Solidarity and Others v Tsebo Facilities Solutions (Pty) Ltd and Others [2026] ZALCCT 49

Seat of the Court: The Labour Court of South Africa, Cape Town

Presiding Judge: De Kock, AJ (Acting Judge)

Summary of the Basis of the Claim

The Applicants, Solidarity and three former employees of Tsebo Facilities Solutions (Pty) Ltd, sought review and setting aside of an arbitration award by Commissioner Reza Slamang. The Commissioner had found that the Applicants had forfeited their entitlement to severance pay in terms of section 41(4) of the Basic Conditions of Employment Act 75 of 1997 ("BCEA") on the basis that Tsebo had "arranged" their alternative employment with Excellerate Facilities Management (Pty) Ltd (CBRE), the incoming service provider at the Sanlam contract. The Applicants contended that they had secured employment with CBRE independently, through their own efforts and applications, prior to the conclusion of any Alternative Employment Agreement ("AEA") between Tsebo and CBRE, and therefore did not forfeit their statutory entitlement to severance pay upon retrenchment.

Analysis and Findings of the Court with Direct Quotations

On the Causation Requirement under Section 41(4) BCEA:

"[25] ... The decisive question under section 41(4) of the BCEA is whether the employer has arranged alternative employment for the employee. The Labour Appeal Court in Irvin & Johnson held that the forfeiture clause is not triggered by the mere fact that an employee obtains or accepts alternative employment. The employer must have taken purposive steps to cause that employment to come about. It must have initiated and driven the process of securing employment for the employee with the incoming employer, such that the employment was obtained as a result of the employer's efforts." (para 25)

On the Commissioner's Misconception of the Inquiry:

 "[26] The commissioner erred, as a threshold matter, in the identification of the question he was required to answer. Having correctly found that a retrenching employer must demonstrate that it played an instrumental role in securing alternative employment, the commissioner proceeded to treat the dispositive question as whether the applicants accepted employment with CBRE, which was common cause, rather than whether Tsebo's efforts caused that employment to come about. This is a misconception of the nature of the inquiry under section 41(4)." (para 26)

On the Temporal Impossibility of Causation:

"[27] ... It is common cause that De Villiers and Samuels received formal CBRE employment offers as early as 28 February 2020, more than two months before the AEA was reached in principle... In respect of Theunissen, the commissioner records at paragraph 21 of the award that in March 2020 CBRE published a Notice of Hiring People with a closing date of 24 April 2020, and that Tsebo ostensibly did not know about the recruitment drive. It was this independent recruitment drive, of whose existence Tsebo was ignorant, to which Theunissen responded. He applied on 22 April 2020 and was interviewed on 29 April 2020 before the in-principle agreement on the AEA was reached on that same day... Tsebo cannot have arranged an appointment arising from a recruitment process of whose existence it was unaware. An employer who does not know a recruitment process exists cannot be the cause of an appointment made through it." (para 27)

On the Significance of the 27 Retrenchments: "[28] ... The significance of the 27 retrenchments is fatal to the causation case and equally fatal to Tsebo's characterisation of the AEA as constituting an undertaking by CBRE that the applicants will be appointed... Clause 4.10 expressly provided that the placement provisions did not constitute a stipulation for the benefit of employees and that employees could not accept or enforce any obligations arising from those provisions. An arrangement that by its own express terms creates no rights for and confers no enforceable obligations towards the affected employees cannot simultaneously constitute the arrangement of those employees' alternative employment for purposes of section 41(4)." (para 28)

On the Unreasonableness of the Outcome:

 "[29] The commissioner's conclusion that Tsebo played an instrumental role in securing the applicants' CBRE employment is not rationally connected to his own preceding findings... Applying the standard in Gold Fields and Mofokeng, this constitutes a failure to apply the mind to material facts such that the outcome is unreasonable." (para 29)

On the Legally Unsound "Stratagem" Reasoning:

"[30] ... The commissioner's secondary route that the individual applicants held back from formally resigning in order to profit from severance pay and that their failure to resign was nothing more than a stratagem, this reasoning is not merely unsound on the facts; it is unsound in law. Section 41(4) contains no motive-based exception to the entitlement to severance pay. The provision operates on a single criterion: whether the employer arranged the alternative employment... To the extent the commissioner's secondary reasoning purports to stand independently of the causation analysis, it cannot do so. It is ultra vires the provision on which it purports to rely." (para 30)

Order of the Court

 "Order

 1. The arbitration award issued by the Third Respondent under case number WECT 8983-20, dated 8 August 2023, is reviewed and set aside.

 2. The following is substituted as the finding of this Court:

2.1 The Second Applicant (De Villiers B) is entitled to severance pay in the amount of R274,521.93.

2.2 The Third Applicant (Samuels W) is entitled to severance pay in the amount of R81,235.82.

2.3 The Fourth Applicant (Theunissen E) is entitled to severance pay in the amount of R21,312.18.

3. The amounts referred to in 2.1 to 2.3 above attract interest at the relevant, prescribed legal rate of interests as from the date that severance pay became due and payable, i.e., as from 1 June 2020.

4. No order is made as to costs." (para 34)