HOSPERSA & another v Public Service Co-ordinating Bargaining Council & others [2026] ZALCPE 26

Date of Judgment & Seat of Court: 18 February 2026, Labour Court, Gqeberha

Case No: P57/2023

Name of Judge(s): Thys AJ

Summary of Factual Matrix:

Ms Tshentu, an employee of the Eastern Cape Department of Health appointed in January 2020, referred a dispute to the Public Service Co-ordinating Bargaining Council (PSCBC) in September 2022 about the interpretation and application of Resolutions 3 of 2009 and 1 of 2012, which she contended entitled her to a salary adjustment. Without hearing oral evidence, and after the parties had been told that the merits would be decided after evidence, an arbitrator conducted the proceedings virtually and, on 27 April 2023, issued a ruling that the PSCBC lacked jurisdiction because Ms Tshentu had been appointed after the relevant date.

The employee and her union applied to review that ruling, contending that it concerned the merits and not jurisdiction, that the arbitrator had relied on a DPSA circular rather than the resolutions, and that the matter had been decided on documents alone. The Department opposed, raising non-joinder of the department itself and, for the late delivery of its answering affidavit, condonation. Both parties sought condonation. The court also considered whether a virtual hearing was permissible under the PSCBC's 2005 dispute resolution resolution, which preceded the 2024 amendment permitting virtual venues.

Summary of Findings:

[9] ‘However, in matters such as the present case (concerning jurisdiction and/or the interpretation or application of collective agreements) the “correctness” test applies.[4] The ‘correctness’ test applies equally when arbitrators committed errors of law[5] and acted beyond the scope of their power[6] – as in the present matter.’

[10] ‘I have no hesitation in agreeing with the employee’s proposition that the arbitrator was ‘incorrect’ to conclude the PSCBC does not have jurisdiction to entertain her claim.’

[12] ‘Therefore disputes about the interpretation and application of PSCBC resolutions and/or specifically the ones under consideration, fall squarely within its jurisdiction. The arbitrator’s finding to the contrary is therefore inconsistent with these instruments and is plainly erroneous.’

[13] ‘The difficulty with the arbitrator’s reasoning is that she confused a potentially weak case with a lack of jurisdiction.’

[15] ‘The jurisdiction (in this case, and as stated above) is derived from statute, the constitution of the PSCBC, and the terms of its resolutions/collective agreements. The merits, by contrast, turn on whether the employee proved the entitlement sought, under the resolutions. Therefore the employee’s appointment date and eligibility relates to the merits, not jurisdictional bars.’

[16] ‘As a result, the arbitrator’s conflation of potential weakness on the merits with an absence of jurisdiction constitutes a fundamental error, amounting to a mismanagement of the dispute that fatally undermines the correctness of her ruling.’

[21] ‘However, the arbitrator ought to have been immune to such confusion and, regardless of the parties’ perception, was duty bound to apply the correct legal position.’

[24] ‘The arbitrator also missed the legal mark that the strength or weakness of the merits has absolutely no bearing on jurisdiction. Jurisdiction turns on the nature of the dispute and the forum’s authority, to hear the case.’

[26] ‘This finding and approach of the arbitrator is problematic because it implicates a fundamental principle of adjudication, which is that an arbitrator commits a reviewable irregularity when issuing an award that is materially contradictory. An award must be internally coherent and materially consistent, both in its reasoning and in its operative part. Where the arbitrator’s findings are irreconcilable with the conclusions reached, or where the dispositive order contradicts the reasoning underpinning it, the award is rendered defective.’

[35] ‘In my view, the very need for such an amendment demonstrates that, prior to its adoption, virtual hearings were neither permitted nor contemplated under the old/2005 PSCBC dispensation.’

[40] ‘Consequently, the arbitrator exceeded her powers when she conducted the proceedings virtually, without the necessary legal foundation.’

