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‘… on the evidence their jobs did become redundant; it was their duties that remained and were allocated for performance by other employees within the revised structure.’
The aforesaid being found to be the case, the Court then concluded:6
‘… It followed that the three respondents were liable to be dismissed for substantive reasons unless they were appointed to other positions within the revised structure. …’
In simple terms, the aforesaid is what happened to the applicant. Her duties relating to branding and also marketing were allocated to other new positions, still vacant. But even her existing duties relating to marketing were different as well, as has been discussed above. There can be no doubt redundancy existed.
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With the applicant’s former position in fact being redundant, and pursuant to answering the specific question referred to above, could her retrenchment then have been avoided? Or was it the applicant’s own intransigent and immovable position she adopted from the very outset that stood squarely in the way of her avoiding her own retrenchment? These questions are to be answered based on considering whether it can nonetheless be argued that the applicant could justifiably adopt the position that she simply remain in her position, without applying for the new position, and that the respondent negotiate changes to the applicant’s existing position with her. This was certainly the applicant’s firm view, without compromise, throughout.
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I do not believe this was a justified position to adopt, as her former position had actually ceased to exist because of the changes made. The applicant cannot insist on remaining in a position that does not exist and then seek to negotiate changes to it. In Freshmark (Pty) Ltd v Commission for Conciliation, Mediation and Arbitration and Others7 the Court said the following, which ratio can also be applied in this matter:
'An employer enters into a certain contract of employment with an employee on certain terms and conditions because he or his business or undertaking requires an employee who is prepared to work in accordance with those terms and conditions in order to meet the operational requirements of the business or undertaking. When that contract of employment as a whole or some of its terms and conditions can no longer serve or no longer suit the operational requirements of the business, that is a valid reason for the employer to terminate that contract of employment. However, if the employer has need to employ an employee on a contract of employment that is different either as a whole or only in some respects from the one that he has terminated, or wishes to terminate the employer must offer the new contract to the employee whose contract of employment has been terminated or is under threat of termination if that employee is suitable for employment on the terms of the new contract of employment. If the employee accepts the offer of a new contract of employment, he avoids being out of employment but this does not mean that his previous contract of employment remains. It does not. It is cancelled or it is amended. In either case the employment of the employee by the employer is subsequently governed by the terms and conditions of employment that are different from the terms and conditions which previously governed his employment. From this it is clear that the position is that the reason why in this case the contract of employment of the employee was terminated is that it was no longer suitable for the operational requirements of the employer, but, the reason why the employee was not employed on the new terms and conditions, and, therefore, why she became unemployed is that she rejected the appellant's offer of employment on terms and conditions of employment that, save for one new condition, were the same as the terms and conditions of employment that governed her employment.’
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Considering the actual redundancy of the applicant’s existing position, and the nature of the changes made to the new marketing manager position, it is in fact the proper approach for the respondent to apply an restructuring (operational requirements) process to effect the changes it wants. It needs to finally determine the actual redundancy of the former position, the nature of the new position, and then how the new position is to be filled, in the course of a restructuring exercise under Section 189 of the LRA. The Court in Forecourt Express (Pty) Ltd v SA Transport and Allied Workers Union and Another8 dealt with the situation where employees were offered alternative positions with a temporary employment service in circumstances where the employer, due to its business methodology, decided to declare those positions internally in the employer itself redundant. The Court held:9
‘… the appellant was entitled to choose the manner in which it would run its business provided that it did not change the terms and conditions of employment of the employees without their consent, and provided that, if it contemplated the dismissal of the employees, it complied with its obligations provided for in s 189 of the Act.’
