Mondoro Ngezi Rural District Council v Zimbabwe Rural District Council Workers Union

### Preamble
IN THE LABOUR COURT OF ZIMBABWE
JUDGMENT NO LC/H/163/25
CASE NO LC/H/1257/24
HELD AT HARARE, 11th MARCH 2025
AND 16 April 2024
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IN THE LABOUR COURT OF ZIMBABWE
LC/H/163/25

Held at HARARE, 11th MARCH 2025

AND 16 April 2024

Judgment no
CASE NO LC/H/1257/24

In the matter between: -

MONDORO NGEZI RURAL DISTRICT COUNCIL: APPELLANT

And

ZIMBABWE RURAL DISTRICT COUNCIL WORKERS UNION: RESPONDENT

BEFORE THE HONOURABLE KACHAMBWA J,

For the Appellant: Adv B. Magogo, Legal Practitioner

For the Respondent: T. Mudzuri, Legal Practitioner

KACHAMBWA, J:

THE APPEAL

1. This is an opposed appeal in terms of Rule 19(1) of the Labour Court Rules, 2017, made against the Arbitration Award issued on 09 September 2024, but was served on the appellant’s email on 3 December 2024. The appeal was made on the following grounds:


1.1 “The arbitrator grossly erred and misdirected himself in basing his decision on a purported agreement between the parties setting the debt at US$27 710.65 when no such agreement was ever arrived at neither was it supported in evidence by the respondent.

1.2 The arbitrator grossly erred and misdirected himself in offering the payment of union dues in foreign currency while disregarding the abundant evidence that the appellant was remunerating its employees in local currency and deducting union dues in the same currency.

1.2.1 A fortiori, the arbitrator grossly erred and misdirected himself, having found that the respondent’s dues were deducted at source in the nominal local currency in then ordering their conversion into foreign currency without a basis in law for doing so.

1.3 The arbitrator grossly misdirected himself in failing to find that the local currency payments made by the appellant amounting to RTGS$41 552 868.80, extinguished the entire union dues debt owed to the respondent for the year 2023.

1.4 The arbitrator erred at law in reversing the incidence of onus by finding that the appellant, as opposed to the respondent, had the burden to prove whether the union dues were deductible from gross or basic salary.


1.4.1 A *fortiori*, the arbitrator erred at law in failing to find that the

2024 collective bargaining agreement prescribed only NEC dues, to the exclusion of trade union dues, to be deducted from both the basic salary and attendant allowance.”

**BACKGROUND FACTS**

2. The appellant disputed the respondent's claim that the appellant owed the respondent a sum of US$23,478.36 for the period spanning January 2023 to November 2023. He submitted that he had made a full and final settlement for union dues covering the entire 2023 period. The appellant contended that any outstanding union dues only related to the months of January, February, and March 2024.

3. He further submitted that union dues were deducted based on the basic salary of union members, in line with the salary schedule generated by the payroll system. Until December 2023, these deductions were made in RTGS currency, in accordance with the law, and only the amounts deducted were remitted to the union.

4. The appellant also argued that the respondent had no legal basis to convert the RTGS amount of $23,666,788.31 into United States dollars, since the actual remittance reflected what had been lawfully deducted. He emphasized that the respondent’s assertion that this figure amounted to US$4,232.29 was unfounded and unsupported by any legal or contractual provision. He also provided a detailed breakdown of further payments made by the appellant as follows:

On 11 December 2023................. RTGS$5 888
392.86 On 11 December 2023................. RTGS$5
942 285.57 On 31 January 2024.................
RTGS$6 055 402.09

5. In response the respondent submitted that the issue of non-remittal of union dues amounted to an unfair labour practice in terms of Section 8(e)(i) of the Collective Bargaining Agreement (CBA) for Rural District
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 Councils Statutory Instrument 87 of 2017. He further contended that the appellant engaged in an unfair labour practice by failing to remit the union dues which had been duly deducted, in violation of Section 8(o) of the CBA, which provides as follows:

“Where an employer makes deductions on behalf of the trade union or other third party concerned not later than 14 days of the month following which the deduction relate.”

6. The respondent stated that the parties met and discussed the claim prior to the arbitral hearing, during which meeting they had the opportunity to exchange membership forms and returns, which reflected the union dues deducted by the appellant. It was further submitted that correspondence between the parties confirmed this position and a certificate of settlement was subsequently issued, in which the appellant made a commitment to pay the outstanding union dues, the amount of which had been agreed upon following a reconciliation process. The respondent asserted that the parties agreed that payment would be made by 5 October 2023. However, the appellant had failed to honour this commitment.

