GEBE SXM Loses ANOTHER Court Case, Has To Pay SMCU Court Costs Sint Maarten
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Sint Maarten. Union demands order to employer to sign collective labor agreement, including articles with financial consequences.
Case numbers:
Judgment: October 23, 2024
JOINT COURT OF JUSTICE
of Aruba, Curacao, Sint Maarten and
of Bonaire, Sint Eustatius and Saba
JUDGMENT
in the case of:
the association
SINT MAARTEN COMMUNICATIONS UNION,
located in Sint Maarten,
in the first instance the plaintiff, now the appellant
authorized representative: mr. MM Hofman-Ruigrok,
in return for
the public limited company
NV JOINT ELECTRICITY COMPANY WINDWARD ISLANDS,
located in Sint Maarten,
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defendant in the court of first instance, now respondent,
authorized representative: mr. CMP van Hees.
The parties will hereinafter be referred to as SMCU and GEBE.
1The case in brief
In this lawsuit, a union is seeking an order for the employer to sign a collective bargaining agreement, including eight articles that have financial consequences for the employer.
The Court dismissed the claim, inter alia on the grounds that the text of the eight articles had not been established.
In this appeal, the union states that the text of the eight articles was indeed established. The Court reassesses the claim, taking this position into account.
2The course of the procedure
2.1
By a notice of appeal received on April 3, 2023, SMCU appealed against the judgment rendered between the parties and delivered on February 21, 2023 by the Court of First Instance of Sint Maarten (hereinafter: the Court).
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2.2
In a memorandum of appeal, with exhibits, received on 12 May 2023, SMCU raised and explained four grounds of appeal against the judgment. Its conclusion is that the Court will annul the judgment and grant its claim, with GEBE being ordered to pay the costs of the proceedings in both instances.
2.3
In its memorandum of reply, with exhibits, received on 7 July 2023, GEBE contested the grievances. Its conclusion is that the Court will confirm the contested judgment, with an order that SMCU, enforceable provisionally, pay the costs of the appeal.
2.4
On March 13, 2024, the parties’ attorneys filed briefs.
2.5
Judgment has been requested and set for today.
3The assessment
Facts
3.1
The Court assumes the following facts.
3.1.1
On 18 November 2013, a collective labour agreement (hereinafter: CLA) for the period 2013-2015 was agreed between employer GEBE and trade union WIFOL.
3.1.2
Since April 2017, GEBE has been negotiating with the SMCU trade union on the creation of a new collective labor agreement.
3.1.3
On September 6, 2017, Sint Maarten was hit by Hurricane Irma.
3.1.4
In August 2020, GEBE requested mediation by a national mediator as referred to in the Labor Disputes Ordinance 1946.
3.1.5
On September 14, 2020, after mediation by the national mediator, GEBE and SMCU signed a memorandum of understanding , which included a timeline for the development of a social plan.
In an email dated September 15, 2020, [union member] wrote to various people on behalf of SMCU (CLA means: collective labor agreement ):
The CLA document is in good order, and SMCU agree with the document please change the date from February 27, 2021 to January 1, 2021.
Then ones (read: once, Hof) the supervisory board approve the CLA you ca pran the three copies and bind them.
Ones (read: once, Hof) they are bind parties can start signing them and then set a date for an official ceremony.
In an email dated September 16, 2020, [HR officer], assistant manager human resources at GEBE, forwarded the email of September 15, 2002 received from [union member] to various people, with the following accompanying text:
See attached the CLA version that was amended, under both party’s guidance. Before going to print, you may still want to do a quick scan and see if there is anything else such as typos, formatting, spacing, etc. that you want to see edited. Just let me know and I will adjust.
The Word document attached to these emails is entitled CLA SMCU GEBE approved draft as per Sept. 15 2020 (hereinafter: the text of 15 September 2020). The text drafted in Word is entitled Collective labor agreement 2021-2024 and consists of 63 pages. It contains the complete and unambiguous text of 52 articles.
3.1.6
As of October 31, 2020, the GEBE board was replaced by a temporary manager . The temporary manager continued negotiations with SMCU. In reports of February 12, 2021, February 26, 2021 and March 12, 2021, the national mediator reported on meetings held and each time mentioned a date for a next meeting. In the reports of February 26, 2021 and March 12, 2021, eight articles are mentioned (hereinafter: the eight articles). In the latter report, the eight articles are provided with an article number and further indicated with, among other things: vacation allowance, jubilee bonus , etc.
These numbers and indications correspond to the numbers and headings of eight articles in the text of September 15, 2020. The reports state that the eight articles are put on hold at the proposal of GEBE , because they have financial consequences and it must be assessed whether the financial developments and position of GEBE allow them to be implemented.
