Article 45/2024

LabourEdge

The labour appeal court recently had the opportunity to identify the different approaches that could be adopted to compulsory interest arbitration in terms of s74(4) of the LRA in respect of essential services – what were these options and on what basis would an arbitrator decide which one is more appropriate than others in a specific scenario?

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  • The labour appeal court, in Working on Fire (Pty) Ltd v NUMSA and Others (2022) 43 ILJ 2764 (LAC); [2023] 1 BLLR 39 (LAC); (2022) 33 SALLR 64 (LAC), approached the above issues as follows:
    • in the scenario where the parties do not agree to an arbitrator’s terms of reference and it is left to the arbitrator to determine, in terms of s136(4) of the LRA, the arbitrator has to ascertain the applicable rule of law or legal questions available to him or her – this is a question of law
    • the arbitrator has to make a value judgment as to which of the options listed below are best suited to resolve the dispute before him or her – this is a matter of discretion and not a question of law
  • The labour appeal court, in the aforesaid matter, identified the following three options available to an arbitrator in the aforesaid scenarios, namely:
    • the hypothetical outcome approach (NEHAWU v Lifecare Health [1999] 2 BALR 153 (CCMA)) – this approach entails the arbitrator anticipating where bargaining should have been struck had the bargaining continued to conclusion and in good faith
    • the fairness approach (SAMWU v Water and Sanitation Services SA (Pty) Ltd [2002] 1 BALR 89 (CCMA)) – this approach entails that the arbitrator is to be persuaded on the basis of fairness, which respective case should be accepted and the arbitrator is to investigate whether the respective parties had proffered sufficient reasons for the acceptance of their respective positions
    • final offer position/approach (NUMSA v Working on Fire [2018] 10 BALR 1082 (CCMA)) – the arbitrator has no choice but to decide between the respective final proposals of the parties, with no discretion to merely split the difference between the final positions
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