ELRC644-20/21 EC
Text
ELRC159-21/22 WC
Award Date:
09 November 2021
IN THE EDUCATION LABOUR RELATIONS COUNCIL HELD AT CAPE TOWN VIA VIDEO ZOOM CONFERENCE
Case No: ELRC159-21/22 WC
In the matter between
Danville Esau Applicant
and
WESTERN CAPE EDUCATION DEPARTMENT Respondent
PANELLIST: Dr. GC. Van Der Berg
ARBITRATION AWARD: 09 November 2021
ARBITRATION AWARD
Details of hearing and representation
1. The arbitration hearing was held on 8 October 2021, and on 29 October 2021 at 09:00 via digital zoom conference from Cape Town, under the auspices of the Education Labour Relations Council (“ELRC”). The proceedings were both digitally and manually recorded. The applicant, Danville Esau was represented by Maurice Brinkhuis, an Official from SADTU. The respondent, Education Department of the Western Cape, was represented by Anthe Willemse. The arbitration proceedings were postponed by the ELRC on 13 August 2021 and then it was again postponed by the Panellist on 08 September 2021 as the representative of the respondent tested positive for Covid-19 and provided a medical certificate.
Issue to be decided
2. I must decide whether the applicant was dismissed and if he was dismissed, whether the dismissal was substantively and procedurally fair and if not, determine the appropriate remedy. The applicant sought retrospective reinstatement without loss of benefits.
Background to the issues
3. The respondent is the Department of Education in the Western Cape and the Eden Central Karoo South, falls under their jurisdiction. The applicant was employed by the respondent as Acting Principal/Caretaker at Van Wyksdorp Primary School from 1 October 2009, and from 1 July 2010 as Principal. The Applicant was earning R38 978-00 gross salary per month and R 21 314-32 net salary per month.
4. Two charges were leveled against the applicant as follows: Charge 1 “It is alleged that you are guilty of misconduct in terms of Section 18(1)(dd) of the Employment of Educators Act, no 76 of 1998 (hereinafter referred to as the Act), un that during 2016 and/or 2017, you committed a common law offence namely fraud, by misrepresenting to the Western Cape Education Department that Van Wyksdorp Primary School had indeed paid 80% of the Grade R subsidy, whereas in truth the actual amount paid to the Grade R teacher was less than 80%. The Financial Statement submitted to WCED is attached and can be seen on page 2 of bundle “R”. The alternative to charge 1 states: “It is alleged that you are guilty of misconduct in terms of Section 18(1)(ee) of the Act, in that during 2016 and/or 2017, you committed an act of dishonesty by knowingly submitting incorrect pay sheets pertaining to the payment of the Grade R educator of Van Wyksdorp Primary School, to the Western Cape Education Department”.
5. Charge 2 states: It is alleged that you are guilty of misconduct in terms of Section 18(1)(a) of the Act, read in conjunction with Section 16A(2)(i) of the South African Schools Act of 1996, in that during the period 1 April 2016 to 30 September 2016 and/or 1 April 2017 to 30 September 2017 you failed to take reasonable steps to prevent any financial maladministration or mismanagement by any staff member or the governing body at the school, by not ensuring that 80% of the Grade R subsidy was paid to the Grade R educator, which resulted in an amount of R45 630-28 unaccounted for”.
6. The investigation report was completed and approval was given in April 2019 to proceed with charges. The disciplinary hearing commenced on 26 April 2019. The applicant pleaded guilty on the two charges and he was dismissed on 5 August 2019.
7. The dispute arose on 1 May 2021 and was referred to ELRC on the 14th of May 2021. The dispute was conciliated on the 11th of June 2021. It remained unresolved and a certificate of non-resolution was issued. The arbitration proceedings were set down for 13 August 2021 and it was postponed by the ELRC. The arbitration proceedings were rescheduled for 8 September 2021, and postponed as a result of the absence of the representative of the respondent due to Covid-19. Then it was scheduled for 8 October 2021. It was again postponed as a part heard case due to the Covid-19 symptoms by the representative of the applicant, after two witnesses of the respondent testified, to 29 October 2021.
8. The parties did present opening statements and both parties’ representatives presented written closing statements, as agreed, on 29 October 2021. Both parties submitted their written closing statements on 5 November 2021. Both parties were allowed to cross-examine and re-examine during the presentation of their evidence. For the sake of brevity, the details of this will not all be repeated in the award, but it should not be construed that it was not considered.
Survey of evidence and argument
Documentary evidence.
9. Both parties submitted bundles of documents. The bundle of the respondent was marked as “R” pages 1-77. The bundle of the applicant was marked as “A” pages 1 – 8 plus other annexures. Both parties did not dispute the authenticity of the bundles.
* As noted previously the proceedings were digitally recorded therefore what appears hereunder constitutes a summary of the evidence deduced by the parties in so far as it is relevant for the purpose of this arbitration; it is by no means a minute of what transpired in the course of the proceedings. Section 138 of the Labour Relations Act provides in subsection (7) that within 14 days of the conclusion of the arbitration proceedings-(a) the commissioner must issue an arbitration award with brief reasons, signed by that commissioner. These follow below.
Respondent’s evidence and argument
The respondent called two witnesses who testified after being duly sworn in
1st witness: Siyanda Xokozela, State Accountant in Compliance, testified as follows:
10. She testified that she is responsible for financial assessment at schools, verified documents and the school budged, income and expenditure at the schools, and give assistance regarding finance at schools. She became aware of the allegations when she did a financial assessment of the income and expenditure at the specific school and she found an unfavourable account. She further evaluated the bank account and found that the bank account was on a negative. The assessment at the school was concerning certain mismanagement of finances at Van Wyksdorp Primary School where the applicant was the Principal. She did not receive any allegations, but after she did an assessment of the income and expenditure plus the budget, she identified the mismanagement and misrepresentation of finances.
11. Page 1 and 2 in bundle “R” represents charge 1 and 2 as formulated. In Circular 0039/2016 it states on page 6 of bundle “R” under 5 and 5.1 the following: “Use of Grade R allocation. Salary of the Grade R practitioner schools are reminded that Grade R practitioners at all schools must receive the full 80% subsidy allocation which is transferred biannually. Governing bodies of NQ4 and NQ5 schools must augment the Grade R practitioner’s salary so that the practitioner receives an amount which is more than the minimum of R7964 per month. Grade R practitioners at no-fee schools are entitled to the full 80% of the subsidy”. The applicant was aware of this Circular and the 80% of the subsidy to be paid to the Grade R educator.
12. The responsible person in this case, the applicant, must submit proof what he did with the subsidy received. On page 9, annexure C, of bundle “R” it represents the Grade R classes: Financial Statement of receipts and expenditure for 2016, and page 10 is the pay sheet which indicates what was paid to Grade R educator. It can be seen that the amount the Grade R educator must receive monthly was R7 488-00. The pay sheet of April 2016 shows that the Grade R educator received only R5119-66 per month. The Educator was not paid the amount that she was supposed to be paid on a monthly basis.
13. The salary advice on page 12 of bundle “R” indicates that the full amount was part of the salary advice by the Grade R educator and she did not receive it. She received a lessor amount. It is not clear for what the funds were used for. The applicant explained that the financials of the school was not in a good position. The Grade R educator received for the month of April 2016 only R5119-66. The cheque made out for this amount can be seen on page 11 of bundle “R”. The cheque requisitions and the actual cheques can be seen on pages 13 and 14 for May 2016 and on pages 15 and 16 for June 2021, and it followed the same trend as in April 2016. The Grade R subsidy was paid for 1 April to September 2016 and from 1 April 2017 to September 2017. Subsidy was paid over to the School every six months.
14. Charge 2 regarding financial mismanagement was read as it appears on page 2 of bundle “R” and as formulated in paragraphs 4 and 5 above. It means that R45 000 is uncounted for. If does not reflect in the bank statements as it was used for other expenditure. It was probably together with other subsidies received for maintenance, municipal accounts. There was however no reason to use the subsidy for Grade R educator for other expenses. The impact of the R45 000 unaccounted for impacted on the finances of the school as the Grade R educator has to be repaid the underpayment of the 80% as stipulated and it had a negative impact on the school.
15. It was further indicated by the witness that pages 18 -20 and 25 of bundle “R” reflects the underpayment of the Grade R educator for August and September 2016. In 2017, pages 39, 40 and 41 reflects the underpayment for April 2017. Pages 39 to 41 is the underpayment for May 2017, and pages 42 to 43 for May 2017. The following is for June to September 2017: (1) June 2017 is page 44; (2) Page 45 for July 2017; (3) For August and September 2017 it is pages 46 to 48. It is also clear on page 9 of bundle ”R” that no 1% for UIF was deducted from the payslip of the Grade R educator. There were also no contributions from the school.
16. Under cross-examination she confirmed that her role was to support the Principal of the school when she determined the mismanagement. The Department of Education in the Western Cape had monthly follow-up sessions with the Principal to follow up on regular payments. The Principal requested the Department of Education for financial assistance. He did not explain to the witness what happened to the R45 000. She confirmed that the money was not used for personal gain as it was not proved.
17. She confirmed that the sanction that the applicant received was not too harsh as the applicant received the mentioned Circular and he was responsible for the finances of the school and that it was used for the identified purpose. There was evidence of monthly school visits by other Departments of the Department of Education in the Western Cape. It was mentioned to her that the applicant had twenty years’ experience and no misconduct as mitigation. The witness replied that she could not say, but if she was the chairperson of the disciplinary hearing, she would have dismissed the applicant.
18. Under further cross-questioning the witness confirmed that the school was not function well after the dismissal of the applicant as it was already in financial difficulty. She admitted that training was given to the Principal as monthly visits was done and his expenditure and income were monitored.
19. Under re-examination she confirmed that support was indeed offered to the applicant in the form of training and regular monthly school visits. She was aware of the financial backlog.
2nd witness: Anton Gunter, Chairperson of the disciplinary hearing, testified as follows:
20. He was the chairperson of the disciplinary hearing of the applicant and he pleaded guilty on the two charges on 26 April 2019. He gave his decision on 2 May 2019 and the applicant signed for a copy on 6 May 2019. He considered mitigation and aggravation presented and he took a decision. No witnesses testified as the applicant pleaded guilty. The evidence the applicant submitted in mitigation was that he was not well treated in his position as Principal. He also mentioned that the Admin Clerk who assisted him was also not well acquainted with the finances. There was a lot of shortages and he was not well trained in the management of the school. His report appears on pages 73 to 77 of bundle “R”.
21. He did not explain the guilty plea to the applicant as he was represented. However, he explained in detail to the applicant his rights. The applicant decided with is representative to plead guilty. He decided on dismissal as misrepresentation and mismanagement of funds of the school, plus the R45 000 of the school that was uncounted for, was very serious. He never dismissed the applicant for taking money of the school, and the applicant admitted mismanagement of funds. He however considered to demote the applicant to an educator P1 post as he has still value to add. It was not possible to accommodate him as no access post was available. However, his key responsibility was to manage financial funds.
22. Under cross-examination the witness confirmed that the applicant pleaded guilty on both charges. He has 23 years’ experience as a Presiding Officer and he did not ask the applicant why he pleaded guilty on the two charges, but he listened to his mitigation presented. He believes that it was a fair dismissal as he did the same in the past for similar transgressions. The Grade R educator, D Swanepoel was never present and mentioned during the disciplinary hearing. He phoned the Circuit Manager about placement in a suitable position at another place, but no suitable position was available at that stage. The applicant could continue as an educator but not in a position where he has to manage finances. According to the witness, the applicant admitted that he received financial training, but he was not taken through the whole financial processes.
23. He confirmed that the applicant has a Line Manager that he could phone at any time for assistance. The applicant was in the position for nine (9) years and he was the person responsible to manage funds, and he found that the applicant mismanagement the funds. He did not answer whether the school was in a financial crisis when he managed the finances. He stated that the buck stops at the Principal of the school and he could not account for the finances. He stated that with twenty-three years’ service and a clean disciplinary record the applicant should have given another change in the capacity as a teacher P1. The applicant is presently employed by the SGB in a particular school. He confirmed that the applicant can re-apply for a post at the Department of Education as he can still deliver valuable input. He believes the sanction of dismissal was not too harsh.
