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Jurisdictional Prerequisites Stipulated by S32(1)(B) of The Labour Relations Act when Extending Collective Agreements to Non-parties

By Bongani Khanyile, Director at Bongani Khanyile Attorneys

 

In the reportable judgment of Plastics Converters Association of South Africa and NEASA v MEIBC and Two Others JR2282/16, Judge Steenkamp had to deal with the review application to set aside a request to the Minister to extend a collective agreement to non-parties.

 

The Facts

The MEIBC took a decision, purportedly in terms of s32(1) of the LRA, to request the Minister of Labour, who was the third respondent in the matter, to extend a Registration and Administration Expenses Collective Agreement. The applicants argued that that decision is reviewable, either in terms of s 158(1)(g) of the Labour Relations Act or under PAJA or on the grounds of legality.

 

The trade unions party to the Council voted in favour of the extension. However, only two employers’ organisations voted through their representatives at the meeting, and another two exercised their votes by proxy. Between them, the employees employed by those four employer organisations represent, at best, 36% of the employees employed by the members of the employer’s organisations that are party to the bargaining council as envisaged by s32(1)(b).

 

On 30 August 2016, the Council requested the Minister to extend the administration agreement to non-parties for a period of 12 months after a meeting held on 28 July 2016. The Minister published a notice in the Government Gazette on 7 October 2016, inviting representations from interested parties in terms of s32(5)(c) of the LRA.

 

The Analysis

The Learned Judge provided clarity on the impugned decision that was sought to be reviewed. He found that the decision to be reviewed is not the Minister’s decision to extend the collective agreement. That had not happened. What the applicants sought to review was the decision of the MEIBC to request the Minister to extend the administration agreement. The distinction is important, said the Judge, not least in addressing the questions of ripeness and the nature and method of the decision itself.

 

The applicants argued that the jurisdictional facts required by s32(1)(b) were not present. The employer organisations that voted in favour of the request for an extension did not employ the majority of the employees employed by members of the employer parties to the Council.

 

The Respondents argued, inter alia, that the application was premature and therefore not ripe and that the decision of the Bargaining Council did not constitute administrative action.

 

On the issue of ripeness, the Court found that the premise of this argument appears to be that the Minister has not yet extended the agreement. But the impugned decision is that of the Bargaining Council, not the Minister. And the Council’s decision is complete. Should that decision be reviewable, now is the time to review it. The Court further held that it would lead to far greater costs and uncertainty to wait for the Minister to extend the agreement, and then seek to review the Minister’s decision once it had already taken effect and fees had already been levied from non-parties. The matter was, therefore, ripe for hearing as the decision by the Council had been made.

 

Does the decision to request the Minister to extend collective agreements to third parties constitute an administrative action?

As it was conceded by Numsa and the Council that this application could be brought in terms of s158(1)(g) which empowers the Labour Court to review the performance of any function provided for in the LRA on any grounds permissible in law, the Court found it less important to decide whether the Council’s decision to request the Minister to extend the administration agreement to non-parties constitutes administrative action that is reviewable under PAJA or on the principle of legality.

 

Jurisdictional requirements stipulated by s 32(1)(b)

Section 32 stipulates a number of jurisdictional facts before the Council may ask the

 

Minister to extend a collective agreement to non-parties. In casu the one in section 32(1)(a), that at a meeting of the Council, one or more registered trade unions whose members constitute the majority of the members of the trade unions that are a party to the Council voted in favour of the extension, is met. The Applicants contended that the Council did not comply with section 32(1)(b).

 

Section 32(1)(b) requires that, at a meeting of the Council, one or more registered employer’s organisations whose members employ the majority of the employees employed by the members of the employers’ organisations that are party to the bargaining council, vote in favour of the extension.

 

The applicant’s counsel referred the Court to the description of the prescribed process by a full bench of the High Court in the Free Market Foundation v Minister of Labour (2016) 37 ILJ 1638 (GP) which found that “Section 32(1) of the LRA stipulates a number of legal prerequisites to the bargaining council’s action. The collective agreement in question must be concluded in the bargaining council. The decision to ask the Minister to extend it to non-parties must be by way of a resolution taken at a bargaining council meeting. The resolution must be supported by one or more trade unions whose members constitute the majority of members of all the trade union parties to the council. Likewise, the resolution must be supported by one or more employers’ organisations which employ the majority of employees employed by the employer organisation members who are party to the council. The request to the Minister must be in writing. The non-parties sought to be bound must be identified in the written request to the minister, and they must fall within the registered scope of the council.”

 

The Court stated that if these jurisdictional facts are not present, the Council cannot validly ask the minister to extend a collective agreement. The Court found that the legal requirements of section 32 were not met.

 

At the meeting of 28 July 2016, only two employer’s organisations voted in favour of extension and a further two by proxy. Together, they represented no more than 36% of the employees employed by members of the employers’ organisations that are party to the council. However, the percentage did not meet the majoritarian requirement stipulated by section 32(1)(b).

 

The Decision

The Court found that the decision by the Council did not meet the jurisdictional prerequisites stipulated by s 32(1)(b) of the LRA. It also found that it is reviewable in terms of s158(1)(g) of the LRA, but whether it is also reviewable under PAJA and the Constitutional principle of legality, the Court found to be moot.

 

 For more information please contact Bongani at This email address is being protected from spambots. You need JavaScript enabled to view it.

 

 

 

 

 

 

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