City of Harare v A Gwatiringa and 2 Others

### Preamble
IN THE LABOUR COURT OF ZIMBABWE
JUDGMENT NO.LC/H/654/2013
HARARE, 2 OCTOBER 2013
CASE NO.LC/H/429/2013
AND 31st JANAURY, 2014
JUDGMENT NO. LC/H/654/2013
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IN THE LABOUR COURT OF ZIMBABWE	  JUDGMENT NO.LC/H/654/2013

HARARE, 2 OCTOBER 2013				CASE NO.LC/H/429/2013

AND 31st JANAURY, 2014

In the matter between:-

CITY OF HARARE							Appellant

And

A GWATIRINGA AND 2 OTHERS				Respondents

Before The Honourables Manyangadze : J

Makamure : J

For Appellant		C. Kwaramba (Legal Practitioner)

For Respondent		J. Mambara (Legal Practitioner)

MANYANGADZE J.;

This is an appeal against an arbitral award of 27 May 2013 in which the Appellant was ordered to pay the Respondents acting allowances and appoint them to the substantive position of Finance Manager Grade 4.

The Respondents are employed by the Appellant, and each currently holds the post of Senior Accountant Grade 7.  The first and second Respondents are acting in the position of Principal Accountant (Grade 6).

The Respondents raised a grievance of unfair labour practice, which was referred to conciliation.  Their complaint was basically that they were entitled to acting allowance from 2006 to 2012 as they were performing duties of a higher grade.  They all claimed that they were entitled to substantive appointment to the position of Finance Manager (Grade 4).

The matter was referred to arbitration after the parties failed to settle at conciliation, leading to the arbitral award which is the subject of this appeal.

In its grounds of appeal, the Appellant avers that the Arbitrator erred in ordering the payment of acting allowance to the Respondents when they never performed the duties of a higher grade.  Appellant also argued that Respondents were not appointed to act in a higher grade in terms of the applicable regulations.

Secondly, Appellant contends that the Arbitrator misdirected himself by holding that the Respondents had legitimate expectation to be appointed to the position of Finance Manager (Grade 4).

Thirdly, Appellant avers that the Arbitrator’s award is so unreasonable and irrational in its defiance of logic to constitute a ground of appeal.

In their response to the appeal Respondents contend that:

“1. The appeal is misplaced, frivolous and vexatious.

2. The appeal apart from the saying so, is not a question of law.”

I must say the response to the appeal is so terse one must look at their Heads of Argument to appreciate where the Respondents are coming from.

In their Heads of Argument, Respondents elaborate on their terse notice of response.  They assert that the appeal is “patently frivolous and vexatious” in that Appellant is refusing to pay the Respondents for services it benefited from.  Appellant is also refusing to promote Respondents to positions in which they acted for more than 6 years.  Put differently, Appellant is prosecuting an appeal which it knows is devoid of merit.

Respondents also argue that the appeal is ill – founded in that it does not lie on a question of law.  The Appellant is challenging the Arbitrator’s findings of fact, which according to the Respondents, were properly assessed.

Respondents further contend that they had a legitimate expectation to be promoted to the position of Finance Manager Grade 4.

Conveniently, I will start by looking at Respondents’ averment that the appeal does not raise a question of law, as it has the character of a point in limine. The Respondents have not specifically raised the issue as a point in limine.  It appears as the second issue in their Heads of Argument.  In his oral submissions, Counsel for the Respondents did not dwell on this aspect of their Heads of Argument, preferring to argue the other points, in particular the point that the Respondents were entitled to be appointed Finance Mangers, having acted in that position for a long time.

