Case No:PSHS337-16/17
Panelist: Thando Ndlebe
Date of Award:27 December2016
In the matter between:
NEHAWU obo MAKHUBEDU, V.S APPLICANT
and
DEPARTMENT OF HEALTH- MPUMALANGA RESPONDENT
DETAILS OF HEARING AND REPRESENTATION
1. The matter was sat down before me as an arbitration process on 5 September 2016, 5 December 2016 and 6 December 2016 in Nelspruit. The Applicant, Mr. Victor Sipho Makhubedu, was present and was represented by Mr. Ponoane, an attorney from Ponoane Attorneys and as instructed by the National Education, Health and Allied Workers Union, (Nehawu).
2. The Respondent was represented by Mr. Jacques Theron, an attorney from Adendorff Attorneys.
3. The parties submitted bundles of documents and same were admitted and marked as Applicant’s Bundle “A” and Respondent’s Bundle “B”, respectively.
ISSUES TO BE DECIDED
4. I am required to determine whether or not the Applicant was unfairly dismissed by the Respondent, both procedurally and substantively.
BACKGROUND TO THE DISPUTE
5. The Applicant was appointed by the Respondent on 1 August 2013 in the position of Deputy Director General – General Finance. The Applicant was earning an annual salary of R1236000.00 at the time of his dismissal on 22 June 2016.
6. The Applicant’s trade union referred his unfair dismissal to the Council as it believed that his dismissal by the Respondent was procedurally and substantively unfair. The Applicant seeks retrospective reinstatement as relief.
SUMMARY OF EVIDENCE AND ARGUMENTS
RESPONDENT’S CASE
7. The Respondent called in two witnesses in support of its case.
Mr. Mogomotsi Boikanyo
8. He possesses the following qualifications, namely; Bachelor in Commerce and a Certificate in Commercial Crime Investigations. He is a trained Forensic Analyst. He is the director of a firm known as Sedupe & Metje Consulting which was appointed by the Respondent to conduct forensic investigations on irregular appointments. The investigation showed that the Applicant was negligent in that there were irregular appointments of three (3) Ward Clerks and three (3) Telkom Operators which was in contravention to the Public Finance Management Act 1 of 1999 (PFMA). The Applicant was involved in the appointment of three (3) Ward Clerks and three (3) Telkom Operators, whereas the advert at page 246 of Bundle “B” specified two (2) vacancies per job category. The advert was published in July 2013. The Respondent’s Recruitment and Selection Policy as found at page 277 of Bundle “B” requires that a recruitment and selection process must be finalized within a three months period. The Respondent must always advertise vacant positions, unless it decides to headhunt potential candidates. The recruitment for the positions in dispute, namely that of Ward Clerks and Telkom Operators, was supposed to have been finalized by the end of November 2013.
9. It is stated in the Forensic Report and set out at page 154 of Bundle “B” that the Applicant was found to have transgressed section 45 of the PFMA which provides that an official in a department, trading entity or constitutional institution must take effective and appropriate steps to prevent, within that official’s area of responsibility, any unathourized expenditure and fruitless and wasteful expenditure and any under collection of revenue due. At page 1 of the Bundle “B” the preamble of the PFMA is found which reads as follows; “to regulate financial management in the national government and provincial governments, to ensure all revenue, expenditure, assets and liabilities of those governments are managed efficiently and effectively; to provide for the responsibilities of persons entrusted with financial management in those governments; and to provide matters connected therewith”. It was therefore the responsibility of the Applicant in his role of Deputy Director-General of General Finances to manage the Respondent’s finances.
10. The memorandum entitled “RECOMMENDATION FOR FILLING OF ADVERSTISED POSTS OF X3 TELKOM OPERATORS AT EVANDER HOSPITAL” dated 3 February 2014 and issued by Mrs. N.G Hlatshwayo is found at page 247 of Bundle “B”. The advert in respect of the advert for two (2) Telkom Operators is found at page 246 of Bundle “B”. The signature of the Applicant in the memorandum recommending the appointment of three (3) Telkom Operators is found at page 253 of Bundle “B” and date therein is the 24 February 2014. The Applicant did not make any comments in the memorandum in the space above his signature. The Applicant was gross negligent by recommending the appointment of three (3) Telkom Operators as he was supposed to ensure that the Respondent complied with the PFMA.
