Mafanzou Fisheries v Patrick Njeresa & Gloria Chibviri

### Preamble
IN THE LABOUR COURT OF ZIMBABWE
JUDGMENT NO. LC/H/785/16
HARARE, 6 OCTOBER 2016
CASE NO.
JUDGMENT NO. LC/H/785/2016
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IN THE LABOUR COURT OF ZIMBABWE	    JUDGMENT NO. LC/H/785/16

HARARE, 6 OCTOBER 2016			    	    CASE NO. LC/H/207/16

AND 9 DECEMBER 2016

In the matter between:-

MAFANZOU FISHERIES					Appellant

And

PATRICK NJERESA	 				1st Respondent

And

GLORIA CHIBVIRI					2nd Respondent

Before The Honourable E. Muchawa, Judge

For Appellants	Mr E Donzvambeva (Legal Practitioner)

For Respondent	Mr R.K. Madyira (Trade Unionist)

MUCHAWA, J:

This is an appeal against an arbitral award.

The background to this matter is that the respondents were employed by the appellant until a time they were allegedly transferred.  The first respondent was transferred to a Mozambican entity called Kapenta De Nova Chicoa and worked there from February 2014 to June 2014 when the contract of employment was terminated.

The second respondent was allegedly also transferred at the same time to a different entity called Cherachesa Fisheries.  That employment relationship was also terminated sometime in August 2014 following a dispute between the parties.

Following the terminations of employment, the respondents lodged a complaint of unfair dismissals.  Attempts at conciliation were unfruitful before the designated agent for the National Employment Council Agriculture.  The matter ended up before arbitration.

The arbitrator found that the respondents had been unfairly dismissed.  He ordered that they be paid outstanding allowances amounting to $1 300.00. An order of reinstatement without loss of salary and benefits from the date of termination was made.  As an alternative the appellant was ordered to pay three months’ notice, accrued leave pay, gratuity, compensation for loss of employment and back pay.

That is the award appealed against before me on these grounds;

The Arbitrator misdirected, himself on a question of law, by making a finding that the first respondent was unlawfully dismissed from employment when he had earlier conceded that he could not analyse the employment relationship between the first respondent and an entity known as Kapenta De Nova Chicoa (a company that operates in Mozambique).  In making a contradictory finding the arbitrator committed a grave error of law.

The Arbitrator fell into error by coming to a conclusion that was not supported by the facts when he made reference to section 16 of the Zimbabwean Labour Act, which does not apply extra territorially to Mozambican companies.  In so doing, he misapplied the provisions of section 16 of the Labour Act which were not applicable to the matter that was before him.

The arbitrator erred, on a question of law, in finding that the defence of set off which was raised by the appellant was not available when it was clear that the respondents owed the appellant money in legal fees from previous proceedings between the parties.

The arbitrator erred on a question of law by concluding that the respondents were unlawfully dismissed when the evidence presented clearly showed that they had been transferred to other entities.  In so doing, the arbitrator committed a grave error of law.

The Arbitrator erred on a question of law, in failing to deal with the defences that had been advanced by the appellant to the claim and choosing instead to create arguments in support of the respondents’ claim which arguments were never made by the respondents themselves.  Failure to deal with a submission made by a party constitutes failure to deal with a matter in accordance with the law.

The appeal is opposed. I intend to deal with each ground of appeal starting with grounds 1 and 4.

Grounds 1 and 4 of appeal: Whether the respondents were unlawfully dismissed by the appellant

The arbitrator made a finding that the respondents were unlawfully dismissed by the appellant.

In their submissions before the arbitrator the respondents alleged that,

“The dispute arose when Njeresa was transferred to Mozambique by the respondent there in Mozambique Njeresa was terminated his employment by respondent unprocedural (sic) Chibviri was working in Kariba was also terminated her employment by respondent unprocedural violating section 27 of SI 116 of 2014 no hearing was conducted by respondent on terminating claimants allowances (sic)”

It is submitted that the conclusions of the arbitrator in this regard run contrary to the evidence on record which shows that the respondents had been transferred to other separate entities.

It is apparent from the respondents’ statement of the dispute that they concede and admit that first respondent was transferred to Empresa Kapenta De Nova Chicoa Ltd Mozambique and second respondent to Cherachesa Fisheries in Kariba.