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The fact further is that where a position is redundant and a new position is created, it is entirely competent for an employer to fill these new positions based on a process where employees are required to apply for such available positions, and are then interviewed for such positions for the purposes of placement. The proviso is that the selection criteria used in the interview process and subsequent placement must be fair and objective, or agreed to. In the current matter, there was no suggestion that the selection criteria that would be applied by the respondent in the interview process would be anything but fair and objective. All the applicant then needed to do was apply. The Court in Blue Financial Services10 held as follows:
‘To the extent that the present case concerns a requirement that employees apply for posts within a restructured organizational template, the legitimacy of this approach was recognized by the Labour Appeal Court in Vancoillie v Santam Life Insurance Ltd (2003) 24 ILJ 1518 (LAC). It is not a strategy that is without risk to the employer seeking to implement it. …’
The Court also referred with approval to an article by Alan Rycroft titled ‘Corporate Restructuring and "Applying for your own Job"'11, where the learned author says:
‘… employers will bear the onus of showing how the new jobs are different from the old jobs. If they are not sufficiently different, the employer will have to show why skills could not have been upgraded rather than resort to retrenchment.'
In casu, the differences in the positions have been fully discussed above. Clearly the kind of concerns referred to by Professor Rycroft as quoted in Blue Financial Services do not arise in this instance.
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The respondent fully explained to the applicant why she needed to follow the process and apply for the positions. In particular, and as made clear to the applicant not only in the consultations themselves, but also in later correspondence, it was essential to ensure a fair process to other employees as well that the procedure of applying and then interviews were consistently applied. In short, the respondent said that to have the other employees comply with this process and then treat the applicant differently would be unfair. The applicant’s answer was that she did not have much of a concern with regard to what may be the position with regard to other employees. The approach of the respondent was right, whilst that of the applicant was wrong. This is confirmed by the following dictum in SA Airways v Bogopa and Others12 where the Court said the following:
‘In my judgment the appellant's requirement that employees should apply for appointment to the positions in the new structure was effectively part of a process used to select the employees who would remain in the appellant's employ and those who would be dismissed for operational requirements. The appellant required the respondents to apply for positions in the new structure so that it could, by the use of the so-called best competency fit test, decide whether they would remain in the inflight service department or whether they would be dismissed, subject to whether they got appointed to other vacant positions outside the inflight service department but within the appellant. The respondents refused to apply for what they referred to as their old positions. It is important to make the point that the appellant has failed to justify its decision to require some employees to apply when it appointed others without requiring them to apply. …’
The Court then held as follows as to this failure of the employer referred to:13
‘… This means that in insisting on this requirement the appellant acted in breach of the parity principle. That is the principle that an employer should treat its employees equally or consistently when they are in the same circumstances unless there is justification to differentiate between them.’
The respondent was clearly heeding the warning enunciated by the Court in Bogopa in its consultations with the applicant on this issue.
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This then bring me to the next critical consideration in this matter. This is the applicant’s persistent refusal to apply for the positions available to her. Considering that the applicant had legal advice throughout, I am entirely mystified as to why the applicant did not apply for the positions. I find her approach in this regard to be bordering on the ludicrous. The applicant in the end conceded that what she did was based on her own personal and subjective considerations, which were entirely unfounded. I explored with the applicant when she testified as to what possible risk there could have been to her if she had simply applied for a position. She could provide no satisfactory answer. The point is she had no risk. If she applied, and was not successful and then retrenched, she could still challenge her retrenchment as being unfair on the same basis she is now doing. In particular, if it should be found that she could competently fill either of the two positions but was not so placed but rather retrenched, it would be highly likely that she would succeed in Court. If she applied, and was successful, she would still have a job, in a position she was competent in, was of the same grade and status, and at the same remuneration. There was simply no downside for her.
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As I will deal with in more detail below, the consultation process, in order to be effective, envisages compromise by both parties, if jobs are to be saved. The applicant’s unwillingness to in any way compromise the position she adopted before the consultation even really started closed her eyes to the opportunities available to her. If the applicant was advised to adopt this approach, she was poorly advised.
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Further, the fairness of what happened to the applicant must also be considered on the basis of a complete conspectus of what happened throughout the consultation process, and in particular, how the respondent conducted itself as well. In the end, there can be no doubt that the respondent’s approach in the consultation process was entirely focussed on avoiding the retrenchment of the applicant. It wanted to retain her, and in effect pleaded with her to apply for the position she preferred. The respondent went to the extent of compromising at the end of the process (possibly even to its own detriment where it came to other employees in the process) by way of foregoing the requirement of application and interview and placing the applicant in the brand manager position. All the applicant needed to do, to remain employed, was to apply for a position she wanted or take up the placement. Even if there was not an exact fit, the respondent would apply training. The respondent did exactly what was required of it to be fair. As was held in Bogopa:14
‘The question which arises is what the obligation of an employer is in relation to the dismissal of employees for operational requirements when it does away with an old structure and adopts a new structure (for operational requirements). An employer has an obligation to try to avoid the dismissal of an employee for operational requirements. This obligation entails that an employer may not dismiss an employee for operational requirements when such employer has a vacant position the duties of which the employee concerned can perform with or without at least minimal training.’
