South Africa: Test For Review Relooked - Is There Still Scope For Process Related Reviews Or Is It Limited To Sidumo's Outcome-Based Approach?

Last Updated: 4 December 2013
Article by Pareen Rogers and Crystal Naidu
Most Read Contributor in South Africa, September 2019

The approach our courts are required to adopt in reviewing the awards and rulings of CCMA arbitrators was revisited in the recent Labour Appeal Court ("LAC") decision of Goldfields Mining South Africa (Pty) Limited (Kloof Gold Mine) v CCMA, case number JA2/2012 ("Goldfields").

This issue has been the subject of debate over a number of years. At the heart of the debate was the question of to what extent the Labour Court should be able to overturn CCMA awards and rulings. It was the intention of the legislature that the powers of the Court in this regard should be limited. This is the reason why the Labour Relations Act, 66 of 1995 ("LRA") does not make provision for an appeal against the arbitration awards or rulings. It simply makes provision for the review of such awards on limited grounds (e.g. where the arbitrator commits misconduct in relation to his/her duties or there is a gross irregularity in the arbitration). But, experience over the last few years has shown that the concept of a review has been widely or narrowly interpreted by different courts – hence the debate. The approach our courts should adopt was finally decided, or so we thought, in the widely-popularised case of Sidumo & Another v Rustenburg Platinum Mines Ltd & Others [2007] 12 BLLR 1907 (CC) ("Sidumo").

In essence, Sidumo required a review court to ask the following question: Is the decision one that a reasonable decision maker could not reach on the evidential material available. Thus the focus was largely on the outcome of the decision, as opposed to the manner in which the arbitrator arrived at the outcome.

This approach presupposes that arbitration awards ("awards") based on defective reasoning by an arbitrator will still pass the muster required in reviews, provided that the result is one that a reasonable arbitrator could have reached.  This is generally known as an 'outcome-based approach'.

However, in various decisions, the Labour Court did not limit itself to this relatively narrow test for review. It developed the concept of the "process related review", which it treated as existing in addition to Sidumo's 'outcome-based approach'. This approach accepted that, even  if the outcome of the award was one that a reasonable arbitrator could have reached, an award could still be overturned if the process through which the award was arrived at was found materially wanting – for example if the arbitrator ignored material relevant facts or misconstrued material evidence in coming to his/her decision.

This approach had been accepted by the Labour Appeal Court ("LAC") in the recent case of Herholdt v Nedbank Ltd [2012] 9 BLLR 857 (LAC) ("Heroldt"). In this case the LAC adopted a generous approach to the scope of the test for reviews. The LAC indicated that the ground of review of gross irregularity in terms of s145 (2)(a)(ii) of the LRA included "latent irregularities" and "dialectical unreasonableness" as the basis for the review of an award. This required the reviewing court to consider the reasoning of the arbitrator.

The LAC stated that a 'latent irregularity' occurred where the arbitrator failed to take into account material facts or took into account immaterial facts, whereas 'dialectical unreasonableness' was unreasonableness stemming from the process of reasoning of the arbitrator. In this regard, the LAC held that the reviewing court must consider whether the arbitrator's decision is supported by arguments and considerations that are valid, albeit, not necessarily conclusive. In order for an arbitrator's decision to be reasonable in a dialectical sense, he/she is required to properly consider all the relevant and material facts indispensable to a reasonable decision.

This was a far wider interpretation than the traditional approach to the concept of gross irregularity which was largely limited to the situation where the arbitrator misconceives the whole nature of the enquiry, and as a result the arbitrator misconceives his/her mandate or duties in conducting the enquiry.

The LAC's judgment in Heroldt went on appeal, however, and the Supreme Court of Appeal did not uphold such a generous approach. It revisited and analysed the provisions of s145 of the LRA, and stated that the legislature was deliberate in rejecting the option of an appeal of awards. It deliberately chose review, on narrow grounds, so as to serve as a deterrent to parties seeking to challenge awards. This supported the purpose of the CCMA as a dispute resolution forum that is to provide for an inexpensive and expeditious dispute resolution process.

The SCA summarised the position as follows:

"A review permissible if the defect in the proceedings falls within one of the grounds in s145 (2) (a) of the LRA. For a defect in the conduct of the proceedings to amount to a gross irregularity as contemplated by s 145(2) (a) (ii) ...the arbitrator must have misconceived the nature of the inquiry or arrived at an unreasonable result. A result will only be unreasonable if it is one that a reasonable arbitrator could not reach on all the material that was before the arbitrator. Material errors of fact, are not in and of themselves sufficient for an award to be set aside, but are only of any consequence if their effect is to render the outcome unreasonable." (our emphasis)

The SCA thus made its position clear on the issue through its judgment in the Heroldt matter.  However, since the coming into force of the Constitutional Seventeenth Amendment Act, 2012 the SCA no longer has the jurisdiction to hear appeals from the LAC and the LAC is now the final body of appeal (except for Constitutional issues) when interpreting the LRA.