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3.1.7
On 17 and 18 March 2021, the government of Sint Maarten ratified three national ordinances (AB 2021 nos. 8-10, hereinafter: the Temporary National Ordinances). The Temporary National Ordinances were the result of the Corona pandemic. The Netherlands was prepared to provide financial aid and assistance to Sint Maarten under conditions that included a reduction in employment conditions at government institutions (such as GEBE). The National Ordinances stipulate that they have retroactive effect to 1 July 2020. By petition of 26 April 2021, the Ombudsman requested the Constitutional Court to annul the National Ordinance on the grounds that it was in conflict with the Constitution. By judgment of 1 November 2021, ECLI:NL:OCHM:2021:2, the Constitutional Court rejected those requests. Two weeks later, the Temporary National Ordinances entered into force.
3.1.8
On 25 March 2021, a (partial) collective labour agreement for the period 2020-2023 was submitted for approval to the supervisory board of GEBE. By written decision of 8 April 2021, the supervisory board of GEBE approved the (partial) collective labour agreement as submitted. According to art. VI of the decision, the eight articles with financial consequences were not submitted (and therefore excluded from approval). Article VI of the decision states:
[On] March 25th, 2021, Temporary Manager (โฆ) presented for Supervisory Board approval the draft CLA, excluding 8 articles with financial impact, going into effect retroactively as per January 1st, 2021. It was further agreement that in a meeting to be held in the first week of July 2021 the 8 articles will be discussed for possible reintroduction based on the financial results of NV GEBE in the preceding months of 2021 to be sent to the Government Mediator and SMCU prior to the meeting. This change is reflected in the addendum document which forms integral parts of the draft CLA.
By letter dated April 8, 2021, the temporary manager of GEBE SMCU reported that the supervisory board had approved the submitted NV GEBE Collective Labor Agreement .
3.1.9
On April 23, 2021, an ‘addendum to the collective labor agreement’ was signed (hereinafter: the addendum). It states, among other things:
Whereas the Employer and the Union (โฆ) have negotiated a new Collective Lanor Agreement (CLA) to go into effect on January 1, 2021;
Whereas, mainly due to the SARS-CoV-2 pandemic that started in 2020, the Employer has experienced a significant decline in its revenues, while it is uncertain what effects the pandemic will still have in 2021;
NOW THEREFOR, parties have agreed as follows:
- The CLA negotiated between the Union and the Employer will go into effect retroactively as of January 1, 2021, however, parties have agreed to delay the following proper articles:
o Child allowance (Art. 10)
o Stand-by allowance (Art. 11)
o Cashier allowance (Art. 9)
o Deputizing allowance (Art. 13)
o Jubilee bonus (Art. 16)
o Holiday & overtime payments (Art. 18)
o Cost of living adjustment (Art. 6)
o Travel allowance (Art. 39)
- Parties, together with the Government Mediator, will reconvene in the first week of July 2021 to discuss the possible introduction of all or some of the eight articles mentioned in Article 1 of this Addendum, based on the financial results of the Employer in the preceding months of 2021, to which the Employer shall send the relevant financial information to the Union and to the Government Mediator two (2) weeks prior to the meeting held in the first week of July 2021.
- This addendum forms an integral part of the CLA between the Union and the Employer, and shall remain in full force and effect until the earlier of either December 31, 2021 or the date that it has been canceled and/or replaced by the parties hereto, but no later than December 31st, 2021.
3.1.10
Despite the urging of SMCU, no meeting as referred to in art. 2 of the addendum was held in the first week of July 2021 to discuss the eight articles mentioned in art. 1 of the addendum (hereinafter: the eight articles). GEBE did not provide the financial data referred to in art. 2 of the addendum to SMCU and the national mediator two weeks before the first week of July 2021. By letter dated 29 October 2021, the interim manager informed SMCU that GEBE had decided to request the national mediator to convene a meeting as soon as possible to discuss the possible implementation of the eight articles or part thereof.
3.1.11
By letter dated 20 December 2021, the (successor) temporary manager of GEBE informed SMCU that GEBE is obliged to implement measures as referred to in the Temporary National Ordinances and that therefore the holiday pay will not be paid out. In response to this, SMCU has called in the mediation of the national mediator. By letter dated 8 April 2022, the temporary manager requested the supervisory board to approve further measures to comply with the provisions of the Temporary National Ordinances in 2022. The supervisory board approved those measures. By letter dated 5 May 2022, the temporary manager announced further measures.
3.1.12
After the Court had rendered its judgment in this case on 21 February 2023, the parties continued negotiations. Meetings were held on 9 March 2023 and 26 April 2023. These negotiations did not result in the signing of a collective labour agreement.