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It was fully explained to the applicant why the respondent considered it to be appropriate to compromise where it came to the brand manager position. In simple terms, the reason was that for the period of some two years immediately preceding the restructuring, the respondent witnessed how the applicant excelled in that position. Also, for the last year at least prior to the restructuring, the applicant’s main focus was on branding. It was common sense that this would be the best fit for the applicant, as far as the respondent was concerned. I can see nothing unreasonable or even wrong in this approach.
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How the applicant however responded to the attempted compromise leaves one with a rather bad taste in the mouth. Instead of seeing the positive in this, she immediately assumes the worst of intentions on the part of the respondent. She accuses the respondent of always intending to drive her into the position of brand manager, which she saw as a demotion and an attempt to discredit her. There is simply no substance in this point of view adopted by the applicant. As stated above, I accept that the respondent was justified in its view (without the benefit of application and interview) that the applicant was best suited to the position of brand manager.
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Further, the suggestion that the respondent was always driving her into the position of brand manager is preposterous. If that was the case, then the respondent would simply have placed her in that position from the start of the process. Not only did the respondent not do that, but it made it clear from the start of the process that it was entirely up to the applicant to indicate which position she wanted, by applying for the positions in an order of preference. Finally, in this respect, and even when the applicant was placed in the brand manager position, the applicant was still specifically informed that she could still apply for the marketing manager position and be interviewed for it. This conduct is completely inconsistent with the objective of driving the applicant into a position.
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With regard to the contention that the brand manager position was a demotion, it is my view that this was simply a deliberate design by the applicant to justify the entirely unreasonable position she adopted, that has no merit. Once it was made clear to the applicant that the brand manager position had a proper independent existence of sufficient scope, that it was on the same H13 grade and of the same status, and that the applicant’s salary and benefits would remain the same, any consideration that it was a demotion was completely unsustainable. The applicant then resorted to more obscure means to try and justify her contention of a demotion. One of these means was to conduct her own personal research on the internet as to the status and prospect of brand manager positions in what she called ‘the market’. This research was ill conceived and without proper factual foundation. It was entirely unsubstantiated. In fact, there was not even a proper indication of the parameters of this research and what this ‘market’ was supposed to be. This research was nothing more than an act of self-justification.
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Further, the applicant contended that the brand manager position had only one direct subordinate whilst the marketing manager position had three. That may be, but I do not believe that this constitutes a demotion. As Ledwaba explained, the brand position was more strategic, whilst the marketing position was more management. Therefore, the number of subordinates are linked to the nature of the position, and not to its level or status. In any event, and what the evidence revealed is that the brand manager position at the respondent, after it had been filled by the respondent following the applicant’s departure, continued to exist and was a position of substance at the same level as that of marketing manager. In fact, the discipline had grown to the extent that a further direct subordinate was added. The applicant sought to contradict this by saying she did not know this at the time. But the point is that she did not even give the position a chance. Despite the respondent in effect pleading with her, following detailed explanations, to accept that brand manager position was one of substance and not a demotion, the applicant simply was not interested in listening. She adopted a position, stuck to her guns, and was not open to any considerations to the contrary.
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The fact that the respondent was entirely genuine in seeking to retain the services of the applicant is not only apparent from the manner in which the consultations were conducted and the contents thereof, but also from what happened at the end thereof. As referred to above, and when the applicant’s approach came to the attention of the respondent’s CEO, Newton-King, the CEO in an unprecedented move involved herself to convince the applicant to change her views. Newton-King made it clear to the applicant that there was no risk to the applicant simply participating in the process and applying for a position as the respondent wanted to keep her. The applicant testified that she accepted that Newton-King was genuine, and undertook to go and reconsider her position. What the applicant then did, after this meeting, is flabbergasting, as she simply reverted to her original stance raising the exact same arguments as before. The applicant’s conduct, I must confess, makes little sense to me.
