Judge warns Rainbow Farms over abuse of process in 13-year labour battle

A Labour Court judge has rebuked Rainbow Farms, which is now RCL Foods Consumer and a unit of the listed Rainbow Chicken company, after it lost every stage of a 13-year labour dispute, warning that its litigation conduct “approaches the borderline of an abuse of process”.

In a judgement handed down in the Labour Court of South Africa, acting judge De Kock AJ said the company had failed at every stage of the dispute with former employee Etienne Jordaan.

“Every single adjudicative process in which this dispute has been determined has produced a finding adverse to the respondent,” the judgement states.

“The respondent has not succeeded at any level, before any decision-maker, at any stage of the 13-year history of this matter.”

The judge added that “the cumulative effect of the respondent’s conduct is that what began as a straightforward reinstatement order… has become a 13-year legal odyssey”.

While not making a formal finding that Rainbow abused the process, the court allowed Jordaan to enforce a R3 million arbitration award despite the company petitioning the Labour Appeal Court for leave to appeal.

Normally, filing an appeal automatically suspends enforcement of a judgement.

However, the court exercised its powers under the Superior Courts Act to allow execution while the appeal process continues.

Rainbow Chicken is one of South Africa’s largest, fully integrated poultry producers, founded in 1960.

The company, which listed independently on the Johannesburg Stock Exchange (JSE) in July 2024, focuses on affordable, locally produced chicken products.

The dispute dates back to January 2013, when Jordaan, a maintenance fitter at a processing plant in Worcester, was dismissed for alleged dishonesty related to clocking offences.

The Commission for Conciliation, Mediation and Arbitration ruled that the dismissal was unfair and ordered his reinstatement with backpay calculated at his salary of R20 012.54 per month, amounting to R120 075.24.

Jordaan reported for duty in July 2013 but was sent home while Rainbow challenged the ruling by launching a review application that was dismissed years later.

Jordaan and the company eventually reached an agreement in 2020 – more than seven years after the original reinstatement order – that he would return to work while the calculation of his backpay was referred to arbitration.

However, Jordaan was dismissed again in 2023 for alleged falsification of maintenance records. He did not challenge that dismissal.

“A successful litigant, brought to the verge of financial ruin by 13 years of sustained litigation,” the judgement states.

Court papers show Jordaan incurred about R2.5 million in legal-related costs during the dispute, exhausted his pension fund, sold his vehicle and had his wife surrender an insurance policy.

To address concerns about repayment if the appeal succeeds, Jordaan and his wife undertook not to sell or further bond their Worcester property while the appeal process continues.

The court incorporated that undertaking into its order while also noting that Rainbow, as a JSE-listed company, could absorb the award, even if temporarily while the appeal process unfolds.

Rainbow was also ordered to pay the costs of the application. – IOL Business

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