The applicant was employed by Nedbank from November 2000 in a senior position within the bank's client coverage department. On 3 October 2019, the bank gave him notice of termination of employment on account of operational requirements. The bank initiated a restructuring process commencing with a meeting on 30 April 2019 with the union, followed by meetings with affected employees on 9 May and 22 May 2019. The applicant applied for positions in the new structure on 27 May 2019 but was unsuccessful. He was then placed in an operational redeployment pool on 26 July 2019 with notice that if not placed within two months from 1 August 2019, he would receive notice of termination. The critical procedural flaw was that the bank never issued a section 189(3) notice before commencing the consultation process. The union raised this concern as early as 7 and 8 August 2019, but the bank maintained it had satisfied the substance of legal provisions without issuing the statutory notice.
The court ordered: (1) The respondent's failure to issue a notice in terms of section 189(3) constitutes procedural unfairness; (2) The applicant's notice of termination of employment given on 3 October 2019 is set aside; (3) The respondent is directed, should it wish to proceed with a consultation process regarding dismissals for operational requirements in its client support division, to issue a notice in terms of section 189(3) and comply with applicable provisions of sections 189 and 189A; (4) The respondent is ordered to pay the costs of these proceedings.
The requirement to issue a notice in terms of section 189(3) of the Labour Relations Act is peremptory and not a mere formality that can be dispensed with through substantial compliance with consultation requirements. The section 189(3) notice serves as the statutory trigger for multiple time periods regulating dismissals, the appointment of facilitators, strike rights, and dispute referral deadlines. Where no notice is issued at all (as distinguished from cases where a deficient notice is issued), procedural unfairness is established. The provisions of sections 189 and 189A, rooted in the constitutional right to fair labour practices under section 23 of the Constitution, warrant a strict approach to procedural requirements. In determining appropriate remedies under section 189A(13), the court must apply the hierarchy of remedies established in Steenkamp v Edcon Ltd, with primary remedies (compelling compliance, setting aside dismissals, reinstatement pending compliance) being preferred over compensation unless inappropriate in the circumstances.
The court observed that section 189A(13) is not an invitation to consulting parties to use the Labour Court to micro-manage a consultation process, but rather intervention ought to be limited to substantial failures or refusals to comply with relevant statutory requirements. Van Niekerk J noted that the purpose of section 189A was to enhance the effectiveness of consultation in larger scale retrenchments through mechanisms including early facilitation, and the separation it effects between substantive and procedural fairness in retrenchment disputes. The court referenced the policy underlying section 189A as articulated by Murphy AJ in National Union of Metalworkers of South Africa v SA Five Engineering (2004) 25 ILJ 2358 (LC), namely that section 189A(13) provides a mechanism to pre-empt procedural problems before substantive issues become ripe for adjudication or industrial action. The court noted that section 189A(13) extends to the Labour Court a supervisory role over the consultation process with powers to intervene when necessary and craft remedies designed to address procedural shortcomings.
This case reinforces the peremptory nature of the requirement to issue a section 189(3) notice in retrenchment processes. It establishes that substantial compliance with the substantive elements of consultation is insufficient if the statutory notice is not issued at all. The judgment emphasizes the critical role of the section 189(3) notice as a procedural baseline that triggers multiple statutory time periods and options, including facilitation, strike rights, and dispute referral deadlines. The case clarifies the distinction between cases concerning deficiencies in the terms of a notice (where substantial compliance may suffice) and complete failure to issue the notice (which is fatal to procedural fairness). It demonstrates the Labour Court's supervisory role over retrenchment consultation processes under section 189A(13) and its willingness to intervene and craft remedies where there is substantial failure to comply with statutory requirements. The judgment also illustrates the application of the Steenkamp hierarchy of remedies in section 189A(13) applications, confirming that primary remedies (compelling compliance, setting aside terminations) are preferred over compensation. The constitutional dimension is emphasized, linking strict compliance with procedural requirements to the protection of the constitutional right to fair labour practices under section 23.