Applicant’s evidence and arguments
The applicant, Danville Esau, after having been sworn in, testified as follows:
24. The applicant stated that he is 46 years of age and he was 16 years in the service of the respondent. He was appointed as principal in 2010 after acting in the position since 2009. No handover took place by WCED at Van Wyksdorp Primary School. The school was taken over with financial backlogs. The respondent did not investigate it, because there was no handover and he was sent on a path of failure by the respondent. The issue of handing over in schools is extremely important. A strict process of handing over ensures responsibility and accountability are completely clear, and the school would avoid arguments and denials in 2016/2017 over an unaccounted amount.
25. He asked for help and support from the respondent since his acting and appointment as Principal, but did not receive any help. In 2016 – 2017, they were expected to deduct income tax from Grade R posts. He was not given the support and they struggled to register with SARS and made deductions. It was a common problem in the circuit and district in 2016/2017. He attended both workshops in Riversdale and in Ladismith, and registered the school on 16 May 2018. It is strange that only Van Wyksdorp Primary School’s Principal was guilty of misconduct and dishonesty in 2019. There were many schools in the circuit and district which did not comply and registered for the first time in Riversdale or Ladismith.
26. He did not use any money of the school for personal gain or his own use. He was dismissed for misrepresentation of the grade R money. It was not his responsibility as he did not receive a proper handover and he took over a backlog. The funds came in but then the account went in a negative, and there was then not enough money at the school. He pleaded guilty on the formulated charges as he was under the impression that they would give him the opportunity to explain the reasons he did it this way, but nobody listened to him. He only later understood the implications of pleading guilty, and if he understood it from the beginning, he would not have pleaded guilty. The chairperson of the disciplinary hearing did not explain to him the consequences of pleading guilty.
27. The applicant explained in detail the circumstances he was in regarding charge 1. On page 2 of bundle “A” he explained the financial statements submitted to the WCED since April 2016 up to September 2016 and again from April 2017 up to September 2017. Only two examples were mentioned as the rest is clearly spelled out on page 2. In April 2016 the amount received from the WCED was R7488-00 and the actual amount paid out to the Grade R educator was R5119-62. The accrual amount in the school account was R70240-41 according to bank statement 182. In July and August 2016 no salary was paid out to the Grade R educator, as there were negative amounts in the school account as per bank statements 185 and 186. In September 2016 the Grade R educator was paid R18 978-48 in lieu of short or no payments in the previous months.
28. In April 2017 the school received an amount of R8070-00 from the respondent but only paid our R5000-00 and the amount in the school account was R10814-70 according to bank statement 194. In June and July 2017, the school received each month R8070.00 and paid no salary to the Grade R educator, as there was negative amounts in the school bank account according to bank statements 196 and 197. He also explained the amounts paid out for April 2016 to June 2016. For example, the June 2016 amounts are reflected as follow: received R7488-00 – R2293-50 tax deduction and R74-88 UIF deduction. Then R3619-62 was deducted as back pay for September 2016. The nett amount received by the educator was R1500-00. The Grade R educator received all her money as indicated, and the school suffered financial loss due to payments made.
29. The applicant then explained in detail the amounts received by the educator in September 2016 and the deductions made. He also explained the deductions for April, May and August 2017, regarding Tax and UIF, as can be seen on page 3 of bundle “A”. He mentioned for example that on 20 April 2016 the school received R56 160-00 from the respondent and 80% represents R44 928-00 and R7488-00 per month for six months. He stated that the above on pages 2 and 3 of bundle “A” proved that he and the SGB complied to circular: 0005/2016 & 0039/2016.
30. The Tax and UIF deductions were made and UIF was paid over to the Department of Employment and Labour on a monthly basis. He also indicated that after he submitted the money income and expenditure report to the respondent, nobody assisted him. D Swanepoel, Grade R educator, SGB member and authorised signatories on school account, gave permission that the school hold back money for her tax, which the school (SGB) did. That is the reason why D Swanepoel understood that there was no money paid for some months, because there was no money to pay her salary. Her signature was on the cheques/claim/forms/pay sheet, with the purpose of the money paid out was on all cheques. She was also present in the SGB meetings where financial reports were given.
31. After his wife died, there was no time to really grieve over her. There was a school to run and a daughter of only 10 years to take care of attending Van Wyksdorp Primary School, and the other daughter was 17 years of age in High School in the hostel. His wife worked at Van Wyksdorp Primary School as the Admin and Finance Officer. She was appointed in 2007 by the SGB and she was the one normally worked with the claims, and suddenly he was the one who must advice/complete (April to September 2016) the Grade R claim forms. He asked for help and phoned other schools, but none came with a solution. That was the reason D Swanepoel gave the school (SGB) permission to deduct tax and to keep it. She said that when SARS starts to deduct tax, she would not be able to afford to pay the money back to SARS. That was the reason why the amounts differed from the pay sheets.
32. He stated that he can see it was wrong to hold back tax money or to let the SGB did it. Under normal circumstances he would have done the right thing like he always did from I October 2009 as part of the responsibility of a Principal. In 2016-2017 he was emotionally unstable and was on sedative pills to control his emotions that affected his ability to work under pressure. He really tried his best to take reasonable steps to prevent financial maladministration or mismanagement. After his dismissal he is still employed and is working at Panorama Primary School as a SGB teacher. He was employed by them in January 2020 and he is loyal to his work, and towards the children and responsibilities entrusted to him. He was put on a path by the WCED to gain more experience and he did, and he is genuinely remorseful over actions that leads to his dismissal. He will never again make the same mistake as he learned from this mistake. If WCED could have find a position for him at the stage of his dismissal, and as it was testified by the second witness of the respondent, he would have taken the position.
33. When he took over as Principal at the school the account of the school was in a backlog as can be seen from the audited financial statements from 2010 up to 2018. When he took over in 2010 the loss for 2010 was –R53 667-58. The school could not recover financially after he took over the school on 1 October 2009. In the nine to ten years as a Principal, he struggled to manage a negative account, and after he managed finally to work down the backlogs to –R9206-00 in 2018, and he was dismissed in 2019 by the WCED. The table appears on page 6 of bundle “A”. He was shocked when he was dismissed and he was not given an opportunity to appeal when he pleaded guilty on the charges. He was only given the opportunity to explain mitigation. He did not feel well when he was dismissed but he must continue with his life.
34. He was aware of the relevant circulars regarding the Grade R educator money received from the respondent. According to him the trust relationship between him and the WCED was not irreparably harmed ant therefore he can be reinstated. It was not his own supervisor that testified that the trust relationship was destroyed. He stated that he is aware of other cases where the WCED gave educators another change who was charged with mismanagement and they were reinstated. In the case ELRC639-19/20EC the Panellist found that the applicant was remorseful and he was reinstated.
35. It is clear from the decision of the Labour Appeal Court in Woolworths (Pty) Ltd v Mabija and others (PA3/14) (2016) ZALAC 5; (2016) 5 BLLR 454 (LAC) (19 February 2016, that the arbitrator/commissioner must be made aware in determining whether the dismissal for misconduct was fair, whether the trust relationship has been broken. In this case therefore, it is clear that it is insufficient for an employer to merely allege a breakdown in the trust relationship. Evidence must be laid at the disciplinary hearing and arbitration to show specific instances of how an employee’s misconduct destroyed the trust relationship.
36. The applicant asked for reinstatement to the position he previously occupied, subject to the caveat that, if the position is no longer available, he will be placed in a similar position at another school on the same salary he earned before his dismissal. He also stated that he be paid all outstanding money due to him to be calculated based on the salary which he earned from the date of his dismissal to the date of granting of the award.
37. Under cross-examination the applicant was referred to page 23 of bundle “R”, and he confirmed that the salary advice was part of the documents he failed to submit to the District Office. He further confirmed that the amount received for April and May 2016 from the WCED was R7488-00 but he only paid out R5119-62 to the Grade R educator. He admitted that his breakdown presented on page 3 of bundle “A” is not reflected on page 23 of bundle “R”. He therefore agreed that it is not a real representation of wat actually happened in May 2016. He did not submit the breakdown on pages 2 to 3 of bundle “A” to the WCED before at any stage. He however submitted the salary advice on page 24 of bundle “R” to the WCED, for July 2016. It is again not a true reflection of what happened in July 2016. He agreed that he implicated himself by sending wrong documentation to the WCED. It was not his intention mislead the WCED as the Grade R educator asked him to hold back money for tax and he was under pressure.
38. He stated that in 6 to 7 years he did not misrepresent documentation and this was the first time. The deductions for tax of D Swanepoel is still in the account of the school. They made deductions of R26 698-84 for 2016-2017. According to charge 2, the amount unaccounted for is R45 630-28. He stated that money came in, but it was consumed in the budget. The accounting officer did not do a proper handover and that was why he was responsible for the unaccounted amount. He agreed that the documents submitted to WCED from April 2016 to September 2016 was misrepresented, but it was not a true reflection of what happened.
39. Under re-examination he said that in 2016 the Finance Officer and Treasurer did the submissions to the WCED, but in 2017 a new person was appointed as Finance Officer with Grade 12 and she needed training. He submitted the documentation after his wife died and he did not get any support from the District regarding the issues he was charged for. The unaccounted amount was not used for other school activities. There was not always money in the school account in 2016-2017 to level all necessities. He asked assistance in July 2016 from the WCED and he did not receive help from them. He did not on purpose misrepresent anything for the WCED.
1st witness of the applicant: Desire Swanepoel, Grade R educator, testified as follows:
40. She is 47 years of age and she was appointed in 2015 as Grade R educator at Van Wyksdorp Primary School. She knows the applicant as he was the Principal of the school when she was appointed. She said that the applicant has good manners and is a person of integrity, has no secrets, honest and transparent. She is aware of the charges against the applicant and all the monies paid to her. In 2016 the SGB was under pressure to deduct tax and UIF from her and they struggled to register. She asked the principal and the SGB to deduct monies for tax purposes and kept in the school account until she needed to pay income tax to SARS.
41. She was told by the Principal that he took over under a financial backlog. She admitted that she signed the cheques on pages 11, 14 and further in bundle “R”, as she knew about the money situation at the school and she accepted it. She admitted that she received all her money however late or some months nothing. She gave permission to withhold the tax money and therefore she believes that the dismissal of the applicant was unfair. She stated that she does not believe the trust relationship between the applicant and the WCED has been broken down beyond repair. She wants to see him back as educator in the position as Principal in a permanent position.
42. Under cross-examination the witness agreed that she gave permission to the SGB and the Principal to deduct money for tax purposes. She is not aware what happened to the money as it must be paid over to SARS when tax deductions were needed. She confirmed that she is aware that she must receive 80% of the allocated amount as the Grade R educator, and the Principal was the responsible person to ensure that the 80% was paid over to her for salary. She also knew about the amount unaccounted for as it was mentioned to her during the previous arbitration session.
43. Under re-examination the applicant confirmed that she was not supposed to know how every rand was spent at the school. There was no financial loss to the school as a result of her action as she received 80% for all the months.
Closing arguments
44. Both parties presented closing arguments in writing on the 5 November 2021 as agreed. The written closing arguments were perused and incorporated in the decisions made in the award.
Analysis of evidence and argument
45. Section 192(1) of the LRA, as amended, states that the applicant has a duty to prove that he was dismissed and once that has been proven, the respondent must prove that the dismissal was fair in terms of section 192(2). Dismissal is not in dispute.
46. The parties agreed during a pre-arbitration meeting on 8 October 2021 that the following facts are common cause between the parties: (1) The applicant was employed by the respondent as Acting Principal/Caretaker at Van Wyksdorp Primary School from 1 October 2009, and from 1 July 2010 as Principal; (2) The applicant was earning R38 978-00 gross salary per month and R 21 314-32 net salary per month. Two charges were levelled against the applicant as formulated in paragraphs 4-5; (3) After a disciplinary hearing was conducted, the dismissal sanction was imposed against the applicant; (4) The applicant was dismissed on 5 August 2019.
