Nelia Muzunze v The Chairperson of the Disciplinary Committee and J and P Security Private Limited

### Preamble
IN THE LABOUR COURT OF ZIMBABWE
JUDGMENT NO LC/H/263/2023
HARARE 6 JULY 2022
CASE NO LC/H/700/21
07 SEPTEMBER 2023
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IN THE LABOUR COURT OF ZIMBABWE

HARARE 6 JULY 2022

07 SEPTEMBER 2023

JUDGMENT NO LC/H/263/2023 CASE NO LC/H/700/21

NELIA MUZUNZE	APPLICANT

THE CHAIRPERSON OF THE DISCIPLINARY	1st RESPONDENT COMMITTEE

AND

J AND P SECURITY PRIVATE LIMITED	2nd RESPONDENT

Before the Honourable Chivizhe Judge:

For Applicant	In Person

For 1st and 2nd Respondent	Ms B.M. Mudehwe (Legal Practitioner)

CHIVIZHE, J:

The delay in the hand down of this judgement is sincerely regretted. On the 19th of February, 2020 this court issued an order by consent of the parties referenced LC/H/ORD/137/2020. The Court directed the stay of disciplinary proceedings against Applicant and her reinstatement to her original position without loss of salary and benefits. After the proceedings before this court the employer took the position to pay damages rather than to reinstate the Applicant. This resulted in the Applicant approaching this court with her application for quantification of damages. The Respondent opposed the application.

The Applicant in her application quantified the damages as covering backpay which is from the date of unfair dismissal that is June 2019 to the date of the order by this court on 19th February 2020. The Applicant submits in her papers that she was earning US$100 per month at the time of her suspension. Her total claim for backpay is therefore US$100.00 multiplied by 9 months to give a total of US $900.00.

She is further claiming an amount of $2100.00 to cover the period from the date of court order to the date of filing of application i.e. 21 months. She also submits that on the basis of justice and equity she ought to be granted this amount as 2nd Respondent has refused/failed to reinstate her. The cumulative amount therefore for backpay is US$3000.

The Applicant is also claiming for damages in lieu of reinstatement in the form of 24 months salary. She submits that she was entitled to this in view of the economic challenges prevailing at the time of her termination. The amount translates to US$2 400.

The 2nd Respondent in opposition submits that it did not refuse to reinstate the Applicant but due to the deterioration of her health she was no longer capable of placement. The 2nd Respondent refers to a letter written by its legal consul to Applicant legal practitioners dated 13 March 2020 (Annexure ‘B” to Applicant papers) where it indicated its intention to pay damages rather than reinstatement.

The 2nd Respondent further submits that the Appellant could also not be reinstated to the UN job as it has since lost the contract with the UN. The 2nd Respondent also contends that it was always willing to pay Applicant damages but that she had gone missing from March 2020. The contention is also made that although Applicant was being paid in USD currency, in view of the promulgation of S.I. 133/19 dated 2nd February 2019 the Applicants salary wages had to be converted to the Zimbabwe dollar. The change was said to have been communicated to 2nd Respondent by Applicant bankers through a letter which also forms part of the record (Annexure B to Applicant paper). The 2nd Respondent submits that on this basis there was a review of the 2nd Respondent salary from US $100 to $ZWL 235.46 and later to $ZWL 465.46. In regards the specific claims made 2nd Respondent submits the Applicant’s claims were divided between back-pay to be calculated from date of dismissal to date of order of reinstatement and damages in lieu of reinstatement. Whilst conceding to the payment of backpay to cover 9 months the 2nd Respondent however disputed that Applicant was entitled to 24 months to cover damages in lieu of reinstatement. The Applicant had a duty to mitigate her loss after the 2nd Respondent elected to pay damages. The 2nd Respondent further contends the Applicant’s job was also not a skilled job and she could have reasonably obtained alternative employment within six months. The 2nd Respondent also submits that the economic factors prevailing then were affecting every one, companies included to the extent that companies were closing down. In view of the Applicant’s failure to place any evidence of her attempts to mitigate her losses the 2nd Respondent is tendering six months damages in lieu of reinstatement. This period is said to be consistent with other judgements from this Court. 2nd