It seems to me no meaningful submissionscould be made on this point. It was clear that the question of whether Respondent had a legitimate expectation to be promoted involved an enquiry into what the law says on that issue.  The case cited by the Respondents, of Muzuvavs. United Bottlers (Pvt) Ltd 1994 (2)ZLR 217 (S) in fact strengthens the argument that the issues raised in the appeal are mainly on law.  Entitlement to promotion in my view, involves a question as to what the applicable law is.  It fits in the second of the three senses in which the concept of the question of law is described in the Muzuva case.  In this sense; it means;

“A question as to what the law is.  Thus an appeal on a question of law means an appeal in which the question for argument and determination is what the true rule of law is on a certain matter”

The Court, in determining whether or not Respondents enjoy a legal right to be promoted by the Appellant, is clearly seized with a question of law.

In the circumstances, it is ruled that the appeal is properly before this court as it raises both questions of law and fact.

Going to the merits, this appeal cannot be satisfactorily determined without first looking at what the Appellant’s promotion policy and regulations say.

The applicable regulations are contained in the Collective Bargaining Agreement: Harare Municipal Undertaking Statutory Instrument 18 of 2007.  Clause 18 (d)(2) of S.I. 18/2007 provides:

“If an employee is required to carry out the duties of a position which commands a higher salary scale … his head of department shall appoint such employee, in writing to act in such a position.”

It is further provided in clause 18(d)(4) of the same Collective Bargaining Agreement.

“If an employee is appointed in terms of sub clause (1) of (2) …….. he shall be paid an acting allowance …”

It is quite clear from there provisions that the responsibility of acting in a higher position is preceded by a formal appointment.  It is specifically provided that such appointment shall be in writing.

The position which is the subject matter of this appeal is that of Finance Manager (Grade 4).  The crucial question, the question on which a resolution of this appeal in fact turns, is whether the Respondents were appointed to act in the position of Finance Manager (Grade 4), as required by the Collective Bargaining Agreement.

The Respondents have not been able to point to evidence that shows that they were appointed to act in the post of Finance Manager.  In their Heads of Argument, this fundamental issue has received scant, if any attention at all.  In paragraph 5 of the Heads of Argument, they deal, rather briefly, with the question of whether or not the Respondents are entitled to acting allowance from 2006 to 2012.

On this question, one would naturally and reasonably expect the Respondents to refer to some form of recognized or documented appointment, as a basis for claiming the acting allowance. Instead, the Respondents simply say they were rendering services to the Appellant, for which the Appellant chose not to remunerate them.  Still under paragraph 5 of their Heads of Argument, they refer the Court to the case of City of Harare vs. Zimucha S-32-95 where the Supreme Court held that employers should not unjustly enrich themselves at the expense of employees by refusing to pay for services rendered to them by the employees.

Indeed, an employer is under an obligation to remunerate an employee for services rendered, otherwise he would be guilty of breaching the contract of employment.  However, it would have been clearly agreed between the two what services are to be rendered, and what remuneration is payable.  If the employer fails to pay, the employee should be able to point to a specific agreement that obliges the employer to pay, which will be the basis for the employee’s claim.  Any claim by the employee would obviously be supported by evidence of this agreement.

A problem arises where the employee goes on to perform duties of a higher grade than one heor she currently holds.  Should the employee be remunerated for the extra responsibility, in the absence of a specific agreement to reward the extra load of duties in the form an acting allowance?  It seems to me it is this kind of situation the Collective Bargain Agreement looked at intended to deal with.A condition precedent for acting in a higher post, and consequentlyremuneration for so acting, is written appointment to act in the higher post.  There is no document in the record evidencing that appointment.

It is appreciated there have been attempts to improve the Respondents conditions of service.  The Respondents have referred to these attempts or “undertakings by the Appellant” as a possible basis for their claim to be paid an acting allowance and also be promoted to the substantive position of Finance Manager.

The undertakings relied on by the Respondents have a long history, dating back to 1994, in which Appellant endeavored to generally improve the conditions of service for Accountants in its employment.

