Gabriel Chipana, a NUMSA shop steward employed by Exxaro Coal in human resources, was dismissed on 14 May 2014 for misconduct. He was charged with dishonesty for allegedly selling jobs to members of the public - specifically for soliciting and accepting R5000 from Ms Mange/Ms Thobane in 2012 and R6000 from Mr Nong for promises of employment at Exxaro. At the disciplinary hearing, Exxaro called three witnesses: two forensic auditors (Messrs Steyn and Claasen) who provided hearsay evidence, and one complainant (Ms Thobane). The other complainants did not testify, allegedly due to intimidation by Chipana. Chipana was found guilty and dismissed. He referred an unfair dismissal dispute to the CCMA. At arbitration, Exxaro again relied on hearsay evidence including affidavits from the complainants. Chipana denied the allegations, claiming he had a romantic relationship with Ms Mange and gave her money for sexual favours. The commissioner only ruled on the admissibility of the hearsay evidence in the award itself, excluding it on the basis that Chipana had not consented to its admission. The commissioner found the dismissal substantively unfair and ordered reinstatement.
The appeal was upheld. The Labour Court order dismissing the review was set aside. The CCMA award was reviewed and set aside. The matter was remitted to the CCMA for a hearing de novo before a different commissioner. No costs order was made in respect of either the Labour Court application or the appeal.
A CCMA commissioner who purports to apply the law on admissibility of hearsay evidence must correctly state and apply that law. Section 3 of the Law of Evidence Amendment Act permits admission of hearsay evidence in the interests of justice even without consent of the party against whom it is adduced. A commissioner must rule on the admissibility of hearsay evidence timeously - when it is first adduced - not for the first time in the award. Late rulings on admissibility deprive parties of the opportunity to know what evidentiary case they must meet and constitute a gross irregularity that results in unfairness to both parties. A commissioner must be proactive when hearsay evidence is introduced and cannot remain passive. Fundamental unfairness caused by late ruling on admissibility cannot be cured by a reviewing court or appeal court purporting to exercise the discretion under section 3(1)(c) of the LEAA for the first time. Where a commissioner fundamentally misstates the law on hearsay evidence and this materially affects the outcome (in this case, finding no evidence to support dismissal), this constitutes a reviewable irregularity.
The Court observed that hearsay evidence is a common form of evidence in disciplinary proceedings and it is reasonable to expect commissioners to be familiar with it and able to identify it readily. While section 138 of the LRA gives commissioners discretion to conduct arbitrations informally, this does not mean they may arbitrarily receive or exclude hearsay evidence. The prudent commissioner does not err by applying section 3 of the LEAA when dealing with hearsay evidence, as it provides invaluable guidance for ensuring fairness. The section can be readily adapted for arbitration proceedings (e.g., "court" refers to the commissioner; "criminal or civil proceedings" refers to arbitration). An equitable balance must be struck between the requirements of minimal formality, fairness and speed under section 138 - fairness should not be sacrificed on the altar of informality. The Court noted that safeguards from criminal law (adapted from S v Ndhlovu) should apply to arbitration: commissioners must prevent witnesses heedlessly giving hearsay; parties cannot be ambushed by late admission of hearsay; the significance of section 3 must be explained to parties; and parties must signal their intention to rely on hearsay early so the opposing party can appreciate the evidentiary ambit they face.
This case is significant for establishing clear principles regarding the admission of hearsay evidence in CCMA arbitration proceedings. It clarifies that section 3 of the Law of Evidence Amendment Act applies to arbitration proceedings and that commissioners cannot simply exclude hearsay evidence on the basis of lack of consent - they must consider whether admission is in the interests of justice. Critically, it establishes procedural safeguards for fairness: (1) commissioners must be proactive, not passive, when hearsay evidence is introduced; (2) parties must declare their intention to rely on hearsay early; (3) commissioners must explain the legal framework to parties; (4) rulings on admissibility must be made timeously when evidence is adduced, not in the final award; and (5) late rulings create unfairness that cannot be cured on review or appeal. The judgment balances the informality permitted under section 138 of the LRA with the fundamental requirement of procedural fairness, recognizing that some formality is necessary to achieve fairness. It provides important guidance for CCMA commissioners on their duties when confronted with hearsay evidence.