Respondent has referred in particular to a judgement by my brother, Honourable Musariri J in Again Chamakaona vs J & P Security & Anor LC/H/74/2021 where an employee was awarded six months in similar circumstances of failure to prove any effort taken to mitigate loss. The 2nd Respondent is thus tendering ZWL 3, 499.14 as backpay and ZWL 2,792.76 in damages in lieu of reinstatement. The 2nd Respondent is also tendering ZWL $1,396.38 as cash for accrued 90 days leave days bringing the total amount tendered to ZWL $7,788,28 which amount 2nd Respondent contends has already been paid into Applicant’s account.

In presenting oral arguments Applicant insisted that she be paid on the basis of the US dollar salary. When the basis of the conversion of the salary to RTGS was properly explained to her she altered her claim so that she would be paid the damages in lieu of reinstatement on the basis of the inter-bank exchange rate prevailing on the date of payment. She did not lay a basis for the claim except that she had been advised that it was now the position that damages payable were to be calculated on the basis of prevailing rate of exchange on the date of payment. Applicant further submitted that as she is now suffering generally due to her poor health she would therefore be unlikely to obtain any alternative employment. On the issue of mitigation she submitted that she had only approached Safeguard who had denied her a job on the basis of her unresolved issues with the 2nd Respondent. She would however need money to enable her to start a project since she was no longer employable due to her deteriorating health situation.

EVALUATION

There are three issues for determination before the court. The issue are as follows firstly, whether or not the Applicant is entitled to damages in United States dollars; secondly, whether or not the Applicant is entitled to damages in lieu of reinstatement for the period of 24 months as claimed; thirdly, whether or not Applicant is entitled to punitive damages. I shall address the issues seriatim.

WHETHER OR NOT THE APLICANT IS ENTITLED TO DAMAGES IN UNITED STATES DOLLARS

I find it convenient to address this as the first issue considering that the issue of in which currency each claim would be paid is a theme that cuts across all the claims.

The Applicant, in her application, submits that as she was receiving her salary in United States Dollars at the time of termination of employment that is 19th February, 2020, she ought to be paid all damages in United States dollars. The 2nd Respondent does not agree. 2nd Respondent

submits that in view of the introduction of Statutory Instrument 33 of 2019 with effect from 22nd February 2019 all liabilities that were accrued in United States Dollars were deemed to be valued in RTGS Dollars at the rate of 1 RTGS Dollar to 1 United States Dollar from the effective date that is 22 February 2019. The 2nd Respondent further submits that the Applicant had been advised by its banker through a letter that all nostro accounts were being converted to RTGS accounts in compliance with the changes in law (Copy of letter tendered and marked as Annexure “BB”) On this basis 2nd Respondent contends that all liabilities ought to be settled in RTGS dollars.

It is common cause the parties entered into a contract of employment. The 2nd Respondent was on the basis of the contract obligated to pay Applicant a monthly salary of USD$100 as at the time of termination that is February 2019. It is also correct as contended by 2nd Respondent that with effect from 22 February 2019 the government introduced a new currency “RTGS’ currency through Statutory Instrument 33/2019. By dint of this piece of legislation the Applicant’s salaries being in the nature of liabilities valued and expressed in United States Dollars immediately before the effective date i.e. 22 February 2019 those were deemed to be values in RTGS dollars at the rate of 1:1. There was a further introduction of Statutory Instrument 142 of 2019 which made it specific that the Zimbabwe dollar should be the sole legal tender for all transactions in Zimbabwe. It is important to also note that the provisions in Statutory Instrument 33 of 2019 were reproduced in the Finance Act No. 2 of 2019. Section 21(1) of that Act makes it clear that the conversion of the rate of 1:1 does not apply in the case of foreign loans. It is apparent that the liability in this case being salaries does not fall in the class of foreign loans as referred to in Section 21(1) of the Finance Act No. 2 of 2019.

