Our client recently had a dispute set down for hearing at the CCMA wherein the main issue for determination was the severance pay owed to him. From the outset, the Commissioner was concerned as to whether the CCMA had jurisdiction to hear the dispute before it.
In such a matter, there is an onus on a Commissioner to satisfy himself that the CCMA does have jurisdiction. In our client’s matter, both parties were directed to prepare written arguments in order for the Commissioner to make a ruling on jurisdiction.
Briefly, in terms of the facts of this matter, the Applicant concluded a personal loan agreement with his employer during his employment. The Respondent however, included the loan agreement in negotiations of the Applicant’s severance package during the retrenchment process. The Applicant had previously contested the validity of the loan agreement and as a result the Respondent contended that the CCMA did not have the necessary jurisdiction to make a ruling on the validity of the loan agreement.
Jurisdiction may be defined as the ability of the CCMA to hear and determine a dispute between the parties involved. It has become apparent that where a matter falls outside of the scope of the CCMA, it shall lack jurisdiction to hear a dispute. The difficulty arises however, where a dispute tends to have multiple issues but not all the issues in contention fall within the scope of the CCMA. This seemed to be the challenge that the Commissioner grappled with in this instance.
On behalf of our client, it was submitted that the only issue for determination in this matter was the Applicant’s entitlement to a fair severance package and as such Section 41(6) of the Basic Conditions of Employment Act 75 of 1997 which states the following applies:
“(6) If there is a dispute only about the entitlement to severance pay in terms of this section, the employee may refer the dispute in writing to—
(a) a council, if the parties to the dispute fall within the registered scope of that council; or
(b) the CCMA, if no council has jurisdiction.”
The Applicant admitted that there were incidental issues that surrounded the severance package dispute, but went on to state that these issues did not detract from the fact that the sole dispute for determination at the CCMA was about the severance package. In support of the Applicant’s contention, we made specific reference to case law that has examined this matter in the past.
In Burman Katz Attorneys v Brand NO and Others (2001) 22 ILJ 128 (LC), the Court stated the following:
“It is correct that, in order to decide a dispute about severance pay, the Commissioner was obliged to consider other provisions of the BCEA, Section 197 of the LRA and the law of partnership but this was entirely incidental to deciding the core dispute. The fact that incidental matters need to be decided does not detract from the fact that the central dispute was about severance pay. I am satisfied that the Commissioner had jurisdiction to arbitrate the dispute which was presented to him”
In addition, we made reference to the case of Department of Justice v CCMA and others  JOL 8738 (LC), in which the Labour Court stated the following:
“From the above it seems to me that the following principles are applicable in situations where two possible causes of action are present, and each would lead to a different forum having jurisdiction:
- The applicant is the master of the dispute and has the right to choose the cause of action and grounds upon which it relies;
- The Commissioner must determine what the main issue to be decided is and whether the matter is one to be determined by arbitration in the CCMA. Although the ipse dixit of the applicant may be the decisive factor where the wording of the statute is clear on this point, the Commissioner may, in certain circumstances, be required to look at the objective situation to determine what the “real issue” before the CCMA is.
- The mere presence of issues that usually fall to be determined by the Labour Court does not automatically preclude the CCMA jurisdiction. The CCMA may be required to decide issues usually reserved for the Labour Court where it is peripheral or incidental to the main dispute before it.
- Where there are elements of both classes of dispute, that is those that fall to be determined by the Labour Court and those over which the CCMA has jurisdiction, jurisdiction will be determined with reference to the usual twofold test for causation (factual and legal causation).
- In determining the extent of the CCMA's jurisdiction, the wording of the empowering statutes should be given effect to.”
The case went on to state the following:
“In the interests of efficiency and swift resolution of disputes envisaged by the legislation, it is necessary that the CCMA has the authority to determine peripheral issues which affect the determination of the main issue before it.”
In light of the above cases, the Applicant’s submission was simple; the core dispute to be decided was one of severance. Any incidental issues to be decided upon did not diminish the CCMA’s jurisdiction in this matter. Any ancillary issues such as the validity of the loan agreement was a separate issue and should be dealt with as such in the appropriate forum and at the appropriate time. It was thus concluded by the Applicant that should the CCMA find that it lacked jurisdiction to hear the dispute, the Applicant would be unfairly prejudiced to the extent that he would be denied access to an efficient and cost effective forum.
The Applicant’s and Respondent’s legal representatives have both submitted their written arguments and the parties are now awaiting the Commissioner’s ruling. We are hopeful that the Commissioner will find in favour of the Applicant and we will update you once we have received the Commissioner’s ruling on jurisdiction.