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The respondent’s HR director, Mashigo, then becomes involved. It is he who sanctioned the compromise relating to placement of the applicant into brand manager without application and interview. His correspondence to the applicant could not be clearer and has been dealt with in detail above. In the end, and after giving the applicant some three weeks over Christmas to finally consider her position, all the applicant had to do in January 2015 was either take up the position of brand manager, or apply for the position of marketing manager. She remained steadfast in her refusal to do either. I find this to be inexplicable, and unreasonable.
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I add that I have very little hesitation in accepting that if the applicant applied for the position of marketing manager, she would have been placed in it. This is evident from the fact that the undisputed evidence was that the applicant was considered by the respondent to be overall competent to fill the marketing manager position and certainly qualified for it. If the interview process and accompanying psychometric test highlighted any deficiencies in the applicant’s make up for the position, then she would be trained to skill and equip her. The respondent made this clear to her in the consultation.
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In the end, the applicant should have applied for the new positions of marketing manager or brand manager, or even both in an order of preference. At the very least, she should have taken up the position of brand manager in which she was ultimately placed as a basis of compromise by the respondent. Her failure to do so must be fatal to her case of substantive unfairness. She left the respondent with no choice but to retrench her, despite being in a risk free position to have avoided her own retrenchment. The applicant only has herself to blame for what happened to her. As was said in Freshmark15:
‘ …. an employee who unreasonably refuses an offer of alternative employment is not without fault. He has himself to blame if he subsequently finds himself without employment and, therefore, does not deserve to be treated on the same basis as the employee who finds himself without employment due to no fault on his part …. Where the employer offers to continue to employ the employee - whether in the same position but on different terms or on the same terms but in a different position or in the same position and on the same terms but in a different place, that is still alternative employment. It is an offer of an alternative contract of employment.’
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The same sentiment was echoed in Latex Surgical16 where the Court said:
‘ …. Accordingly, when an employer's operational requirements dictate that its workforce should work in accordance with certain terms and conditions by which such workforce is not bound, the employer should convey this to the workforce and ask them to agree to work according to such terms and conditions, negotiate with them and warn them that, if they reject such terms and conditions, he will have to terminate their contracts of employment and employ new employees in their place, who will accept such terms and conditions. … If the employees reject such proposals and the employer terminates their services, the employees cannot complain that they were not given a chance to avoid their dismissal by accepting the new terms and conditions of employment.’
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In Entertainment Catering Commercial and Allied Workers Union of SA and Others v Shoprite Checkers t/a OK Krugersdorp17 it was held as follows:
‘… where the amendment to terms and conditions of employment is proffered by an employer as an alternative to dismissal during a bona fide retrenchment exercise and it is a reasonable alternative based upon the employer's operational requirements, the employer will be justified in dismissing employees who refuse to accept the alternative on offer.’
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I also again mention Forecourt Express18, where the Court said the following, in circumstances where it was argued that the alternative positions at a third party were less attractive to the employees:
‘… In my view the second and further respondents' loss of income arose out of their refusal of the offer of employment by the subcontractor and labour broker and not from their dismissal. It seems to me that the second and further respondents are, in this regard, the authors of their own misfortune.’
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Another apt example is found in the judgment of Mineworkers Union/Solidarity on behalf of MacGregor v SA National Parks19 where the Court held as follows in finding the retrenchment of the employee to be fair:
‘If the applicant had followed the instructions of Mr Mogome, he would have just continued in the employ of the respondent, but in the position of manager: environmental management services. His intransigent stance in refusing to change direction caused the respondent to advertise that position internally and to treat all the applicants the same. The applicant was nonetheless encouraged to apply, even belatedly, as the respondent believed he was the best person for the position. However, after the long consultation process, which included meetings and correspondence, the respondent was entitled to decide not to accept an 'under duress' application for the position. The applicant was interviewed though. It was clear that he was not interested in the position. If he was, he would have withdrawn the 'under duress' reservation. … ‘
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