The Labour Court, sitting in Johannesburg, has granted the business rescue practitioners (BRPs) for financially-beleaguered State-owned national flag carrier South African Airways (SAA) leave to appeal against the whole of a Labour Court judgment handed down on May 8. In that judgment, the court had interdicted a section 189 retrenchment process initiated by the BRPs at SAA and had ordered the BRPs to produce a business rescue plan before making any retrenchments.
That ruling had been the result of an application to the court by the National Union of Metalworkers of South Africa (Numsa) and the South African Cabin Crew Association (Sacca). They had called on the court to rule that the BRP's retrenchments at the airline were unfair.
The BRPs have welcomed the court’s latest ruling. They, and SAA, had argued that there was a reasonable prospect that another court would take a different view of the facts, when presented with them. They also argued that the issue was of major public importance and that the May 8 ruling had been in conflict with previous judgments on such matters.
“Our position in seeking leave to appeal on the basis that another court may come to a different decision has been accepted by this ruling,” stated the BRPs. “We will seek an urgent date for the matter to be heard by the Labour Court.”
In his emailed letter giving his judgment (released by the BRPs along with their own statement), Judge Andre van Niekerk gave his reasons for granting leave to appeal. “Section 17 of the Superior Courts Act provides that conflicting judgments on the matter under consideration is a ground for leave to appeal,” he wrote. While he pointed out differences between a previous case (which involved Numsa and Vanchem Vanadium Products) and the SAA one, “the conclusion reached [in that case] is one that stands in conflict with the finding of this court.”
“Further, the present case raises a constitutional issue; in particular, the proper interpretation of s[ection] 136 (1) of the Companies Act in the context of the constitutional right to fair labour practices,” he added. “For these reasons, leave to appeal ought to be granted.”
The judge rejected an argument presented by Numsa and Sacca that an appeal would be moot because of a memorandum of understanding signed by the BRPs and the Minister of Public Enterprises. “I do not understand the terms of that memorandum finally to resolve the issue of any possible retrenchments, or the timing of a s[ection] 189 (3) notice,” he affirmed. “The dispute between the parties may have been paused, but it remains alive.”