Whistleblowers in the Rail Industry: the LAC gives one a green light, whilst another gets derailed

South Africa

Fraud, corruption and irregularities are an unfortunate reality within the South African landscape and those who dare to expose such malpractices, often facing significant professional and personal repercussions. Protection of such employees and available remedies in law are therefore crucial.  Interestingly, the Labour Appeal Court (“LAC”) has recently ruled on two such cases concerning whistleblowing, both arising in the rail industry, in respect of Mr. Solomon Kekana (“Kekana”), formerly from the Safety Regulator, and Ms. Onica Ngoye (“Ngoye”), formerly from PRASA – but with contrasting outcomes. 

Ngoye was PRASA’s erstwhile Head of Legal. Ngoye has widely been reported to be a whistleblower and testified at the State Capture Commission ("Commission") in relation to allegations of corruption at PRASA, both before and after her employment had been terminated.  

In early 2021, PRASA terminated Ngoye’s and other employees’ employment by way of a letter. The letter gave the reason for the termination as the expiry of a five-year period and stated that since they held executive positions within PRASA, their employment was limited to a period of 5 years, which had now lapsed.

The employees denied that they were employed for a fixed period as their employment contracts reflected that they were employed on an indefinite basis. One of the employees had only been employed for 12 months when he received the termination letter. 

Following their termination, Ngoye and the other employees approached the Labour Court, on an urgent basis, challenging the termination of their employment on the basis that it was unlawful (as opposed to unfair).  The Labour Court found that the termination of their employment was unlawful and ordered reinstatement.  The LAC however reversed this decision despite the fact that it agreed that the terminations were unlawful.  It did so due to, inter alia, the employees having based their claim in contract as opposed to the Labour Relations Act 66 of 1995 (“LRA”). The LAC found that the relief which had been granted by the Labour Court was founded in the LRA as opposed to contract law.   The LAC noted that litigants often take the route of challenging the lawfulness of their termination as opposed to the fairness, due to the ability to approach the Court on an urgent basis, however doing so meant that remedies from the LRA could not be awarded.  Unfortunately, because of the approach that they had taken, Ngoye and the other employees did not receive any relief and were not reinstated.  

By contrast, in the case of Safety Regulator v Solomon Kekana [2024] 1 BLLR 40 (LAC), Kekana, an executive manager, was dismissed after voicing concerns about the appointment and qualifications of officials appointed to investigate rail accidents and the procedural and substantive integrity of the investigations. The CEO had sent an unqualified investigator, Mr. Bruwer and a service provider to prepare rail accident reports, while Kekana was on leave.  Even though Kekana was on leave, he dispatched a team to attend to prepare a report of the railway accident.  Kekana objected to aspects of the reports prepared by Mr Bruwer and voiced his concerns regarding “non-compliance with chain management and occurrence investigation processes”.  Kekana reported these concerns to the CFO.      

Kekana’s initial grievances led to allegations of misconduct being levelled against him relating to gross dereliction of duty regarding the leave he had taken when railway accidents had taken place and alleged failure to ensure that an investigation team responded timely and appropriately to the railway accident.  Kekana was ultimately dismissed.  Kekana referred his dismissal to the Labour Court as an automatically unfair dismissal, on the basis that his dismissal was in response to his protected disclosures, which were made by way of a grievance.  The Labour Court agreed and awarded him reinstatement with full back pay and held that the allegations levelled against Kekana were “nothing but a ruse and a fig leaf to hide the true reason”, being his protected disclosure. 

The Safety Regulator took the matter on appeal to the LAC.  The LAC upheld that Kekana’s dismissal was automatically unfair but reversed the order of reinstatement on the basis that Kekana had not in fact requested reinstatement in his claim.  Instead, the LAC awarded Kekana compensation equal to 24 months’ remuneration.  

Both cases illustrate the unenviable position of whistleblowers, particularly in state-owned entities.  While Ngoye’s legal strategy focused on the contractual unlawfulness of her dismissal and may have been influenced by the need to obtain urgent relief, it effectively yielded no tangible redress to her and the other employees’ terminations.  Kekana’s approach in terms of the LRA, which may have been a slower process by comparison, secured him redress in the form of the maximum compensation permissible under the LRA, which is rarely seen.

Where employees have followed the protections afforded to them in terms of the LRA in relation to protected disclosures, it is certainly welcome and to be celebrated, that the courts are imposing maximum penalties afforded under the LRA.  This lends both confidence and reverence to our laws, promoting the ability to come forward in times of such high corruption and fraud.