The answer to whether employers can use replacement labour during a lock-out after a strike has ended or been suspended remains uncertain since the promulgation of the Labour Relations Act, 1995 (LRA).
Section 76(1)(b) of the LRA states that an employer may not take into employment any person for the purpose of performing the work of an employee who is locked out unless the lock-out is in response to a strike. Section 76(1)(b) allows employers to use replacement labour only during a lock-out that is in response to a strike. However, there is disagreement between trade unions and employers on whether replacement labour can be used during a lock-out that continues after the strike has ended or been suspended. This question came before the Constitutional Court in National Union of Metalworkers of South Africa v Trenstar (Pty) Ltd 2023 (7) BCLR 814 (CC).
NUMSA demanded that the employer, Trenstar, pay its members a once-off ex gratia amount of R7 500.00. Trenstar refused. NUMSA then referred a mutual interest dispute to the CCMA which was not resolved at conciliation. NUMSA gave Trenstar 48 hours' notice that its members would embark on a strike. The strike commenced as notified and continued for several weeks. Eventually, NUMSA informed Trenstar that their members decided to suspend the strike starting from the upcoming Friday. They would then resume work on the following Monday. NUMSA further stated that the suspension of the strike should not be construed as a withdrawal of the demand for payment of the R7 500.00 ex gratia amount.
On the same day, after receiving this notification, Trenstar responded to NUMSA by giving 48 hours' notice of Trenstar's intention to lock-out all NUMSA members with effect from the following Monday. Trenstar intended to implement the lock-out in support of its demand that NUMSA's members abandon their demand to be paid the ex-gratia payment. Trenstar contended that the lock-out was in response to NUMSA's strike action and was therefore permissible under section 76(1)(b) of the LRA.
NUMSA responded by stating that the intended lock-out was in response to a suspended strike and therefore, Trenstar was not entitled to use replacement labour during the lock-out. NUMSA demanded an undertaking that Trenstar would not use temporary labour during the lock-out. Trenstar replied that its lock-out notice was issued to NUMSA before the strike was suspended at the close of business on the Friday and that the strike was not over, having only been suspended. Trenstar therefore commenced its lock-out on the Monday.
NUMSA launched an urgent application in the Labour Court (LC)to interdict Trenstar from using replacement labour during the lock-out. NUMSA did not challenge the lawfulness of the lock-out but alleged that it was not in response to a strike and therefore Trenstar was not entitled to use replacement labour under section 76(1)(b) of the LRA.
NUMSA claimed that by the time the lock-out began, the strike action had already ended. . Trenstar opposed the urgent application, stating that the strike had only been suspended and could be resumed. The LC ruled that the suspension of the strike did not prevent the use of replacement labour during the lock-out. The LC determined that the lock-out was lawful and dismissed NUMSA's urgent application. Following LC's judgment, NUMSA and its members abandoned their demand and the lock-out ended. According to NUMSA, its members had little choice but to capitulate.
Although NUMSA and its members had abandoned their demand and the lock-out had ended, the LC's decision set a worrying precedent for NUMSA which could significantly weaken its bargaining position during future strike action. As a result, NUMSA took the LC's judgment on appeal to the Labour Appeal Court (LAC). The LAC dismissed NUMSA's appeal on the grounds that the matter was ‘factually' moot since the strike and lock-out had both ended. Undeterred, NUMSA appealed the decisions of the LC and LAC to the Constitutional Court.
The Constitutional Court acknowledged that the issue at hand may have become “factually” moot but recognised the conflicting judgments in the LC regarding the interpretation of section 76(1)(b). Furthermore, the LAC had twice declined, on grounds of mootness, to address the issue. The Constitutional Court agreed with NUMSA that cases involving the interpretation of section 76(1)(b) often become moot before reaching the appellate court, but it remained crucial for future collective bargaining to have clarity on the use of replacement labour during lock-outs. The Constitutional Court also reasoned that it was important to consider the distinction, if any, for purposes of section 76(1)(b), between a suspended strike and a terminated strike. On this basis, the Constitutional Court granted NUMSA's application for leave to appeal.
Regarding the appeal itself, the Constitutional Court examined the definition of a strike in the LRA. They concluded that for a strike to exist, there must be a collective refusal to work aimed at resolving a mutual dispute between employer and employee. If employees previously refused to work but are no longer doing so, there is no ongoing strike. The fact that the underlying demand or dispute persists does not mean the strike continues. The Constitutional Court concluded that a demand without a concerted withdrawal of labour does not qualify as a “strike” under the LRA.
The Constitutional Court addressed the distinction between a suspended and terminated strike, noting that the LRA does not specifically address these terms. A strike is a state of affairs with a purpose, either existing or not existing. A strike ceases to exist when there is no longer a concerted withdrawal of labour. If the dispute remains unresolved after conciliation and 48 hours' notice has been given, there is an unconditional right to commence a strike. However, until there is a concerted withholding of labour, there is no strike as defined, but rather an unconditional right to strike during the suspension period.
The Constitutional Court expressed that when an employer continues to exclude employees from the workplace after they have ended their strike and offered their services, it is no longer a response to the strike but an offensive use of lock-out. This approach is similar to when an employer initiates a lock-out without any existing strike, aiming to enforce compliance with its demand. Allowing the use of replacement labour for the duration of the lock-out, even after the strike ends, makes strike action less appealing and effective for unions and employees. The Constitutional Court concluded that in this case, replacement labour was used indefinitely until the employees surrendered. Therefore, the Constitutional Court favored an interpretation that limits the use of replacement labour to the duration of the strike.
The strike in this case involved a complete withdrawal of labour. The suspension of the strike and the tender of services starting on Monday meant that the strike officially ended on the preceding Friday at 17h00. According to the Constitutional Court's interpretation of section 76(1)(b), even if Trenstar's lock-out notice was technically in response to the ongoing strike, the right to use replacement labour no longer existed when the lock-out began on Monday. NUMSA's appeal was successful, leading to the Constitutional Court setting aside the order of the LAC. The Constitutional Court declared that Trenstar was not entitled to use replacement labour for the work of any employees affected by the lock-out.
Conclusion
The key learnings from this case are that an employer may engage replacement labour during a lock-out if it is in response to a strike. However, replacement labour cannot be used if the lock-out is not a response to a strike or if the strike has already ended, regardless of whether the employees have given up their demand that led to the strike.
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