Interpreting collective bargaining agreements

A collective bargaining agreement (CBA) is a written agreement between an employer and a registered trade union concerning terms and conditions of employment or any matter of mutual interest concluded between them.

A CBA addresses issues such as ordinary hours of work, overtime, discipline, vacation and other types of leave, minimum wages and so on, for employees falling within a particular industry.

In terms of the Labour Act (Chapter 28:01), a CBA can be negotiated between an employer and a workers’ committee or between an employer and a trade union.

This article focuses on CBAs negotiated at employment council (NEC) level between representatives of employers and representatives of a trade union.

A CBA is legally binding and overrides the affected employees’ individual contracts of employment. Its terms automatically apply to employees who are not members of the trade union or employers who are not members of the employers’ organisation. It is an offence or unfair labour practice for employers or employees working in a particular industry not to obey the terms of the CBA.

A CBA is usually an outcome of several months (or even years) of negotiations between parties to the NEC. However, the true intention of parties is not always accurately reflected in the final agreement.
Disputes often arise over the meaning of a particular provision of the CBA or over whether the agreement applies to a particular set of facts or circumstances.

The best way for parties will be to meet face-to-face and clarify any problem(s) with a clause or section of the CBA. This is likely to result in a win-win resolution that eliminates hard feelings and misunderstandings between workers and management. Referring the dispute to a third party, such as an arbitrator, may leave one or both parties feeling slighted or wronged.

A meeting must be set up comprising key members who originally negotiated the agreement. Notes and minutes from previous negotiation sessions will help to clarify ambiguity in the language of a CBA as well as clarifying the original intent at the time of the negotiation of the agreement.

Disagreements over interpretation of a CBA or how it is being applied can also be referred to conciliation. The NEC, where it exists in an industry plays a role in settling disputes in that sector. The NEC acts as a mediator to try to help the two parties negotiate a solution.

If the conciliation does not resolve the dispute, either of the parties may refer the matter for arbitration. The role of an arbitrator will be to interpret the CBA and not to apply his or her standards of what is right in a given situation.

In interpreting the CBA, the arbitrator is enjoined to apply a purposive approach in order to ensure interpretation is consistent with the primary objects of the Labour Act while, of course, taking cognisance of the ordinary principles of interpretation of contract.

For example, in the South African case of NUMSA vs VW South Africa (a dispute over interpretation of a collective agreement), the Labour Appeal Court stated that “a collective agreement in terms of the Act (the South African Labour Relations Act) is not an ordinary contract, and the context within which a collective agreement operates under the Act is vastly different from that of an ordinary commercial contract”.

The Labour Appeal Court made it quite clear primary objects of the Act, namely, the effective, fair and speedy resolution of labour disputes would be better served by “a practical approach to the interpretation and application of the collective agreement . . . rather than by reference to purely contractual principles”.

Arbitrators use a number of legal rules to interpret disputed language in a CBA. Below are some of the common rules used.

Clear and unambiguous language: In general, arbitrators give in “clear and unambiguous language”, the meaning that it expresses. If the language is not clear and ambiguous, certain rules of interpretation can be used to determine what the parties meant. The arbitrator is not required to use any particular rule, but can use any rule that helps determine what the parties meant.

Ordinary and common language: Arbitrators will generally assign words their ordinary, day-to-day meaning unless evidence shows parties intended a different or more technical meaning.

Specific context: The arbitrator looks at the specific context in which words appear to determine what the parties intended.

Contract as a whole: The arbitrator looks at the contract as a whole to derive meaning, that is, he “gives effect to all provisions”. If an interpretation makes some part of the CBA meaningless, that interpretation is normally avoided.

Item not mentioned is excluded: If one item in a group or series is mentioned, but not another, it is assumed that the item not mentioned was intentionally excluded.

Bargaining history: In interpreting a CBA provision, the arbitrator will use bargaining history between parties to help determine their intent. He may use oral or documentary evidence to construe any ambiguous language. Comprehensive and accurate notes from previous bargaining sessions will be critical in this respect.

Legal interpretation preferred: Where two interpretations are possible, one legal and the other non-legal, the arbitrator will choose the legal interpretation.

Reasonable interpretation preferred: In instances where two interpretations are possible, one reasonable and the other absurd, the arbitrator will opt for the reasonable interpretation.

Past practice: Past practice in an industry or sector plays an important role in the interpretation of a CBA. It can assist an arbitrator in a variety of ways in clarifying what is ambiguous, to give substance to what is general and perhaps even to modify or amend what is seemingly unambiguous.

Something qualifies as a practice if it is shown to be the understood and accepted way of doing things over an extended period of time and that both parties had accepted the practice either explicitly or implicitly. In the 1960 case of United Steelworkers of America vs Warrior and Gulf Navigation Company Justice Douglas of the United States Supreme Court stated that “the labour arbitrator’s source of law is not confined to the express provisions of the contract, as the industrial common law — the past practices of the industry and the shop — is equally a part of the collective bargaining agreement although not expressed in it”.

Careful negotiation and drafting of a CBA with examples, guidelines and interpretation notes, will help eliminate the need for parties to resort to litigation over its interpretation and application.

Isaac Mazanhi is a labour analyst. He writes in his personal capacity. He can be contacted on email: imazanhi@hotmail.com

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