Pick n Pay Namibia (Pty) Ltd v Namibia Food and Allied Workers Union (HC-MD-LAB-APP-AAA-2023/00069) [2024] NALCMD 55 (12 December 2024)

REPUBLIC OF NAMIBIA

LABOUR COURT OF NAMIBIA MAIN DIVISION, WINDHOEK

JUDGMENT

Case no: HC-MD-LAB-APP-AAA-2023/00069

In the matter between:

PICK N PAY NAMIBIA (PTY) LTD APPELLANT

and

NAMIBIA FOOD AND ALLIED WORKERS UNION RESPONDENT

Neutral citation: Pick n Pay Namibia (Pty) Ltd v Namibia Food and Allied Workers Union (HC-MD-LAB-APP-AAA-2023/00069) [2024] NALCMD 55 (12 December 2024)

Coram: PARKER AJ

Heard: 27 September 2024

Delivered: 12 December 2024

Flynote: Labour law – Arbitration – Appeal against award – At the centre of the dispute is a collective agreement concluded between the appellant (the employer) and the first respondent (a registered trade union in terms of the Labour Act 11 of 2007) – Respondent in the appeal bears no onus to prove that the award is right – Appellant bears the onus of proving that the award is wrong – Arbitrator’s decision that she had no power to vary the terms of the collective agreement upheld – Appellant failed to persuade the court that the award is wrong – Appeal, accordingly, dismissed.

Summary: The first respondent, a registered trade union, concluded a collective agreement with the appellant, the employer, on behalf of and for the benefit of its members, who were employees of the appellant. The first respondent lodged a complaint with the Labour Commissioner in terms of the Labour Act that the appellant had failed or refused to carry out its obligations under the collective agreement. The appellant cited economic difficulties due to recession allegedly brought on by the COVID-19 pandemic.

The appellant’s failure or refusal to honour its obligations under the collective agreement took the form of a reduction of agreed remuneration of the employees and the offering of lower-than-agreed annual salary increments. Aggrieved by the appellant’s conduct, the first respondent referred a dispute of ‘Organizational rights’ on the prescribed Form LC 21 to the Labour Commissioner. Conciliation having failed, the arbitrator proceeded to conduct arbitration. The principal decision of the arbitrator in her award was that she had no power (‘jurisdiction’, according to her) to vary the terms of the collective agreement. It is against this principal decision that the appellant appealed to the court. The court upheld the arbitrator’s decision.

There was also the ground of appeal that the first respondent’s aforesaid Form LC 21 was defective inasmuch as ‘Organizational rights’ is the dispute indicated on Form LC 21. The court rejected this ground of appeal. The court found that the defect did not in any way prejudice the appellant. The reason is that it is clear from the ‘Summary of the dispute’, attached to the completed Form LC 21, as required by law, that the complaint was about the appellant’s failure or refusal to carry out its obligations under the collective agreement. That was the case the appellant was to meet and it was aware of it and the self-same case the arbitrator was seized with.

Held, that where a collective agreement is confided to, and governed by, the Labour Act 11 of 2007 and a breach of the whole or part of the agreement has occurred, instead of breach of contract, we now have an unfair labour practice in the form provided in s 50(1)(e) of the Labour Act.

ORDER

1. The appeal is dismissed.

2. Paragraph 53(a) of the order (as varied) is replaced with the following paragraph:

‘53(a) That, the collective agreement dated 3 October 2019 entered into by the applicant and the respondent herein be implemented on or before 31 January 2025.’

3. There is no order as to costs.

4. The matter is finalised and removed from the roll.

JUDGMENT

PARKER AJ:

[1] The appellant (the employer) has appealed against the arbitral award in Case No. CRWK 1166-20, dated 14 September 2023, and varied on 8 March 2023. It is noted that what was varied was only the year in which the collective agreement, discussed in para [6] below, was entered into, being 2019 and not 2009, as appears in the original award. In any case, the variation turns on nothing material as far as these proceedings are concerned, considering the arbitrator’s award and the grounds of appeal.

[2] In its amended notice of appeal, the appellant, represented by Mr Heathcote SC (with him Mr Quickfall), has raised five grounds of appeal. The first respondent (a registered trade union), represented by Mr Namandje (with him Ms Hamunyela), has opposed the appeal.

[3] The first ground of appeal concerns specific performance of contractual obligations under the collective agreement. The second ground deals with the arbitrator’s (ie the second respondent’s) decision in the award that the arbitration ‘tribunal has no jurisdiction to vary, cancel or amend the parties (parties’) impugned collective agreement dated 03 October 2019 unfortunately’. The third ground concerns the appellant’s view that on the evidence it was ‘entitled to a variance of terms of the collective agreement insofar as it concerns the implementation of the 2020/2021 and 2021/2022 financial years’.