It is clear therefore that the liabilities against 2nd Respondent in this case have to sound in Zimbabwean dollars. The 2nd Respondent has also tendered in evidence a letter from its ZB Bank (Annexure “B”) in which Applicant was advised of the conversion of her nostro account in which she had been receiving salarys in USD to RTGS Dollars account.

WHETHER THE APPLICANT IS ENTITLED TO 24 MONTHS SALARY AS DAMAGES IN LIEU OF REINSTATEMENT

The Applicant is claiming damages in lieu of reinstatement for a period of 24 months. She submits that this is after she is paid her backpay which is covering a period of 9 months

i.e. from the date of unfair dismissal that is 3 June 2019 up to the date of the order of this court which is 19th February, 2020. She is therefore claiming US$100 multiplying by 9 months to

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LC/H//2023 LC/H/700/21

get a total of US$900.00. The 2nd Respondent has conceded to backpay to cover the period. The claim for backpay is allowed subject of course to the conversion of that amount to Zimbabwean dollars.

On the issue of damages in lieu of reinstatement, 2nd Respondent contends that Applicant having failed to tender any evidence pointing to any effort taken to mitigate her losses she can at best be only awarded six months in line with other judgements from this court. The Respondent has specifically referred to a judgment by my brother, Honourable Musariri J in Chamakaona v J and P Security (Private) Limited LC/H/74/21. In that case the Applicant had also failed to tender any proof of effort undertaken to mitigate his losses. The court awarded him 6 months wages as damages in lieu of reinstatement. On this basis 2nd Respondent has already tendered six months salary and deposited it into Applicant’s bank account.

It is clear from the 2nd Respondent submissions that it is presenting an inconsistent position. In paragraph 24 of its Heads of Argument there is an admission of the harsh economic situation prevailing during the relevant time of termination of employment. The 2nd Respondent even submitted that a period of 18 months would have been adequate time for Applicant to obtain alternative employment. The 2nd Respondent stated as follows;

“24. The Respondents appreciates that during this period there was economic meltdown. Many people were leaving their jobs or being retrenched. However 2019

to 2021 is too long a period for Applicant to secure alternative employment. The period of 18 months was enough for the Applicant to secure alternative employment.”

The 2nd Respondent however in the next two paragraphs altered its position to now state that a period of six months should have been adequate and that it has consequently settled that account. What effrontery! The position of the law is clear that an employee wrongfully dismissed is not entitled to just sit, she has a duty to mitigate her loss immediately. See Ambali vs Bata Shoe Company Limited 1999 (1) ZLR 417 (S). It is indeed correct that the Applicant in this case has not tendered any proof of effort made to mitigate her losses. The Applicant was however employed as a security guard, so her job is not in the skilled sector. The 2nd Respondent however made a concession as to the harsh economic situation prevailing during the period of termination. The 2nd Respondent has to be held to the concession of 18 months period as made in paragraph 24 of its Heads of Argument. The 2nd Respondent cannot be allowed to prevaricate from one position to the other. With regards the precedent from this court it is also not clear if the economic position situation prevailing during the period

Chamakaona left employment was the same as when Applicant left employment and if he also occupied the same position as the Applicant. It is on this basis I am not persuaded to follow my brother, Musariri J’s line of reasoning in Chamakaona vs K and P Security (Private) Limited. The 2nd Respondent therefore is to pay 18 months salary as damages in lieu of reinstatement.