47. Both parties agreed that the following issues are in dispute: (1) On procedure: he was not given an opportunity to give his version; (2) substantively the penalty of dismissal was too harsh and the applicant put in dispute as well, the fact that he did not broke the rules and regulations. The applicant sought retrospective reinstatement. The applicant asked for reinstatement to the position he previously occupied, subject to the caveat that, if the position is no longer available, he will be placed in a similar position at another school on the same salary he earned before his dismissal. He also stated that he be paid all outstanding money due to him to be calculated based on the salary which he earned from the date of his dismissal to the date of granting of the award.
48. The applicant pleaded guilty in the disciplinary hearing after the respondent revealed and convinced him at a hearing that he is indeed guilty of the misconduct. He discovered that he made a very big mistake by pleaded guilty and never thought this would lead to his dismissal, without following the correct procedures to outlined his and witnesses view. He also got to the understanding that his employer has the right to discipline him for such actions to correct the wrong behavior and never consider dismissal as outcome.
Substantive fairness
49. Section 185 of the LRA, as amended, stipulates that every employee has the right not to be unfairly dismissed or to be subjected to an unfair labour practice. Section 186 (1) (a) of the LRA, stipulates that dismissal means an employer has terminated employment with or without notice. Section 188 of the LRA, stipulates that a dismissal that is not automatically unfair, is unfair if the employer fails to prove that the reason for dismissal is a fair reason related to the employee’s conduct and that the dismissal was effected in accordance with a fair procedure.
50. Schedule 8 to the LRA, the “Code of Good Practice: Dismissal” gives guidance to an arbitrator evaluating the fairness of a dismissal for misconduct. It provides that any person who is determining whether a dismissal for misconduct is unfair, should consider whether a rule regarding conduct in the work-place was contravened, and if so, whether the rule was valid or reasonable. Whether the employee was aware of it, whether it was consistently applied, and whether dismissal was an appropriate sanction for its contravention. Paragraph (a) of item 7 requires the employer to prove, on a balance of probabilities, that the employee was actually guilty of misconduct. However, the rule need not exist in written form; it is generally assumed that certain conduct is calculated to destroy the employment relationship, whether or not it is expressly prohibited in a contract or disciplinary code, and that the employee knew or should have known that this conduct could lead to dismissal.
51. It is submitted by the representative of the respondent that during 2018 the Directorate Employee Relations received allegations of misconduct pertaining to financial mismanagement and misrepresentation that implicated the applicant. On 10 April 2019, approval was granted to charge the applicant with charges relating to misrepresentation, dishonesty, and failure to take reasonable steps to prevent mismanagement. The disciplinary hearing commenced on 26 April 2019, Mr A Gunter, presiding officer, imposed a sanction of dismissal on the applicant. He lodged an appeal to the Minister of Education (MEC) against the sanction that was imposed on him. On 5 August 2019, the applicant’s appeal was dismissed by the MEC on the basis that the trust relationship between the employer and employee was destroyed beyond repair.
Did the applicant break the rules (policies) of the WECD?
52. In Circular 0039/2016 it states on page 6 of bundle “R” under 5 and 5.1 the following: “Use of Grade R allocation. Salary of the Grade R practitioner schools are reminded that Grade R practitioners at all schools must receive the full 80% subsidy allocation which is transferred biannually. Governing bodies of NQ4 and NQ5 schools must augment the Grade R practitioner’s salary so that the practitioner receives an amount which is more than the minimum of R7964 per month. Grade R practitioners at no-fee schools are entitled to the full 80% of the subsidy”. The applicant was aware of this Circular and the 80% of the subsidy to be paid to the Grade R educator.
53. The applicant confirmed that the salary advices were part of the documents he failed to submit to the District Office. He further confirmed that the amount received for April and May 2016 from the WCED was R7488-00 per month, but he only paid out R5119-62 to the Grade R educator. He admitted that his breakdown presented on page 3 of bundle “A” is not reflected on page 23 of bundle “R”. He therefore agreed that it is not a real representation of wat actually happened in May 2016. He did not submit the breakdown on pages 2 to 3 of bundle “A” to the WCED before at any stage. He however submitted the salary advice on page 24 of bundle “R” to the WCED, for July 2016. It is again not a true reflection of what happened in July 2016. He agreed that he implicated himself by sending wrong documentation to the WCED. It was not his intention to mislead the WCED as the Grade R educator asked him to hold back money for tax and he was under pressure. He stated that in 6 to 7 years as principal, he did not misrepresent documentation and this was the first time. He agreed that the documents submitted to WCED from April 2016 to September 2016 was misrepresented, but it was not a true reflection of what happened.
54. The standard of proof is that of a balance of probabilities. If, in this analysis, certain evidence or argument is not referred to, this does not imply it had not been considered. The arbitration is a two-step process, firstly the respondent has to prove that an applicant is guilty, and if the respondent can do this on the balance of probabilities, the second step follows; the respondent must prove why the sanction is an appropriate one. The test that a commissioner must employ when impartially considered the fairness of a dismissal dispute therefore requires that the commissioner must take into account the totality of circumstances.
55. During evidence in chief and cross-examination the applicant testified that he was appointed as the Principal of Van Wyksdorp Primary School on 01 July 2009. When he was appointed there was no handover, and he took over the school with financial backlogs which affected the school negatively. The applicant, according to the representative of the respondent, further alleged that it was a common problem that schools in that area were struggling to register for SARS. In the applicant’s testimony he did not dispute the fact that made himself guilty of the charges levelled against him, however stated that he did not use the monies for his personal gain. The applicant further testified that the school had financial backlogs and the finances were in the red. Therefore, whenever funds were deposited in the school’s account it goes into a negative. He further confirmed that he pleaded guilty on the charges during the disciplinary hearing, however states that he did not understand the implications of his guilty plea.
56. Pertaining to charge 1, the applicant testified that D Swanepoel, the Grade R educator, gave him/the School Governing Body (SGB), permission to make deductions from his salary for tax purposes. However, he did not indicate the deduction on the documentation submitted to the district as he was not sure whether he should, as they might have required proof that the monies were transferred to the Department of Labour. The school was not registered at the department at this stage. The witness of the applicant testified that as Grade R educator she requested the applicant and the SGB that money to be deducted from her salary for tax purposes. She did not always get her salary on a monthly basis, but at the end she received her salary over the mentioned period.
57. The first witness of the respondent became aware of the allegations when she did a financial assessment of the income and expenditure at the specific school. She found an unfavourable account. She further evaluated the bank account and found that the bank account was on a negative. The assessment at the school was concerning certain mismanagement of finances at Van Wyksdorp Primary School where the applicant was the Principal. She did not receive any allegations, but after she did an assessment of the income and expenditure plus the budget, she identified the mismanagement and misrepresentation of finances.
58. It is submitted by the representative of the respondent that they refute the version of the applicant and based its argument that prior to the applicant’s misrepresentation he was the Principal of Van Wyksdorp Primary School for almost nine (9) years. In this regard, as the accounting officer he ought to have been able to manage the school’s finances better than to intentionally misrepresent and falsify documentation. When he signed and submitted the financial statement of receipts and expenditure, he undertook and confirmed that the statement is a true reflection. Circular 0039/2016, point 5.1, explicitly states that Grade R practitioners at all schools must receive full 80% subsidy allocation.
59. During the testimony of Ms Xokozela, she advised that when they did their investigations into the misrepresentation, they could not establish why the full 80% allocation was not used accordingly. Furthermore, it was not reflecting in the school’s bank statements, therefore they concluded that he funds were used for other activities/expenditure. However, the school does receive transfer payments such as the norms and standards which covers maintenance, municipal accounts, learner transport and teaching material and local purchases such as stationary and cleaning material. Therefore, there was no need for the school to use the Grade R subsidy for other expenditures. It is submitted by the respondent that it was evident that the applicant made himself guilty of misrepresentation and fraud when he submitted documents that was not a true reflection of the school’s figures.
60. The applicant testified that he believes that the WCED failed him by not following their own protocols, for example the “handover” which was no done on two occasions namely 01 October 2009 when he was appointed as Acting Principal, and 01 July 2010, when he was appointed as Principal, and only one School Based Assessment Report on file in ten (10) years. He could not understand where the unaccounted amount comes from. He believed that without any backlogs since 30 September 2009, the money allocated by the WCED for budget items was spend accordingly. He testified that it seems he as Principal failed to take reasonable steps to prevent any financial maladministration or mismanagement by any staff member or the SGB by not ensuring that 80% of the Grade R subsidy was paid to the Grade R educator, which resulted in a loss of R45 630-28 unaccounted for. He explained the above amounts in detail, and ensured that the 80% was paid, with reasons why there were some months no salary, but in the end the money was paid. He testified that his above explanation gives a real picture of the financial position at Van Wyksdorp Primary School. He testified that every signed cheque, has supported documentation with the necessary approval signatories.
61. The witnesses of the respondent were reliable and credible when they testified. I therefore find it probable that the applicant indeed was guilty of the charges levelled against him. This was confirmed by documentary evidence in the bundles of the respondent. The applicant’s testimony and submissions under cross-examination did not always corroborate with each other and he presented in detail the financial figures in his evidence, but it differed from the documentation that was submitted to the respondent. He agreed that he made a mistake and I find that sufficient support was available from the Department.
62. I therefore, find that the applicant did contravene Circular 0039/2016, point 5.1, which explicitly states that Grade R practitioners at all schools must receive full 80% subsidy allocation. He also could not give an acceptable explanation of the unaccounted amount mentioned. Any reasonable person would arrive at the same conclusion on a balance of probabilities, having heard and observed the evidence given during the arbitration hearing.
Is dismissal the appropriate sanction?
63. In Cash Paymaster Services Northwest (Pty) Ltd v Paul Shabanga NO & others [2009] 5 BLLR 415 (LC) it was held that the commissioner must consider if the trust relationship was destroyed in evaluating the appropriateness of the sanction. It is the submission of the respondent that the sanction of summary dismissal was the only appropriate sanction the respondent could have considered. The trust relationship between the management and the applicant had broken down after they became aware of the mismanagement of finances at the school. His misleading of management clearly showed that the applicant was not a trustworthy employee.
64. During Mr Gunter’s testimony he confirmed that the applicant pleaded guilty to the charges levelled against him. Thereafter the applicant had a fair opportunity to submit mitigation factors in terms of an appropriate sanction. During cross examination the witness stated that that he was not aware that the applicant had the intention to call D Swanepoel as a witness for the disciplinary hearing. He further advised that due to the fact that funds were mismanaged and unaccounted for, there was a permanent breach in the relationship between the applicant and his employer, the WCED. Therefore, dismissal was an appropriate sanction, as the buck stops in the office of the principal as the accounting officer.
65. It was submitted by the representative of the respondent that when the applicant applied for and accepted the position as Principal, he knew that one of his key responsibilities is the management of funds. Section 16 A (2) (i) clearly states that the Principal must take all reasonable steps to prevent any financial maladministration or mismanagement. In this case he mismanaged the funds of Van Wyksdorp Primary School. The applicant, however showed no remorse and took no responsibility for his actions. The first witness of the respondent testified that training was given to the Principal as monthly visits was done and his expenditure and income were monitored. She confirmed that support was indeed offered to the applicant in the form of training and regular monthly school visits. She was however, aware of the financial backlog.
66. The second witness of the respondent stated that with twenty years’ service and a clean disciplinary record the applicant should have given another change in the capacity as a teacher P1. The applicant is presently employed by the SGB in a particular school. He confirmed that the applicant can re-apply for a post at the Department of Education as he can still deliver valuable input. He believes the sanction of dismissal was not too harsh.
67. The applicant testified in mitigation that after his wife died, there was no time to really grieve over her. There was a school to run and a daughter of only 10 years to take care of attending Van Wyksdorp Primary School, and the other daughter was 17 in High School in the hostel. His wife worked at Van Wyksdorp Primary School as the Admin and Finance Officer. She was appointed in 2007 by the SGB and she was the one normally worked with the claims, and suddenly he was the one who must advice/complete (April to September 2016) the Grade R claim forms. He asked for help and phoned other schools, but none came with a solution. That was the reason that D Swanepoel gave the school (SGB) permission to deduct tax and to keep it. She said that when SARS starts to deduct tax, she would not be able to afford to pay the money back to SARS. That was the reason why the amounts differed from the pay sheets.
