Minister of Justice and Correctional Services v Ramaila

Mr Ramaila was appointed as a State Law Adviser on 2 March 2015, coming from private practice. He was appointed together with five other State Law Advisers, some of whom previously worked in other public service departments. All were appointed to the same grade, started on the same salary notch, signed identical performance agreements with the same Key Results Areas, and did the same work. For the 2015/2016 financial year, Mr Ramaila achieved a 100% performance rating. However, he was denied pay progression because under PSCBC Resolution 1 of 2012, the Incentive Policy Framework, and the Department's Performance Management Policy, first-time appointees to the public service had to serve 24 months before qualifying for pay progression, whereas other employees only needed 12 months. Two of his comparators (Ms Grootboom and Ms Le Roux), who achieved the same performance rating, received pay progression because they had previously worked in other public service entities. Mr Ramaila referred a dispute concerning unfair discrimination to the CCMA, which remained unresolved and proceeded to the Labour Court.

• Whether the differentiation in the qualifying period for pay progression between first-time appointees to the public service (24 months) and other employees (12 months) constitutes unfair discrimination under section 6(1) of the Employment Equity Act on 'any other arbitrary ground'
• Whether the differentiation is rationally connected to the stated purpose of 'developing and professionalising the public service'
• Whether PSCBC Resolution 1 of 2012, the Incentive Policy Framework, and the Performance Management Policy constitute administrative action reviewable under PAJA
• Whether the deeming provision in section 5(6)(a) of the Public Service Act converts a collective agreement into administrative action
• The proper interpretation of 'any other arbitrary ground' in section 6(1) of the Employment Equity Act

The appeal was upheld with no order as to costs. The Labour Court's order was set aside and replaced with an order dismissing the applicant's claim with no order as to costs.

The binding legal principles established are: (1) The phrase 'any other arbitrary ground' in section 6(1) of the Employment Equity Act is not a self-standing ground but must refer back to specified grounds - a ground must be analogous to listed grounds and have the potential to impair fundamental human dignity or affect persons adversely in a comparably serious manner. Being a 'newcomer' or 'first-time appointee' to the public service does not constitute such a ground. (2) Collective agreements concluded by bargaining councils in the public service, even when they regulate conditions of service and adversely affect employees' rights, are purely contractual in nature and do not constitute administrative action reviewable under PAJA as they have no external legal effect outside the bargaining council. (3) The deeming provision in section 5(6)(a) of the Public Service Act, which deems collective agreement provisions to be ministerial determinations, does not transform the contractual nature of a collective agreement into administrative action. The juridical act introducing differentiation remains founded in the collective agreement itself. (4) Similarly, directives issued by the Minister of Public Service and Administration under section 5(6)(b) to elucidate or supplement collective agreements do not mutate the contractual nature of those agreements into administrative action.

The Court made several non-binding observations: (1) It acknowledged that the pay progression system creates considerable difficulty and despondency because it results in pay disparity between employees appointed at the same time, at the same grade and salary notch, performing the same work of equal value with the same performance outcomes, solely based on whether they are first-time appointees to the public service. (2) The Court noted that 'not all wrongful conduct is justiciable under s 6(1) of the EEA because there is no self-standing ground of arbitrariness or capriciousness.' This suggests the Court may have viewed the differentiation as potentially problematic but not remediable through employment equity law. (3) The Court observed that collective agreements have 'deliberative characteristics' and are products of a 'haggle or wrangle' process involving 'give and take'. (4) The Court noted that costs orders against employees vindicating constitutional rights are rarely made, particularly where parties remain in an employment relationship. (5) The Court referenced the obiter observations in Free Market Foundation v Minister of Labour that while collective agreements may not constitute administrative action under PAJA, they remain subject to judicial checks and supervision, including potential rationality and legality review under the rule of law provision in section 1 of the Constitution, though it did not decide this issue.

This case provides important guidance on: (1) The interpretation of 'any other arbitrary ground' in section 6(1) of the Employment Equity Act, confirming the narrow interpretation requiring analogy to specified grounds and potential impairment of fundamental human dignity. (2) The nature of collective agreements in the public service context and their relationship to administrative action under PAJA. (3) The effect of deeming provisions in section 5(6) of the Public Service Act - they do not transform collective agreements into administrative action merely by deeming them to be ministerial determinations. (4) The limits of judicial review of collective agreements concluded by public service bargaining councils. (5) The distinction between wrongful conduct that creates pay disparity and conduct that is justiciable as unfair discrimination under the EEA. The case demonstrates the primacy given to collective bargaining in the public service and the limited scope for challenging collectively agreed terms through discrimination or administrative law remedies.