By the Employment Law department
On 10 May 2016, the Labour Appeal Court (the “LAC”) heard two consolidated matters from the Labour Court (the “LC”). The facts and relief sought in both matters were similar. In the MBS application the employer brought an urgent application to the LC seeking an order in terms of which the respondents were required to provide reasons as to why the enforcement of an arbitration award should not be suspended pending the outcome of the review application. Similarly in the Bheka application, the employer approached the LC on an urgent basis to suspend the enforcement of an award granted in favour of the employee.
It is noteworthy to mention that in both cases, the Director of the CCMA certified and issued the enforcement of the awards. In terms of Rule 40(2)(a) of the Rules for the Conduct of Proceedings Before the CCMA, an arbitration award that has been certified in terms of section 143 of the Labour Relations Act (the “LRA”) that orders payment in money may be executed by using the writ of execution in the LRA Form 7.18 or LRA Form 7.18A. This Rule was applicable in both cases since the awards ordered the employers to pay the employees a sum of money.
In the LC, the Judge raised the point as to whether the LC could grant an order suspending writs of execution issued by the CCMA. The Judge concluded, among other things, that the CCMA does not have jurisdiction to issue writs of execution in respect of arbitration awards issued by the CCMA. The Judge was of the opinion that the CCMA is not a court of law and writs are ordinarily issued by courts of law. The LC consequently set aside both enforcement awards. Subsequent to the LC’s judgment, the Judge granted the CCMA leave to appeal to the LAC to challenge its judgment. The CCMA argued that in light of the amendment of section 143 of the LRA, the LC Judge erred in finding that the CCMA does not have the power to issue writs of execution.
The LAC upheld the appeal and unpacked section 143 of the LRA in its judgment with the intention to suppress the misinterpretation of the section and to advance the remedy it sought to provide. Before the amendment, section 143(1) of the LRA read as follows:
An arbitration award issued by a commissioner is final and binding and may be made an order of the Labour Court in terms of section 158(1)(c), unless it is an advisory arbitration award.
Previously, after the employee was granted an arbitration award in his or her favour at the CCMA, he or she had to go to the LC to apply for the award to be made an order of court before the award could be enforced. Consequently section 143(1) of the LRA created a two-stage procedure: firstly, the employee who was granted an arbitration award was required to attend the CCMA and secondly he or she was required to attend the LC to enforce his or her award. The two-stage procedure was evidently time consuming and expensive, particularly for the employees. To combat the undesirable effects of the two-stage procedure, the legislature amended Section 143 of the LRA to read as follows:
An arbitration award issued by a commissioner is final and binding and it may be enforced as if it were an order of the Labour Court, unless it is an advisory arbitration award.
Unlike previously, an employee with an arbitration award granted in his or her favour need not approach the LC to enforce an award issued by the CCMA, such an award is deemed enforceable. The legislature created a legal fiction giving the CCMA the power to have a status, of a court of law, which it would not otherwise have without the fiction. As a consequence, once the CCMA has issued the writ, an employee may present the award and the writ to the sheriff for execution if payment is not made.
It is evident that the amendments to section 143 make it easier, inexpensive and accessible for a person to enforce a certified arbitration award. The LAC correctly interpreted section 143 of the LRA amendments as a tool to expedite the enforcement of arbitration awards issued by the CCMA
For more information on the above contact:
Siobhan Leyden, Partner, Employment Law department,
+(0)11 290 2540, firstname.lastname@example.org
Pamela Bodlo, Candidate Attorney, Employment Law department