Norton Town Council v Lameck Ndiya & 7 Ors

### Preamble
IN THE LABOUR COURT OF ZIMBABWE
JUDGMENT NO. LC/H/424/25
HARARE, 8 OCTOBER AND 15 OCTOBER
CASE NO. LC/H/696/25
2025
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IN THE LABOUR COURT OF ZIMBABWE HARARE, 8 OCTOBER AND 15 OCTOBER 2025

JUDGMENT NO. LC/H/424/25

CASE NO. LC/H/696/25

and

JOHN MSINDE	5TH RESPONDENT

and

STEPHEN CHITUNGO	6TH RESPONDENT

and

EZRA GIYA	7TH RESPONDENT

and

GODFREY KADUNGURE	8TH RESPONDENT

Before the Honourable Mzyece Judge

MZYECE, J:

This is an appeal against the arbitral award dated 20 June 2025 handed down by the Arbitrator. After hearing submissions from the parties, the Arbitrator ordered that;

Norton Town Council had committed an unfair Labour practice by failing to pay Claimants gratuity and salary arrears.

The Council to pay gratuity to each of the Claimants in accordance with the formula set out in the 85th Human Resources Committee Meeting minutes of the 28th of August 2019. The gratuity for each Claimant to be calculated using their final monthly salary and their years of continuous service.

Council should pay the cash equivalent of the outstanding salary arrears to each Claimant and to provide within fourteen days a detailed calculation of the gratuity and clear statement of payments already made, and the outstanding balances.

All payments in respect of gratuity and salary arrears should be completed within 30 days from the date of the award.

The Appellant was aggrieved by the award and filed an appeal to this court. The Respondents opposed the appeal and also filed their cross appeal against part of the award relating to the formula to be used to calculate the gratuity.

BACKGROUND FACTS

On the date of hearing of the matter, on 7 October 2025, Counsel for the Appellant applied for a postponement in order for her to file proof that the Respondents were paid their salary arrears in full. The application was not opposed.

The Court then issued a case management order with the consent of the parties to the effect that;

Appellant shall upload on the IECMS Platform a schedule showing how much each of the Respondents were owed in salary arrears.

In addition, the Appellant shall upload the Salary payment schedule and the Bank statement showing when the Respondents were paid the salary arrears.

The above listed documents shall be uploaded on IECMS Platform by the Appellant by end of business on Monday the 13th of October 2025.

The Appellant shall also serve the physical copies of the aforementioned documents to the Respondents' representative.

The case will then be heard on Wednesday the 15th of October 2025 at 14:15hours

There shall be no order as to costs for the postponement.

The Appellant duly filed the following documents; salary schedule, bank statements and the payment vouchers which appeared from page 83 to 106 of the consolidated record.

On resumption of the hearing on the 15th of October 2025, Counsel for the Appellant objected to the following three Respondents; Onius Makope, S Njanji and Mary Tulukane joining the proceedings at this stage. She submitted that the three only surfaced on the notice of response filed by the Respondents. She said their names were not there from the list by the Arbitrator on the Arbitral Award. The objection was not opposed. It was upheld.

SUBMISSIONS BY THE PARTIES

Counsel for the Appellant submitted that all the salary arrears were paid in full. She referred the Court to the Bank Statements from AFC showing the Appellant- Norton Town Council’s General Account. She said that the Bank Statements showed the payment of the salary arrears to the Respondents as at 7 October 2021. The payment of the salary was made in cash because the Minister had given a Ministerial directive that no salary arrears should be paid by using immovable property – stands. For instance, on page 85 of the consolidated record, it showed the name of Alfonse Chiname and that the payment of $2, 178.17 in Zimbabwe Local currency was paid to him. This was supported by the payment voucher on page 103 of the consolidated record

showing that the same Respondent, Alfonse Chiname, was paid the salary arrears in full. Counsel stated that the salary arrears were paid in RTGS in accordance with Statutory Instrument 33 of 2019. The Court enquired as to when the salary arrears had accrued? Counsel said that the salary arrears were accrued in 2018. She referred the Court to a memo from the Appellant dated 15 August 2018. The memo was advising Appellant’s employees that Council had agreed to compensate salary arrears for the period January 2018 to July 2018 by offering residential stands as a payment modality to those who were still owed.

