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PPC ordered to provide former employee with forensic report

Of investigation into information leaking about a proposed merger between PPC and AfriSam.
PPC is considering whether or not to make use of its right to appeal. Image: Waldo Swiegers/Bloomberg

The Labour Court has ordered PPC to provide a former employee with the forensic investigation report into the leaking of sensitive information about a proposed merger in 2017 between the JSE-listed cement producer and competitor AfriSam.

Siobhan McCarthy, former group manager of corporate affairs at PPC, is involved in a labour dispute with the company.

She claims that the proximate cause of her dismissal was PPC’s alleged retaliation against her for her alleged protected disclosure that former PPC financial director Tryphosa Ramano was the person who leaked the information about the proposed merger to Bloomberg – and for the unfair labour practice dispute that she referred to the Commission for Conciliation, Mediation and Arbitration (CCMA).

The CCMA in March 2019 ruled that McCarthy had been subjected to an unfair demotion at PPC and she was awarded two months’ compensation.

Read: PPC forensic investigation report takes centre stage in court case

PPC dismissed McCarthy in November 2018. She subsequently lodged a Labour Court application to have her dismissal declared automatically unfair in terms of the Labour Relations Act (LRA).

McCarthy lodged the application in March 2021 to compel PPC to provide her with the forensic investigation report compiled by Exactech on behalf of the PPC and a number of other documents.

The case was heard in July 2021, with judgment reserved.

Judge AJ Seale, in a judgment made available this week, ordered PPC to, within 10 days of his order, provide McCarthy with the forensic investigation report.

Commenting on the judgment, McCarthy told Moneyweb: “I am very pleased with the outcome and believe it takes us a step closer to uncovering the truth.”

Judge Seale also ordered that a number of documents related to a 2018 retrenchment process at the company be provided to McCarthy.

These documents include:

  • A list of all the PPC employees it contemplated retrenching at the time of McCarthy’s retrenchment.

  • Written proof of the 60 or more employees PPC contemplated retrenching, including a list of their positions and all the LRA Section 189 notices issued to the employees.

  • A list of the 17 employees allegedly terminated by PPC by reason of operational requirements (including the date of termination of their employment and positions).

PPC CEO Roland van Wijnen said: “PPC has had the chance to provide its views on the matter to the court, it respects the judgment and is now considering whether or not to make use of its right to appeal.”

In the judgment, Judge Seale said there is no suggestion in the pleadings of either of the parties that the disclosure of the forensic investigation report would result in an unlawful appropriation of PPC’s property.

He said the report is of sufficient relevance for the court to compel its production.

“Thus, even if the report is confidential [which the applicant (McCarthy) has not disputed], a blanket prevention of access to the report on such grounds will unduly limit the applicant’s right to have her automatically unfair dismissal claim fully and fairly ventilated,” he said.

Read: PPC: Critical audit report ‘unprecedented’

Judge Seale also rejected PPC’s contention that the annexures to the forensic report are privileged.

He said PPC only provided the court with vague references to other possible disciplinary or criminal proceedings.

“I am not satisfied the report was procured in view of likely or probable litigation. Indeed, this court was not presented with evidence that the issues to which the report relate have manifested in any form of litigation.

“This in circumstances where some years have passed since the report was received by the respondent [PPC]. For these reasons, the annexures to the report are not subject to the ‘privilege’ alleged by the respondent [PPC],” he said.

PPC argued in its answering affidavit that it opposed the disclosure of the report because its contents are irrelevant to the issues in dispute and it also has no bearing on the retrenchment of McCarthy or on whether her dismissal was automatically unfair or not.

The company said the retrenchment process commenced long before McCarthy lodged the complaint which gave rise to the report and the report was produced long after she had left PPC’s employment.

In regard to the other documents, Judge Seale said to determine the question of procedural fairness of McCarthy’s dismissal, the court will be required to determine at trial whether or not the retrenchment exercise in terms of which McCarthy was dismissed was a large-scale retrenchment in terms of Section 189A of the LRA based on the evidence that will serve before the court.

He said PPC cannot simply rely on the judgment of another case, to which McCarthy was not party, to preclude any assessment by this court of the alleged procedural unfairness of McCarthy’s dismissal.

Judge Seale said if McCarthy was dismissed in terms of a large-scale retrenchment exercise in terms of Section 189A, the documents she is requesting should prove this.

“The disclosure of these items ahead of trial is therefore in both parties’ interest. This is particularly so considering that it is the respondent [PPC] who has pleaded – by way of its amended statement of response – that the applicant [McCarthy] was dismissed in terms of a section 189A retrenchment exercise,” he said.

PPC contended that these documents are matters for evidence at trial.

Judge Seale said not only are these items required in advance of the trial to potentially narrow the issues in dispute but PPC’s refusal to produce these items also suggests that PPC has no intention to disclose or deal with these items in evidence at trial.

“In the circumstances, it is appropriate the respondent [PPC] be compelled to produce these items,” he said.

The judgment summarised McCarthy’s and PPC’s cases.

It said McCarthy contends that during approximately August 2017, she met with the chairman of PPC’s board of directors to inform him that she was aware of the identity of a person leaking confidential information to the media regarding merger talks between PPC and AfriSam.

After Bloomberg published two articles on the issue, which had delayed the merger discussions between PPC and AfriSam, the JSE responded by suspending PPC shares from trading due to sensitive information having been published in contravention of the JSE Listing Requirements.

McCarthy said she informed the chairman of PPC’s board of directors that PPC chief financial officer Tryphosa Ramano was the person who had leaked this information to the media and subsequently also informed PPC’s then CEO Johan Claassen and then PPC company secretary Jaco Snyman that Ramano was the source of the leak.

McCarthy claimed that by reporting this information in the manner that she did, she made a “protected disclosure” as contemplated under the Protected Disclosures Act (PDA).

McCarthy further claimed she informed Ramano that the information she had provided to the media was in contravention of the JSE Listing Requirements and the Takeover Regulation Panel’s requirements.

She claimed Ramano responded that she had confirmed with her lawyer that she had not contravened any regulations and Ramano did not deny having provided the information to the media.

The judgment said PPC’s case was that it denies that McCarthy’s dismissal was in any way related to the alleged protected disclosure or to her referral of an unfair labour practice claim against PPC.

PPC contended that the only reason for McCarthy’s dismissal was operational requirements based on the redundancy of her position.

PPC announced in October 2019 that Romano would step down from her role as chief financial officer of the company on October 31 2019, but would take on a consultancy role with PPC to ensure continuity.

The Financial Mail in January 2021 reported it had emerged that PPC had agreed to pay Romano a monthly “consultancy” fee of R321 499.95 for just 40 hours of work a month and questioned whether PPC shareholders were getting a raw deal.

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You go girl….we need more people like you in our listed companies. EOH, Tongaat, African Bank, Steinhoff take note! As for the Consultancy Fee paid to Romano – that just about says it all!

End of comments.

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