7. The arbitrator found that the appellant failed to provide sufficient evidence to prove that union dues were deducted from the basic salary. Consequently, he upheld the respondent’s position that it was appropriate to calculate union dues based on the gross salary.

8. Upon further analysis, the arbitrator also discovered that certain payments despite being supported by proof of payment submitted by the appellant, had not been factored in to reduce the total amount owed. He provided a breakdown of the amounts as follows:


| Date of payment | Amount in (RTGS) | Bank rate | Amount in (USD) |
|-----------------|------------------|-----------|----------------|
| 12/11/23        | 5 888 392.86    | 5 839.24  | 1 008.42       |
| 12/11/23        | 5 942 285.57    | 5 839.24  | 1 017.25       |
| 31/01/24        | 6 055 402.09    | 10 152.39 | 596.45        |
| TOTAL            |                  |           | 2 622.52       |

Amount owed .................................. 23 478.36  
Deductions .................................. 2 622.52  
Balance to be paid ........................ 20 855.84  

9. The arbitrator gave a ruling in favour of the respondent and ordered the appellant to pay the sum of USD$20 855.84 on or before the 15th of October 2024. Dissatisfied with the arbitral award the appellant appealed to this court.  

**SUBMISSION BEFORE THE COURT**  

The respondent raised a point *in limine*, arguing that the appeal had been filed out of time. However, the court dismissed this preliminary objection and proceeded to hear the matter on its merits.  

**APPELLANT’S SUBMISSIONS**  

10. The appellant submitted that the appeal should be resolved based on the first ground, which challenges the arbitrator’s finding that the parties agreed that the appellant owed the respondent US$27,710.65. He argued that no such consensus was ever reached, and that the arbitrator erred in relying on the respondent’s
 Statement of Claim as evidence of an agreement. The appellant stated that the documents referred to by the arbitrator, including the agreement, were either absent, unsigned, or demonstrated a lack of consensus, particularly regarding the conversion of RTGS deductions into USD.

11. The appellant pointed out that correspondence and a draft agreement indicated the absence of agreement. Moreover, the respondent’s claims were categorically denied and the respondent did not persist with the claim of consensus thereafter.

12. As such, the appellant argued that the arbitrator’s reliance on non-existent proof amounted to a gross factual misdirection, rendering the award invalid. He cited legal authority MacFoy v United Africa Co Ltd 1961 3 All ER 1169 at 1172 to argue that a decision based on a nullity must be set aside in its entirety.

13. In addition, the appellant raised three issues relating to:

**Whether there was Improper Currency Conversion by the arbitrator:**

14. Counsel for the appellant submitted that the arbitrator erred in accepting the unilateral conversion of RTGS$ to USD without legal justification or proof of exchange rate or payment date. The dues had been deducted in RTGS, and the principle of currency nominalism applied. In making the point counsel referred to Makwindi Oil Procurement v NOCZIM 1988 2 ZLR 482 SC.

**Whether the arbitrator failed to Consider Payments Made:**

15. The appellant pointed out that the arbitrator failed to account for RTGS$41,552,868.80 already paid by it, should have offset the 2023 dues.


He further stated that the respondent’s figures lacked evidentiary support, while the appellant’s computations were never challenged.

**Whether there was Incorrect Basis for Deduction**

16. The appellant stated that the arbitrator erred by accepting that union dues were to be deducted from gross salary (including allowances). The appellant argued that the CBA only provided for NEC dues to be deducted from gross salary, and not trade union dues. Hence, the burden of proof was on the respondent to justify deductions from gross salary. Reference was made to the case of *Eagle Insurance Co Ltd v Grant* 1989 (3) ZLR 278. The appellant concluded that the appeal was well-founded and should be upheld.

**RESPONDENT’S SUBMISSIONS**

17. Counsel for the respondent argued that the appellant’s grounds of appeal were fundamentally flawed, lacking sound reasoning or persuasive merit capable of overturning the arbitral award. He emphasized that the appeal was not based on misapplication of legal principles, but rather on alleged factual errors, which are insufficient to warrant interference by the appeal court.

18. The respondent maintained that the existence of an agreement between the parties was not in dispute. He argued that the appellant had acknowledged the agreement and made partial payments, thereby confirming its validity. Consequently, the appellant's denial of the agreement at this stage was described as misleading and inappropriate. The respondent submitted that since the agreement was not challenged during the arbitral proceedings, the appellant was estopped from now disputing its existence, especially where the respondent relied on it to its detriment.