11. The Applicant failed to comply with section 45of the PFMA when he signed the memorandum in respect of the appointment of the three (3) Telkom Operators. The Applicant did not comply with section 45(1)(b) of the PFMA in that as the Deputy Director-General for Finance he was expected to properly apply his mind. The Applicant did failed to comply with section 45 (1)(c) of the PFMA as he exposed the Respondent when he recommended the irregular appointments of three Telkom Operators. The Applicant was supposed to have stopped the appointment of three (3) Telkom Operators. The appointment of the three (3) Telkom Operators amounted to irregular expenditure as envisaged by the PFMA.
12. The memorandum entitled “RECOMMENDATION FOR FILLING OF ADVERSTISED POSTS OF X3 WARD CLERKS AT EVANDER HOSPITAL” dated 3 February 2014 and issued by Mrs. N.G Hlatshwayo is found at page 238 of Bundle “B”. The Applicants in the memorandum wherein he recommended the appointment of three (3) Ward Clerks is found at page 245 of Bundle “B”. The comment of the Applicant at page 245 of Bundle “B” reads as follows;” on condition that they form part of the priority list for 2014/15”. The advert of the positions in dispute was enclosed in the memoranda that were signed by the Applicant. The Applicant exposed the Respondent to irregular expenditure when he recommended the appointments of three (3) Ward Clerks and three (3) Telkom Operators when he signed the memoranda. The Applicant failed to prevent irregular appointments of two extra employees by the Respondent.
13. The document that appears at page 233 of Bundle “B” is an email dated 3 October 2013 from Mr. Pauleck Makhubela to Mr. Maxwell Sithole in respect of a Circular 28 of 2013 on the moratorium on tne filling of posts and issuing of appointment letters. The document at page 234 of Bundle “B” is a memorandum from the Head of Department, Dr. J.V Dlamini, to managers dated 30 September 2013 relating to the moratorium on filling of posts and issuing of appointment letters. The implication of the latter mentioned memorandum was that managers were not meant to issue appointment letters and that posts that could be filled were to have been budgeted for. The Applicant was the Deputy Director for General Finance, he was therefore expected by the Respondent to ensure that a budget was available for the posts in dispute. At paragraph 6 in the memo dated 3 September 2013 it is was stated strong action would be taken against managers who violated the contents of the abovementioned circular. The document appearing at page 235 of Bundle “B” dated 4 October 2013 confirming the moratorium on the filling of posts. The memorandum also stated, as found at page 236 of Bundle “B”, that managers were directed by the Respondent not to overspend. The Applicant was the person who was expected to know if there was a budget for posts in dispute.
14. The Applicant was expected to check that finances were available for the posts. The managers that would be disciplined were those listed at page 235 of Bundle “B” namely; Deputy Director-Generals, Chief Directors, District Managers, Chief Executive Officers, Medical Managers and Human Resources Practitioners. The relevance of section 45 of the PFMA is that the Applicant failed to effectively manage costs when he recommended irregular appointments. In the Senior Managers Handbook at paragraph 2.6 and as found at page 11 of Bundle “B”, the Respondent may appoint a person from within or from outside the public service, as its representative to initiate an inquiry. The appointment of the Initiator for the internal disciplinary hearing of the Applicant was sought from the Respondent.
15. Financial loss is a component of irregular expenditure as there was no budget for the two posts relating to this dispute. The Respondent was prejudiced by the irregular appointments as the moratorium on the filling of posts was not complied with. The Applicant’s recruitment and selection policy was also contravened. A rule was broken when the Applicant recommended that Respondent to fill posts that were not budgeted for. The advert was very clear that the posts were for two (2) Ward Clerks and two (2) Telkom Operators.
Under cross-examination, Mr. Boikanyo responded as follows;
16. The basis of the Applicant’s charges for misconduct was the forensic report from Sedupe & Metje Consulting. Dr. Tonie Botha, the Initiator, is not an employee of Sedupe & Metja Consulting. There was a letter that was issued by the Respondent which authourized Sedupe & Metja Consulting to appoint an Initiator. He did not ask Dr. Pule on whether the two extra posts were vacant or not. He also interviewed Ms. Leah Jiyane who was a Selection Committee panellist. The memoranda that were drafted by Ms. Hlatshwayo were not properly drafted.
