12 September 2022 – ELRC628-21/22MP

Panellist: Asnath Sedibane
Case No: ELRC628-21/22MP
Date of Award: 08 September 2022

In the ARBITRATION between:

MAIMELA PIET MODIBA
(Union / Applicant)
and

EDUCATION DEPARTMENT OF MPUMALANGA
(Respondent)

Union/Applicant’s representative: Self-Represented
Union/Applicant’s address:
Respondent’s representative: Ms I N Madonsela (Respondent’s Representative)
1st Respondent’s address:

DETAILS OF HEARING AND REPRESENTATION

1. The arbitration hearing between Mr Maimela Piet Modiba (applicant) and the Department of Education – Mpumalanga (respondent) was held under the auspices of the Education Labour Relation Council (“ELRC”), virtually via Zoom Meetings on 08/08/2022. The matter was set down for arbitration in terms of Part C of the Constitution of the ELRC, which provides a dispute resolution procedure for parties to the Council.
2. The applicant was present at the arbitration hearing and he represented himself. The respondent was represented by Ms. N M Madonsela from the respondent’s employee relations section.
3. The respondent submitted a bundle of documents which was marked as bundle “R”. The applicant did not submit any documents.
4. The parties agreed to narrow issues on record and to submit their heads of arguments on the issues in dispute, in writing. It was agreed that the applicant would first submit his heads of arguments on or before the 18th of August 2022 and that the respondent would submit their heads of arguments on or before 23rd of August 2022 and that the applicant would then submit his reply on or before the 26th of August 2022. I received the Applicant’s heads of arguments on the 18th of August 2022. The respondent submitted their heads of arguments on 24th August 2022 after requesting to do so through the Council, which request I granted as it was explained to me that the respondent only received the applicant’s heads of arguments from the Council on the 23rd of August 2022. I received the applicant’s Reply to the respondent’s heads of arguments on the 29th of August 2022.
PRELIMINARY ISSUES
5. The respondent raised an issue whether the ELRC had the jurisdiction to grant the relief sought by the applicant. I reserved my ruling on the issue since I had not received the evidence relating to the dispute between the parties at that stage.
ISSUES TO BE DECIDED
6. The dispute was referred to the ELRC by the applicant as “Interpretation and Application of a Collective Agreement” as provided for in clause 3.8 in Part B of the Constitution of the ELRC.
7. I was required to determine whether the respondent correctly interpreted and implemented the Collective Agreement (ELRC Resolution No 5 of 2002), when paying the applicant the cash bonus for his improved qualifications.
8. The relief that the applicant seeks is that the department must be ordered to acquire the services of an actuary to determine the correct value of the cash bonus at the time it was paid to him and to then pay him the correct amount and that the tax on this amount be calculated correctly.
9. After the narrowing of issues, it was decided that the following issues were common cause between the parties:
9.1 The applicant was appointed by the respondent as a post level 1 educator in 2004.
9.2 At the time of his appointment, the applicant had two qualifications that placed him on REQV 15. In 2015 the applicant obtained a qualification that placed him on REQV 16.
9.3 In 2015 the respondent paid the applicant a cash bonus in recognition of the improved REQV that he had acquired before joining the Department, as per the provisions of the ELRC Resolution 5 of 2002: Recognition for improvement in REQV.
9.4 Paragraph 4.5 of the old version of PAM as well as paragraph B10 of the new PAM of 2016 speaks to the recognition for improvement in REQV.
10. It was agreed between the parties that the issues in dispute in this matter were as follows:
10.1 The interpretation and application of the applicable PAM provision on the payment of a cash award in recognition of improved qualifications.
10.1 Tax implications on the cash bonus paid to the applicant for the two improved qualifications (REQV 14 and 15) that the applicant acquired before joining the Department.
10.2 Whether the respondent paid the applicant the correct value of the cash bonus for the improved qualifications that he had obtained before joining the Department.
BACKGROUND TO THE DISPUTE
11. The applicant, Mr Maimela Piet Modiba is employed by the respondent, Education Department of Mpumalanga as a level 1 educator. He has been so employed since 2004.
12. The applicant had acquired REQV 14 and 15 qualifications prior to joining the Department in 2004. In terms of the ELRC Resolution No 5 of 2002, the applicant qualified for a cash bonus for the improved REQV. The cash bonus which the applicant was entitled to in 2004 was only paid to him in 2015.
13. The applicant was aggrieved with the calculations of the cash bonus and followed internal grievance procedures of the respondent and when the dispute remained unresolved internally, the applicant lodged a dispute with the ELRC.
14. To prove their respective cases, the parties submitted written heads of arguments and also relied on the respondent’s bundle of documents.