There was therefore some anticipation to see if the LAC would follow the SCA decision in Heroldt when it next confronted the review test issue. The Goldfields decision, handed down on 4 November 2013, was the first LAC decision to consider the test for review after the SCA's Heroldt decision. In its judgment, the LAC recognises that the process-related grounds of review provided for in section 145(2)(a) still pertain but finds that, once the procedural defect is established, the reviewing court must go a step further and satisfy itself that the defect resulted in the award being one that a reasonable arbitrator could not have reached. In the words of the LAC, "What is required is first to consider the gross irregularity that the arbitrator is said to have committed and then to apply the reasonableness test established by Sidumo. The gross irregularity is not a self-standing ground insulated or independent of the Sidumo test. That being the case it serves no purpose for the reviewing court to consider and analyse every issue raised at the arbitration and regard failure by the arbitrator to consider all or some of the issues albeit material as rendering the award liable to be set aside on the grounds of process-related review."

The LAC in Goldfields reaffirmed the purpose of an arbitrator, as set out in section 138 of the LRA, to deal with the substantial merits of the dispute between parties with the minimum of legal formalities and to do so expeditiously and fairly.  The relevant enquiries to make in review applications, said the LAC are the following:

"(i) In terms of his or her duty to deal with the matter with the minimum of legal formalities, did the process that the arbitrator employed give the parties a full opportunity to have their say in respect of the dispute? (ii) Did the arbitrator identify the dispute he was required to arbitrate...? (iii) Did the arbitrator understand the nature of the dispute he or she was required to arbitrate? (iv) Did he or she deal with the substantial merits of the dispute? And (v) Is the arbitrator's decision one that another decision – maker could reasonably have arrived at based on the evidence?"

In the Goldfields matter Mr Moreki had been dismissed for allegations of misconduct. However, the arbitrator found that Mr Moreki was in fact guilty of poor performance and that the sanction for dismissal was too harsh and ordered that the Mr Moreki be reinstated.

Applying the review test that it had articulated, the LAC found that the arbitrator had misconceived the nature of the enquiry, which had been to determine whether the dismissal of Mr Moreki, based on grounds of misconduct, was fair. The arbitrator had erroneously miscategorised Mr Moreki's conduct as poor performance, which entailed a different enquiry than in cases involving misconduct. This amounted to a gross irregularity.

The LAC, in this regard, stated that

"...the arbitrator committed a gross irregularity in the conduct of the proceedings. The conclusion he arrived at was influenced by the wrong categorisation of the case against the Third Respondent. This however is not sufficient for the award to be reviewed and set aside. The question needs to be asked: had the categorisation of the case against the Third Respondent been misconduct as opposed to poor performance, is the arbitrator's award nonetheless one that could be arrived at by a reasonable decision – maker? In my view it is clearly not. The Third Respondent committed a serious act of misconduct...the decision arrived at by the arbitrator is not one which a reasonable – maker could reach"

Thus, where an arbitrator commits misconduct in relation to his/her duties or there is a gross process-related irregularity in the arbitration, this is not - in and of itself - a sufficient ground to warrant interference by our courts on review. The irregularity must be of such a nature that it renders the decision reached unreasonable in the circumstances.

So practically what does all of this mean?  It is no longer good enough for employers or employees wishing to review an award based on one of the procedural defects provided for in section 145(2)(a), to only establish the existence of the defect, i.e. misconduct by an arbitrator in relation to his/her duties, a gross irregularity committed by the arbitrator in the conduct of the arbitration proceedings or the arbitrator exceeding his powers.  It is now also necessary to show that the defect caused the ultimate result of the award to be unreasonable. Thus, the two stage test adopted by the LAC in such instances is:

a. Was there a section 145(2)(a) defect ?; and

b. If so, can the defect be said to be such that resulted in the decision reached being unreasonable (in the sense that it was one that a reasonable arbitrator could not have reached)?

It thus now appears that it will, once again, be more difficult to successfully prosecute review applications in the Labour Court.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Practice Guides
by Mondaq Advice Centres
Relevancy Powered by MondaqAI
Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions