Allied Timbers Limited v Tapiwa Mavhondo

### Preamble
IN THE LABOUR COURT OF ZIMBABWE
JUDGMENT NO. LC/H/680/14
MUTARE, ON 16th SEPTEMBER , 2014
CASE NO. LC/H/54/12
AND 10 OCTOBER, 2014
JUDGMENT NO. LC/H/680/14
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IN THE LABOUR COURT OF ZIMBABWE                               JUDGMENT NO. LC/H/680/14

MUTARE, ON 16th SEPTEMBER , 2014			             CASE NO. LC/H/54/12

AND 10th OCTOBER, 2014

In the matter between

ALLIED TIMBERS LIMITED				–	APPELLANT

And

TAPIWA MAVHONDO					-	RESPONDENT

Before The Honourable L.M. Murasi, J

For Appellant   :	Mr H.B.R. Tanaya (Legal Practitioner)

For Respondent:	Ms L.S. Ncube (Legal Practitioner)

MURASI J,

Respondent was in the employ of the Appellant as a Production Manager before being elevated to the position of Acting Divisional Manager. Respondent was subsequently re-appointed to Production Manager which resulted in matter being referred to conciliation. Conciliation failed and the matter was referred to arbitrator. The Arbitrator found in favour of Respondent. Appellant is dissatisfied and has appealed to this Court. Appellant’s grounds of appeal are as follows:

The Arbitrator erred by entertaining and awarding a claim that had prescribed at law. The alleged overtime accrued in 2014.

The Arbitrator erred in challenging and reviewing the decision of another arbitrator in respect of the garnishing of leave days. The arbitrator had no powers of review at law.

The Arbitrator grossly erred in finding that the complainant (Respondent) was unfairly demoted when it is clear that the complainant had only served three (3) months probation period before he was transferred.

The Arbitrator grossly erred in awarding compensation for prejudice resulting from unfair demotion when it was apparent that the employee had not been confirmed after finishing his probation contract. The acts of the employer were in line with Section 12(4)(5b) of the Labour Act.

The Arbitrator grossly erred in awarding salary arrears that had no legal basis at law. It is trite that management enforces salary changes and not the Board of Directors. The Arbitrator therefore erred by basing his award (on) a smuggled Board Remuneration Matrix which was not an official document at law thus unenforceable. The claim for underpayment is therefore misplaced.

Appellant’s  Counsel submitted that he abided by the Heads of Argument filed of record. Appellant’s Counsel stated that as regards the first ground of appeal, the Arbitrator had not taken into account the provisions of Section 94 of the Labour Act [Cap 28;01]. If he had done, it was submitted, he would have dismissed the claim for overtime. As regards the second ground of appeal, it was stated that the issue of the leave days had been the subject of an arbitral award. It was argued that the Arbitrator had no jurisdiction to “review” another Arbitrator’s decision. As far as the third ground of appeal was concerned, it was submitted that the Arbitrator had erred in finding that the contract was of unlimited duration and that it was terminated as provided for by the law. It was also  stated in ground four of the appeal that the Arbitrator had erred in awarding compensation resulting from the finding that the contract had not been lawfully  terminated. In the fifth ground of appeal it was submitted that the Arbitrator had not shown how he had arrived at the figures as they were not in complainant’s submissions.

Respondent’s Counsel stated that Appellant had agreed to pay for the accrued vacation leave days but was now reneging on the previous undertaking. As regards the arbitral award dealing with vacation leave days, it was argued that Respondent had not been a party to those proceedings and was therefore not bound by the award. Further, it was stated that the Arbitrator was not bound by the decision of another arbitrator especially where it involves the interpretation of the law. Respondent’s Counsel submitted that there was no evidence that Respondent’s contract had been terminated either in terms of the contract or the law. This therefore meant that the contract was unlawfully terminated.

The Court will deal with the grounds of appeal seriatum.  Was the Arbitrator correct in entertaining the claim for overtime worked? Respondent is alleged to have worked overtime in 2004. There is no allegation that he worked overtime during a subsequent period for which no payment was made. Was this therefore continuing as envisaged in Section 94 of the Act? I think not. It was an amount which accrued at a certain time which was to have been claimed within the prescribed period of time. The following was stated in MURRAY AND ROBERTS (CAPE) v UPINGTON MAN 1984 (1) SA 571 at pages 578  F – G:

“Although many philosophical explanations have been suggested for the principles of extinctive prescription .. its main practical purpose is to promote certainty in the ordinary affairs of the people. Where a creditor lays claim to a debt which has been due for a long period, doubts may exist as to whether a valid debt ever arose, or if it did, whether it has been discharged. The alleged debtor may have come to assume that no claim would be made, witnesses may have died, memories would have faded, etc. The sources of uncertainty are reduced by imposing a time limit in the existence of a debt and the relevant time limits reflect to some extent, the degree of uncertainty to which a particular type of debt is ordinarily subject.”