Counsel for Appellant referred the Court to page 102 of the consolidated record which showed payment of salary arrears to the 6th Respondent, Stephen Chitungo. The amount which was paid was said to have corresponded to the letter that was written to Stephen Chitungo showing the amount he was owed. Ezra Giya was paid on 7 October 2021. Nota Nota was also paid on 7 October 2021 and Godfrey Kadungure was also paid in full on the same date. Counsel for the Appellant submitted that all the Respondents were paid in full according to the Bank Statements and payment vouchers. She averred that it was, therefore, a gross irregularity on the part of the Arbitrator to order that Appellant should pay the Respondents salary arrears when evidence was presented to him showing that salary arrears had been paid in full.

Per contra, the Respondents’ representative submitted that Norton Town Council was discouraging. He said the Council had agreed to pay the salary arrears by giving the Respondents housing stands in Swallow Fields. However, it then changed and paid using RTGS. The Court asked the Respondent’s representative why they never complained or appealed against the Arbitrator’s finding on page 12 of the record. The Arbitrator held as follows; “regarding the residential stands, the Tribunal accepts that while the Claimants had a legitimate expectation based on earlier representations, such expectation was lawfully curtailed by a binding Ministerial directive. The Council cannot now be compelled to act contrary to such directive.”

The Respondents’ representative said that they thought that Council was going to pay, “the market value of the salary arrears”. He added that the employer owed the salaries in United States Dollars in 2018, but paid in RTGS in 2021. Regarding Statutory Instrument 33 of 2019, the Respondent’s representative said that the Statutory Instrument 33 of 2019 was not meant to affect salaries. He further said the Employer waited until the Statutory Instrument was enacted and then paid the salary arrears. He said that was unfair. The Respondent’s representative admitted that the Respondents were paid their salary arrears in full. However, his bone of contention was that the Respondents were not happy that the arrears were paid in RTGS. He said that, that was all he could submit relating to salary arrears.

Counsel for the Appellant in response submitted that the Appellant had paid the salary arrears in line with the ruling of the Supreme Court in the case of Zambezi Gas Zimbabwe (Private) Limited v N.R. Barber (Private) Limited and Anor SC 3/20 where it was held that debts accrued in United States Dollars before 22 February 2019 could be paid using RTGS local currency at a rate of 1:1 with the United States Dolar as per the provisions of Statutory Instrument 33 of 2019.

The Court is convinced that the decision of the Arbitrator was grossly irregular considering the evidence submitted showing beyond reasonable doubt that the salary arrears were paid in full in October 2021. Even the Respondents themselves admitted that they were paid. However, they were not happy that payment was made in local currency instead of United States Dollars. This issue was covered by Statutory Instrument 33 of 2019 which became law by virtue of the Finance Act no 2 of 2019. The effect of that Statutory Instrument was discussed at length by the Supreme Court in the case of Zambezi Gas Zimbabwe (Private) Limited v N.R. Barber (Private) Limited and Anor (supra) where it was held that "S.I. 33/19 expressly provides that assets and liabilities, including judgment debts, denominated in United States dollars immediately before the effective date of 22 February 2019 shall on or after the aforementioned date be valued in RTGS dollars on a one-to-one rate.” Therefore, the Appellant’s conduct of paying the salary arrears which were

accrued before the effective date using RTGS, was lawful. As such, the Appellant had extinguished the debts/ salary arrears owed to all the Respondents in full.

Whether or not the Respondents were entitled to be paid gratuity as awarded by the Arbitrator?

Counsel for the Appellant abandoned the second ground of appeal. However, she pointed out that; when the Human Resource Committee of Norton Town Council made a recommendation on 28 August 2019 to Council to pay its employees gratuity upon retirement, the 1st Respondent- Lameck Ndiya and the 5th Respondent- John Msinde were no longer Norton Town Council Employees. She submitted that the two Respondents had retired in 2018. The Appellant was prepared to pay the other six Respondents gratuity in line with the formula ordered by the Arbitrator.

