Application in terms of section 145 of the South African Labour Relations Act, 66 of 1995 (as amended) Dismissal – Misconduct – “Team liability” – All members on particular shift in fast food outlet dismissed as massive shrinkage continued – Concept of “team liability” applicable and employer not required to prove individual guilt – Dismissal fair. Editor’s Summary [Courtesy LexisNexis - BALR] After the applicant discovered it was losing stock from one of its fast food outlets at an “astonishing” rate, the respondent employees were informed of the problem and that the applicant would adopt a zero tolerance approach to further shrinkage. The applicant implemented a host of security measures, and introduced new stock handling procedures but was unable to lock refrigerators because of the nature of the business. Losses continued at a rate the applicant claimed employees must have been aware of and that they knew who the culprits were. The respondent employees, who were all employed on a particular shift, were suspended and summoned to a disciplinary inquiry. The respondent Commissioner ruled that the applicant failed to prove that the employees were responsible for the losses or that they would have been aware of the culprits and awarded each of them compensation equal to six months’ wages. The applicant contended that the Commissioner had erred by holding that the concept of “team liability” on which it had relied was unclear and suggested the imposition of strict liability, and that it was not the most probable inference that each employee knew who the culprits were. After restating the current test for review, the Court noted that the presiding officer of the disciplinary hearing had relied on the concept of “team liability”. That concept, like the doctrine of common purpose and “derivative misconduct”, does not require proof of individual guilt in cases of mass misconduct; it is sufficient that each employee is a member of a team , the members of which failed to ensure that the team meets its obligations, in this case to ensure that there was no further stock loss. It was common cause that the applicant had taken all possible measures to stem the shrinkage, and that the employees had been warned several times of the consequences of its continuation. Since the employees had elected not to testify at the disciplinary hearing or in the arbitration proceedings, the applicant’s version was unchallenged. The “team misconduct” approach was confirmed in Foschini Group v Maidi and others [2010] 7 BLLR 689 (LAC), the facts of which were indistinguishable. By holding to the contrary, the Commissioner had misconstrued the issue. The award was set aside and the dismissals declared fair.

1. “In search of the
dream team”

2. “Team Misconduct…’Team
Liability’…Derivative
Misconduct…Common
Purpose????”

4. True Blue Foods (Pty) Ltd t/a Kentucky Fried Chicken v
Commission for Conciliation, Mediation and Arbitration
And others [2015] 2 BLLR 194 (LC)
• “Application in terms of section 145 of the
LRA”
• Dismissal – Misconduct – “Team liability” –
All members on particular shift in fast food
outlet dismissed as massive shrinkage
continued – Concept of “team liability”
applicable and employer not required to
prove individual guilt – Dismissal fair.”
[Courtesy: BALR – Lexis Nexis]

6. BACKGROUND:
- One of ER’s fast food outlets losing stock due to
“shrinkage” at an “astonishing “rate – R 80 000.00 – R
120 000.00 per month
- EL’s employed with effect 01 December 2009 as
cooks, expediters & cashiers
- During period all in question worked evening shift
- ELS informed of ER zero tolerance approach to
“shrinkage”
Risk control measures implemented..
- Changing locks and locking the freezer
- Locks to store room, interlinking door at ‘drive-thru’
section.
- CCTV cameras
- Installation of the ALOHA system, captures all
activities at every till and captures the time of
activity/transaction.
Communication with TU, Shop Steward and all staff
- restatement of zero tolerance rule

8. Decision made to proceed with DE against rest of
shift or “team”
NB: ER during arbitration & LC application
contended it would be operationally impossible
to view all footage to check each and every
cashier.
NB: ER during arbitration & LC application
contended it would be operationally impossible
to view all footage to check each and every
cashier.
NB: ER during arbitration & LC application
contended it would be operationally impossible
to view all footage to check each and every
cashier.
NB: ER during arbitration & LC application
contended it would be operationally impossible
to view all footage to check each and every
cashier.