Claims
3.2
In this legal case, SMCU, in short, demanded that the court order GEBE to sign the new collective labor agreement and to bring the eight articles into effect, under penalty of forfeiture of penalty payments.
Decisions of the Court
3.3
In the contested judgment, the General Court dismissed the claim. In this regard, the General Court considered that the text of the eight articles is not fixed and that the obligations that the eight articles regulate are not determined or determinable (4.2). No agreement has been reached on the eight articles and their financial consequences. They should form part of the new collective labour agreement (4.3). The General Court is not in a position to enforce the conclusion of a new collective labour agreement. The General Court will not order GEBE to continue negotiations, because there is no clear operative part to that effect and GEBE has declared itself prepared to continue negotiations (4.4), according to the General Court.
Assessment by the Court
3.4
The report of the national mediator of 12 March 2021, the decision of the board of directors of 8 April 2021 and the addendum of 23 April 2021 refer to eight articles. On appeal it has become apparent that these references relate to a specific text, namely the text of 15 September 2020. This is different from what the General Court assumed. Nevertheless, the Court agrees with the outcome reached by the General Court. This is substantiated below.
3.5
It was clear to the parties that no collective labour agreement could be concluded without the approval of the supervisory board. The mere fact that a complete text was apparently concluded on 15 September 2020 or earlier does not therefore imply the conclusion of a binding collective labour agreement, but only the completion of a step in the negotiation process. The parties have not argued otherwise either.
3.6
In the decision of 8 April 2021, the Supervisory Board explicitly excluded the eight articles from approval. The parties have not argued otherwise either.
3.7
The decision of 8 April 2021 explicitly states that the introduction of the eight articles was a possibility and would depend on the financial results of GEBE. SMCU could not reasonably have inferred from this that the eight articles would be introduced and that the discussion would only concern the date on which the eight articles would enter into force. SMCU had to reasonably take into account the possibility that GEBE’s financial results would be such that the eight articles would not be introduced at all.
3.8
Art. 3 of the addendum must be interpreted. The Court will do so first by reference to the Haviltex standard.
3.9
The text of Article 3 of the Addendum indicates that if 31 December 2021 passes without agreement being reached on the full or partial implementation of the eight Articles, the Addendum will cease to have effect. In other words, the text of 15 September 2020 will enter into force retroactively to 1 January 2021 without the eight Articles. No circumstances have been stated or demonstrated on the basis of which the parties to the negotiations could or should reasonably have believed that Article 3 of the Addendum should be interpreted differently.
3.10
If the addendum is not to be interpreted in accordance with the Haviltex standard, but in accordance with the collective labour agreement standard, the Court reaches the same conclusion. The text does not indicate that if 31 December 2021 passes without agreement being reached on the full or partial implementation of the eight articles, the eight articles are to be considered as agreed and must be implemented (with or without 31 December 2021 as the date of entry into force). The legal consequences of such an interpretation of the text are also not plausible. It could then lead to GEBE having to bear the financial consequences of the eight articles, although its financial position does not allow this.
3.11
At the time of the creation of the addendum, the government of Sint Maarten had ratified the Temporary Ordinances and the period within which the Ombudsman could submit the case to the Constitutional Court (see art. 127 paragraph 3 Sint Maarten Constitution) had not yet expired. It was therefore an uncertain time for GEBE’s financial position. On 31 December 2021, the date mentioned in art. 3 of the addendum, the Constitutional Court had already rendered its judgment and the Temporary Ordinances had become law. The Temporary Ordinances meant that the law did not allow GEBE to implement the eight articles. SMCU could not reasonably expect that GEBE would nevertheless do so in violation of the law.
3.12
In view of the previous judgments, the Court rightly dismissed the claims. This does not affect the fact that the parties must continue to negotiate the creation of a new collective labour agreement, if necessary with the assistance of the national mediator. According to the overview of the facts, they do so.
3.13
The appeal fails. The judgment under appeal must be confirmed. GEBE will be ordered to pay the costs of the appeal as the unsuccessful party.
DECISION
The Court:
confirms the judgment under appeal;
condemns GEBE to pay the costs of the appeal, incurred by SMCU and estimated to date at NAf 240.50 in disbursements and NAf 5,000.00 in attorney’s fees;
declares the award of costs provisionally enforceable.
This judgment was rendered by Mrs. EA Saleh, GCC Lewin and J. de Boer, members of the Joint Court of Justice of Aruba, Curaรงao, Sint Maarten and of Bonaire, Sint Eustatius and Saba and pronounced at the public hearing of the Court in Sint Maarten on 23 October 2024 in the presence of the registrar.
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