I now turn to the second ground of  appeal where it was alleged that the Arbitrator “reviewed” another Arbitrator’s decision. It is common cause that the matter involving the leave days was supposed to be dealt with by the Arbitrator. It was part of Respondent’s claim. It was also part of Respondent’s claim that the decision by the Appellant to “garnishee” excess leave days was in contravention of both the provisions of the Labour Act and the contract. The Arbitrator was duty bound to make a determination on the matter. Appellant’s argument is that this matter was dealt with by a different arbitrator and Respondent had not appealed against the decision. I believe Respondent’s submission that he was not party to those proceedings in a reasonable explanation.

The question is, is a decision of one Arbitrator binding on another? Section 98(9) of the Labour Act provides that Arbitrators, in hearing and determining any dispute, shall have the same powers as the Labour Court. The Act is silent on the binding nature of the decisions. Rule 35 f the Labour Court Rules provides that decisions of the Labour Court are binding on labour officer, arbitrators, disciplinary authorities and other determining authorities. I am convinced that the decision of the Arbitrator in a case similar or identical can only have persuasive authority. What then is the correct interpretation? Section 14A(2) provides:

“Unless more favourable conditions have been provided for in any employment contract or in any enactment, paid vacation leave shall accrue … to a maximum accrual of ninety days ‘paid’ vacation leave.”

A reading of the above provisions shows that it is clear and unambiguous. Any action purporting to circumvent this will be falling foul of the law. It was stated in SCHIEHOUT v MINISTER OF JUSTICE 1926 AD 99 at 109:

“It is a fundamental principle of our law that a thing done contrary to the direct prohibition of the law is void of no force or effect ……”

It is my view that the Arbitrator was correct in interpreting this provision and this ground of appeal must fail.

The third and fourth grounds of appeal are intertwined as the payment of compensation in the fourth ground emanates from a finding in the third ground. Respondent was appointed Acting Divisional Manager. When this contract was subsisting, he was re-appointed Production Manager which was a lower grade. Appellant does not deny that no formal termination of the contract of Acting Divisional Manager was made. It was sought to be argued that the appointment of Respondent as Production Manager meant that the contract of Acting Divisional Manager had been terminated. I am unable to grasp and digest this submission. It is clear that Appellant did not comply with the provisions of both statute and the termination of that contract was unlawful. This brings me to the issue of compensation due to Respondent as a result of such unlawful dismissal. It is clear that the Arbitrator does not state how he arrives at the figure of $4 460.14 when Respondent had claimed a figure of $7 234.00 the Arbitrator was not entitled to “pluck a figure out of the air”. In the result, the third ground of appeal fails whilst the fourth ground of appeal succeeds.

In respect of the last ground of appeal, Appellant avers that the Arbitrator was not entitled to rely on a “smuggled” document. Respondent produced a schedule of salaries which he claimed were to be paid by Appellant. The Arbitrator makes a finding that Appellant did not dispute that the document was a genuine one. The question then is where is the Arbitrator’s misdirection when he relied on documentary evidence emanating from Appellant’s offices? The Court is of the view that the Arbitrator’s finding in this regard is unassailable.

In conclusion, the Court finds merit in the first ground of appeal, dismisses the second and third grounds of appeal whilst finding the fourth ground of appeal to be with merit. The fifth ground of appeal is also dismissed. There is therefore need for a recalculation of the amounts due to Respondent. I have already noted that the Arbitrator has not indicated how he arrived at the final figure as compensation for unfair demotion. There is need to lead evidence in this respect.

In the result, the appeal partially succeeds and the Court makes the following order:

The decision by the Arbitrator to award Respondent payment of overtime be and is hereby set aside.

The decision by the Arbitrator to award Respondent as cash in lieu of leave is hereby upheld. Both parties are to present evidence as regards the quantum before the Arbitrator.

The decision by the Arbitrator holding the termination of Respondent’s contract as Acting Divisional Manager as unlawful is hereby upheld.

The decision by the Arbitrator to award Respondent an amount of $4 460.14 as compensation is hereby set aside. Both parties to present evidence before the Arbitrator as to the quantum of the damages.

The decision by the Arbitrator to award the Respondent payment of salary arrears is hereby upheld.

The submission of evidence before the Arbitrator stated in paragraphs two (2) and four (4) shall be done within sixty (60) days from the date of this order.

That there be no order as to costs.

Mugadza, Chinzamba & Partners  - Appellant’s legal practitioners

Thondhlanga & Associates – Respondent’s legal practitioners