The Respondents referred to the Council’s General Purpose Committee resolutions of 1994, Town Treasurer’s recommendation of 2000, Executive Committee resolution of 2004, and City Treasurer’s recommendation of 2001.  The City Treasurer’s Report of 18 November 2011 is of particular interest. Relevant portions thereof read:

“4. 	RECOMMENDATION

4.1.	That, the Committee approves the payment of acting allowances to the accountants who were omitted when other accounts in charge of Departments were paid actingallowances.

4.2. 	That, subject to 4.1 above the City Treasurer beauthorized to pay acting allowances to the employeesnamed in paragraphs 5.2 below.

4.3. 	That subject to approval of 4.1 and 4.2 above the matter be referred to the Finance Committee for its concurrence.

4.4. 	That the monthly acting allowances be paid on a monthlybasis to the employees listed in 5.2 up to April 2012.

5.3. 	The employees listed in paragraphs 5.2 above raised a grievance that some of the Accountants in the same grade as them and in the Central Accounts Division were in receipt of an acting allowance and they were not being

paid anything despite carrying out the same functionsas those being paid the allowance.  However some have been subsequently appointed to substantive position of Grade 4.

5.4.	Due grievance procedures were followed until the issue cascaded to the National Employment Council for conciliation.

5.5. 	Management then advised the aggrieved parties to withdrawthe cases from NEC for further discussions in order toreach an amicable solution to the grievance in order to	avoid further law suits.

5.6. 	The parties met and have thus agreed to the recommendations as in 4 above.

6.	I have recommended as in paragraph 4 above.”

As the relevant sub heading of the report, item 4, shows, it is only a recommendation to pay acting allowances to the affected employees, who include the Respondents.  Its implementation is subject to approval.  The Report shows it was signed on 4 May 2012, by Mr. M. Mubvumbi, the City Treasurer.  It was moving up to Mr. C. Chimombe the Human Resources Director, and Mr T. Mahachi, the Town Clerk, whose signatures do not appear.  It thus appears it is a report that is yet to be approved and implemented.

In the light of the applicable Collective Bargaining Agreement, any implementation would have to be firstly by letter of appointment as Acting Finance Manager (Grade 4), then payment of the appropriate acting allowance.

In their submissions to the Arbitrator, Respondents, it seems, are suggesting that S.I. 18 of 2007, the Collective Bargaining Agreement, is irrelevant.  Paragraph 24 of their submissions reads:

“The bottom line for other arbitrators was if the supervisor confirms that indeed a Claimant performed duties of a higher grade then that claimant was entitled to acting allowance whether or not the appointment was in writing.  It is not incumbent upon the claimant to make sure that all the necessary administrative steps had been done. “The crux of the matter is, was work or is work of a higher grade being performed.”(emphasis added)

The Respondents were infact urging the Arbitrator to disregard the clear provisions of the law.  The Respondents are basing their claim on the fact that they performed work of a higher grade.  The claim is not on the basis that they were appointed to act in that higher grade.  The record bears no evidence of such appointment.  The Arbitrator therefore misdirected himself by awarding an acting allowance, when no evidence of the entitlement to the acting allowance was placed before him.

InCity of Harare vs. Anberld Nyenyai, LC/H/129/13, MHURI Senior President (as she then was) set aside an arbitral award appointing Respondent into a position she was acting in, on the basis that the Respondent had not been appointed to act in such position.

After referring to clause 18 (2) of S.I. 18 of 2007, the Senior President stated:

“… Respondent was not appointed to act in the higher position. The Head of Department did not make any appointment at all.  He declined to appoint Respondent in compliance with clause 18 (2) despite Mr. Mupunga’s recommendation that Respondent be so appointed as he had instructed her to perform higher duties.”

The provisions of S.I. 18 of 2007 are mandatory.  There must be evidence of compliance with them before any acting entitles an employee to an acting allowance.  Thus, the issue of an acting allowance is resolved by application of the clear and unambiguous regulations governing such allowances.

