When a dispute has been referred to the CCMA or Bargaining Council, and the matter proceeds to an arbitration hearing, the Commissioner will proceed to make the appropriate ruling and issue an arbitration award, against either the Applicant or Respondent, depending on the facts of the dispute.
Section 143 of the LRA (Labour Relations Act) provides that an arbitration award issued by a Commissioner with the CCMA or Bargaining Council is indeed final and binding between parties.
Section 143 states the following: “Effect of arbitration awards:
- An arbitration award issued by a commissioner is final and binding, and it may be enforced as if it were an order of the Labour Court, unless it is an advisory arbitration award.
- If an arbitration award orders a party to pay a sum of money, the amount earns interest from the date of the award, at the same rate as the rate prescribed from time to time in respect of a judgment debt in terms of section 2 of the Prescribed Rate of Interest Act, 1975 (Act No. 55 of 1975), unless the award provides otherwise.
- An arbitration award may only be enforced in terms of subsection (1) if the director has certified that the arbitration award is an award contemplated in subsection (1).
- If a party fails to comply with an arbitration award that orders the performance of an act, other than the payment of an amount of money, any other party to the award may enforce it by way of contempt proceedings instituted in the Labour Court.”
Accordingly, when reading Section 143(1) together with Section 143(3) of the LRA, one will agree that a certified arbitration award may be enforced without having a Warrant of Execution (Writ) issued by the CCMA or any court.
Further to the above mentioned, Rule 40 of the CCMA Rules deals with the certification of arbitration awards.
Section 40 states the following: “Certification and enforcement of arbitration awards:
- An application to have an arbitration award certified must be made on, or contain the following information:
- LRA Form 7.18 in respect of an award by a commissioner;
- LRA Form 7.18A in respect of an award in arbitration conducted under the auspices of a bargaining council.
- Any arbitration award that has been certified in terms of section 143 of the Act that orders the payment of an amount of money, may be executed:
- by using the warrant of execution in the LRA Form 7.18 or LRA Form 7.18A; or
- the warrant of execution prescribed in the Rules for the Conduct of Proceedings in the High Court.
- For the purposes of subrule (2), an arbitration award includes an award of costs in terms of section 138(10), a taxed bill of costs in respect of an award of costs, and an arbitration fee charged in terms of section 140(2).”
Simply put, Section 40 states that should a party fail to abide by the arbitration award, the other party must complete an LRA 7.18 form and submit it, together with a copy of the arbitration award, to the CCMA in order to have the arbitration award certified. Only after an arbitration award has been certified, may it be delivered to a Sheriff to proceed to execute the arbitration award on the “cheated” party’s behalf.
In the past, it was required of a party to approach the Labour Court to have an arbitration award certified, which was a very costly exercise. In favour of all parties, the Act was amended and made more accessible and cost-effective to a party to enforce an award.
Accordingly, all parties (most likely employers) should be extremely cautious when deciding not to abide by an arbitration award. You might have the Sheriff knocking on your door to collect your business’s movable goods, to the excitement and delight of the other party (most likely the former employee).
Article by: Tarien Conradie
Dispute Resolution Official – Gauteng
VIDEO: Ryan Chetty, Dispute Resolution Official in KwaZulu-Natal talks about how the arbitration process works, and how CEO can assist you in this matter