Karo Platinum (Private) Limited v Upenyu Havazvidi and The Retrenchment Board

### Preamble
IN THE LABOUR COURT OF ZIMBABWE
JUDGEMENT NO. LC/H/377/25
HARARE, 03 OCTOBER, 2025
CASE NO. LC/H/654/20025
In the matter between;
---------


IN THE LABOUR COURT OF ZIMBABWE	JUDGEMENT NO. LC/H/377/25 HARARE, 03 OCTOBER, 2025		CASE NO. LC/H/654/20025

In the matter between;

KARO PLATINUM (PRIVATE) LIMITED	APPLICANT

AND

UPENYU HAVAZVIDI	1ST RESPONDENT

AND

THE RETRENCHMENT BOARD	2ND RESPONDENT

Before the Honourable G. Ziyaduma, Judge:

For the Applicant	-S. Bhebhe, Legal Practitioner

For the 1st Respondent	-T. Muchini, Legal Practitioner

For the 2nd Respondent	- No Appearance

ZIYADUMA J

This is an application for review of the proceedings of the Retrenchment Board brought in terms of section 92EE (1) of the Labour Act [Chapter 28:01] as read with Rule 20 of the Labour

Court Rules. The Retrenchment Board delivered its decision date stamped 8 July 2025. In its determination, the Retrenchment Board found that the applicant failed to follow the dictates on the retrenchment procedure as provided for in section 12D and 12C of the Labour Act as read with Statutory Instrument 191 of 2024. It nullified the retrenchment and ordered the employer to comply with the Regulations.

PRELIMINARY POINTS

Before the hearing the parties had raised preliminary points. However, on the date of the hearing, both parties agreed to abandon the preliminary points. They were of the considered view that the matter be heard on its merits. In view of this attitude taken by the parties, this court will not belabor itself with the preliminary points.

BACKGROUND

The applicant (hereinafter referred to as the employer) and the first respondent entered into an employment contract wherein the first respondent was engaged by the company as a Commercial Manager. The employer decided to terminate the employment relationship with 1st respondent by way of retrenchment. To that end, it notified the Retrenchment Board of its intention to retrench and attached a list of 16 employees on the notice who were to be affected by the retrenchment. The 1st respondent was amongst the 16 employees who were to be affected by this retrenchment process.

The 1st Respondent, aggrieved by the decision to terminate the employment relationship this way, approached the Retrenchment Board for intervention. He challenged the entire retrenchment process and argued that it was an unlawful process. He stated that he was not given reasons for the retrenchment process. He also complained that he was not consulted, notified or given the right to negotiate on the terminal package. He also claimed the employer failed to utilize the provisions of section 12D which are mandatory measures to avoid retrenchment. He prayed that the Retrenchment Board rejects the application for retrenchment filed with the Board.

The employer before the Board argued that the Retrenchment Board had no jurisdiction to entertain the application that was brought before it. It argued that section 12C and 12D does not give the Retrenchment Board inherent jurisdiction to entertain all retrenchment disputes. The employer also argued that it was not mandated to engage in prior consultations with the employee.

It relied for that proposition on section 12C (2) of the Labour Act [Chapter 28:01]. He however submitted that the employee was nevertheless engaged during the retrenchment stages.

The retrenchment Board ruled that it had jurisdiction to “consider all matters related to the retrenchment of employees referred to it in terms of section 12C.’’ It further held that in terms of section 4(a) of S.I 191 of 2024, its function was to “consider and resolve matters related to retrenchment referred to it in terms of section 12C,12CC and 12D of the Labour Act [Chapter 28:01].’’ It also held that it had inherent jurisdiction to adjudicate over all retrenchment disputes. The Board found that even though the employee was served with a notice of intention to be retrenched, the employer had not engaged in prior engagements with the employee prior and during the retrenchment process. The Board ruled that this requirement was in terms of section 12C and 12D of the Labour Act. It also made a finding that the employee was a managerial employee hence was not part of the Works Council. It held that engaging him directly was a necessity. It also observed that the employee had continued to work even after the effective date of the retrenchment. The Board finally nullified the retrenchment process for the reason that the affected employee had not been engaged. It made a finding that engaging him was mandatory in terms of section 12C and 12D of the Labour Act.

GROUNDS OF REVIEW

Irked by the finding of the Retrenchment Board, the applicant approached this court with a view to having the decision of the Retrenchment Board set aside. The grounds for seeking this remedy are that:

The Retrenchment Board lacked jurisdiction to hear the matter, it being a creature of statute, it does not have inherent power to deal with all retrenchment disputes. Instead, it can only deal with disputes which it is expressly empowered to deal with.