17. He disagreed that no policy was broken by the Applicant. The charges that lead to the dismissal of the Applicant related to the PFMA, specifically section 45 therein. It was the Member of the Executive Council (MEC) that effected the two irregular appointments, the Applicant merely recommended the appointments. The date when the Applicant signed the memoranda in respect of him recommending the appointments is irrelevant. The fact that the Applicant signed the memorandum on 27 February 2014 is immaterial as the MEC signed the memorandum on 11 March 2014. He never saw a letter from the Respondent uplifting the moratorium. The recruitment and selection process was completed in the 2013-2014 Financial Year. The appointments were for the 2014-2015 Financial Year, and not the 2013-2014 Financial Year.
18. The Respondent initially appointed Sedupe & Metje Consulting in July 2014 and the firm’s scope of responsibility was extended by the Respondent in November 2014. He could not say if Ms. Hlatshwayo or Ms. Jiyane were charged for misconduct by the Respondent. He disagreed that his evidence was irrelevant as the Applicant was involved in the activities that resulted in the irregular appointments. The Applicant’s actions in so far as the recommending of the two extra positions is concerned, meant that same were in tandem with acts of misconduct numbers 1, 2, 6 and 10 at page 14 of the SMS Handbook and as contained at page 20 of Bundle “B”. The Applicant was grossly negligent as the Respondent ended up appointing extra two employees that were not budgeted for. The document appearing at page 283 of Bundle “B” is the appointment letter of Sedupe & Metje Consulting by the Respondent dated 21 July 2014. The document appearing at page 284 of Bundle “B” is a letter confirming the extension of scope on the forensic investigation from the Respondent to Sedupe & Metja Consulting dated 18 November 2014.
19. The moratorium was for the 2013-2014 Financial Year. The Respondent charged the Applicant, Dr. Mhlongo and Mr. Sithole in respect of the alleged misconduct pertaining to the irregular appointments. The Head of Department who also involved in the two irregular appointments resigned from the Respondent before he was charged for misconduct. There was irregular expenditure that was occasioned by the Respondent in relation to the two irregular appointments.
Ms. Sipho Elizabeth Motau
20. She is employed by the Respondent as a Chief Director, Primary Health Care and is also an Acting Deputy Director-General for Clinical Health Care. She has been employed in the public service for twenty (20) years.
21. The document appearing at page 234 of Bundle “B” is HR Circular 28 of 2013 and it related to a moratorium on the filling of posts within the Respondent. The moratorium was a temporary prohibition on the filling of posts. Circular 28 of 2013 also provided that the Respondent discipline those who failed to adhere to its directives. The document at page 235 of Bundle “B” is HR Circular 29 of 2013 and it also relates to the memo on the filling of posts and provides guidance in the implementation of Circular 28 of 2013. The 2013-2014 was a difficult year for the Respondent financially. The moratorium was up to 31 March 2014.
Under cross-examination, Ms. Motau responded as follows;
22. There were some appointments that were made by the Respondents during the 2013-2014 Financial Year. She could not say if the Respondent made any appointments after it issued the memoranda on moratorium dated 30 September 2013 and 4 October 2013. She knows the Applicant as he was her Chief Financial Officer.
Applicant’s case
Mr. Victor Sipho Makhubedu
23. He was dismissed by the Respondent on 22 June 2016 and after he was suspended from the 27 August 2014. He was earning R95228.30 per month at the time of his dismissal. He was initially charged for three charges by the Respondent. In the disciplinary hearing the three charges were as follows; 1. Appointment of three (3) Ward Clerks, 2. Appointment of three (3) Telkom Operators and 3. Appointment of a Groundsman. In the disciplinary hearing he was guilty for the appointment of the Ward Clerks and the Telkom Operators and not the Groundsman. It was not fair for the Respondent to charge him for alleged misconduct that happened in February 2013, whereas the he joined the employer on 1 August 2013.
24. He was not responsible for the appointment of an extra Ward Clerk. The official within the Respondent that has the authority to appoint employees is the MEC. It was unfair for the Respondent for the irregular appointments, whereas same were effected by the MEC. The findings of the chairperson of his internal disciplinary hearing were unfair. There was no need for the Respondent to have a deviation application when it needed to appoint more than three (3) Ward Clerks and three (3) Telkom Operators. For example in the past the Respondent has appointed a Groundsman and two hundred and twenty officials in its Nursing College without following procedures.
