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Ivan Israelstam

 


There are few things more disappointing and shocking for an employer or employee than to receive an unfavourable arbitration award after having been supremely confident of success, based on the merits of the case.

The reasons that this might happen include, among others:

  • The case of the party concerned was in fact weak without him/her realising it and despite the fact that the he/she thought it was very strong;
  • The party's case was, in fact, strong enough to reasonably expect a positive outcome, but he/she failed to present it in an understandable and/or convincing manner; or
  • The party did have a strong case, and it was presented in a proper manner but the arbitrator nevertheless failed to appreciate the case put forward.



It is the third of these three reasons that is unfair to the losing party. However, in such a case, the disappointed party has the right to challenge the arbitrator via a review at the Labour Court. This challenge can be made on the grounds that, among others, the arbitrator took a bribe, was biased, ignored pertinent evidence or failed to arrive at a properly reasoned award.

Wayne Hutchinson, who has many years of experience as a CCMA arbitrator, has stated that the arbitrator is required to "weigh up and consider all the evidence, both oral and documentary, prior to embarking upon the process of making factual findings" (May 2007, CLL page 107).

In his article, Hutchinson cites the decisions of senior judges that reinforce the arbitrator's requirement to provide a properly reasoned award. Specifically, he cites the cases of Crown Chickens v Kapp and Rustenburg Platinum Mines v CCMA.
    
As per Hutchinson's report, the court in the Crown Chickens case found that the award of an arbitrator:

  •  must not be arbitrary;
  •  must be arrived at by a reasoning process as opposed to one based on conjecture, fantasy, guesswork or hallucination;
  •  the arbitrator must have applied his mind seriously to the issues at hand; and
  •  must have been based on conclusions that are justifiable, defensible and logical.

In the Rustenburg Platinum case, the court found that "the Promotion of Administrative Justice Act (PAJA) applied to CCMA arbitration proceedings" and that, on fact, "the PAJA was enacted in order to give effect to the right to administrative action that is lawful, reasonable and procedurally fair".


In effect, the PAJA requires the decisions of arbitrators to:

  •  Comply with the law
  •  Be rational
  •  Be properly explained through the medium of giving of reasons for the decision. 

Thus the arbitrator must not only have logical and legal reasons for his/her decisions but must also give these reasons at the time of rendering the decisions, otherwise it may be assumed that he/she did not have good reason.

The emphasis has been placed on the actual giving of good reasons because:

  •  The parties have the right to know why the arbitrator has found against them so they can decide whether and how to challenge the arbitrator's decision.
  •  This requirement deters the making of faulty decisions by arbitrators. That is, an arbitrator who has to explain his actions will be less likely to ignore or misconstrue relevant evidence and to make bad decisions.

The comprehensive furnishing of reasons by the arbitrator enables anyone questioning the

decision to better assess whether the arbitrator has:

  •  Considered all serious objections to and all alternatives to the decision he/she has made; and
  •  Provided a rational connection between the facts of the case and the decision.
  •  The significance of this requirement for employers is that they must themselves have good reason when acting against employees. 


Furthermore, they must be able to provide their good reasons clearly and comprehensively to the arbitrator when called to CCMA hearings. This will pave the way for the arbitrator to accept the employer's reasoning and to follow the same line of reasoning as the employer did when introducing the disciplinary measures. In this way the employer aids the arbitrator to find in its favour.

The above approach requires of employers that they insist on managerial decisions being made unemotively, rationally and in line with the law by managers who have been trained in labour law and decision-making.


Ivan Israelstam is chief executive of Labour Law Management Consulting. He can be contacted on 011-888-7944 or via e-mail at

Our appreciation to Ivan and The Star newspaper for permission to publish this article.

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