Botanical gardens loan shark goes to court but fails to get job back

A former employee of the South African National Biodiversity Institute (Sanbi) in the Free State lost his bid to get his job back after his dismissal for being part of a loan shark scheme which charged fellow employees 50% interest rate.

Manapole Daniel Kawang was dismissed from the Free State National Botanical Gardens as a specialist machine operator in August 17 2021. He was fired for being party to a stokvel which lent money to employees at the workplace in 2017. The Botanical Gardens is managed by Sanbi.

The institute found him guilty of having “participated in the unlawful moneylending scheme within Sanbi's premises for own benefit during official working hours.”

The institute, in court papers, argued Kawang and a fellow employee violated the company’s policy “which says that an employee shall not commit any deed to the detriment of Sanbi or the discipline or efficiency of Sanbi, or allow such deed to be committed.” 

He lost the case at the Commission for Conciliation, Mediation and Arbitration. He took the case on appeal to the labour court but lost again. The judgment was delivered last week. 

The company said it learnt of the loan scheme from a whistle-blower.

“On June 11 2019, the employer received a whistle-blower report indicating that a loan shark was operating at the botanical gardens. The matter was investigated by Mazars forensic services, who produced its report in September 2019. It found that a senior artisan was involved in lending money to employees, at interest rates of 50%.” 

During the investigation, the senior artisan implicated Kawang, who was also a shop steward at the time.

“The applicant [Kawang] submitted that he did not break the rule. The applicant initially maintained that he was involved in a stokvel, but under cross-examination he conceded that some people had borrowed money from the scheme. He further conceded that interest was charged during 2017 on the borrowed money but averred that he did not agree with the decision and as such terminated his membership,” read the judgment.

Though Kawang left the stokvel in December 2017, being uncomfortable with the changes, and it continued after him, acting judge AJ Myburgh found him guilty because he had financially benefited in 2017. 

“I should mention that even if the moneylending scheme was somehow not in breach of the NCA, the commissioner’s decision to uphold the applicant’s dismissal would, nevertheless, have been reasonable,” the judgment read,

“For the duration of 2017, the applicant participated in the moneylending scheme at work — with fellow employees apparently having been charged exorbitant interest rates — and there was evidence of it having caused disruptions to the workplace (even if this was caused by the applicant’s partner [senior artisan]).

“Though it might be considered harsh, a decision to the effect that this constituted serious misconduct warranting dismissal, nevertheless, falls within a range of reasonableness and is thus not reviewable.” 

The court also rejected his version that he was a member of a stokvel. 

“The definition of a stokvel in the South African context is ‘a savings or investment society to which members regularly contribute an agreed amount and from which they receive lump sum payment’. The definition of a stokvel does not include the lending of money to others.” 

The legal papers cited the department of trade & industry, on May 11 2016, published a notice that the threshold for registering as a credit provider with the National Credit Regulator (NCR) is R0, for all the applicable credit providers involved in lending money.

“Only a loan which does not include interest or a fee for late or deferred payment will be exempt as it would not fall under the definition of a ‘credit agreement’ in the National Credit Act (NCA) and registration as a credit provider will not be required. It is therefore clear that, by its very definition, the applicant was involved in an illegal money lending scheme.” 

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