The Retrenchment regulations only empower the 2nd Respondent to consider and resolve matters related to retrenchment referred to it in terms of section 12C,12CC and 12D of the Labour Act [Chapter 28:01].

The purported complaint by the first Respondent was not and could not have been referred to the Retrenchment Board in terms of section 12C, 12CC or 12D of the Labour Act, in that the sections do not empower the Retrenchment Board to adjudicate a dispute regarding

the lawfulness of a retrenchment exercise or whether the retrenchment procedure was followed properly.

The Retrenchment Board acted irrationally and contrary to evidence by finding that the due process was not followed.

RELIEF SOUGHT

Applicant prays that the application for review be and is hereby granted.

It also prays that the determination delivered by the Retrenchment Board sitting at the Ministry of Public Service, Labour and Social Welfare be and is hereby set aside and substituted with the following order:

“The matter be and is hereby struck off the roll for lack of jurisdiction.”

In the alternative applicant prays that the determination delivered by the Retrenchment Board, sitting at the Ministry of Public Service, Labour and Social Welfare dated 8 July 2025 be and is hereby set aside and substituted with the following order

“The matter be and is hereby dismissed.’’

The 1st and second Respondents to pay costs of suit in the event that either opposes this application.

On the other hand, the Respondent contended that the employer undertook an unlawful retrenchment process. Further averred that the Retrenchment Board had jurisdiction to hear and determine the application placed before it. The Respondent further averred that the employer should have complied with the provisions of section 12C and 12D conjunctively.

The Respondent prays that;

The Application be dismissed with costs on a higher scale.

The court confirms the determination given by the 2nd Respondent to the effect that the 1st Respondent be reinstated and the retrenchment process be regularized in line with the provisions of the act.

This Court now proceed to deal with the merits of the case.

ON MERITS

From the many words used in the grounds of appeal, only two grounds of appeal can be gleaned from the notice of appeal. The first ground of appeal is whether or not the Retrenchment Board had jurisdiction to entertain the kind of dispute that was brought to it by the 1st Respondent. The second ground is whether the Board acted irrationally and contrary to evidence by finding that the due process was not followed.

WHETHER OR NOT THE RETRENCHMENT BOARD HAD JURISDICTION TO HEAR THE MATTER.

At the outset it is important to note that the employer intended to retrench 16 employees. As a result of that, the provision of section 25A (5) of the Labour Act kicks in. It is couched in the following manner:

“Without prejudice to the provisions of any collective bargaining agreement that may be applicable to the establishment concerned, a works council shall be entitled to be consulted by the employer about proposals relating to any of the following matters –

(a)… (b)…. (c)…… (d)….

(e) the retrenchment of employees, whether voluntary or compulsory; (g)….

Provided that any matter involving the retrenchment of five or more employees within a period of 6 months shall be governed by section twelve C and 12D, unless otherwise agreed by the employer with the members of the works council representing the workers committee.’’

The key takeaway from this provision is that if the employer is retrenching less than 5 employees, it is mandatory for it to CONSULT the works council about the retrenchment process, whether it be voluntary or compulsory retrenchment. In casu the employer wanted to retrench 16 employees hence it is bound by the provisions of section 12C and 12D of the Labour Act [Chapter 28:01]. In summary section 12C provides that an employer who intends to retrench should give a 14 days’ notice to retrench. This notice is given to the works council or in its absence, the employment council. Where a better retrenchment package is negotiated and agreed upon, the

Retrenchment Board shall be notified of such in writing within 14 days. The employer is also mandated to notify the Board of the fact that they were not able to agree to a retrenchment package.

Section 12D provides in summary that every employer shall ensure that, at the earliest possible opportunity, his employees are kept informed of and consulted in regard to any major changes in production, programmes, organisation or technology that are likely to entail the retrenchment of any employees.

It is important to indicate that the wording of the proviso to section 25A (5) is clear and is not subject to ambiguity. Simply put, the starting point for any employer who intends to retrench employees irrespective of the number of employees to be retrenched, is to consult the works council first. See Ronald Kandemiri v First Capital Bank Limited SC 22/25 @ paragraph 28.