[42] ‘Put in another way, in the present matter, the arbitrator/secretary had no discretion, or authority, to substitute the legally required face to face hearing with a virtual hearing. By doing so, she or they acted ultra vires the constitution and resolutions of the PSCBC, which renders the ruling per se invalid, irrespective of the merits of the dispute.’

[45] ‘In my view, that determination is flawed and not one I am prepared to follow. The SAPS v Scheun judgment incorrectly treated the issue as one dependent on prejudice, whereas the true point is jurisdictional and legality based.’

[46] ‘I pause to emphasise that my conclusions in respect of virtual hearings should under no circumstances be construed as being “anti” virtual hearings. Rather, what is proposed is that virtual hearings operate from a sound legal basis and that proper systems be put in place to facilitate such hearings.’

[54] ‘The arbitrator thus acted improperly by electing to proceed to determine the matter without hearing oral evidence, notwithstanding the parties’ shared understanding and the existence of material factual disputes that could not be resolved on paper alone.’

[57] ‘The arbitrator’s approach was also fundamentally flawed, because by determining the matter solely on the face of certain documents, she denied the parties the right to a proper ventilation of the dispute and thereby infringed the principle of audi alteram partem, which requires that each party be afforded a fair opportunity to present its case.’

[60] ‘It must be noted that there are, in principle, three recognised methods by which evidence may properly be received in proceedings of this nature – first, through viva voce testimony delivered under oath; second, by way of evidence tendered under cover of a sworn affidavit; and third, through evidence formally recorded in a pre trial minute or agreed special/stated case. In the present matter, the arbitrator acted in a highly irregular fashion because none of the established mechanisms for the reception of evidence were employed.’

[61] ‘I therefore agree with the employee that the arbitrator ought not to have determined the dispute solely based on certain documents. By deciding the matter solely on documents, the arbitrator denied proper ventilation of the dispute. She acted without a formal jurisdictional objection, failed to hear oral evidence, and neglected to secure either agreed common cause facts or a stated case. This deprived the proceedings of evidentiary clarity, undermined fairness, and rendered the award procedurally defective and reviewable.’

[69] ‘This objection, however, stands to be rejected. The ‘Department’ is an entity that is, an institutional structure created by statute, which in and of itself lacks the capacity for independent thought, volition, or action.’

[71] ‘Responsibility must be attributed to a specific official who had the duty and capacity to exercise the powers of the department and to represent it in legal proceedings. This is precisely what the MEC (third respondent) and Minister (fourth respondent) are, namely the designated office bearers who embody the department’s legal personality and who may properly be cited in proceedings of this nature.’

[75] ‘Viewed in the context of this matter, neither delay can properly be characterised as egregious. The delays were occasioned primarily by the procurement of legal representation and the observance of internal protocols dependent upon that process. In my assessment, these explanations are both reasonable and acceptable.’

[76] ‘In the interests of justice and bearing in mind the principle that disputes should be resolved on their merits rather than on technicalities, condonation is granted to both parties.’

[77] ‘It is well established that in labour matters costs do not automatically follow the result. The general rule in labour litigation is that costs orders should be approached with caution, precisely to avoid deterring parties from approaching the Labour Court to vindicate their rights.’

[80] ‘My view on costs is reinforced by the fact that no proper case for a costs order was made out in the papers, by either party, as contemplated by section 162 of the LRA.’

[83] ‘Given all the considerations set out above, it is clear that the arbitrator’s ruling to the contrary was fundamentally flawed and must be set aside.’

[84] ‘In the interests of fairness and to ensure that the dispute is properly ventilated, it is prudent that the matter be re enrolled before another arbitrator under the auspices of the PSCBC.’

Relief: The PSCBC ruling of 27 April 2023 (PSCBC 180-22/23) was reviewed and set aside. It was declared that the PSCBC has jurisdiction to determine disputes concerning the interpretation and application of Resolutions 3 of 2009 and 1 of 2012. The matter was remitted to be re-enrolled before another arbitrator for determination afresh on the merits, and no order was made as to costs. Condonation was granted to both parties.

Judgment on SAFLII