68. In the case of Hullet Aluminium (Pty) v Bargaining Council for the Metal Industry and others (D679/04 [2007) ZALC 93 (6 December 2007) it was stated that turning to the issue of the seriousness of the offence, the presence of dishonesty tilts the scales to the extent that even the strongest mitigation factors, like long service and a clean disciplinary record of discipline are likely to have minimal impact on the sanction to be imposed. In other words, whatever the amount of mitigation, the relationship is unlikely to be restored once dishonesty has been established in particular in a case where the employee shows no remorse.
69. The following case was mentioned by the representative of the respondent as applicable in the dispute of the applicant. In the case of Standard Bank of SA v CCMA and Others (1998) 19 ILJ 903 where the court held that dishonesty in general renders the employment relationship intolerable and incapable of restitution. In Bidsery Industrial Products (Pty) Ltd v CCMA and others (JA73/15) [2017] ZALAC 4 the court held that were misconduct by way of dishonesty is committed by the employee, it is often considered to be of such serious nature, so as to naturally imply a breakdown of the trust relationship this, notwithstanding the presence of a blemish-free long service.
70. The applicant further testified the supervisor nor his own supervisor did testify that the trust relationship had been destroyed and neither did he testify as to what the impact of the incident was on the trust relationship. He did not use the money for own gain, but rather to further the aims of the school. The representative of the applicant states that a dismissal for such an offence, particularly after 21 years of service to the Department, was too harsh a sanction. According to him the WCED, on the other hand, argued that misappropriation of funds constituted such an attack on the very fundamentals of the trust relationship between the employer and employee that dismissal was the only possible sanction.
71. It is the further submission of the representative of the applicant that the applicant is highly passionate about his contribution to education, honoured that he can be in this position to influence society through education, and to assist in the provision of improved learner opportunities to many children through managing the school professionally to become citizens that will improve their lives. Values of honesty, integrity, trustworthiness and ethics are very high on his priority list. He commits himself to further training and development. He and the applicant is of the view that the breach in trust relationship can be restored through corrective counselling and effective guidance and support. The applicant has the potential to make a valuable contribution towards the delivery of quality primary education and have a lot to offer to his community and teaching profession.
72. It is submitted by the representative of the applicant that he learned a very serious lesson in his life as a principal, manager, leader as well as an SGB member with the responsibility and duty to advice the SGB. He is very much remorseful for his actions and promised to never make himself guilty of such an act. The Code of Good Practice in relation to dismissal states that whether or not a dismissal is for a fair reason is determined by the facts of the case, and the appropriateness of dismissal as a penalty. The court has endorsed the concept of corrective or progressive discipline, meaning that the purpose of discipline is viewed as a means for employees to know and understand what standards are required of them. The respondent must indicate that the misconduct is of such a nature to make the relationship intolerable. This cannot be done by alleging the breakdown of the trust relationship, the respondent must put enough material before a commissioner to persuade such person that having regard of the totality of circumstances, the sanction of dismissal was appropriate and fair. I find that the respondent has proved that that due to the actions of the applicant over a period, the trust relationship was damaged beyond repair in the position as Principal regarding the management of finances of a school.
73. The Constitutional Court confirmed in Sidumo & another v Rustenburg Platinum Mines Ltd 2008 (2) SA 24 (CC); (2007) 28 ILJ 2405 (CC) that an arbitration under the LRA is a hearing de novo and that commissioners are charged with determining the fairness of a dismissal on the basis of the evidence presented at the arbitration. The commissioner must determine whether what an employer did in arriving at the decision to dismiss was fair. It may therefore be relevant to have regard to the evidence before the presiding officer. An arbitrator must consider all the material that is tendered at the arbitration and the record of the enquiry will form part of the material evidence before the arbitrator. It was the submission of the respondent that the sanction of dismissal was the only appropriate sanction the chairperson could have considered. The submission of the applicant’s representative was that the applicant must be retrospectively reinstated from date of dismissal.
74. In the Sidumo case the Constitutional Court proceeded to list the factors that a commissioner must consider when deciding on the fairness of a dismissal. These factors do not represent a closed list and the weighing that should be attached to each factor differ from case to case. The factors are: (1) The importance of the ruled that was breached; (2) The reason the employer imposed the sanction of dismissal; (3) The basis of the employee’s challenge to the dismissal; (4) The harm cause by the employee’s conduct; (5) Whether additional training and instruction may result in the employee not repeated the misconduct; (6) The effect of dismissal on the employee; and (7) The long-service record of the employee.
75. It is the submission of the representative of the applicant that the applicant did not get the necessary support and training from the respondent. The respondent only decided to enforce the rule after the wrong doing was already corrected. The representative is confident that additional training and instruction will result in the applicant to never repeat such misconduct. The school did not suffer any losses during these periods of misconduct and the unblemished disciplinary record will also support an alternative sanction for dismissal.
76. I find that the respondent had discharged the onus of proof by showing on a balance of probabilities that the applicant was dismissed fairly. The respondent did prove that the offences that the applicant were found guilty on, warrants dismissal due to the seriousness of the offences and the total breakdown in the trust relationship. The applicant caused considerable harm to the position of principal as he did not fully acquaint himself to be in control of finances at the school. He left this responsibility for many years to the Admin and Finance Officer.
77. In the light of the above, I find that the dismissal of the applicant was substantively fair. I find that the dismissal of the applicant was an appropriate sanction because of the circumstances mentioned above.
Procedural fairness
78. The procedure of the disciplinary hearing was put in dispute by the representative of the applicant. He claimed that the applicant was not given an opportunity to give his version in the disciplinary hearing after he pleaded guilty on both charges levelled against him. Item 4 (1) of the Code of Good Practice: Dismissal deals with the procedural fairness of a dismissal, and provides that an employer should inform an employee of the allegations against the employee and give the employee an opportunity to state a case in response to the allegations. In determining procedural fairness, the relevant facts should be summarized and analysed under the following heads: (1) The employee must notify the employee of the allegations using a form and a language that the employee can reasonably understand; (2) The employee should be allowed a reasonable time to prepare a response to the allegations; (3) The employee should be given the opportunity to state a case in response to the allegation.
79. If there is a workplace disciplinary procedure in place, an arbitrator must have regard to that procedure. The approach to the procedural fairness of a dismissal will be determined by the existence of a workplace procedure and the legal status of the procedure. The disciplinary code and procedure applicable to educators and the ELRC was followed by the presiding officer. According to Schedule 2 added by section 15 of Act number 53 of 2000 as amended by Act 57 of 2001 and Act 50 of 2002, the Disciplinary Code and Procedure for Educators spells out the process to be followed. It states in 14(a) that the educator or his representative must be given an opportunity to lead evidence. This was not done by the president officer and he immediately proceeded to 18 (a) and (b) to ask for mitigation and aggravation to be presented. This was done by the applicant and initiator of the respondent. If an employee pleaded guilty, he must still be given the opportunity to state his case.
80. It is our law that a dismissal should be effected in accordance with a fair procedure and should be for a valid and fair reason. The Labour Court confirmed the fundamental requirements of fairness envisaged in the Code in Avril Elizabeth Home for the Mentally Handicapped v CCMA & Others (2006) ILJ 1644 (LC). In 2007 the Supreme Court of Appeals held that it is an implied term of every contract of employment that employees be treated fairly. Similarly, in Boxer Super Stores Mthatha and Another v Mbhenya (2007) 28 ILJ 2209 (SCA) and Old Mutual Life Assurance Co SA v Gumbi (2007) 8 BLLR 699 (SCA) the court held that every employee was entitled to be treated fairly and to a fair pre-dismissal hearing. In SA Maritime Authority v McKenzie (2010) 5 BLLR 448 (SCA) the court held that a duty of fairness can be tacitly incorporated in a contract of employment.
81. The second witness of the respondent was the chairperson of the disciplinary hearing of the applicant and he pleaded guilty on the two charges on 26 April 2019. He gave his decision on 2 May 2019 and the applicant signed for a copy on 6 May 2019. He considered mitigation and aggravation presented and he took a decision. No witnesses testified as the applicant pleaded guilty. The evidence the applicant submitted in mitigation was that he was not well treated in his position as Principal. He also mentioned that the Admin Clerk who assisted him was also not well acquainted with the finances. There was a lot of shortages and he was not well trained in the management of the School. He did not explain the guilty plea to the applicant as he was represented. However, he explained in detail to the applicant his rights. The applicant decided with his representative to plead guilty. He decided on dismissal as misrepresentation and mismanagement of funds of the school, plus the R45 000 of the school that was uncounted for, was very serious. He never dismissed the applicant for taking money of the school and the applicant admitted mismanagement of funds. The applicant chose not to call any witnesses to testify on his behalf.
82. The applicant pleaded guilty on the formulated charges as he was under the impression that they would give him the opportunity to explain the reasons he did it this way, but nobody listened to him. According to the applicant he was not afforded an opportunity to give his version therefore he was charged with misrepresentation. He went on to testify that if he was given a change to explain, the presiding officer would have realized that the misrepresentation was not his responsibility. He pleaded guilty on the charges and the chairperson said in his testimony he could not imposed a lesser sanction as he considered demotion of the applicant, but could not find at that stage a suitable post to place the applicant within the Western Cape Education Department.
83. I find that the presiding officer has no authority to deviate unilaterally from the disciplinary code procedure as it forms part of the prescribed Disciplinary Code and Procedure applicable to educators. He did not give the applicant an opportunity to state his reasons for pleading guilty as described in 14 (a) of the Disciplinary Code and Procedure. The representative of the applicant however, did not insisted that the presiding officer listened to the reasons for the misconduct.
84. An analysis of the relevant requirements of a fair disciplinary hearing is therefore necessary to come to decision regarding procedural fairness. I find that that on a balance of probabilities that the applicant was indeed not given a fair hearing. The applicant was subjected to a fair disciplinary hearing as he was given all his rights, but he was not allowed to state his case although he pleaded guilty. The only slight deviation from the procedure was that the presiding officer did not provide the applicant with the opportunity to explain why he did the misconduct. I further find that the respondent used a seasoned chairperson and slight departures from codes in appropriate circumstances will not in itself render a dismissal unfair.
85. In light of the above I find that the respondent had discharged the onus of showing that on a balance of probabilities that the applicant’s dismissal was substantively fair but it was not proven to be procedurally fair.
86. However, I agree with the representative of the applicant that the applicant has values of honesty, integrity, trustworthiness and ethics and it is very high on his priority list. He commits himself to further training and development. The applicant has the potential to make a valuable contribution towards the delivery of quality primary education and have a lot to offer to his community and teaching profession. It was confirmed by the presiding officer that the applicant cannot be reinstated as Principal, but he can be appointed and apply at the WCED as an educator on P1 level. As commissioner I also do recommend that when he applied for a position at the WCED, that he must be positively evaluated and appointed.
Remedy
87. According to section 193 (2) (d) the arbitrator must require the employer to reinstate or re-employ the employee unless the dismissal is unfair only because the employer did not follow a fair procedure. In this case it was only procedurally unfair. The relief of compensation is therefore applicable in this case.
88. In determining the amount of compensation to award to the applicant in terms of section 194 (1) of the LRA, I have taken into account that the dismissal was only procedurally unfair. I have further taken into account that there was only a slight defect in the procedure. I find one month’s compensation just and equitable.
Award
89. I find the dismissal of Danville Esau, substantially fair, but procedurally unfair.
90. I order the respondent, the Western Cape Education Department, to pay the applicant, Danville Esau, compensation for procedural unfairness in the sum of R38 978-00 (thirty-eight thousand nine hundred and seventy-eight rand), minus normal taxation deductions.
91. The respondent, the Western Cape Education Department, must pay the amount referred to in par. 93 to Danville Esau on or before the 30th of November 2021.
Panelist Signature:
Name: Gert van der Berg
ELRC Panelist
Case No: ELRC159-21/22 WC
In the matter between
Danville Esau Applicant
and
WESTERN CAPE EDUCATION DEPARTMENT Respondent
PANELLIST: Dr. GC. Van Der Berg
ARBITRATION AWARD: 09 November 2021
ARBITRATION AWARD
Details of hearing and representation
1. The arbitration hearing was held on 8 October 2021, and on 29 October 2021 at 09:00 via digital zoom conference from Cape Town, under the auspices of the Education Labour Relations Council (“ELRC”). The proceedings were both digitally and manually recorded. The applicant, Danville Esau was represented by Maurice Brinkhuis, an Official from SADTU. The respondent, Education Department of the Western Cape, was represented by Anthe Willemse. The arbitration proceedings were postponed by the ELRC on 13 August 2021 and then it was again postponed by the Panellist on 08 September 2021 as the representative of the respondent tested positive for Covid-19 and provided a medical certificate.
Issue to be decided
2. I must decide whether the applicant was dismissed and if he was dismissed, whether the dismissal was substantively and procedurally fair and if not, determine the appropriate remedy. The applicant sought retrospective reinstatement without loss of benefits.
Background to the issues
3. The respondent is the Department of Education in the Western Cape and the Eden Central Karoo South, falls under their jurisdiction. The applicant was employed by the respondent as Acting Principal/Caretaker at Van Wyksdorp Primary School from 1 October 2009, and from 1 July 2010 as Principal. The Applicant was earning R38 978-00 gross salary per month and R 21 314-32 net salary per month.
4. Two charges were leveled against the applicant as follows: Charge 1 “It is alleged that you are guilty of misconduct in terms of Section 18(1)(dd) of the Employment of Educators Act, no 76 of 1998 (hereinafter referred to as the Act), un that during 2016 and/or 2017, you committed a common law offence namely fraud, by misrepresenting to the Western Cape Education Department that Van Wyksdorp Primary School had indeed paid 80% of the Grade R subsidy, whereas in truth the actual amount paid to the Grade R teacher was less than 80%. The Financial Statement submitted to WCED is attached and can be seen on page 2 of bundle “R”. The alternative to charge 1 states: “It is alleged that you are guilty of misconduct in terms of Section 18(1)(ee) of the Act, in that during 2016 and/or 2017, you committed an act of dishonesty by knowingly submitting incorrect pay sheets pertaining to the payment of the Grade R educator of Van Wyksdorp Primary School, to the Western Cape Education Department”.
5. Charge 2 states: It is alleged that you are guilty of misconduct in terms of Section 18(1)(a) of the Act, read in conjunction with Section 16A(2)(i) of the South African Schools Act of 1996, in that during the period 1 April 2016 to 30 September 2016 and/or 1 April 2017 to 30 September 2017 you failed to take reasonable steps to prevent any financial maladministration or mismanagement by any staff member or the governing body at the school, by not ensuring that 80% of the Grade R subsidy was paid to the Grade R educator, which resulted in an amount of R45 630-28 unaccounted for”.
6. The investigation report was completed and approval was given in April 2019 to proceed with charges. The disciplinary hearing commenced on 26 April 2019. The applicant pleaded guilty on the two charges and he was dismissed on 5 August 2019.
7. The dispute arose on 1 May 2021 and was referred to ELRC on the 14th of May 2021. The dispute was conciliated on the 11th of June 2021. It remained unresolved and a certificate of non-resolution was issued. The arbitration proceedings were set down for 13 August 2021 and it was postponed by the ELRC. The arbitration proceedings were rescheduled for 8 September 2021, and postponed as a result of the absence of the representative of the respondent due to Covid-19. Then it was scheduled for 8 October 2021. It was again postponed as a part heard case due to the Covid-19 symptoms by the representative of the applicant, after two witnesses of the respondent testified, to 29 October 2021.
8. The parties did present opening statements and both parties’ representatives presented written closing statements, as agreed, on 29 October 2021. Both parties submitted their written closing statements on 5 November 2021. Both parties were allowed to cross-examine and re-examine during the presentation of their evidence. For the sake of brevity, the details of this will not all be repeated in the award, but it should not be construed that it was not considered.
Survey of evidence and argument
Documentary evidence.
9. Both parties submitted bundles of documents. The bundle of the respondent was marked as “R” pages 1-77. The bundle of the applicant was marked as “A” pages 1 – 8 plus other annexures. Both parties did not dispute the authenticity of the bundles.
* As noted previously the proceedings were digitally recorded therefore what appears hereunder constitutes a summary of the evidence deduced by the parties in so far as it is relevant for the purpose of this arbitration; it is by no means a minute of what transpired in the course of the proceedings. Section 138 of the Labour Relations Act provides in subsection (7) that within 14 days of the conclusion of the arbitration proceedings-(a) the commissioner must issue an arbitration award with brief reasons, signed by that commissioner. These follow below.
Respondent’s evidence and argument
The respondent called two witnesses who testified after being duly sworn in
1st witness: Siyanda Xokozela, State Accountant in Compliance, testified as follows:
10. She testified that she is responsible for financial assessment at schools, verified documents and the school budged, income and expenditure at the schools, and give assistance regarding finance at schools. She became aware of the allegations when she did a financial assessment of the income and expenditure at the specific school and she found an unfavourable account. She further evaluated the bank account and found that the bank account was on a negative. The assessment at the school was concerning certain mismanagement of finances at Van Wyksdorp Primary School where the applicant was the Principal. She did not receive any allegations, but after she did an assessment of the income and expenditure plus the budget, she identified the mismanagement and misrepresentation of finances.
11. Page 1 and 2 in bundle “R” represents charge 1 and 2 as formulated. In Circular 0039/2016 it states on page 6 of bundle “R” under 5 and 5.1 the following: “Use of Grade R allocation. Salary of the Grade R practitioner schools are reminded that Grade R practitioners at all schools must receive the full 80% subsidy allocation which is transferred biannually. Governing bodies of NQ4 and NQ5 schools must augment the Grade R practitioner’s salary so that the practitioner receives an amount which is more than the minimum of R7964 per month. Grade R practitioners at no-fee schools are entitled to the full 80% of the subsidy”. The applicant was aware of this Circular and the 80% of the subsidy to be paid to the Grade R educator.
12. The responsible person in this case, the applicant, must submit proof what he did with the subsidy received. On page 9, annexure C, of bundle “R” it represents the Grade R classes: Financial Statement of receipts and expenditure for 2016, and page 10 is the pay sheet which indicates what was paid to Grade R educator. It can be seen that the amount the Grade R educator must receive monthly was R7 488-00. The pay sheet of April 2016 shows that the Grade R educator received only R5119-66 per month. The Educator was not paid the amount that she was supposed to be paid on a monthly basis.
13. The salary advice on page 12 of bundle “R” indicates that the full amount was part of the salary advice by the Grade R educator and she did not receive it. She received a lessor amount. It is not clear for what the funds were used for. The applicant explained that the financials of the school was not in a good position. The Grade R educator received for the month of April 2016 only R5119-66. The cheque made out for this amount can be seen on page 11 of bundle “R”. The cheque requisitions and the actual cheques can be seen on pages 13 and 14 for May 2016 and on pages 15 and 16 for June 2021, and it followed the same trend as in April 2016. The Grade R subsidy was paid for 1 April to September 2016 and from 1 April 2017 to September 2017. Subsidy was paid over to the School every six months.
14. Charge 2 regarding financial mismanagement was read as it appears on page 2 of bundle “R” and as formulated in paragraphs 4 and 5 above. It means that R45 000 is uncounted for. If does not reflect in the bank statements as it was used for other expenditure. It was probably together with other subsidies received for maintenance, municipal accounts. There was however no reason to use the subsidy for Grade R educator for other expenses. The impact of the R45 000 unaccounted for impacted on the finances of the school as the Grade R educator has to be repaid the underpayment of the 80% as stipulated and it had a negative impact on the school.
15. It was further indicated by the witness that pages 18 -20 and 25 of bundle “R” reflects the underpayment of the Grade R educator for August and September 2016. In 2017, pages 39, 40 and 41 reflects the underpayment for April 2017. Pages 39 to 41 is the underpayment for May 2017, and pages 42 to 43 for May 2017. The following is for June to September 2017: (1) June 2017 is page 44; (2) Page 45 for July 2017; (3) For August and September 2017 it is pages 46 to 48. It is also clear on page 9 of bundle ”R” that no 1% for UIF was deducted from the payslip of the Grade R educator. There were also no contributions from the school.
16. Under cross-examination she confirmed that her role was to support the Principal of the school when she determined the mismanagement. The Department of Education in the Western Cape had monthly follow-up sessions with the Principal to follow up on regular payments. The Principal requested the Department of Education for financial assistance. He did not explain to the witness what happened to the R45 000. She confirmed that the money was not used for personal gain as it was not proved.
17. She confirmed that the sanction that the applicant received was not too harsh as the applicant received the mentioned Circular and he was responsible for the finances of the school and that it was used for the identified purpose. There was evidence of monthly school visits by other Departments of the Department of Education in the Western Cape. It was mentioned to her that the applicant had twenty years’ experience and no misconduct as mitigation. The witness replied that she could not say, but if she was the chairperson of the disciplinary hearing, she would have dismissed the applicant.
18. Under further cross-questioning the witness confirmed that the school was not function well after the dismissal of the applicant as it was already in financial difficulty. She admitted that training was given to the Principal as monthly visits was done and his expenditure and income were monitored.
19. Under re-examination she confirmed that support was indeed offered to the applicant in the form of training and regular monthly school visits. She was aware of the financial backlog.
2nd witness: Anton Gunter, Chairperson of the disciplinary hearing, testified as follows:
20. He was the chairperson of the disciplinary hearing of the applicant and he pleaded guilty on the two charges on 26 April 2019. He gave his decision on 2 May 2019 and the applicant signed for a copy on 6 May 2019. He considered mitigation and aggravation presented and he took a decision. No witnesses testified as the applicant pleaded guilty. The evidence the applicant submitted in mitigation was that he was not well treated in his position as Principal. He also mentioned that the Admin Clerk who assisted him was also not well acquainted with the finances. There was a lot of shortages and he was not well trained in the management of the school. His report appears on pages 73 to 77 of bundle “R”.
21. He did not explain the guilty plea to the applicant as he was represented. However, he explained in detail to the applicant his rights. The applicant decided with is representative to plead guilty. He decided on dismissal as misrepresentation and mismanagement of funds of the school, plus the R45 000 of the school that was uncounted for, was very serious. He never dismissed the applicant for taking money of the school, and the applicant admitted mismanagement of funds. He however considered to demote the applicant to an educator P1 post as he has still value to add. It was not possible to accommodate him as no access post was available. However, his key responsibility was to manage financial funds.
22. Under cross-examination the witness confirmed that the applicant pleaded guilty on both charges. He has 23 years’ experience as a Presiding Officer and he did not ask the applicant why he pleaded guilty on the two charges, but he listened to his mitigation presented. He believes that it was a fair dismissal as he did the same in the past for similar transgressions. The Grade R educator, D Swanepoel was never present and mentioned during the disciplinary hearing. He phoned the Circuit Manager about placement in a suitable position at another place, but no suitable position was available at that stage. The applicant could continue as an educator but not in a position where he has to manage finances. According to the witness, the applicant admitted that he received financial training, but he was not taken through the whole financial processes.
23. He confirmed that the applicant has a Line Manager that he could phone at any time for assistance. The applicant was in the position for nine (9) years and he was the person responsible to manage funds, and he found that the applicant mismanagement the funds. He did not answer whether the school was in a financial crisis when he managed the finances. He stated that the buck stops at the Principal of the school and he could not account for the finances. He stated that with twenty-three years’ service and a clean disciplinary record the applicant should have given another change in the capacity as a teacher P1. The applicant is presently employed by the SGB in a particular school. He confirmed that the applicant can re-apply for a post at the Department of Education as he can still deliver valuable input. He believes the sanction of dismissal was not too harsh.
Applicant’s evidence and arguments
The applicant, Danville Esau, after having been sworn in, testified as follows:
24. The applicant stated that he is 46 years of age and he was 16 years in the service of the respondent. He was appointed as principal in 2010 after acting in the position since 2009. No handover took place by WCED at Van Wyksdorp Primary School. The school was taken over with financial backlogs. The respondent did not investigate it, because there was no handover and he was sent on a path of failure by the respondent. The issue of handing over in schools is extremely important. A strict process of handing over ensures responsibility and accountability are completely clear, and the school would avoid arguments and denials in 2016/2017 over an unaccounted amount.
25. He asked for help and support from the respondent since his acting and appointment as Principal, but did not receive any help. In 2016 – 2017, they were expected to deduct income tax from Grade R posts. He was not given the support and they struggled to register with SARS and made deductions. It was a common problem in the circuit and district in 2016/2017. He attended both workshops in Riversdale and in Ladismith, and registered the school on 16 May 2018. It is strange that only Van Wyksdorp Primary School’s Principal was guilty of misconduct and dishonesty in 2019. There were many schools in the circuit and district which did not comply and registered for the first time in Riversdale or Ladismith.
26. He did not use any money of the school for personal gain or his own use. He was dismissed for misrepresentation of the grade R money. It was not his responsibility as he did not receive a proper handover and he took over a backlog. The funds came in but then the account went in a negative, and there was then not enough money at the school. He pleaded guilty on the formulated charges as he was under the impression that they would give him the opportunity to explain the reasons he did it this way, but nobody listened to him. He only later understood the implications of pleading guilty, and if he understood it from the beginning, he would not have pleaded guilty. The chairperson of the disciplinary hearing did not explain to him the consequences of pleading guilty.
27. The applicant explained in detail the circumstances he was in regarding charge 1. On page 2 of bundle “A” he explained the financial statements submitted to the WCED since April 2016 up to September 2016 and again from April 2017 up to September 2017. Only two examples were mentioned as the rest is clearly spelled out on page 2. In April 2016 the amount received from the WCED was R7488-00 and the actual amount paid out to the Grade R educator was R5119-62. The accrual amount in the school account was R70240-41 according to bank statement 182. In July and August 2016 no salary was paid out to the Grade R educator, as there were negative amounts in the school account as per bank statements 185 and 186. In September 2016 the Grade R educator was paid R18 978-48 in lieu of short or no payments in the previous months.
28. In April 2017 the school received an amount of R8070-00 from the respondent but only paid our R5000-00 and the amount in the school account was R10814-70 according to bank statement 194. In June and July 2017, the school received each month R8070.00 and paid no salary to the Grade R educator, as there was negative amounts in the school bank account according to bank statements 196 and 197. He also explained the amounts paid out for April 2016 to June 2016. For example, the June 2016 amounts are reflected as follow: received R7488-00 – R2293-50 tax deduction and R74-88 UIF deduction. Then R3619-62 was deducted as back pay for September 2016. The nett amount received by the educator was R1500-00. The Grade R educator received all her money as indicated, and the school suffered financial loss due to payments made.
29. The applicant then explained in detail the amounts received by the educator in September 2016 and the deductions made. He also explained the deductions for April, May and August 2017, regarding Tax and UIF, as can be seen on page 3 of bundle “A”. He mentioned for example that on 20 April 2016 the school received R56 160-00 from the respondent and 80% represents R44 928-00 and R7488-00 per month for six months. He stated that the above on pages 2 and 3 of bundle “A” proved that he and the SGB complied to circular: 0005/2016 & 0039/2016.
30. The Tax and UIF deductions were made and UIF was paid over to the Department of Employment and Labour on a monthly basis. He also indicated that after he submitted the money income and expenditure report to the respondent, nobody assisted him. D Swanepoel, Grade R educator, SGB member and authorised signatories on school account, gave permission that the school hold back money for her tax, which the school (SGB) did. That is the reason why D Swanepoel understood that there was no money paid for some months, because there was no money to pay her salary. Her signature was on the cheques/claim/forms/pay sheet, with the purpose of the money paid out was on all cheques. She was also present in the SGB meetings where financial reports were given.
31. After his wife died, there was no time to really grieve over her. There was a school to run and a daughter of only 10 years to take care of attending Van Wyksdorp Primary School, and the other daughter was 17 years of age in High School in the hostel. His wife worked at Van Wyksdorp Primary School as the Admin and Finance Officer. She was appointed in 2007 by the SGB and she was the one normally worked with the claims, and suddenly he was the one who must advice/complete (April to September 2016) the Grade R claim forms. He asked for help and phoned other schools, but none came with a solution. That was the reason D Swanepoel gave the school (SGB) permission to deduct tax and to keep it. She said that when SARS starts to deduct tax, she would not be able to afford to pay the money back to SARS. That was the reason why the amounts differed from the pay sheets.
32. He stated that he can see it was wrong to hold back tax money or to let the SGB did it. Under normal circumstances he would have done the right thing like he always did from I October 2009 as part of the responsibility of a Principal. In 2016-2017 he was emotionally unstable and was on sedative pills to control his emotions that affected his ability to work under pressure. He really tried his best to take reasonable steps to prevent financial maladministration or mismanagement. After his dismissal he is still employed and is working at Panorama Primary School as a SGB teacher. He was employed by them in January 2020 and he is loyal to his work, and towards the children and responsibilities entrusted to him. He was put on a path by the WCED to gain more experience and he did, and he is genuinely remorseful over actions that leads to his dismissal. He will never again make the same mistake as he learned from this mistake. If WCED could have find a position for him at the stage of his dismissal, and as it was testified by the second witness of the respondent, he would have taken the position.
33. When he took over as Principal at the school the account of the school was in a backlog as can be seen from the audited financial statements from 2010 up to 2018. When he took over in 2010 the loss for 2010 was –R53 667-58. The school could not recover financially after he took over the school on 1 October 2009. In the nine to ten years as a Principal, he struggled to manage a negative account, and after he managed finally to work down the backlogs to –R9206-00 in 2018, and he was dismissed in 2019 by the WCED. The table appears on page 6 of bundle “A”. He was shocked when he was dismissed and he was not given an opportunity to appeal when he pleaded guilty on the charges. He was only given the opportunity to explain mitigation. He did not feel well when he was dismissed but he must continue with his life.
34. He was aware of the relevant circulars regarding the Grade R educator money received from the respondent. According to him the trust relationship between him and the WCED was not irreparably harmed ant therefore he can be reinstated. It was not his own supervisor that testified that the trust relationship was destroyed. He stated that he is aware of other cases where the WCED gave educators another change who was charged with mismanagement and they were reinstated. In the case ELRC639-19/20EC the Panellist found that the applicant was remorseful and he was reinstated.
35. It is clear from the decision of the Labour Appeal Court in Woolworths (Pty) Ltd v Mabija and others (PA3/14) (2016) ZALAC 5; (2016) 5 BLLR 454 (LAC) (19 February 2016, that the arbitrator/commissioner must be made aware in determining whether the dismissal for misconduct was fair, whether the trust relationship has been broken. In this case therefore, it is clear that it is insufficient for an employer to merely allege a breakdown in the trust relationship. Evidence must be laid at the disciplinary hearing and arbitration to show specific instances of how an employee’s misconduct destroyed the trust relationship.
36. The applicant asked for reinstatement to the position he previously occupied, subject to the caveat that, if the position is no longer available, he will be placed in a similar position at another school on the same salary he earned before his dismissal. He also stated that he be paid all outstanding money due to him to be calculated based on the salary which he earned from the date of his dismissal to the date of granting of the award.
37. Under cross-examination the applicant was referred to page 23 of bundle “R”, and he confirmed that the salary advice was part of the documents he failed to submit to the District Office. He further confirmed that the amount received for April and May 2016 from the WCED was R7488-00 but he only paid out R5119-62 to the Grade R educator. He admitted that his breakdown presented on page 3 of bundle “A” is not reflected on page 23 of bundle “R”. He therefore agreed that it is not a real representation of wat actually happened in May 2016. He did not submit the breakdown on pages 2 to 3 of bundle “A” to the WCED before at any stage. He however submitted the salary advice on page 24 of bundle “R” to the WCED, for July 2016. It is again not a true reflection of what happened in July 2016. He agreed that he implicated himself by sending wrong documentation to the WCED. It was not his intention mislead the WCED as the Grade R educator asked him to hold back money for tax and he was under pressure.
38. He stated that in 6 to 7 years he did not misrepresent documentation and this was the first time. The deductions for tax of D Swanepoel is still in the account of the school. They made deductions of R26 698-84 for 2016-2017. According to charge 2, the amount unaccounted for is R45 630-28. He stated that money came in, but it was consumed in the budget. The accounting officer did not do a proper handover and that was why he was responsible for the unaccounted amount. He agreed that the documents submitted to WCED from April 2016 to September 2016 was misrepresented, but it was not a true reflection of what happened.
39. Under re-examination he said that in 2016 the Finance Officer and Treasurer did the submissions to the WCED, but in 2017 a new person was appointed as Finance Officer with Grade 12 and she needed training. He submitted the documentation after his wife died and he did not get any support from the District regarding the issues he was charged for. The unaccounted amount was not used for other school activities. There was not always money in the school account in 2016-2017 to level all necessities. He asked assistance in July 2016 from the WCED and he did not receive help from them. He did not on purpose misrepresent anything for the WCED.
1st witness of the applicant: Desire Swanepoel, Grade R educator, testified as follows:
40. She is 47 years of age and she was appointed in 2015 as Grade R educator at Van Wyksdorp Primary School. She knows the applicant as he was the Principal of the school when she was appointed. She said that the applicant has good manners and is a person of integrity, has no secrets, honest and transparent. She is aware of the charges against the applicant and all the monies paid to her. In 2016 the SGB was under pressure to deduct tax and UIF from her and they struggled to register. She asked the principal and the SGB to deduct monies for tax purposes and kept in the school account until she needed to pay income tax to SARS.
41. She was told by the Principal that he took over under a financial backlog. She admitted that she signed the cheques on pages 11, 14 and further in bundle “R”, as she knew about the money situation at the school and she accepted it. She admitted that she received all her money however late or some months nothing. She gave permission to withhold the tax money and therefore she believes that the dismissal of the applicant was unfair. She stated that she does not believe the trust relationship between the applicant and the WCED has been broken down beyond repair. She wants to see him back as educator in the position as Principal in a permanent position.
42. Under cross-examination the witness agreed that she gave permission to the SGB and the Principal to deduct money for tax purposes. She is not aware what happened to the money as it must be paid over to SARS when tax deductions were needed. She confirmed that she is aware that she must receive 80% of the allocated amount as the Grade R educator, and the Principal was the responsible person to ensure that the 80% was paid over to her for salary. She also knew about the amount unaccounted for as it was mentioned to her during the previous arbitration session.
43. Under re-examination the applicant confirmed that she was not supposed to know how every rand was spent at the school. There was no financial loss to the school as a result of her action as she received 80% for all the months.
Closing arguments
44. Both parties presented closing arguments in writing on the 5 November 2021 as agreed. The written closing arguments were perused and incorporated in the decisions made in the award.
Analysis of evidence and argument
45. Section 192(1) of the LRA, as amended, states that the applicant has a duty to prove that he was dismissed and once that has been proven, the respondent must prove that the dismissal was fair in terms of section 192(2). Dismissal is not in dispute.
46. The parties agreed during a pre-arbitration meeting on 8 October 2021 that the following facts are common cause between the parties: (1) The applicant was employed by the respondent as Acting Principal/Caretaker at Van Wyksdorp Primary School from 1 October 2009, and from 1 July 2010 as Principal; (2) The applicant was earning R38 978-00 gross salary per month and R 21 314-32 net salary per month. Two charges were levelled against the applicant as formulated in paragraphs 4-5; (3) After a disciplinary hearing was conducted, the dismissal sanction was imposed against the applicant; (4) The applicant was dismissed on 5 August 2019.