However, the legislature then put a proviso to the section. In Kandemiri v First Capital

(supra) the court stated as follows;

“However, the legislature saw it fit to then insert the proviso to except out of the preceding s 25A

(5) of the Act five or more employees. The use of the word ‘shall’ in the proviso signifies the need for strict compliance with the section. It therefore follows that when a retrenchment involves five or more employees, the provisions of s 25A (5) of the Act requiring the employer to consult the works council do not apply. As provided in the proviso, the retrenchment of five or more employees is in terms of ss 12C and 12D of the Act.’’

It is important to highlight that where an employer intends to retrench five or more employees in the absence of an agreement, he shall make use of both section 12C and 12D conjunctively. This comes out from the use of the word “and’’ between 12C and 12D. The use of the word “and’’ in the proviso cannot be read disjunctively. I am fortified in this by what Chinhengo J (as he then was) stated in Makupe v ZB Bank Ltd HH 257/16 in the following manner;

“	The ‘golden rule’ for construing all written engagements is that the words used must be

given their ordinary grammatical and ordinary meaning unless there are reasons for departing from that meaning. A ground for not adhering to the grammatical and ordinary sense of the words used in an enactment could be found where such meaning would lead to an absurdity or some repugnancy or inconsistency with the rest of the instrument or would otherwise defeat the intention of the legislature. See ZRA & Anor v Murowa Diamonds (Pvt) Ltd 2009 (2) ZLR 213 (S) @ 217D- 218A	Thus, the word ‘and’ may be read as ‘or’ and ‘or’ as ‘and’ if the

context renders it absolutely necessary. In the context of subrule (5e), no absurdity or repugnancy or inconsistence results from giving the word ‘and’ its ordinary grammatical meaning. I believe there would be an injustice if a judgment debtor would be allowed to escape the ordinary consequences of execution by merely proving the likelihood of great hardship without making a

reasonable offer to settle the debt or satisfying any of the other requirements disjunctively provided for in ss (ii) and (iii) of para (b) of subrule (5e)	Such an approach would drown the efficacy

of judicial execution of judgments in a sea of biased equity.’’

There is nothing in the wording of the wording of the proviso to section 25A (5) that tend to suggest that the word ‘and ‘ought to be used disjunctively. Giving the word ‘and’ its ordinary grammatical meaning would not lead to an absurdity or repugnancy with the rest of the instrument. In the result, because the legislature has used the word and between 12C and 12D means that both sections ought to be complied with in a retrenchment process.

It was submitted on behalf of the applicant that the employer substantially complied with section 12C. The court is in agreement with this. However, what the applicant failed to demonstrate was that it also complied with the provisions of section 12D (1) of the Act. It would be remiss for the court to ignore such failure to comply with a peremptory provision of section 25A (5) (f) and the proviso thereto. It is peremptory for any employer who intends to retrench an employee to not only follow procedural requirements outlined in section 12C but to also show that he managed to satisfy the requirements of the provisions of section 12D (1). The court agrees with the applicant that the Applicant was only supposed to ‘notify’ the works council in terms of section 12C. There is no requirement to negotiate and consult with the employee in terms of section 12C.

What the employer failed to do was simply to demonstrate that it also complied with section 12D (1). Where an employee complains that an employer did not inform him or consult him pursuant to section 12D on any major changes to the production, programs, organization, or technology which changes were likely to result in retrenchment, he cannot be estopped from approaching the Retrenchment Board for resolution of this kind of dispute as it is a dispute referred to the Board in terms of section 12D of the Labour Act. It is a matter related to retrenchment which can be resolved and considered by the Retrenchment Board in terms of section 4(a) of Statutory Instrument 191 of 2024.

There is nothing in the wording of section 12D as a whole that tends to give the impression that an employer can simply ignore the peremptory provisions of the section 12D (1) without opening themselves to litigation in the retrenchment board. It is open for any aggrieved party who feels hard done by the failure to comply with it, to initiate proceedings to ensure the defaulting party complies with this mandatory provision. If an employer fails to satisfy the Retrenchment Board that they kept their employees informed and consulted at the earliest possible opportunity

about any major changes in production, programs, organization or technology that are likely to lead to retrenchment of any employees, the subsequent retrenchment process will be tainted and thus open to be vacated.

The provisions of section 12D (1) have to be read in light of the provisions of section 2A (1) (e)

of the Labour Act which sets out the purpose of the Labour Act in the following terms;

‘The purpose of this Act is to advance social democracy in the workplace by-

….

…

….