SURVEY OF SUBMISSIONS AND ARGUMENTS
THE APPLICANT`S CASE:
The applicant, Mr Maimela Piet Modiba’s submissions on the points in dispute were briefly as follows:
15. The dispute is premised on chapter B of PAM, paragraph B 10.1.4. The cash bonus in terms of the PAM provision is 10% of his salary notch.
16. The cash bonus for the improved qualifications became due and payable to him in 2004 at the time of his appointment or 12 months after the appointment as provided in paragraph B 10.1.4 of PAM. The cash bonus was only paid to him in 2015.
17. The incorrect Tax Schedule was used when the cash bonus was paid, resulting in an incorrect calculation of the cash bonus paid to him in 2015.
18. The respondent must be ordered to appoint an actuary to do a proper calculation of the cash bonus that was supposed to be paid to the applicant in 2015.
19. The respondent be further ordered to pay the value of the cash bonus that the actuary would have determined.
20. That SARS be directed to review the tax calculation of the cash bonus paid, based on the fact that a wrong tax schedule was used when the cash bonus was paid to the applicant in 2015. The correct tax calculation would be determined by the actuary.
21. The respondent in their bundle of documents submitted the ELRC Resolution 5 of 2002 in which paragraph 4.4 of Chapter B of PAM is amended. The amendment is however not applicable to the applicant’s dispute.

THE RESPONDENT`S CASE:
The respondent’s heads of arguments were briefly as follows:
22. The purpose of the ELRC Resolution No 5 of 2002 on the Recognition of improvement in REQV was to effect an amendment to the PAM with regards to the recognition for the improvement in REQV and the benefits educators would receive in recognition of the improvement in their REQV.
23. An error was discovered in 2015 regarding the non-payment to the applicant of the cash bonus as per the provisions of paragraph 4.3 of Chapter B of the PAM. Upon discovering the error, the respondent then paid the applicant the cash bonus.
24. The respondent’s interpretation of the provision in paragraph 4.5(e) of Chapter B of the PAM is that the 10% of the minimum of salary range 7 that should be paid as once off bonus in recognition of the improved REQV should be the 10% of the minimum of salary range 7 that was applicable when the qualification was obtained. This means that if the qualification was obtained in 1998, the 10% of the minimum of salary 7 that will be applicable will be the salary range 7 that was applicable in 1998.
25. The applicant was therefore paid correctly when the cash bonus was paid to him in 2015.
26. The Minister of Basic Education, Mrs A Motshega, published the Government Gazette No 39684, the PAM on 12 February 2016, and paragraph 10.1 and 10.2 thereof deal with measures applicable for the recognition of the improvement in REQV. It is the respondent’s submission that these measures were not applicable when the applicant was paid the cash bonus in 2015 and the applicant can therefore not base his claim on any of the measures contained in the PAM that came into effect in 2016.
27. The ELRC is a bargaining council that is established by section 35 of the LRA. It is accredited by the CCMA to conciliate and arbitrate disputes in relation to amongst others the interpretation and application of collective agreements. The current dispute does not fall within the ambit of the interpretation and application of a collective agreement and the ELRC therefore lacks jurisdiction to conciliate and arbitrate the dispute.
28. The relief sought by the applicant is outside the competence of the ELRC as the council is confined to award remedies that are provided for in the LRA, in terms of its accreditation to conciliate and arbitrate disputes.
29. Tax related issues and a taxable amount payable by an individual employee are matters that are regulated by SARS and any claim that is tax related in the respondent’s view should be directed to SARS. The amount paid to the applicant in 2015 was taxed in accordance with the tax tables that were applicable in 2015. This tax was paid over by the respondent to SARS as per the requirements of tax laws.
30. The relief that the applicant seeks in relation to the tax table that was used to calculate the taxable amount that was deducted from him falls outside the competence of the commissioner and the council. The remedies the commissioner can award are confined to those provided for in the LRA.
31. Based on the above, the respondent submits that the applicant’s case be dismissed.
THE APPLICANT`S REPLY TO THE RESPONDENT’S HEADS OF ARGUMENTS
The applicant, Mr Maimela Piet Modiba’s submissions on the points in dispute were briefly as follows:
32. The dispute is premised on chapter B of PAM, paragraph B 10.1.4
33. The cash bonus for the improved qualifications became due and payable to him in 2004 at the time of his appointment or 12 months after the appointment as provided in paragraph B 10.1.4 of PAM. The cash bonus was only paid to him in 2015.
34. The respondent’s submission that they received the applicant’s heads of arguments on 24 August 2022 was not correct because he had personally served his heads of arguments on the respondent on 17 August 2022. In the absence of application for condonation for late filing of the respondent’s heads of arguments, the heads of arguments of the respondent must not be admitted.
35. The dispute is correctly before the ELRC and the council therefore has the necessary jurisdiction to arbitrate the dispute.
36. The services of an actuary are necessary in this matter, in order to resolve the dispute. However, should there be an alternative method to resolve the dispute, the respondent is welcome to bring forth such alternative method.
37. The applicant’s submission on the issue of the tax schedule is shallow and embarrassing and should therefore be ignored by the commissioner.

