Legacy International School v B. Fleming

### Preamble
IN THE LABOUR COURT OF ZIMBABWE
JUDGMENT NO. LC/H/159/2016
HARARE, 9 FEBRUARY 2016
CASE NO.
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IN THE LABOUR COURT OF ZIMBABWE      JUDGMENT NO. LC/H/159/2016

HARARE, 9 FEBRUARY 2016 			     	CASE NO. LC/H/686/14

AND 18 MARCH 2016

In the matter between:-

LEGACY INTERNATIONAL SCHOOL			-	Appellant

And

B. FLEMING							-	Respondent

Before Honourable L.M. Murasi, Judge

For Appellant	-	Miss L. Shambamuto (Legal Practitioner)

For Respondent	-	Mr. G. Makings (Legal Practitioner)

MURASI J:

This is an appeal against the decision of the arbitrator.  The facts in this matter are largely common cause.  Respondent was employed by the appellant as Principal of its school.  Appellant proceeded to unilaterally reduce respondent’s salary by about 50%.  Respondent took this matter up with appellant and stated in a letter addressed to appellant that if the matter was not amicably resolved as proposed in the letter she would proceed to resign from employment.  The matter remained unresolved and respondent left appellant’s employment and took the matter up for conciliation.  The matter was referred to arbitration and the arbitrator found in favour of respondent.  Appellant is dissatisfied with the decision and has appealed to this Court.

Appellant’s grounds of appeal are as follows:

The Learned Arbitrator misdirected self (?) factual (?) a misdirection that amounts to a point of law in making a finding that the circumstances that gave rise to respondent’s resignation amount to constructive dismissal when respondent’s resignation was voluntary.

The arbitrator grossly erred on the facts such misdirection amounting to a question of law in holding that after the unlawful salary reduction the logical thing was for respondent to resign and look for alternative employment to mitigate her loss yet at law respondent should have made a complaint in terms of section 93 of the Labour Act for unfair labour practice.

The arbitrator erred at law in making a finding that there was constructive dismissal yet the requirements of the doctrine of constructive dismissal were not met namely that there was intolerable working conditions, that it was not possible to seek a redress or that a redress was sought in terms of law and still the appellant proceeded with the intolerable working conditions.

Miss Shambamuto submitted that the decision by the arbitrator that there was constructive dismissal was a clear misdirection.  This was because the letter written by the respondent showed she had acknowledged the reduction in salary and had made a counter proposal.  It was further submitted that in the letter the respondent had acknowledged that school fees levied by appellant was not generating the revenue that was expected.  Miss Shambamuto stated that respondent had not resigned due to the unilateral reduction of her salary but that she had given a condition precedent before resigning.  It was further argued that the real reason was that the appellant had declined to peg respondent’s salary at $3 200.00.  It was further submitted that the arbitrator had misdirected herself in not finding that the appellant had failed to negotiate and this led to the resignation of the respondent.  Miss Shambamuto added that this therefore amounted to a voluntary resignation and could not amount to constructive dismissal.  It was further stated that there was no deliberate intention by the appellant to frustrate the respondent as the latter was aware of the financial situation which appellant was facing at the time.  Lastly, it was averred that respondent had an alternative remedy of pursuing alternative dispute resolution mechanisms through registering the matter as an unfair labour practice.

Mr Makings for the respondent stated that he abided by the heads of argument filed. It was submitted that respondent had been awarded a salary of $4 200.00 at the beginning of the year as another school wanted to procure her services.  The new salary had been paid by appellant for six months when this unilateral variation took place.  It was further stated that the new salary was not pegged on the inflows of revenue from payment of school fees.  Mr Makings further added that after being informed of the unilateral variation of the salary, respondent approached the appellant with a reasonable suggestion.  This was not accepted by the appellant.  It was argued that the actions of appellant were deliberate as the reduction of the salary plummeted from $4 200.00 to $1 700.00.  It was further submitted that this amounted to constructive dismissal because of the intolerable behaviour of the appellant.  Mr Makings further stated that the findings of the arbitrator in this regard cannot be faulted.  As far as seeking alternative dispute resolution was concerned, it was stated that respondent had tried to engage the appellant who did not want to negotiate.  It was further argued that where an allegation of a misdirection is made, it should be demonstrated that the person missed the point completely and this had not been shown to be the case in this instance.

It is crucial to examine the arbitrator’s findings in this regard.  The arbitrator makes the following finding:

“Based on the facts before this tribunal, claimant’s resignation was not voluntary but was induced by the respondent’s unlawful reduction of claimant’s salary.  The respondent put the claimant into a position clearly designed to demoralise her and this is a clear case of constructive dismissal and it amounts to unfair termination under section 12B (3) of the Labour Act [Chapter 28:01].

