms of section 143 is a statutorily created instrument that enables a successful litigant in the CCMA to expedite the enforcement of such award without having to approach the Labour Court to do so. Put differently, the clear wording of section 143(1) indicates an intention to create a statutorily created mechanism, not for orders of the CCMA to become orders of the Labour Court in respect of which a writ has been issued, but for orders of the CCMA to be enforced as if they are orders of the Labour Court in respect of which a writ has been issued.

Secondly, if we were to accept the court's conclusion that the proper course to follow is for litigants to approach the Labour Court to issue the writs of execution in satisfaction of the arbitration awards, in our view, the words "in respect of which a writ has been issued" in section 143(1) becomes superfluous. In the court's words, "it is settled practice" over the years that writs of execution in respect of arbitration awards made by the CCMA were issued by the registrar of the Labour Court. If the proper course to follow, after the amendment, is for litigants to approach the Labour Court to issue the writs of execution in satisfaction of the arbitration awards, then we argue that the amendment is unnecessary and irrelevant.

This interpretation of the amendment is also inconsistent with the memorandum of objects on the Labour Relations Amendment Bill, 2012, which states that the amendments to section 143 of the LRA seek "to streamline the mechanism for enforcing arbitration awards of the commission and to make these more effective and accessible [by removing] the need for the current practice in terms of which parties have a writ issued by the Labour Court". In essence, the court's findings in this case are contrary to what the amendments aim to achieve.

Still the law, for now

Although this decision might cause some consternation and debate, which may necessitate legislative and/or judicial intervention, employers should be aware that this decision remains binding until set aside by the Labour Appeal Court. Accordingly, employers could therefore still expect to be served with writs issued by the Labour Court and may still approach the Labour Court to stay the enforcement of the writs pending the outcome of review proceedings instituted by them. Despite the amendments to section 143 of the LRA, employees seeking to enforce arbitration awards issued by the CCMA will still need to approach the Labour Court to have writs issued.

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.

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