ANALYSIS OF EVIDENCE AND ARGUMENTS
38. I have considered all relevant evidence and arguments raised by the parties and in doing so, I have only referred to evidence and arguments that I regard necessary to substantiate my findings and dispose of the dispute.
39. The applicant has declared a dispute relating to interpretation and application of a collective agreement. The Collective Agreement in question is the ELRC Resolution No 5 of 2002: Recognition for Improvement in REQV.

40. The applicant submitted that the respondent failed to interpret and implement the provisions of paragraph B10.1.4 of Chapter B of PAM when paying him a cash bonus in recognition of his improved qualifications that he obtained before joining the Department in 2004.
41. It is common cause that the applicant qualified for the cash bonus in 2004 but the respondent only paid the cash bonus to him in 2015, after discovering the error/omission. It is the applicant’s contention that the value of this cash bonus has not been correctly determined and that neither of the parties would know what the value of the cash bonus paid to the applicant in 2015 for qualifications he had obtained prior to him joining the department in 2004 would be. The applicant therefore argues that an actuary must be appointed to determine the correct value of the cash bonus.
42. The respondent has referred to the applicable provisions of the PAM and argues that these were correctly interpreted and applied when the applicant was paid the cash bonus in 2015. In terms of paragraph 4.3 of Chapter B of the PAM, an educator who was appointed from outside the department to post level 1 and who has a REQV of 15, 16, or 17 shall after he/she has completed a period of one year of continuous service be paid one cash award calculated in terms of the provisions of paragraph 4.5(e) for each REQV higher than 14 and 13 respectively. Paragraph 4.5 (e) Chapter B of the PAM provides for the calculation of the cash awards at 10% of the minimum of salary range 7, as it was on the date that the qualification was obtained.

43. The applicant does not dispute that the respondent paid him 10% of the minimum of salary range 7 as it was on the date that his qualifications were obtained. He however contends that the applicable provision of the PAM is paragraph B. 10.1.4, in terms of which cash awards payable to educators in terms of the PAM measures are calculated in all cases at 10% of notch code 85. The paragraph goes further to say that “In respect of educators who enter the service and qualify for a cash bonus due to a qualification that is higher than REQV 13, the value of this salary notch, as on the date the person qualifies for the award, will apply.”
44. The respondent has submitted that the applicant cannot rely on the provisions of the PAM that came into effect in 2016 and that the applicable provisions of the PAM in this regard are those of the PAM that brought about the ELRC Resolution No 5 of 2002, which made provision for the recognition for improvement in REQV.
45. I agree with the respondent that the provisions of paragraph B 10.1.4 of the PAM that came into effect in 2016 are not relevant to his case. I have however noted that the said paragraph is in essence reiterating paragraph 4.5 (e) of the PAM that was applicable in 2004 when the applicant joined the Department. Both the paragraphs provide for payment of a 10% cash bonus to an educator who had joined the Department with qualifications higher than REQV 14. This 10% is calculated at the minimum range of salary level 7 as it was when the qualification was obtained. The relevant qualifications of the applicant were obtained in 1996 and 1997 respectfully and the cash bonus that was paid to the applicant in 2015 was 10% of the minimum of salary level 7 as it was in 1996 and 1997 respectfully. I find in this regard that the respondent correctly interpreted and implemented the applicable PAM provisions.
46. Based on the above, the applicant’s contention that the value of the cash bonus paid to him by the respondent in 2015 was wrongly calculated stands to fail. I will therefore not deal with the relief that the applicant seeks in respect of the calculation of the cash bonus.
47. The applicant has also made a submission that the tax schedule that SARS used in calculating the tax payable on the cash bonus that was paid to him in 2015 was incorrect. The applicant seeks an order that the department be ordered to acquire the services of an actuary to determine the correct tax calculation. The respondent has argued that this would be outside the jurisdiction of the ELRC. I agree with the respondent in this regard, the jurisdiction of the council is limited to labour disputes and remedies within the confines of labour legislation. Tax issues are regulated by tax laws that may be interpreted or challenged in a different forum.

48. After considering all the evidence and submissions in this matter and also after considering the applicable prescripts, I find that the applicant has not discharged the onus required to prove that the respondent failed to correctly interpret and implement the provisions of the ELRC Resolution 5 of 2002, read with the PAM (Personnel Administrative Measures).

Award
1. The applicant has failed to prove on a balance of probabilities that the respondent has failed to correctly interpret and implement the provisions of the ELRC Resolution No 5 of 2002, read with the applicable PAM, when calculating the value of the cash bonus for improved qualifications paid to him in 2015.
2. The ELRC lacks the jurisdiction to arbitrate tax related issues.

3. As a result of the aforesaid, the applicant’s application is dismissed.

Asnath Sedibane
ELRC Dispute Resolution Panellist