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    With valid reason, default judgments can be reversed

    Ivan Israelstam


    Where an employer fails to attend an arbitration hearing the arbitrato
    r is entitled to continue without the employer unless the arbitrator is aware of an acceptable reason for the employer's absence. 
    As the arbitrator has little or no way of testing the truth of the employee's evidence, he/she will probably accept the employee's version and find against the absent employer. This is called a default judgment.

    At times the CCMA has been unable to provide proof that it has sent notices to the proper addresses of the parties. On other occasions, the CCMA has been able to provide proof that it has properly sent notices to the parties, but one or other party claims not to have received its notice. This would be due to a problem or error occurring after the notice leaves the CCMA but before it reaches the party concerned.

    So, what can you do if you receive a default judgment in such circumstances? Your first step is to apply for a rescission (or cancellation) of the default award. As there are strict rules and time deadlines for such applications you must ensure that you obtain assistance from a reputable labour law expert.

    A rescission application is normally made to the same arbitrator who made the original arbitration award on the grounds that the award was made erroneously. Such an application might be granted if it is properly put together and valid proof is submitted of factors such as illness, or failure of the CCMA/bargaining council to effectively serve the notice of a hearing on the party concerned.

    In the rescission application and in any opposition papers the main issues argued are the applicant's reasons for absence and the applicant's prospects of succeeding with the case if the rescission is granted.

    Should your rescission application be turned down, you can take the arbitrator on review to the Labour Court. Here, the party who is unhappy with the award or rescission ruling asks the Labour Court to set the ruling or award aside on the grounds that the arbitrator, in making the ruling/award, "misconducted himself/herself".

    That is, the review application is not a direct appeal against the arbitrator's decision but rather a claim that the arbitrator:

    • Committed misconduct in relation to his/her arbitration duties,
    • Committed a gross irregularity in the conduct of the arbitration proceedings
    • Exceeded his/her powers or
    • Made the award improperly

    In the case of Northern Province Local Government Association v CCMA and Other,s the Labour Court found that Commissioners are not entitled to regard fax transmission slips as definitive proof that the party received the notice of the arbitration hearing.

    In the case of Total Facilities Management (Pty) Ltd v CCMA & others, the employer missed the arbitration hearing because the CCMA unwittingly sent the notice of the hearing to the computer of an official of the employer who had left the company. As nobody else had the computer's access code the employer was unaware of the notice and of the date of the arbitration. The CCMA continued with the hearing and made a default award in favour of the employee. The employer then applied for rescission of that award.

    The CCMA arbitrator accepted that the employer was not at fault for failing to attend the arbitration hearing but still turned down the rescission application. The arbitrator based her ruling on the employer's alleged failure to show that, should the rescission be granted, the employer had reasonable prospects of winning its case. The employer then took this ruling on review to the Labour Court which overturned it. The Court found that the arbitrator had erroneously based her ruling on the evidence given by the employee at the arbitration hearing.

    However, the arbitrator was supposed to have based her ruling on the submissions made by the employer in its rescission application. In its application the employer argued that the dismissal had been based on a fair procedure and that the employee had admitted committing the offence. As the court found this to sufficient grounds for prospects of success it overruled the arbitrator and granted the employer's rescission application.

    These judgements should not make employers complacent. Due to the fact that fax transmission reports are generally accepted as proof of legal service of notices any argument as to why such fax reports should not be accepted need to be very well argued. Also, the reason for the employer's absence at the hearing as well as the employer's prospects of success need to be very carefully worded, well argued and backed up.

    In the absence of this the CCMA is likely to turn down rescission applications. The employer is then left to take the matter to Labour Court. There are three reasons that this should be avoided. Firstly, you may not win. Secondly, going to Labour Court is expensive. Thirdly, if you lose you may have to pay the other party's legal fees. It is therefore obviously better to ensure that you win the rescission application first time.


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