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Tuesday, 02 July 2024 11:59

Labour Court orders reinstatement of Prasa's axed CEO Zolani Matthews.

By Lehlohonolo Lehana.

The Labour Court has dismissed the Passenger Rail Agency of South Africa (Prasa) bid to review and set aside an arbitration award that found it must reinstate former CEO Zolani Matthews in his position. 

Prasa fired Matthews in November 2021, after eight months on the job, for failure to disclose he also held citizenship of the UK and thus could not obtain a top security clearance. Matthews holds British and SA citizenship.

Matthews then filed court papers in which he was seeking his immediate reinstatement as CEO of Prasa and also asked the court to interdict the board from taking any action relating to termination of employment.

He wanted the court to stop the board from hiring another CEO to fill his position.

In more than 300-page bundle of court papers, Matthews challenged the board's reasons and powers for terminating his employment.

Few months later, the arbitrator, retired judge Robert Nugent, ruled that the rail agency should reinstate Matthews with backdated pay.

Prasa ignored this ruling and instead applied for a stay of the arbitration award. Prasa also applied to the labour court to review Nugent's award.

In judgement handed down on Monday, Labour Court set aside Prasa's review application and Matthews's "fixed contract remains extant [and that] this is not a case where the arbitrator or court would be reviving an expired fixed-term contract".

It also made the arbitration award an order of the court as it slapped Prasa with legal costs. 

The court decision leaves Prasa in a conundrum, as it now effectively has two CEOs.

In response, Prasa board said, it is reviewing the judgment handed down by the Labour Court.

"In promoting good governance, the PRASA Board is committed to ensuring that our actions align with legal obligations and the company's best interests. The Board Of Control (BOC) remains dedicated to ensuring that PRASA builds on its successful rail rebuilding turnaround.

"PRASA is focused on fulfilling its primary mandate of providing rail commuter services and long-haul passenger rail and bus services in the public interest. The BOC continues to discharge its fiduciary duties whilst upholding a high standard of fairness and integrity," the agency said.

Matthews was appointed by then Minister of Transport Fikile Mbalula. But Matthews was 64, and so he could not take up the position, because he is too old according to the rail agency's policies.

Section 18 of the policy states that, "Subject to the provisions of the approved Retirement/ Provident Funds, an employee shall retire on attaining the age of 63 years … Employees may, however, on request and with the consent of Management remain in the service after attaining the age of 63 years on contract basis, provided that the operational needs of the Company require that an employee’s services be retained."