47. Both parties agreed that the following issues are in dispute: (1) On procedure: he was not given an opportunity to give his version; (2) substantively the penalty of dismissal was too harsh and the applicant put in dispute as well, the fact that he did not broke the rules and regulations. The applicant sought retrospective reinstatement. The applicant asked for reinstatement to the position he previously occupied, subject to the caveat that, if the position is no longer available, he will be placed in a similar position at another school on the same salary he earned before his dismissal. He also stated that he be paid all outstanding money due to him to be calculated based on the salary which he earned from the date of his dismissal to the date of granting of the award.
48. The applicant pleaded guilty in the disciplinary hearing after the respondent revealed and convinced him at a hearing that he is indeed guilty of the misconduct. He discovered that he made a very big mistake by pleaded guilty and never thought this would lead to his dismissal, without following the correct procedures to outlined his and witnesses view. He also got to the understanding that his employer has the right to discipline him for such actions to correct the wrong behavior and never consider dismissal as outcome.
Substantive fairness
49. Section 185 of the LRA, as amended, stipulates that every employee has the right not to be unfairly dismissed or to be subjected to an unfair labour practice. Section 186 (1) (a) of the LRA, stipulates that dismissal means an employer has terminated employment with or without notice. Section 188 of the LRA, stipulates that a dismissal that is not automatically unfair, is unfair if the employer fails to prove that the reason for dismissal is a fair reason related to the employee’s conduct and that the dismissal was effected in accordance with a fair procedure.
50. Schedule 8 to the LRA, the “Code of Good Practice: Dismissal” gives guidance to an arbitrator evaluating the fairness of a dismissal for misconduct. It provides that any person who is determining whether a dismissal for misconduct is unfair, should consider whether a rule regarding conduct in the work-place was contravened, and if so, whether the rule was valid or reasonable. Whether the employee was aware of it, whether it was consistently applied, and whether dismissal was an appropriate sanction for its contravention. Paragraph (a) of item 7 requires the employer to prove, on a balance of probabilities, that the employee was actually guilty of misconduct. However, the rule need not exist in written form; it is generally assumed that certain conduct is calculated to destroy the employment relationship, whether or not it is expressly prohibited in a contract or disciplinary code, and that the employee knew or should have known that this conduct could lead to dismissal.
51. It is submitted by the representative of the respondent that during 2018 the Directorate Employee Relations received allegations of misconduct pertaining to financial mismanagement and misrepresentation that implicated the applicant. On 10 April 2019, approval was granted to charge the applicant with charges relating to misrepresentation, dishonesty, and failure to take reasonable steps to prevent mismanagement. The disciplinary hearing commenced on 26 April 2019, Mr A Gunter, presiding officer, imposed a sanction of dismissal on the applicant. He lodged an appeal to the Minister of Education (MEC) against the sanction that was imposed on him. On 5 August 2019, the applicant’s appeal was dismissed by the MEC on the basis that the trust relationship between the employer and employee was destroyed beyond repair.
Did the applicant break the rules (policies) of the WECD?
52. In Circular 0039/2016 it states on page 6 of bundle “R” under 5 and 5.1 the following: “Use of Grade R allocation. Salary of the Grade R practitioner schools are reminded that Grade R practitioners at all schools must receive the full 80% subsidy allocation which is transferred biannually. Governing bodies of NQ4 and NQ5 schools must augment the Grade R practitioner’s salary so that the practitioner receives an amount which is more than the minimum of R7964 per month. Grade R practitioners at no-fee schools are entitled to the full 80% of the subsidy”. The applicant was aware of this Circular and the 80% of the subsidy to be paid to the Grade R educator.
53. The applicant confirmed that the salary advices were part of the documents he failed to submit to the District Office. He further confirmed that the amount received for April and May 2016 from the WCED was R7488-00 per month, but he only paid out R5119-62 to the Grade R educator. He admitted that his breakdown presented on page 3 of bundle “A” is not reflected on page 23 of bundle “R”. He therefore agreed that it is not a real representation of wat actually happened in May 2016. He did not submit the breakdown on pages 2 to 3 of bundle “A” to the WCED before at any stage. He however submitted the salary advice on page 24 of bundle “R” to the WCED, for July 2016. It is again not a true reflection of what happened in July 2016. He agreed that he implicated himself by sending wrong documentation to the WCED. It was not his intention to mislead the WCED as the Grade R educator asked him to hold back money for tax and he was under pressure. He stated that in 6 to 7 years as principal, he did not misrepresent documentation and this was the first time. He agreed that the documents submitted to WCED from April 2016 to September 2016 was misrepresented, but it was not a true reflection of what happened.
54. The standard of proof is that of a balance of probabilities. If, in this analysis, certain evidence or argument is not referred to, this does not imply it had not been considered. The arbitration is a two-step process, firstly the respondent has to prove that an applicant is guilty, and if the respondent can do this on the balance of probabilities, the second step follows; the respondent must prove why the sanction is an appropriate one. The test that a commissioner must employ when impartially considered the fairness of a dismissal dispute therefore requires that the commissioner must take into account the totality of circumstances.
55. During evidence in chief and cross-examination the applicant testified that he was appointed as the Principal of Van Wyksdorp Primary School on 01 July 2009. When he was appointed there was no handover, and he took over the school with financial backlogs which affected the school negatively. The applicant, according to the representative of the respondent, further alleged that it was a common problem that schools in that area were struggling to register for SARS. In the applicant’s testimony he did not dispute the fact that made himself guilty of the charges levelled against him, however stated that he did not use the monies for his personal gain. The applicant further testified that the school had financial backlogs and the finances were in the red. Therefore, whenever funds were deposited in the school’s account it goes into a negative. He further confirmed that he pleaded guilty on the charges during the disciplinary hearing, however states that he did not understand the implications of his guilty plea.
56. Pertaining to charge 1, the applicant testified that D Swanepoel, the Grade R educator, gave him/the School Governing Body (SGB), permission to make deductions from his salary for tax purposes. However, he did not indicate the deduction on the documentation submitted to the district as he was not sure whether he should, as they might have required proof that the monies were transferred to the Department of Labour. The school was not registered at the department at this stage. The witness of the applicant testified that as Grade R educator she requested the applicant and the SGB that money to be deducted from her salary for tax purposes. She did not always get her salary on a monthly basis, but at the end she received her salary over the mentioned period.
57. The first witness of the respondent became aware of the allegations when she did a financial assessment of the income and expenditure at the specific school. She found an unfavourable account. She further evaluated the bank account and found that the bank account was on a negative. The assessment at the school was concerning certain mismanagement of finances at Van Wyksdorp Primary School where the applicant was the Principal. She did not receive any allegations, but after she did an assessment of the income and expenditure plus the budget, she identified the mismanagement and misrepresentation of finances.
58. It is submitted by the representative of the respondent that they refute the version of the applicant and based its argument that prior to the applicant’s misrepresentation he was the Principal of Van Wyksdorp Primary School for almost nine (9) years. In this regard, as the accounting officer he ought to have been able to manage the school’s finances better than to intentionally misrepresent and falsify documentation. When he signed and submitted the financial statement of receipts and expenditure, he undertook and confirmed that the statement is a true reflection. Circular 0039/2016, point 5.1, explicitly states that Grade R practitioners at all schools must receive full 80% subsidy allocation.
59. During the testimony of Ms Xokozela, she advised that when they did their investigations into the misrepresentation, they could not establish why the full 80% allocation was not used accordingly. Furthermore, it was not reflecting in the school’s bank statements, therefore they concluded that he funds were used for other activities/expenditure. However, the school does receive transfer payments such as the norms and standards which covers maintenance, municipal accounts, learner transport and teaching material and local purchases such as stationary and cleaning material. Therefore, there was no need for the school to use the Grade R subsidy for other expenditures. It is submitted by the respondent that it was evident that the applicant made himself guilty of misrepresentation and fraud when he submitted documents that was not a true reflection of the school’s figures.
60. The applicant testified that he believes that the WCED failed him by not following their own protocols, for example the “handover” which was no done on two occasions namely 01 October 2009 when he was appointed as Acting Principal, and 01 July 2010, when he was appointed as Principal, and only one School Based Assessment Report on file in ten (10) years. He could not understand where the unaccounted amount comes from. He believed that without any backlogs since 30 September 2009, the money allocated by the WCED for budget items was spend accordingly. He testified that it seems he as Principal failed to take reasonable steps to prevent any financial maladministration or mismanagement by any staff member or the SGB by not ensuring that 80% of the Grade R subsidy was paid to the Grade R educator, which resulted in a loss of R45 630-28 unaccounted for. He explained the above amounts in detail, and ensured that the 80% was paid, with reasons why there were some months no salary, but in the end the money was paid. He testified that his above explanation gives a real picture of the financial position at Van Wyksdorp Primary School. He testified that every signed cheque, has supported documentation with the necessary approval signatories.
61. The witnesses of the respondent were reliable and credible when they testified. I therefore find it probable that the applicant indeed was guilty of the charges levelled against him. This was confirmed by documentary evidence in the bundles of the respondent. The applicant’s testimony and submissions under cross-examination did not always corroborate with each other and he presented in detail the financial figures in his evidence, but it differed from the documentation that was submitted to the respondent. He agreed that he made a mistake and I find that sufficient support was available from the Department.
62. I therefore, find that the applicant did contravene Circular 0039/2016, point 5.1, which explicitly states that Grade R practitioners at all schools must receive full 80% subsidy allocation. He also could not give an acceptable explanation of the unaccounted amount mentioned. Any reasonable person would arrive at the same conclusion on a balance of probabilities, having heard and observed the evidence given during the arbitration hearing.
Is dismissal the appropriate sanction?
63. In Cash Paymaster Services Northwest (Pty) Ltd v Paul Shabanga NO & others [2009] 5 BLLR 415 (LC) it was held that the commissioner must consider if the trust relationship was destroyed in evaluating the appropriateness of the sanction. It is the submission of the respondent that the sanction of summary dismissal was the only appropriate sanction the respondent could have considered. The trust relationship between the management and the applicant had broken down after they became aware of the mismanagement of finances at the school. His misleading of management clearly showed that the applicant was not a trustworthy employee.
64. During Mr Gunter’s testimony he confirmed that the applicant pleaded guilty to the charges levelled against him. Thereafter the applicant had a fair opportunity to submit mitigation factors in terms of an appropriate sanction. During cross examination the witness stated that that he was not aware that the applicant had the intention to call D Swanepoel as a witness for the disciplinary hearing. He further advised that due to the fact that funds were mismanaged and unaccounted for, there was a permanent breach in the relationship between the applicant and his employer, the WCED. Therefore, dismissal was an appropriate sanction, as the buck stops in the office of the principal as the accounting officer.
65. It was submitted by the representative of the respondent that when the applicant applied for and accepted the position as Principal, he knew that one of his key responsibilities is the management of funds. Section 16 A (2) (i) clearly states that the Principal must take all reasonable steps to prevent any financial maladministration or mismanagement. In this case he mismanaged the funds of Van Wyksdorp Primary School. The applicant, however showed no remorse and took no responsibility for his actions. The first witness of the respondent testified that training was given to the Principal as monthly visits was done and his expenditure and income were monitored. She confirmed that support was indeed offered to the applicant in the form of training and regular monthly school visits. She was however, aware of the financial backlog.
66. The second witness of the respondent stated that with twenty years’ service and a clean disciplinary record the applicant should have given another change in the capacity as a teacher P1. The applicant is presently employed by the SGB in a particular school. He confirmed that the applicant can re-apply for a post at the Department of Education as he can still deliver valuable input. He believes the sanction of dismissal was not too harsh.
67. The applicant testified in mitigation that after his wife died, there was no time to really grieve over her. There was a school to run and a daughter of only 10 years to take care of attending Van Wyksdorp Primary School, and the other daughter was 17 in High School in the hostel. His wife worked at Van Wyksdorp Primary School as the Admin and Finance Officer. She was appointed in 2007 by the SGB and she was the one normally worked with the claims, and suddenly he was the one who must advice/complete (April to September 2016) the Grade R claim forms. He asked for help and phoned other schools, but none came with a solution. That was the reason that D Swanepoel gave the school (SGB) permission to deduct tax and to keep it. She said that when SARS starts to deduct tax, she would not be able to afford to pay the money back to SARS. That was the reason why the amounts differed from the pay sheets.