…

The respondent made claimant’s continued stay intolerable by unilaterally reducing her monthly salary and as a result the claimant did the logical thing and resigned.

The claimant is not raising the constructive dismissal claim as an after – thought.  At the time of her resignation, claimant advised the respondent that she was not happy with the unilateral reduction of her salary such that she was left with no choice but to resign from employment.

Claimant’s resignation was not voluntary but was induced by the unlawful deduction of her monthly salary by the respondent.  Claimant had to mitigate her loss hence her resignation.”

At the beginning of this judgment I stated that the facts in this matter are common cause.  The arbitrator summaries the facts and then makes the finding that the cause of the respondent’s resignation was the unilateral variation of the contract of employment brought about by appellant reducing respondent’s salary by about 50%.  Was there a misdirection on the part of the arbitrator?  Would another tribunal have come to a different conclusion on the same facts?  I think not.  The facts disclose that the proximate cause of the resignation was the reduction in salary.  Miss Shambamuto did not controvert the submissions by respondent’s Counsel that the salary of $4 200.00 awarded to respondent had been agreed  upon when there was an imminent threat of her being “snatched away” by another college.  It therefore cannot be said that the salary was pegged on revenue inflows from payment of school fees.  What is interesting is that appellant does not deny that this was a unilateral variation of the contract of employment.  There was no discussion with respondent, when respondent raised this and offered to negotiate the door was shut in her face.  What does this amount to if not forcing someone out of employment by such conduct?

In such matters, precedent shows that the onus of proof is on the employee to prove that there was constructive dismissal and that she had not resigned voluntarily.  It is also recognised that the essential features of a claim based on constructive dismissal is that the employee should have terminated the employment contract under circumstances where the resignation was not entirely voluntary but was caused by the actions or omissions of the employer.  The following have been held to be important considerations:

There must be a breach of contract by the employer.  This may be either an actual breach or an anticipatory breach.

That breach must be sufficiently important to justify the employee resigning or else it must be the last in a series of incidents which justify his leaving.

He must leave in response to the breach and not for some other unconnected reason.

He must not delay too long in terminating the contract in response to the employer’s breach otherwise he may be deemed to have waived the breach and agreed to vary the contract. (see generally Jooste vs Transnet Ltd T/A S.A. Airways (1995) 16 ILJ 629 (LAC) per Myburgh J).

That there was a breach of contract by the appellant is without doubt and therefore the first point is satisfied.  That the breach was sufficiently important is also clear as the appellant went on to reduce respondent’s salary by 50%.  That respondent left in response to the breach and not for some other unconnected reason is supported by the facts and her letter of resignation.  It is also clear that the respondent did not wait too long in terminating the contract in response to the breach.  The fourth point raised in the Jooste case supra aptly answers appellant’s averment that respondent should have sought other ways for alternate dispute resolution.  Once having embarked on the appellant’s suggested route, respondent could not then rely on constructive dismissal for unlawful termination of contract.  This is because after waiting too long she would have been deemed to have waived the breach of contract and agreed to vary the contract in that respect.  The evidence shows that respondent attempted to negotiate with the appellant but the latter was not willing to do so.

Can, in the circumstances, the decision of the arbitrator be termed a gross misdirection?  It is trite that an exercise of discretion can only be interfered with where gross unreasonableness, mala fides or capriciousness is proven (See generally Geza vs ZFC 1998 (1) ZLR 137 (SC).  Gross unreasonableness was described in Union Govt vs Union Steel Corporation 1928 AD 220 as follows:

“So gross that something else can be inferred from it, either that it is inexplicable except on the assumption of mala fides or ulterior motives … or that it amounts to proof that the person on whom the discretion is conferred has not applied his mind to the matter.”

I am of the view that there is no basis for this court to interfer with the decision of the arbitrator.  The arbitrator clearly understood what was presented to her in the form of evidence and came up with a rational decision.  Appellant has not demonstrated in what manner that decision can be categorised as being irrational in the circumstances.

In conclusion, it is my view that the decision by arbitrator to hold respondent’s resignation as being constructive dismissal is unassailable in the circumstances.

In the result the Court finds that the appeal is devoid of merit and ought to be dismissed.  The court makes the following order:

The appeal, being devoid of merit, be and is accordingly dismissed.

The arbitral award of Honourable Mukwehwa dated 27 June 2014 be and is hereby upheld.

Appellant to pay costs of suit.

Matsikidze & Mucheche, appellant’s legal practitioners.

G. Makings Legal Practitioner, respondent’s legal practitioner