25. There was no way that a person reading the memoranda by Ms. Hlatshwayo would have been mislead by same. The advert for the positions in dispute was in July 2013 and the recruitment process dragged on for some time until the following financial year. Mr. Boikanyo was not involved in the day to day administration processes of the Respondent. He was shocked when he read the findings of the chairperson. He was surprised that he was dismissed by the Respondent. There is no rule that becomes broken within the Respondent when officials fail to complete a recruitment and selection process within three months. All the recruitment and selection processes within the Respondent always take more than three months. In as much the signature appearing at page 415 of Bundle “A” is his signature, there was no moratorium in the 2014-2015 Financial Year.
26. He has a good relationship with Top Management within the Respondent. He also had a good relationship with staff as he was supportive of their Employee Assistance Program (EAP). There was no charge that was levelled against in respect of the recruitment and selection process having been finalized beyond three months. The official who was overseeing the Interviewing process, namely Ms. Leah Jiyane, was not charged for misconduct nor was she dismissed by the Respondent. Ms. Hlatshwayo, the Chief Executive Officer Evander Hospital, was not charged for misconduct by the Respondent in respect of the memoranda she issued for the motivations in respect of the irregular appointments in dispute.
27. He signed the memorandum of the irregular appointment on 27 February 2014. There was nothing improper in the appointment of the three (3) Ward Clerks and three (3) Telkom Operators as the process that was followed was above board. The appointment of the Initiator, namely Dr. Tonie Botha, was improper as he was appointed by Sedupe & Metje Consulting. The document at page 285 of Bundle “B” does not state that Sedupe & Metje Consulting had the authority to appoint an Initiator. At page 285 of Bundle “B” there is nowhere that the signature of the Head of Department appears. He is seeking that the Council finds in his favour and order retrospective reinstatement.
Under cross-examination, Mr. Makhubedu responded as follows;
28. He was the Chief Financial Officer of the Respondent and was the financial custodian of the Respondent. He was responsible for all adequate financial management of the Respondent. He had the duty to properly manage the finances of the Respondent. He was regulated by the PFMA in his role of Chief Financial Officer. He understands the provisions of the PFMA. He is also aware of the provisions of the SMS Handbook. He disagreed that the appointment of the Initiator was in accordance with paragraph 2.6 of the SMS Handbook. He agreed that the SMS Handbook provides for appointment of an external Initiator.
29. He understood the charges that were levelled against him that resulted in his dismissal. He was able to present a defence for the charges that were levelled to him by the Respondent. He was dismissed by the Respondent for having been involved in the appointment of three (3) Ward Clerks and three (3) Telkom Operators. He conceded he signed the memorandum on 27 February 2014. He was available to advise staff and support them. It is his signature that appears at page 245 of Bundle “B” and which was the memorandum for the appointment of three (3) Ward Clerks. The advert as appearing at page 246 of Bundle “B” was attached in the memoranda that he signed for the appointment of the three (3) Ward Clerks and three (3) Telkom Operators.
30. He agreed that he recommended the appointment of three (3) Ward Clerks and three (3) Telkom Operators, instead of two candidates for the two positions. He understood the contents of the advert for the positions in dispute, He disagreed that he contravened section 45(c) of the PFMA when he recommended the filling of the two positions in dispute. He stated that he understood the meaning of irregular expenditure. Irregular expenditure is when an official deviates from policies and procedures.
31. In as much he understands the Respondent’s Recruitment and Selection Policy’s requirement of finalizing a recruitment process within a three month’s period; he did not advertise the positions but merely recommended the appointments of the positions in dispute. The moratorium was for the 2013-2014 Financial Year and it ended on 31 March 2014. In the event an official did not comply with the Circulars in respect of the moratorium he or she was supposed to be disciplined. He agreed that the Respondent deals with taxpayers’ money and a CFO is expected to be strict with finances. It is a serious offence when a when a CFO causes irregular and wasteful expenditure. However, the offence would not necessarily necessitate a dismissal as it depends on the seriousness of the issues. The moratorium was from 30 September 2013 to 31 March 2014.