WHETHER OR NOT THE APPLICANT IS ENTITLED TO PUNITIVE DAMAGES

The Applicant submitted under this head that she was not treated fairly by the 2nd Respondent when charges were framed against her. She had been so affected that her health had deteriorated. She was now hypertensive and generally unwell. She also has had to move to the rural areas and was hoping to start some lucrative project once she received the payments towards damages. The Applicant also contends that 2nd Respondent bluntly rejected her offer to resume work and only do light duties.

2nd Respondent submitted in counter that it had no obligation to pay punitive damages in this case. It had initially wanted to reinstate applicant but the relationship later deteriorated. As such Applicant was only entitled to be paid damages in lieu of reinstatement. The Respondent position is also that Applicant had not justified why she should also be paid punitive damages. The 2nd Respondent also underscored that the Applicant was already having medically certified health problems by the time she left employment. As the record showed she could no longer do heavy duty or night duty. 2nd Respondent was therefore not in a position to offer her light duties. On that basis the claim for punitive damages has to be dismissed.

It is the trite position at law that punitive damages are only paid where the employer is guilty of reprehensible conduct. Just as any other claim for damages punitive damages also have to be justified. Reference is made to Mvududu vs ARDA (SC 446/14) where Patel JA (as he then was) stated as follows;

My reading of provisos (ii) and (iii) to s 89 (2) (c) (iii) is that different considerations apply under these provisos in determining the untenability of the employment relationship in question. Where the question to be decided is whether to award damages or reinstatement, the onus is on the employer to prove such untenability, taking into account the size of the employer, the preferences of the employee, the situation in the labour market and any other relevant factors. These criteria relate to the practicability of reinstatement and the continuation of the employment relationship as assessed from an objective economic or commercial standpoint. However, once it is decided that reinstatement is no longer feasible by dint of any one or more of the specified factors and that damages should be awarded instead, the sole

criterion to be applied is whether the untenable employment relationship arose from the unlawful or wrongful dismissal of the employee by the employer. What is relevant at that stage is the employer’s fault in the manner or circumstances in which he dismissed the employee and the extent of his blameworthiness in causing the irretrievable breakdown of the employment relationship. It is only in this situation that the question of punitive damages comes into play and where the discretion to award such damages may be exercised in order to penalise the employer for his culpable conduct.

Furthermore, proviso (iii) to s 89 (2) (c) (iii) does not, in my view, envisage the award of double damages, i.e. punitive damages in addition to damages in lieu of reinstatement. Rather, what may be imposed is an award of damages in lieu of reinstatement that is punitive in nature and effect. In other words, what is contemplated is a single award of punitive damages that exceeds what would ordinarily be awarded as damages in lieu of reinstatement, i.e. in the absence of any aggravating circumstance occasioned by the manner in which the employer dismissed the employee.

The 2nd Respondent denies that it was behind the breakdown of the relationship between the parties. The Applicant could not be reinstated after the UN premises where she was working was closed, due to complaints made against the Applicant. The 2nd Respondent in any event had eventually lost the UN contract. There were no aggravating circumstances by 2nd Respondent in the manner in which the Applicant was terminated. On this basis the claim for punitive damages has to be dismissed.

The Applicant has failed to prove/establish that the 2nd Respondent did conduct itself in any manner that is reprehensible towards her. She has also failed to place before the court evidence to justify the amount claim towards punitive damages. On this basis her claim for punitive damages ought to be dismissed.

In the result, it is ordered as follows;

The application is allowed.

The 2nd Respondent is directed to pay to Applicant within 30 days of this order the following as her termination benefits

9 months X USD$100 in backpay = USD$900.00.

18 months X USD$ 100 in damages in lieu of reinstatement = USD$1800.00.

3 months X 100USD Cash in lieu of accrued 90 days leave = USD$ 300.00

Gross Total: USD$ 3000.00 which amount payable on the basis of the prevailing interbank rate of exchange on the date of payment

The 2nd Respondent is to set off against this award the amount already deposited into Applicant’s bank account.

There is no order as to costs.