18 March 2026 -ELRC503-25/26WC

IN THE EDUCATION LABOUR RELATIONS COUNCIL HELD VIA THE MICROSOFT TEAMS VIRTUAL PLATFORM
Case Number ELRC503-25/26WC

In the matter between

SUID AFRIKAANSE ONDERWYS UNIE (SAOU) ON BEHALF OF A. SMITH

Applicant

and

DEPARTMENT OF EDUCATION – WESTERN CAPE

Respondent

ARBITRATION AWARD

PARTICULARS OF PROCEEDINGS AND REPRESENTATION

This matter was scheduled for arbitration on the MS Teams virtual platform on 17 October, 20 November 2025 and 23 February 2026.

The applicant was represented by Ms. A.Bester of the SAOU while the respondent was represented by Mr. T. Seelamo, its labour relations officer.
The parties exchanged bundles of documents and did not record objections to any documents.
The parties agreed that Ms. Bester would forward to the ELRC the bundles of documents of both parties.
As the parties had failed to submit a pre-arbitration minute in this matter, they engaged in finalizing a pre-arbitration minute which both then signed.
Both parties decided not to call any witnesses and that the commissioner should take a decision on the documentary evidence submitted. The applicant agreed expressly with this arrangement.
The parties submitted written closing arguments on 27 October 2025. Subsequently, I as the commissioner was not satisfied with the arrangements to deal with the matter without witnesses being called as this may ultimately constitute an irregularity I therefore called for the matter to be re-scheduled in order that I may hear oral evidence from witnesses. This I did with the authority invested in me in terms of of Section 138 of the Labour Relations Act 66 of 1995 as amended (LRA) to conduct proceedings in any manner I consider appropriate in order to determine the dispute fairly and quickly but with minimum legal formalities. At the conclusion of the arbitration proceedings both parties accepted an invitation to submit further written closing arguments which they did by no later than 2 March 2026.

ISSUE TO BE DECIDED:

I must decide whether the conduct of the respondent in calculating the salary of the applicant after voluntary demotion constitutes an unfair labour practice pertaining to demotion as provided for in Section 186(2)(a) of the LRA.

THE BACKGROUND TO THE DISPUTE

The applicant is an educator/principal at the Primary School in Mossel bay, which is a P3 level school, and earns R616,749.00 p.a. which has a lower remuneration structure than the P4 school at which he worked in the Free State Department of Education where he earned an annual salary of R755,988.00.
His salary had been reduced by 21.5%. The applicant contends that according to the PAM his salary should have been reduced by 6% as he had voluntarily demoted.
This matter is in respect of the salary the applicant ought to be paid his having changed schools in the circumstances set out hereafter in this award.
The applicant contends that his salary must be calculated in accordance with the memo and business rules read with the 2016 PAM in the amount of R713 367.00 (code 323).
The respondent contends that the applicant’s salary had been correctly calculated to be R616 749,00 notch 292 after he had been given an additional 6% R616 749,00 notch 292
In terms of Section 138(7) of the Labour Relations Act 66 of 1995 as amended, I am required to provide brief reasons with my award. Accordingly, I shall only refer to the evidence I consider relevant to determining the dispute between the parties.

SUMMARY OF EVIDENCE AND ARGUMENT

Each party submitted a bundle of documents to which neither recorded any objections.
Smith and Rudolf Willem Baard, the acting provincial secretary of SAOU, testified under oath for the applicant.
Mr. Mfelasakje Mhlangu an education specialist with the Department of Basic Education testified under oath for the respondent.

The evidence for the applicant:

Before his appointment at Park Primary, Smith received an email from the respondent in which his salary notch was stated. The letter also states that “ any appointment-related errors will be rectified”.
After he had been appointed Smith queried the correctness of his salary with his union as the reduction seemed very high and he wanted to know whether the correct salary scales had been applied.
When Baard contacted Smith he advised that the salary had not been calculated correctly in that collective agreement 2 of 2018 had not been interpreted correctly as it is not relevant in demotion cases.
His salary advice for 15 October 2024 shows his salary notch R616,749.00. He interpreted his move to the Western Cape as voluntary but it was a transfer so there was no break in service.
Under cross examination he said that the award stated that Collective Agreement (CA) 2/2018 does not apply to the calculation of his salary notch.
His expectation therefore was that if CA 2/2018 did not apply then another way of calculation would be applied.
He considered his move from the old to the new school a transfer as there was no break in service.
To be transferred from one province to another means to remain in the same scope of work but is transferred from one department to another without having to start over. He would just continue with his duties.
The transfer is confirmed in the persal system.
For personal reasons he had applied for the new position and had gone for the interviews and upon being successful was appointed into the post at the new school.
It was not a new appointment as there was not a break in service.
Baard testified that he had an idea that CA 2/2018 had been applied in the calculation of Smith’s salary and this was not correct as its purpose is to amend and repeal respectively measures regarding the reappointment of educators after a break in service. There had not been a break in the service of Smith and therefore CA 2 /2018 was not applicable to him.
The testimony of Baard pertained thereafter to the circumstance of an educator who had had a break in service as opposed to that of Smith where there was no break in service and how the calculation of Smith’s salary ought to have been effected.
In doing so he referenced numerous collective agreements, the PAM and the Department of Basic Education Memorandum implementation of the new salary scale resulting from the provisions of the Public Service Co-ordinating Bargaining Council resolution 1 of 2018 on the equalization of pay progression as signed on 2 April 2019 read with PAM document of 2016 to determine the applicant’s salary after he was demoted.
CA 2/ 2018 was triggered only upon resignation or retirement of an educator.
The evidence for the respondent:
Mahlangu testified that he is the chief education specialist at the National Department of Basic Education since 2005. In 2016 he took over functions of conditions of service. He is responsible for working with the Labour Relations Department doing the negotiations at the ELRC for Collective Agreements. He also drafts Ministerial determinations relating to conditions of service as well as guidelines and directives. PAM 2016 it referred back to dealing with voluntary demotion in terms of an educator who had a break in service and is now returning. PAM is reviewed every 5 years. It is a consolidation of all collective agreements, ministerial determinations and regulations. PAM 2022 has certain errors. In 2024/ 2025 they went back to the ELRC to make corrections. One of the errors of PAM of 2022 related to demotion. B8.7 was not updated in terms of CA 2/2018. This was corrected in 2025. But it is not yet in the PAM, That will happen in 2027. (Page 60 of the bundle of documents).
He understood how the applicable rule that applied to Smith is rule 2/2018. This appointment was made after the CA 2/2018 was concluded which amended clauses dealing with voluntary demotions. The WCED applied determination of salary of Smith in terms of provisions of CA2/2018. If an educator had more than 6 years’ service one adds 6 per cent to the starting notch of that post.
The provisions of CA 2 of 2018 had always been applied with regard to voluntary demotions notwithstanding that the educator had not had a break in service when transferring from the one school to the other.
He said that the provisions of CA 2/2018 were nevertheless applicable to Smith. i.e such as to educators who returned after a break in service.
He too went on to testify in relation to various versions of the PAM, the business rules and other document.

ANALYSIS OF EVIDENCE AND ARGUMENT

I have perused the bundles of documents submitted by the parties and listened to the oral testimony of witnesses. I have also read the closing arguments of both parties.
The first of the relevant documents in this matter as in any matter decided in terms of the provisions of the LRA, is the referral document. This is so as the LRA referral document is that from which jurisdiction is determined.
The said referral document shows that the matter had been referred to the ELRC as an alleged unfair labour practice dispute on 6 June 2025.
There was an application for condonation brought and dealt with by another panelist of the ELRC. Condonation was granted thereby clothing me with the jurisdiction to arbitrate this matter.
The question that does however arise is what is the effect then of the award issued in the interpretation application of a collective agreement, the dispute which the applicant elected to refer to the ELRC in the first place.
It is to be noted that this election was done after negotiations with the respondent through its Karen Engel and the applicant’s learning on 18 October 2024 that the respondent had no appetite for resolving the matter.
I must point out at this stage that much of the applicant’s case alludes to the award issued under case number ELRC668-24/25WC
I must however point out too that an award of one commissioner in the LRA is not binding on another commissioner.
Notwithstanding, should I find it necessary, I will refer to said award in this analysis.
In fact, I will, at this stage make the point that I am of the view that collective agreement 2 of 2018 fundamentally deals with educators who have returned to service of the employer after a break in service.
Here I concur with the other commissioner that the specific circumstance catered for in CA 2 of 2018 does not apply in casu as Smith had not had a break in service and had not accessed his pension monies.
It is clear from the arguments before me that the applicant contends that the respondent had applied the demotion rules incorrectly when determining the salary of the applicant.
In particular it is the case for the applicant that CA 2/2018 ought not to have been applied in the case of the applicant when determining his salary in the new post.
The argument for the respondent shows however that it had not considered at all the applicant’s taking up the new post as a demotion of any sort nor a transfer. It had considered his taking up the post purely as a successful application for a post it had advertised and in which the applicant had been the successful candidate, consequent upon having gone through the usual recruitment processes.
While the applicant has argued a demotion or a transfer to his new post from the old, I am satisfied to find as I do that there are processes within the respondent that match his argument but that he had not embarked on any of these. It is not clear why the applicant has chosen such a route to the new post. The applicant had offered as a reason for applying for the position at Park primary only that it was for personal reason.
It is clear however that the applicant had moved from a higher position (a principal at a P4 level school) to a lower one (a principal at a P3 level school).
I am satisfied that this therefore constitutes a demotion but merely by virtue of the new post being a lower one than the previous one.
It is however a demotion as a consequence of the applicant’s having attained the lower post new position as a consequence of having made an application therefore and obtaining it through the usual way of competing therefor with others.
The manner in which the new arrangement had come about is clearly as an advantage the applicant sought for himself and which he had then achieved through applying for the post and for personal reasons. It is to be noted that the applicant would have considered himself to have achieved this advantage even upon having accepted the salary proposed in his appointment letter. It is in fact probable that he had.
The applicant having achieved what must be considered his prime objective, the advantage for himself now wishes to challenge the salary he had agreed to and which he had achieved through the above route to obtain the appointment at Park primary which, as stated, he had sought for personal reasons.
Included in the basis for his challenge is his claim of having been transferred from the old to the new post.
In the circumstances I am in agreement with the respondent that this was not a transfer in the sense that it it usually occurs in the workplace.
I am satisfied that this is merely to record a continuance of the applicant’s sojurn with the respondent especially administratively so as to obviate the need for recording a break in service.
The question is not what ought the respondent to have used but rather what in fact it did use as the basis for the calculation of the applicant’s salary and whether or not this was unfair.
The respondentt had clearly calculated the applicant’s salary in accordance with an educator applying for a position and applying whatever benfit is afforded that educator such as for instance length of service.
Notwithstanding anything aforesaid the following is to be noted:

DEPARTMENT OF BASIC EDUCATION
NO. 5957 7 March 2025

GOVERNMENT GAZETTE AMENDMENT OF THE PERSONNEL ADMINISTRATIVE MEASURES AND GOVERNMENT GAZETTE NO 38249, 27 NOVEMBER 2014
I, Siviwe Gwarube , Minister of Basic Education, have in accordance with section 4, read with section 35 of the Employment of Educators Act, 1998 determined that: The Personnel Administrative Measures (PAM) (Government Gazette No. 47295 of 2022) and the Government Gazette No. 38249 of 27 November 2014 will be amended to include these conditions of service as outlined in the Schedule.
Yours sincerely ________ MS S GWARUBE, MP Minister of Basic Education Date: 16/02/202540 No. 52227 GOVERNMENT GAZETTE, 7 March 2025

SCHEDULE 1. The following paragraph shall amend Chapter B of the Personnel Administrative Measures by replacing the paragraph with the same numbering. The amendment in this paragraph will apply retrospectively to the date of the publishing of Personnel Administrative Measures (PAM) (Government Gazette No. 47295 of 2022)
B.8.7 Salary applicable to an educator who is voluntarily appointed to a lower post level/demotion/whose appointment is a downgrade from his/her current post (voluntary)
The same provisions as in paragraph B.8.5.2.1 (b) and (d) apply. 2. The following paragraphs shall amend Chapter B of the Personnel Administrative Measures by replacing the paragraphs with the same numbering. The amendments in these paragraphs will apply retrospectively to the date of the publishing of Personnel Administrative Measures (PAM) (Government Gazette No. 47295 of 2022)

The following is an extract from the PAM of 2022 and which the amendment above refers to.

B.8.5.2 Educators who are reappointed after a break in service
B.8.5.2.1 An educator who is appointed after a break in service shall always be appointed to the entry level salary notch code of the salary band of the post to which he/she has been appointed under the following conditions:
(a)………
(b) Should an educator resign or retire and comes back in service on the lower post level and has more than 6 years of uninterrupted service on any post level, such an educator shall be awarded additional 6 notches to the minimum (entry) notch of the post which he/she is appointed.
………….

(d) Should an educator resign or retire and comes back in service on the lower level and has less than 6 years of uninterrupted service on that particular post level, such an educator shall be appointed to the minimum (entry) notch of the applicable post.

As can be seen from the amendment above, the Department of Basic Education’s intention is to treat employees who are voluntarily appointed to a lower post level/demotion/whose appointment is a downgrade from his/her current post (voluntary) the same as those who are re-appointed after a break in service. It is to be noted that the amendment is to be applied retrospectively to the date of the publishing of PAM 2022.
As the applicant had become aware of a possible discrepancy in his salary in or around September 2024 his dispute falls squarely within the amendments of 2025 to the PAM.
The application therefore by the respondent, the Department of Education Western Cape, of the principles such as are found in clause B.8.5.2.1(d) read with B8.7 of PAM as amended when calculating the salary of Smith, cannot be said to be conduct that constitutes an unfair labour practice as contemplated in S186(2) in respect of demotion of the LRA.

AWARD