19. On the second ground of appeal, counsel for the respondent criticized the appellant’s argument as inconsistent and contradictory, noting that the appellant simultaneously denied having an obligation under the agreement while also insisting that any such obligation should be settled in local currency. This contradiction, he argued, undermined the credibility and coherence of the appellant’s case.

20. Regarding the third ground, counsel submitted that it was devoid of merit, as the core issue was the appellant’s failure to fulfil a clear contractual obligation. He stressed that this was a straightforward matter and did not involve any complex legal questions.

21. In response to the fourth ground, the respondent asserted that the appellant appeared to conflate an appeal with a review, raising issues more appropriately dealt with in a review application. He argued that such matters should have been raised earlier and cited the case of *The Commander Defence Forces v Chiba and Others SC 48/24*, which distinguishes between an appeal and a review as follows, “*an appeal seeks to assail the correctness of a decision while a review impugns the process or procedure by which the decision is made.*”


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22. The matter before this court turns on the determination of whether the arbitrator erred in concluding that the parties had reached an agreement that the appellant owed the respondent the sum of US$27,710.65, and whether the award granted on that basis can be sustained.

23. The cornerstone of the arbitrator’s award was the assertion that an agreement existed between the parties regarding the appellant’s liability. However, upon close scrutiny of the record, this court finds that no signed agreement was ever presented by the parties. The document relied upon by the arbitrator namely, the Statement of Claim does not prove consensus *ad idem*. In fact, it reveals the contrary. The respondent admits in a letter to the NEC that “parties seem not to have reached consensus,” and consequently referred the matter for arbitration.

24. Furthermore, the unsigned draft agreement fails to outline specific terms of obligations or currency denomination. In the absence of a conclusive and mutual agreement, the arbitrator's reliance on an alleged consensus is misplaced. The award is therefore built on a factual nullity, which undermines its legal foundation.

25. The arbitrator further erred by accepting a unilateral conversion of RTGS amounts into USD without judicial sanction or evidentiary support. No proof was furnished to establish the applicable exchange rate, date of conversion, or mutual consent to such conversion. The appellant had
 9 deducted and remitted union dues in RTGS, consistent with the statutory and payroll framework in place at the time. Under the principle of currency nominalism, obligations are to be discharged in the currency in which they are incurred unless parties expressly agree otherwise.

26. As held in *Makwindi Oil Procurement (Pvt) Ltd v NOCZIM* 1988 (2) ZLR 482 (SC), the mere instability of the RTGS does not justify its conversion to USD in the absence of a binding agreement or court order. The arbitrator’s finding in this regard was therefore a misdirection in law.

27. The record reflects that the appellant made payments amounting to RTGS$41,552,868.80, yet the arbitrator failed to consider whether these payments discharged the alleged indebtedness. No computation was undertaken to reconcile these payments with the amounts claimed. The appellant’s own deductions and payment schedules were not challenged, nor were they rebutted by any cogent evidence from the respondent. The arbitrator's omission to assess the probative value of these payments is a material oversight warranting appellate intervention.

28. The respondent’s claim that trade union dues were to be calculated on gross salary, including allowances, lacks both factual and legal basis. The Collective Bargaining Agreement produced by the appellant clearly refers to deductions for NEC dues, not trade union dues. The legal maxim *expresio unius est exclusio alterius* applies as the express mention of NEC dues excludes others not mentioned. It was incumbent upon the
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0 respondent to justify this expansive interpretation, which they failed to do. Accordingly, the arbitrator’s endorsement of this position was unsupported by the applicable instruments and case law.

29. Finally, the arbitrator appears to have discounted the appellant’s submissions on the erroneous assumption that they contradicted an “agreed computation”. This presupposes the very agreement in question, thereby circularly reasoning the issue in favour of the respondent. Moreover, reliance on factual assertions unsupported by evidence amounts to gross misdirection, as outlined in authorities such as *Hama v NRZ* 1996 (1) ZLR 664 (S) which states that:

> “It is trite that an appellate court will only interfere with factual findings of a subordinate court where it is alleged and proved that the findings were arrived at irrationally.”

**DISPOSITION**

30. After having looked at both parties’ arguments before this court, it is clear that the arbitrator’s award has no basis to stand on. It is therefore ordered that:

1) The appeal succeeds.
2) The arbitral award is set aside in its entirety and is substituted as follows:

> 2.1 The claim by the Zimbabwe District Council Worker’s Union be and is hereby dismissed with costs.


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