68. In the case of Hullet Aluminium (Pty) v Bargaining Council for the Metal Industry and others (D679/04 [2007) ZALC 93 (6 December 2007) it was stated that turning to the issue of the seriousness of the offence, the presence of dishonesty tilts the scales to the extent that even the strongest mitigation factors, like long service and a clean disciplinary record of discipline are likely to have minimal impact on the sanction to be imposed. In other words, whatever the amount of mitigation, the relationship is unlikely to be restored once dishonesty has been established in particular in a case where the employee shows no remorse.
69. The following case was mentioned by the representative of the respondent as applicable in the dispute of the applicant. In the case of Standard Bank of SA v CCMA and Others (1998) 19 ILJ 903 where the court held that dishonesty in general renders the employment relationship intolerable and incapable of restitution. In Bidsery Industrial Products (Pty) Ltd v CCMA and others (JA73/15) [2017] ZALAC 4 the court held that were misconduct by way of dishonesty is committed by the employee, it is often considered to be of such serious nature, so as to naturally imply a breakdown of the trust relationship this, notwithstanding the presence of a blemish-free long service.
70. The applicant further testified the supervisor nor his own supervisor did testify that the trust relationship had been destroyed and neither did he testify as to what the impact of the incident was on the trust relationship. He did not use the money for own gain, but rather to further the aims of the school. The representative of the applicant states that a dismissal for such an offence, particularly after 21 years of service to the Department, was too harsh a sanction. According to him the WCED, on the other hand, argued that misappropriation of funds constituted such an attack on the very fundamentals of the trust relationship between the employer and employee that dismissal was the only possible sanction.
71. It is the further submission of the representative of the applicant that the applicant is highly passionate about his contribution to education, honoured that he can be in this position to influence society through education, and to assist in the provision of improved learner opportunities to many children through managing the school professionally to become citizens that will improve their lives. Values of honesty, integrity, trustworthiness and ethics are very high on his priority list. He commits himself to further training and development. He and the applicant is of the view that the breach in trust relationship can be restored through corrective counselling and effective guidance and support. The applicant has the potential to make a valuable contribution towards the delivery of quality primary education and have a lot to offer to his community and teaching profession.
72. It is submitted by the representative of the applicant that he learned a very serious lesson in his life as a principal, manager, leader as well as an SGB member with the responsibility and duty to advice the SGB. He is very much remorseful for his actions and promised to never make himself guilty of such an act. The Code of Good Practice in relation to dismissal states that whether or not a dismissal is for a fair reason is determined by the facts of the case, and the appropriateness of dismissal as a penalty. The court has endorsed the concept of corrective or progressive discipline, meaning that the purpose of discipline is viewed as a means for employees to know and understand what standards are required of them. The respondent must indicate that the misconduct is of such a nature to make the relationship intolerable. This cannot be done by alleging the breakdown of the trust relationship, the respondent must put enough material before a commissioner to persuade such person that having regard of the totality of circumstances, the sanction of dismissal was appropriate and fair. I find that the respondent has proved that that due to the actions of the applicant over a period, the trust relationship was damaged beyond repair in the position as Principal regarding the management of finances of a school.
73. The Constitutional Court confirmed in Sidumo & another v Rustenburg Platinum Mines Ltd 2008 (2) SA 24 (CC); (2007) 28 ILJ 2405 (CC) that an arbitration under the LRA is a hearing de novo and that commissioners are charged with determining the fairness of a dismissal on the basis of the evidence presented at the arbitration. The commissioner must determine whether what an employer did in arriving at the decision to dismiss was fair. It may therefore be relevant to have regard to the evidence before the presiding officer. An arbitrator must consider all the material that is tendered at the arbitration and the record of the enquiry will form part of the material evidence before the arbitrator. It was the submission of the respondent that the sanction of dismissal was the only appropriate sanction the chairperson could have considered. The submission of the applicant’s representative was that the applicant must be retrospectively reinstated from date of dismissal.
74. In the Sidumo case the Constitutional Court proceeded to list the factors that a commissioner must consider when deciding on the fairness of a dismissal. These factors do not represent a closed list and the weighing that should be attached to each factor differ from case to case. The factors are: (1) The importance of the ruled that was breached; (2) The reason the employer imposed the sanction of dismissal; (3) The basis of the employee’s challenge to the dismissal; (4) The harm cause by the employee’s conduct; (5) Whether additional training and instruction may result in the employee not repeated the misconduct; (6) The effect of dismissal on the employee; and (7) The long-service record of the employee.
75. It is the submission of the representative of the applicant that the applicant did not get the necessary support and training from the respondent. The respondent only decided to enforce the rule after the wrong doing was already corrected. The representative is confident that additional training and instruction will result in the applicant to never repeat such misconduct. The school did not suffer any losses during these periods of misconduct and the unblemished disciplinary record will also support an alternative sanction for dismissal.
76. I find that the respondent had discharged the onus of proof by showing on a balance of probabilities that the applicant was dismissed fairly. The respondent did prove that the offences that the applicant were found guilty on, warrants dismissal due to the seriousness of the offences and the total breakdown in the trust relationship. The applicant caused considerable harm to the position of principal as he did not fully acquaint himself to be in control of finances at the school. He left this responsibility for many years to the Admin and Finance Officer.
77. In the light of the above, I find that the dismissal of the applicant was substantively fair. I find that the dismissal of the applicant was an appropriate sanction because of the circumstances mentioned above.
Procedural fairness
78. The procedure of the disciplinary hearing was put in dispute by the representative of the applicant. He claimed that the applicant was not given an opportunity to give his version in the disciplinary hearing after he pleaded guilty on both charges levelled against him. Item 4 (1) of the Code of Good Practice: Dismissal deals with the procedural fairness of a dismissal, and provides that an employer should inform an employee of the allegations against the employee and give the employee an opportunity to state a case in response to the allegations. In determining procedural fairness, the relevant facts should be summarized and analysed under the following heads: (1) The employee must notify the employee of the allegations using a form and a language that the employee can reasonably understand; (2) The employee should be allowed a reasonable time to prepare a response to the allegations; (3) The employee should be given the opportunity to state a case in response to the allegation.
79. If there is a workplace disciplinary procedure in place, an arbitrator must have regard to that procedure. The approach to the procedural fairness of a dismissal will be determined by the existence of a workplace procedure and the legal status of the procedure. The disciplinary code and procedure applicable to educators and the ELRC was followed by the presiding officer. According to Schedule 2 added by section 15 of Act number 53 of 2000 as amended by Act 57 of 2001 and Act 50 of 2002, the Disciplinary Code and Procedure for Educators spells out the process to be followed. It states in 14(a) that the educator or his representative must be given an opportunity to lead evidence. This was not done by the president officer and he immediately proceeded to 18 (a) and (b) to ask for mitigation and aggravation to be presented. This was done by the applicant and initiator of the respondent. If an employee pleaded guilty, he must still be given the opportunity to state his case.
80. It is our law that a dismissal should be effected in accordance with a fair procedure and should be for a valid and fair reason. The Labour Court confirmed the fundamental requirements of fairness envisaged in the Code in Avril Elizabeth Home for the Mentally Handicapped v CCMA & Others (2006) ILJ 1644 (LC). In 2007 the Supreme Court of Appeals held that it is an implied term of every contract of employment that employees be treated fairly. Similarly, in Boxer Super Stores Mthatha and Another v Mbhenya (2007) 28 ILJ 2209 (SCA) and Old Mutual Life Assurance Co SA v Gumbi (2007) 8 BLLR 699 (SCA) the court held that every employee was entitled to be treated fairly and to a fair pre-dismissal hearing. In SA Maritime Authority v McKenzie (2010) 5 BLLR 448 (SCA) the court held that a duty of fairness can be tacitly incorporated in a contract of employment.
81. The second witness of the respondent was the chairperson of the disciplinary hearing of the applicant and he pleaded guilty on the two charges on 26 April 2019. He gave his decision on 2 May 2019 and the applicant signed for a copy on 6 May 2019. He considered mitigation and aggravation presented and he took a decision. No witnesses testified as the applicant pleaded guilty. The evidence the applicant submitted in mitigation was that he was not well treated in his position as Principal. He also mentioned that the Admin Clerk who assisted him was also not well acquainted with the finances. There was a lot of shortages and he was not well trained in the management of the School. He did not explain the guilty plea to the applicant as he was represented. However, he explained in detail to the applicant his rights. The applicant decided with his representative to plead guilty. He decided on dismissal as misrepresentation and mismanagement of funds of the school, plus the R45 000 of the school that was uncounted for, was very serious. He never dismissed the applicant for taking money of the school and the applicant admitted mismanagement of funds. The applicant chose not to call any witnesses to testify on his behalf.
82. The applicant pleaded guilty on the formulated charges as he was under the impression that they would give him the opportunity to explain the reasons he did it this way, but nobody listened to him. According to the applicant he was not afforded an opportunity to give his version therefore he was charged with misrepresentation. He went on to testify that if he was given a change to explain, the presiding officer would have realized that the misrepresentation was not his responsibility. He pleaded guilty on the charges and the chairperson said in his testimony he could not imposed a lesser sanction as he considered demotion of the applicant, but could not find at that stage a suitable post to place the applicant within the Western Cape Education Department.
83. I find that the presiding officer has no authority to deviate unilaterally from the disciplinary code procedure as it forms part of the prescribed Disciplinary Code and Procedure applicable to educators. He did not give the applicant an opportunity to state his reasons for pleading guilty as described in 14 (a) of the Disciplinary Code and Procedure. The representative of the applicant however, did not insisted that the presiding officer listened to the reasons for the misconduct.
84. An analysis of the relevant requirements of a fair disciplinary hearing is therefore necessary to come to decision regarding procedural fairness. I find that that on a balance of probabilities that the applicant was indeed not given a fair hearing. The applicant was subjected to a fair disciplinary hearing as he was given all his rights, but he was not allowed to state his case although he pleaded guilty. The only slight deviation from the procedure was that the presiding officer did not provide the applicant with the opportunity to explain why he did the misconduct. I further find that the respondent used a seasoned chairperson and slight departures from codes in appropriate circumstances will not in itself render a dismissal unfair.
85. In light of the above I find that the respondent had discharged the onus of showing that on a balance of probabilities that the applicant’s dismissal was substantively fair but it was not proven to be procedurally fair.
86. However, I agree with the representative of the applicant that the applicant has values of honesty, integrity, trustworthiness and ethics and it is very high on his priority list. He commits himself to further training and development. The applicant has the potential to make a valuable contribution towards the delivery of quality primary education and have a lot to offer to his community and teaching profession. It was confirmed by the presiding officer that the applicant cannot be reinstated as Principal, but he can be appointed and apply at the WCED as an educator on P1 level. As commissioner I also do recommend that when he applied for a position at the WCED, that he must be positively evaluated and appointed.
Remedy
87. According to section 193 (2) (d) the arbitrator must require the employer to reinstate or re-employ the employee unless the dismissal is unfair only because the employer did not follow a fair procedure. In this case it was only procedurally unfair. The relief of compensation is therefore applicable in this case.
88. In determining the amount of compensation to award to the applicant in terms of section 194 (1) of the LRA, I have taken into account that the dismissal was only procedurally unfair. I have further taken into account that there was only a slight defect in the procedure. I find one month’s compensation just and equitable.
Award
89. I find the dismissal of Danville Esau, substantially fair, but procedurally unfair.
90. I order the respondent, the Western Cape Education Department, to pay the applicant, Danville Esau, compensation for procedural unfairness in the sum of R38 978-00 (thirty-eight thousand nine hundred and seventy-eight rand), minus normal taxation deductions.
91. The respondent, the Western Cape Education Department, must pay the amount referred to in par. 93 to Danville Esau on or before the 30th of November 2021.
Panelist Signature:
Name: Gert van der Berg
ELRC Panelist