Freddie Masangwi and 49 Others v Ruwa Local Board

IN THE LABOUR COURT OF ZIMBABWE                      JUDGMENT NO. LC/H/356/2013
HELD AT HARARE ON 27 JUNE, 2013                       CASE NO. LC/ H/508A/2011
In the matter between



FREDDIE MASANGWI AND 49 OTHERS                              –               Appellant
And

RUWA LOCAL BOARD                                            –               Respondent




Before The Honourable L. Matanda-Moyo, President
For Appellant        - A. Mugandiwa(Legal Practitioner)
For Respondent       - P. Ngarava (Legal Practitioner)


MATANDA-MOYO, L.




This is an appeal against an arbitral award which found as follows;


            “The contracts signed by the Claimants (Appellants herein) are in terms of Section
             16(2) (b) of the Labour Act.    The Claimants freely and voluntarily entered into
             contracts with less favourable conditions.    The Claimants are bound by their
             signatures, caveat subscriptor rule. The contracts signed by the Claimants are valid
             and binding on the parties as far as grades, rates of pay and other benefits are
             concerned. Caveat subscriptor rule does not diminish right to length of service not
             lawfully terminated.
            The Respondent erred by not taking into account Claimant’s length service with
             ZINWA and is hereby ordered to restore diminished length of service.”



The Appellants grounds of appeal are as follows;
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      1) That the Arbitrator misdirected herself on a point of law by failing to

         determine issues raised by Appellants that the contracts signed were

         invalid. Such contracts did not make provision for the salaries to be

         paid to the Appellants.     The Arbitrator erred in not finding the

         contracts signed null and void.

      2) That the Arbitrator misdirected herself on a question of law by finding

         that Appellants were bound by the contracts by virtue of the caveat

         subscriptor principle when it was clear the Appellants signatures to the

         contracts were procured by fraudulent misrepresentation by the

         Respondent.

      3) That the Arbitrator grossly misdirected herself on a factual point that

         no reasonable decision maker applying his mind to the facts of the

         matter could have arrived at such a decision in finding that the

         contents of the purported contracts were explained to the Appellants

         and further that they were given an opportunity to read or peruse the

         documents prior to signature.

      4) The Arbitrator misdirected herself on a question of law in failing to

         give due weight to the fact that the persons who signed the purported

         contracts as witnesses were before her as Claimants.



      The brief facts are that the Appellants are employees of the Respondent.

In 2007 water and sewer services were transferred from Respondent to ZINWA.

Appellants were also transferred to ZINWA.      In April 2009 water and sewer

services were transferred back to Respondent. Appellants were also transferred

to Respondent. Respondent paid Appellants allowances of $100 each up to 30

June 2009.   On 30 July 2009 Appellants signed new contracts.         Appellants


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submitted that they were advised to sign the contracts to facilitate payment of

their salaries. Respondent submitted that Appellants were advised that they

were signing new contracts with less salaries and benefits. Appellants agreed to

the terms of the contracts and voluntarily signed on 30 July 2009. From 1 July

2009 Appellants started receiving down graded salaries plus $25 housing

allowance plus $11 transport allowance. Appellants raised a complaint of unfair

labour practice by the Respondent.      The mater went for conciliation and

subsequently for arbitration. It is against the arbitrator’s decision that

Appellants appealed to this court.



      Respondent raised a point in limine that the appeal is improperly before

me as the grounds of appeal raise no points of law. I do not agree. I am

satisfied that the grounds of appeal as raised, raise issues of law and are

properly before me. See Muzuva United Bottlers(Private ) Limited 1994(1)

ZLR 217(S), Reserve Bank of Zimbabwe vs Comine Granger and Another SC

34/2001 and Halunick Investments (Pvt) Limited t/a Whelson Transport vs

Garai Stephen Nyamwanza SC 48/09.



Let me proceed to deal with the grounds of appeal as raised.



   1) WHETHER     THE    ARBITRATOR    DEALT    WITH   THE     ISSUE   WHETHER

      CONTRACTS SIGNED WERE VALID, AND WHETHER FAILURE TO MAKE

      PROVISONS FOR SALARIES TO BE PAID RENDERS THE CONTRAC TS NULL

      AND VOID?