The arbitrator clearly misconstrued the transfers to be synonymous with dismissals.  A transfer from one employer to another does not constitute an unfair dismissal in terms of section 12B of the Labour Act as read with Section 27 of SI 116 of 2014 which deals with disciplinary issues in the agricultural sector.

The issue before the arbitrator was not that of lawfulness of the transfers of first and second respondent in February 2014.  The first respondent worked under the new Mozambican entity for about 5 months before his dismissal whilst the second respondent worked for the new entity for 7 months before her dismissal.

The arbitrator seems to have been oblivious of the separate legal personalities of the three entities; the appellant, Cherachesa Fisheries and Empresa Kapenta De Nova Chicoa. Each entity possesses its own personality, rights, assets and liabilities.  This is a hallowed status of each entity in law.  Zimnat Life Assurance Ltd v George Dikinya SC-30-10.  This was an error as the appellant could not be saddled with the liabilities of Cherachesa Fisheries and Empresa Kapenta De Nova Chicoa.

In any event a disciplinary hearing was not necessary where there was no allegation of a misconduct.  As stated in the case of Don Nyamande & Anor v Zuva Petroleum (Pvt) Ltd SC 43/15, while dismissal is one method of termination of employment, it is not the only method as there are several other methods.

In casu the respondents accepted the transfers and did not challenge them and that marked the end of the employment relationship.

I find therefore that the respondents were not unfairly dismissed by the appellant.

Ground 2 of appeal:  Whether the arbitrator properly applied the provisions of section 16 of the Labour Act to this matter

The appellant argues that section 16 of the Labour Act was improperly applied to this matter.  The first averment is that this clause could not be applied extra territorially to Mozambican companies as this Act is only applicable to labour disputes arising within Zimbabwe.

The second averment is that section 16 applies to instances where there is a transfer of an undertaking as opposed to where an employee is transferred from one undertaking to another.

The respondents submitted that the arbitrator correctly applied section 16 of the Labour Act to this matter.

Section 16 of the Labour Act deals with the rights of employees on transfer of an undertaking upon its alienation or transfer in whatever way.  That is not the submission of the respondents.  They specifically allege a transfer of employees rather than the undertaking.  This is borne out by the fact that they were each transferred to a different entity.

In any event, the Labour Act applies to employers and employees in Zimbabwe and would not apply to a foreign employer, Empresa Kapenta De Nova Chicoa.  The arbitrator therefore improperly applied section 16 of the Labour Act to this matter.

Ground 3:  Whether the defence of set off was available to the appellant

The record contains an acknowledgement of debt dated 10 August 2014. The appellant acknowledges owing the first and second respondents a total of $1 300 in allowances.

In submissions before the arbitrator, the appellant alleged that the respondents owed it an amount in excess of $2 000.00 in legal fees incurred after the respondents lost a case in which they attempted to register an arbitral award.

It is appellant’s submission that the first and second respondent did not dispute that they owed the appellant money in legal fees from previous proceedings and that the defence of set off should have been upheld.

The respondents submitted that the appellant should claim its legal fees through the magistrates court in Kariba and pay the $1 300.00 it acknowledges owing.

The arbitrator reasoned that the alleged legal fees of $2 000.00 is a counter claim which was not incurred during the employment relationship.

At common law, set off or compensation is a method by which mutual debts, being liquidated and due, may be extinguished.  It takes place ipso jure.  See Commissioner of Taxes v First Merchant Bank Ltd 1997 (1) ZLR 350 (SC).

In casu the alleged fees owed by respondents are neither taxed nor agreed as the record does not have such proof.  This explains why the appellant is not specific as to the figure but talks about an amount in excess of $2 000.00.

Set off could therefore not apply as this debt was not shown to be liquidated.

Ground of appeal 3 is therefore dismissed.

Ground of appeal 5

Ground of appeal 5 appears to me to be an omnibus ground of appeal which does not set out clearly and concisely the particulars on which the appellant alleges that his arguments were not dealt with outside those addressed in grounds 1 to 4 of appeal. I will therefore not detain myself on this ground.

Accordingly grounds 1, 2 and 3 of appeal are upheld whilst ground 4 is dismissed.

Consequently the appeal succeeds on the following terms.

The arbitral award of the Honourable Arbitrator Marisa of 21 March 2016 be ad is hereby set aside in its entirety and it be substituted as follows;

“The claimants’ claim, being without merit is hereby dismissed.”

Wintertons, Appellant’s legal practitioners