10. THE DISCIPLINARY ENQUIRY
- During 27 May 2010 to 30 May 2010
- Some 77 pieces of chicken and 42kgs chips – 27
May 2010
- Some 55 pieces of chicken and 20.72kgs of chips
– 28 May 2010
- Some 113 pieces of chicken – 29 May 2010; all
ELS same shift – night shift
Suspension:
- Prior to suspension - an opportunity to come
forward and provide any information of how the
stock losses were taking place
- None of ELS accepted the offer.

11. The Enquiry:
“Charged – Theft or attempted theft of co property -
…misappropriation co property”
NB: ELS chose not to testify at DE
Finding: Guilty on basis of “team misconduct (team
liability)”
Sanction: Summary Dismissal
Sanction: Summary Dismissal
Sanction: Summary Dismissal

13. THE ARBITRATION PROCEEDINGS:
NB: ELS chose not to testify at arbitration
proceedings
- ER version stood uncontested and only version
before the CR
THE COMMISSIONERS FINDING
“Determined that the RP/ER failed to:
i) prove that the applicants/ ELS were involved in
causing the items to leave the store without it being
paid for; or
ii) that they knew or should have known who was
responsible for it.
Found: dismissal of ELS substantively unfair –
awarded 6 month’s compensation

15. THE APPLICATION FOR REVIEW – SECTION 145 LRA (LC)
Grounds of review:
- Section 145(2)(a)(ii) – CR committed gross irregularity in
the conduct of arbitration proceedings;
Misconceived the nature of the enquiry; as a consequence
arrived at an unreasonable result;
Committed material errors of fact or otherwise erred in the
evaluation of the evidence;
- Section 145(2)(a)(iii) – CR exceeded powers;
Committed material errors of fact or otherwise erred in the
evaluation of the evidence [“by finding that the applicant had
failed to acquit the onus as is
required in section 192 of the LRA”];
- Unreasonable finding
The “material” errors effectively rendered the result of the
award unreasonable (i.e. that the award failed the Sidumo
test).

17. THE JUDGMENT BY THE LABOUR COURT
- CR erred in his finding that ER required to prove guilt
on each of the EL/Respondents
“[51] To the extent that arbitrator has made a finding to
the effect that in case of “team misconduct” the
individual culpability has to be proved, the arbitrator has
failed to apply his mind or has misconstrued the issue
before him.”
“[46] What is clear to me is that in the case of “team
misconduct” just as in the case of derivative misconduct
and common purpose there is no need to prove
individual guilt.
It is sufficient that the employee is a member of the
team, a team the members of which have individually
failed to ensure that the team meets its obligations, in
our given case, to ensure that there is no stock loss.”

18. LC HELD:
CR decision influenced by a CCMA commentary in its publication
entitled Case Law for Commissioners, 2012 Ed. [The Foschini
Group v Maidi and others (2010) 31 ILJ 1787 (LAC) ; [2010] 7
BLLR 689 (LAC)
In Foschini the LAC approved principles of “Team Misconduct” –
outlined in:
SA Commercial Catering and Allied Workers Union v PEP
Stores (1998) 19 ILJ 939 (CCMA) [also reported as SACCAWU v
Pep Stores at [1998] 6 BALR 719 (CCMA) – Ed];
And
FEDCRAW v Snip Trading (Pty) Ltd [2001] 7 BALR 669 (P)
LC Concluded That:
- CR MISCONSTRUED ISSUE BY FINDING THAT INDIVIDUAL
CULPABILITY HAS TO BE PROVED BY ER
- FINDING UNREASONABLE AND FALLS TO BE REVIEWED
AND SET ASIDE

20. INDIVIDUAL CULPABILITY DOES NOT HAVE TO
BE PROVED AS THE INDIVIDUAL MEMBERS OF
A TEAM ARE RESPONSIBLE FOR TEAM
PERFORMANCE.
THE PRINCIPLE – “TEAM LIABILITY” /
“TEAM MISCONDUCT”
In Snip Trading the arbitrator concluded that:
“The essence of team misconduct…is that the employees are
dismissed because, as individual components of the group,
each has culpably failed to ensure that the group complies with
a rule or attains a performance standard set by the employer.”

22. The End