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   The Appellants submitted that the Arbitrator erred on a point of law by

failing to determine the issues raised by them that the contracts they signed

were invalid. Appellants indeed argued before the Arbitrator that the contracts

signed between them and Respondent were null and void.                             Appellants had

argued that for a contract of employment to be valid, such contract should

include the remuneration paid to the employee in return for the services to be

rendered. Appellants also cited section 12(2) of the Labour Act which obligated

an employer upon engaging an employee to inform such employee among

other issues in writing “(e) particulars of the employee’s remuneration its manner of calculation

and intervals at which it will be paid.”      Appellants sought the nullification of the

purported contracts of employment as there was no agreement on an essential

element of a contract of employment, that is to say, the issue of salaries and

wages.



       From a reading of the arbitral award it is clear that the Arbitrator did not

make a determination on the issue. Such failure by the Arbitrator to make a

determination is a clear misdirection in terms of the law. I shall proceed to deal

with the matter. The Appellants argued that the contracts they entered into

with the Respondent are null and void as they failed to include the crucial issue,

the one on remuneration. Let me look at whether it is correct that the contracts

entered into by the parties did not deal with the issue of remuneration.

Paragraph 3 and 4 of the contracts dealt with the issue. They provide;
       “3. A temporary hardship allowance of $100 was initially given across the board for the
       month of April, May and June 2009 to those whose grades could not be reconciled with Ruwa
       Town Council structure.
       4. Council is therefore pleased to offer you all the benefits that go with the grade as outlined
       in 1 above.----“


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      Such contracts are dated 30 July, 31 July and 4 August 2009. Appellants

were transferred in April 2009. It is true that the contracts signed failed to

stipulate the salaries. In Catherine Mono Mutopotola vs Southern African

Development Community SC 6/07 the Supreme Court held that a contract of

employment which failed to stipulate a salary payable to an employee was null

and void. Such agreement also fell short of Section 12(2) of the Labour Act. I

am satisfied that the purported contracts signed by the parties do not meet the

requirements for a contract and are null and void.



      The Respondent strongly argued that the Appellants were transferred in

terms of Section 16(2) (b) of the Labour Act which provides;


      “nothing in subsection (1) shall be deemed to prevent the employees concerned from agreeing
      to terms and conditions of employment which are in themselves otherwise legal and which
      shall be applicable on and after transfer, but which are less favorable than those which
      applied to them immediately before the transfer.”


Section 16(1) provides;
      “(1) subject to this section whenever any undertaking in which any persons are employed is
      alienated or transferred in any way whatsoever , the employment of such persons shall, unless
      otherwise lawfully terminated be deemed to be transferred to the transfer of the undertaking
      on terms and conditions which are not less favourable than those which applied immediately
      before the transfer, and the continuity of employment of such employees shall be deemed not
      to have been interrupted ----.”



      Appellants were transferred in April 2009 to Respondents employment.

The purported contracts of employment were only signed end of July and

beginning August 2009.            When Appellants were transferred there was no

agreement in terms of Section 16(2) (b) of the Act. It means therefore that on

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transfer Section 16(1) was applicable. Appellant were transferred on the same

terms and conditions which applied immediately before their transfer. Any

agreement in terms of Section 16(2) (b) should be concluded on transfer and

such agreement is applicable on transfer and thereafter.                       The purported

agreements do not comply with the terms provided for under Section 16(2) (b)

and it cannot therefore be argued that such agreements are in terms of Section

16(2) (b). See Mutare Rural District Council vs Chikwena 2000(1) ZLR 534(S).



      Once I have made the above findings there is no point in determining the

rest of the grounds of appeal as it is apparent that the Arbitrator erred in

concluding that the contracts signed were in terms of Section 16 (2) (b), and

after my finding that such contracts are null and void.



Accordingly the appeal succeeds and the Arbitrator’s award is set aside and

substituted with the following;


      ‘That the Ruwa Local Board be and is hereby directed to comply with the provisions of
      Section 16 of the Labour Act by matching Claimants terms and conditions of employment with
      those they enjoyed whilst under the employ of ZINWA and further that Ruwa Local Board
      makes good any loss of salaries and benefits the Claimants have suffered since their transfer
      to the Local Board.”


The Respondent is ordered to pay costs of suit.




Wintertons– Appellant’s Legal Practitioners

Ngarava Moyo and Partners – Respondent’s Legal Practitioners


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