….

the promotion of the participation by employees in decisions affecting their interests in the workplace;’

It is thus important at the workplace for an employer to act in accordance with the spirit of section 2A (e). In the context of a retrenchment process, this can be done partly by the employer engaging the employees by giving them information about changes in either production, programs, organization, or technology that are likely to lead to the company retrenching its employees. A decision to retrench impacts on the interests of the employees at the workplace. It would only be fair if the employees are kept abreast of the potential of a future retrenchment process. This accords with the spirit of the Labour Act. From a practical standpoint, it occurs to the court that before the employer engages section 12C, which outlines the practical steps that the employer resorts to in the retrenchment process, it should be able to show that before taking those steps in 12C, he had engaged the employees on the measures it was engaging in at the earliest possible time that it formulated the view that he may end up retrenching employees. From a practical point of view, it would occur to this court that the first step in the retrenchment process is section 12D. Section 12 D (1) merely requires employers to inform and consult employees about major changes that may result in the retrenchment of the employees. This requirement is not burdensome on the employer and it also does not impose financial obligations. The section is peremptory hence employers are supposed to demonstrate that they have complied with it before engaging section 12C.

After measures that it would have engaged have been shown to be ineffective, it then resorts to section 12C for the implementation of the retrenchment process. An employer cannot jump onto section 12C without having firstly engaged section 12D. The applicant has not argued that it engaged section12D. It has argued that he complied substantially with section 12C only. This makes his decision susceptible to be set aside for failure to comply with the mandatory provisions of section 12D (1) of the Labour Act. It is this court’s finding that the employer omitted to comply with this mandatory provision and thus the Board had jurisdiction to set aside the retrenchment process.

WHETHER OR NOT THE DETERMINATION WAS GROSSLY IRREGULAR ON ACCOUNT OF IRRATIONALITY

The applicant argues that the decision of the Retrenchment Board was grossly irregular and irrational. It based this on the fact that all relevant procedures in the retrenchment process were followed in terms of 12C. It argued that due process had been followed hence the finding of the Board ought to be set aside.

In Basera v The Registrar of the Supreme Court of Zimbabwe SC 35/22 the court citing Johannesburg Consolidated Investment Company v Johannesburg Town Council 1903 TS 111 @114 remarked that a Court or a Judge reviews the proceedings or decisions complained of and sets them aside or corrects them, if:

a public official disregards important provisions of a statute that imposes obligations on him or her

a public official is guilty of gross irregularity and his decision will be irrational where the decision-making body has arrived at a decision ‘’ so outrageous in its defiance of logic or of accepted moral standards that no sensible person who has applied his mind to the question to be decided could have arrived at it’’.

There is nothing to suggest gross irregularity in the decision of the Retrenchment Board. After analyzing evidence presented before it, it firstly concluded that it had jurisdiction to deal with the matter before it. It also acknowledged that the applicant had been served with the requisite notice in terms of section 12C. It however found that there were no prior engagements in terms of section 12C and 12D. It also made a determination that the procedure as laid out in section 12D

and 12C had not been followed. While this court acknowledges that the procedure in section 12C was substantially complied with, it made a finding that no attempt to follow the procedure in section 12D had been made. The two sections ought to have been be complied with by the employer. The decision of the Retrenchment Board cannot be set aside on the basis that there was no compliance with section 12D (1). The decision of the board cannot be said to be grossly irregular warranting its setting aside by this court.

DISPOSITION

The applicant has failed to sustain the grounds of review. In this matter the decision of the Retrenchment Board cannot be set aside. It is this court’s decision that the applicant ought to have satisfied requirements for section 12C and 12D. It has failed to do so.

The Respondent prayed for this court to confirm the determination by the Retrenchment Board. The Respondent also prayed for an order of reinstatement. This court is a creature of statute, deriving its powers from the four corners of the Labour Act. It cannot operate outside the powers conferred on it by the Act. Review powers exercisable by the Labour Court are the same as those of the High Court. Section 28 of the High Court Act empowers the court on review to set aside or correct the proceedings or decisions. The court has no power to confirm a determination in the exercise of its review powers. It also has no power to order reinstatement as this naturally follows from the decision to set aside the retrenchment process. This is what the Retrenchment Board did.

The court therefore, dismisses the prayer for confirmation of the Retrenchment Board’s decision. Additionally, the court dismisses the prayer for the reinstatement of the Respondent for the reasons given above.

IT IS ORDERED AS FOLLOWS:

The application for the review of the decision of the Retrenchment Board be and is hereby dismissed.

Costs to follow the cause on an ordinary scale.

For the Applicant	-S. Bhebhe, Legal Practitioner (KANTOR AND IMMERMAN) For the First Respondent	-T. Muchini, Legal Practitioner (MUCHINI ATTORNEYS)