The Respondents’ Representative submitted that they were opposed to the payment of the gratuity using the formula recommended by the Human Resources Committee. He said that there was no Resolution by Council approving and adopting the Human Resources Committee’s recommendation. He said the proper way was for the Human Resources Committee’s recommendations to go to the Finance Committee first, then after that they were supposed to be presented to the Works Council and to the full Council for a Council Resolution. He also said that no such procedure was followed as required by the law.

The Respondents’ representative said that Council was supposed to pay the gratuities as agreed in the Collective Bargaining Agreement signed on 25 June 2014. He was referring to minutes of the Works Council meeting held on 25 June 2014. Respondents’ representative said on page 58 of the Consolidated record, the Works Council agreed on an exit package for Junior staff. The Court pointed out that, that was a proposal which the Works Council agreed to present to the Employer- to consider. The minutes were clear that it was a proposal and

in the minutes, it was stated that: “that Council considers . . .” (my emphasis). The Works Council minutes were not a collective bargaining agreement.

Counsel for the Appellant submitted that Council was aware that there was no resolution submitted from the full council approving payment of gratuities. All what had been presented before the Arbitrator and the Court were just recommendations. However, Counsel said that it was on humanitarian grounds and in the spirit to try and resolve the dispute that it decided just to abide by the Arbitrator’s ruling on gratuities and not pursue their second ground of appeal.

The Court considered the submissions made by the parties relating to the issue of gratuities. The Respondents’ contention that the gratuities ought to have been paid using the proposal made by the Works Council on 25 June 2014 does not have any legal basis at all. It was not proved that the said proposal was adopted and approved by the Employer. It just remained a proposal from 2014 and was never implemented. If it was a collective bargaining agreement, it would have been unlawful for Council not to abide by that Collective Bargaining Agreement. As such, the cross appeal filed by the Respondents had no merits. It was, therefore, dismissed. On the other hand, the Appellant on its own accord decided to pay the Respondents, excluding the 1st Respondent Lameck Ndiya and the 5th Respondent John Msinde; gratuity in line with what was ordered by the Arbitrator. The Court could not interfere with the benevolence of the Appellant in that regard.

DISPOSITION

It was this court’s conclusion that there was no legal basis for the Arbitrator to order that the Appellant should pay outstanding salary arrears when evidence was presented showing that all the Respondents were paid the salary arrears in full by October 2021. The decision by the Arbitrator was so grossly irrational as to defy logic such that this Court was satisfied that it was justified to interfere with that factual finding and set it aside. The appeal on that point was upheld. As for the payment of the gratuities, the Court concluded that there was no

legal basis to order that payment of gratuities should be made in line with recommendations of a Works Council meeting of 2014 as was sought by the Respondents. In that regard, the cross appeal by the Respondents failed due to the reason stated above. The Appellant on the other hand, had offered on its own accord to pay the six Respondents gratuity in line with the Arbitrator’s ruling. The Court had no power to stop the Appellant if it wished to abide by that decision. It was because of those reasons that the court made the following order:

The appeal against the Arbitrator’s award relating to payment of salary arrears be and is hereby upheld.

The Arbitrator’s award be and is hereby set aside and is substituted with:

“The Claimants claim on non-payment of salary arrears be and is hereby dismissed.”

The order by the Arbitrator relating to payment of gratuities to the Respondents be and is hereby amended to read as follows:

“The Appellant shall pay the following Respondents; Charles Mutengwa, Nota Nota, Alfonse Chiname, Stephen Chitungo, Ezra Giya and Godfrey Kadungure gratuity using the formula to calculate the amount as was ordered by the

MBIDZO,	MUCHADEHAMA	&	MAKONI	APPELLANT’S	LEGAL PRACTITIONERS

URBAN	COUNCIL	WORKERS	UNION	OF	ZIMBABWE	FOR	THE RESPONDENTS