[4] The fourth ground partakes of material aspects of the third ground and goes further to complain about the arbitrator’s failure to determine the dispute about the monetary amount claimed by the appellant’s employees, who are members of the first respondent. The fifth ground deals with the dispute, which the first respondent referred to the Labour Commissioner on Form LC 21. Form LC 21 is prescribed under s 82(7) and s 86(1) of the Labour Act 11 of 2007 and certain regulations made thereunder.

[5] It is recalled from the court order (per Ueitele J), dated 26 April 2024, that the first respondent noted its intention to oppose the appeal within the prescribed time, but failed to deliver its statement of opposition within the prescribed time.

[6] Of the view I take of the case, it is important to go to the basics. It is important to consider the legal effects of a collective agreement concluded in terms of, and governed by, the Labour Act, like the ‘Collective Agreement’ concluded by the appellant and the first respondent, dated 3 October 2019, and which is at the centre of the dispute between the appellant and the first respondent in the instant matter.

[7] Section 70 of the Labour Act provides unqualifiedly that a collective agreement binds the parties to the agreement, as Mr Namandje reminded the court. At all events, the enforceability of the aforesaid Collective Agreement is not disputed. This finding leads me to this applicable basic principle: Where the collective agreement is confided to, and governed by, the Labour Act, and a breach of the whole or part of the agreement has occurred, instead of breach of contract, we now have an unfair labour practice in the form referred to in s 50(1)(e) of the Labour Act.

[8] Thus, on the facts of the instant case, the appellant has committed unfair labour practice, within the meaning of s 50(1)(e) of the Labour Act. The principles of pacta sunt servanda, impossibility of performance, and changed circumstances – which savour of the reality of contracts – and references to the United Nations and European Union treaties on contracts and the textual and case-law authorities thereanent are irrelevant. They are of no assistance on the point under consideration.

[9] There is generally only one lawful way in which terms of a contract of employment may be varied: It is by way of agreement between the employer and the employee;¹ and a priori, there is generally only one lawful way in which terms of a collective agreement may be varied: It is by way of agreement between the parties to the collective agreement. Therefore, as Mr Namandje appeared to submit, a court or other tribunal, like an arbitration tribunal established under the Labour Act, has no power and is not entitled to vary such enforceable collective agreement.

[10] It follows inevitably that the appellant’s first, second, third and fourth grounds of appeal stand to be rejected on the basis of the reasoning and conclusions laid out in paras [6]-[9] above. I proceed to consider the fifth and last ground of appeal.

[11] As mentioned previously, the fifth ground concerns the aforesaid Form LC 21. The ‘nature of dispute’ on Form LC 21 that was ticked by the first respondent (the complainant) was ‘Organizational Rights’. As I see it, that is how the first respondent perceived the dispute which it referred to the Labour Commissioner. I do not see any prejudice that occasioned the appellant thereby during the arbitration proceedings. The contents of the ‘Summary of the dispute’ that, in terms of the Labour Act, was attached to the completed LC 21 left no doubt in the mind of the arbitrator and in the mind of the appellant (ie the respondent at the arbitration) as to the nature of the dispute, that is, the case, which the appellant was to meet at the arbitration and the self-same case which the arbitrator was seized with.

[12] The result is that the fifth ground, too, is not sound, and is, accordingly, rejected.

[13] I have rejected all the grounds of appeal. The fundamental undying principle is that the respondent bears no onus of proving that the decision of the arbitrator is right. To succeed, the appellant must satisfy the court that the decision of the arbitrator is wrong. If the appellant fails to discharge this critical burden, he or she must fail.² The appellant in the instant proceeding has failed to discharge the aforesaid critical burden. The appellant must therefore, fail: The appeal cannot succeed. In sum, the appellant has failed to persuade the court to interfere with the decision of the arbitrator.³

[14] Based on these reasons, I hold that the appellant has not made out a case for the relief sought. The order of the arbitrator in para 53(a) of the award, as varied, ought to be confirmed; except that for obvious reasons, the time limit ordered for the implementation of the Collective Agreement ought to be extended.

[15] In the result, I order as follows:

1. The appeal is dismissed.

2. Paragraph 53(a) of the order (as varied) is replaced with the following paragraph:

‘53(a) That, the collective agreement dated 3 October 2019 entered into by the applicant and the respondent herein be implemented on or before 31 January 2025.’

3. There is no order as to costs.

4. The matter is finalised and removed from the roll.

_______________

C PARKER

Acting Judge

APPEARANCES:

APPELLANT: R Heathcote SC (with him D Quickfall) Instructed by Engling, Stritter & Partners, Windhoek

RESPONDENT: S Namandje (with him J Hamunyela)

Of Sisa Namandje Co Inc, Windhoek