The Respondents, as already indicated, have also raised the issue of entitlement to the substantive position of Finance Manger (Grade 4). They base their argument on the principle of legitimate expectation.  They have referred the Court to the case of Administrator vs. Traub 1989 (4) SA 731 (a) where it was stated:

“Legitimate or reasonable expectation may arise either from an express promise given on behalf of a public authority or from the existence of a regular practice which the claimant can reasonably expect to continue”

The Appellant referred to the same authority. In addition it cited the English case of R v Secretary of State for the Environment, ex parte Brent London Borough Council and Others (183) ALL ER 321 (QB) wherein it was stated at p. 354.

“The legitimate expectation doctrine is sometimes expressed in terms of some substantive benefit or advantage or privilege which the person concerned could reasonably expect to acquire or retain and which it would be unfair to deny such person without prior hearing; and at other times in terms of a legitimate expectation to be accorded a hearing before some decision adverse to the interests of the person concerned is taken.”

In my view, the matter again turns on the question of whether the Respondents were appointed to act in the post concerned.  This, it seems, is what the Arbitrator based his finding, that the Respondents had a legitimate expectation of substantive appointment to Finance Manager since they had acted in that grade for too long.

It has already been shown that the Respondents were not appointed to act as Finance Manager. No evidence was placed before the Arbitrator that they were so appointed.  Consequently, their basis for the legitimate expectation falls away.

Also, the common law principle on the right to promotion does not place the Respondents in a favourable position.  The principle is to the effect that the promotion of an employee is a matter within the discretion of an employer, and cannot be demanded, as of right.  It is a privilege, not a right, unless the contract of employment provides specific rights and obligations in that regard.  See Muwenga vs. PTC 1997 (2) ZLR 483 (S).

The Respondents’ predicament is not made easier by the fact that the position of Finance Manager is not on Appellant’s organogram. The organogram (p.37 of the record) shows the following hierarchy for accountants within the City Treasurer’s, Department.

City Treasurer

Deputy City Treasurer

Chief Accountant

Assistant Chief Accountant

Principal Accountant

Senior Accountant

Accountant

Accounting Assistant Clerical

For the Respondents to move from their current positions to the post in question,i.e. Finance Manager, there will have to be some restructuring of the City Treasurer’s Department.

It is not in dispute the post of Finance Manager (Grade 4) is not yet established in the Appellant’s organizational structure.  Respondents however, contend that Appellant can create and abolish positions.  In other words, it is within Appellant’s power to restructure its organization, creating and abolishing certain posts as it sees fit.  The Respondents referred to the Town Clerk’s Office as an example of a Department where such re-organisation took place.  (p. 15-16 of the record)

Again, this is a matter within the employer’s discretion.  The employer should not be compelled by a court order to embark on such an exercise.  Granting Respondents the reliefthey seek would be tantamount to ordering the Appellant to restructure, given that the position is not on his current structure.  This weakens rather than strengthens, any legitimate expectation the Respondents may claim to have to be appointed to the position of Finance Manger (Grade 4).

It is noted that the Respondents have worked for the Appellant for a very long time.  Each has put in more than 10 years of service.  They have established, and continue to develop, their accounting careers in the employment of the Appellant.  Appellant itself is somehow sensitive to that, hence the various undertakings, resolutions and recommendations made to improve the lot of the accountants.The legal instruments the Appellant can use to improve their status are available, within the Appellant’s internal policies and regulations.

The Court cannot however,for reasons indicated, order the appointments sought by the Respondents.  The Arbitrator made his award on the mistaken finding that the Respondents had been appointed to act in the higher grade.  That misdirection was on a fundamental issue, on which a resolution of the case turned.  It therefore warrants interference by this court.

In the circumstances it is ordered that:

The appeal be and is hereby allowed.

The arbitral award granted by the Honourable W.T. Pasipanodya dated 27 May 2013 be and is hereby set aside.

Each party shall bear its own costs.

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Manyangadze J.

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Makamure J.