Section 143 of the Labour Relations Act states that an arbitration award issued and certified by the CCMA “is final and binding and may be enforced as if it were an order of the Labour Court”.
Ignoring these awards may have dire consequences for employers, as became clear in a recent Labour Court ruling in the matter ECCAWUSA obo KELVIN MOYO vs SUPERSPAR – POLOFIELDS & MAGNUS LOUBSER.
Mr. Moyo, the employee, approached the CCMA after being dismissed and referred an unfair dismissal dispute. After hearing evidence, the commissioner concluded that the employee was unfairly dismissed and ordered his reinstatement.
Despite numerous attempts by the employee to tender his services and even after having the award certified, the employer failed to reinstate the employee.
The employee subsequently initiated contempt of court proceedings in the Labour Court due to the employer’s failure to adhere to the court order.
The employer opposed the application by alleging that they were not aware of the award and that the responsible HR official, who was aware of the award, had resigned.
The judge stated that employers generally treat arbitration awards with disdain and utter contempt. The employer’s reasons for not complying were flimsy and are at odds with the undisputed evidence that the award was brought to the employer’s attention. As a director, Mr Loubser is responsible for ensuring that SPAR complies with the law, and blaming an HR official was unacceptable.
SPAR and Mr Loubser personally, were found to be in willful and mala fide contempt of court, and the judge rejected their “flimsy and unconvincing” explanations for non-compliance.
SPAR and Mr. Loubser were fined R1 000 000, which was wholly suspended on condition that the employee be reinstated within 30 days. They were also ordered to pay the employees’ legal costs.
Employers should take arbitration awards seriously.
Numerous legal avenues are available to employers to challenge arbitration awards by the CCMA. They can, among others, take these awards on review or even apply for the rescission of these awards.
Ignoring arbitration awards, hoping they will go away or be forgotten, is very risky and may have dire financial consequences, as this case clearly demonstrated.
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