SIRDC v E Chinzima & 27 Others

### Preamble
IN THE LABOUR COURT OF ZIMBABWE
JUDGMENT
NO LC/H/694/16
HELD AT HARARE 7 JUNE 2016
CASE NO
JUDGMENT NO LC/H/694/16
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IN THE LABOUR COURT OF ZIMBABWE			JUDGMENT NO LC/H/694/16

HELD AT HARARE 7 JUNE 2016				CASE NO LC/H/118/16

& 4 NOVEMBER 2016

In the matter between:

SIRDC						Appellant

And

E CHINZIMA & 27 OTHERS			Respondents

Before The Honourable Manyangadze, J

For Appellant		L Mazhawidza (Human Resources Officer)

For Respondents		E Mudoti (Trade Unionist)

MANYANGADZE J:

This is an appeal against an arbitral award handed down on 12 February 2016, in terms of which the appellant was ordered to pay the respondents cash in lieu of notice.

The respondents were employed by the appellant as general workers.  They were part of the unskilled labour force the appellant engages in its research activities.

The  appellant is a research institution established by an Act of Parliament.  It is mainly engaged in technological research and development in diverse areas, including agriculture.  At the material time, it was carrying out research and development work in maize breeding in the Muzarabani area.  The appellant’s offices are in Harare.  In the execution of its research and development project in Muzarabani, it sourced local labour.  This is how the respondents were engaged in 2011.

The nature and duration of the respondents’ engagement by the appellant is in contention.  The appellant avers that the respondents were engaged as casual workers, to provide labour for the winter cropping season.  Its project was being run during the 2011 winter cropping season.  The respondents contend that there were on a contract of employment without limit of time, and were unfairly terminated in November 2011, having been recruited in May 2011.

The matter went for conciliation before the designated agent for the National Employment Council for the Agricultural Sector.  Conciliation failed, and the matter went for compulsory arbitration, resulting in the arbitral award in contention.  The operative part of the arbitral award reads as follows

“I hereby dismiss the claimants’ claim over matters concerning the fairness or unfairness of the dismissals, allowances, outstanding salary for Eric Chinzima for the month of November 2011, cash in lieu of leave and damages ‘to loss of employment’.

I hereby order that Eric Chinzima and 27 others be paid three months notice each using the rate of pay at the time of dismissal.  Further, that the quantum of the notice pay and names of litigants be agreed mutually by both parties and paid in full by 16 March 2016 through NEC Agriculture Harare offices.  Failure parties should approach the arbitrator for quantification.”

The appellant noted an appeal against the second part of the arbitral award.  It is

the part that is awarding 3 months notice pay to each of the respondents.  Its grounds of appeal are stated as:

“a)	With all due respect, the court a quo erred by proceeding to find that the respondents were entitled to cash in lieu of notice when he had not entertained or heard the allegations of unfair dismissals or circumstances surrounding the termination of the employment relationship.

With respect, the honourable arbitrator erred by overlooking that cash in lieu of notice is not a remedy for consideration as the respondents were raising allegations of unfair dismissal.  Allegations of unfair dismissal have their principal remedies for consideration.

With respect, the arbitrating authority erred by deciding that the respondents were employed on a contract without limit of time because they were engaged for more than 6 weeks in a period of more than four consecutive months.  The respondents were seasonal workers and they had not been  employed for more than eight consecutive months within any period of twelve months as stipulated by Section 15 subsection 2 of the Statutory Instrument 323 of 1993.”

In the main, the appellant’s contention is that the arbitrator could not go on to

award notice pay, having dismissed the claim for unfair dismissal.  In fact, the issue of unfair dismissal was not part of the issues referred for arbitration.  The issues or terms of reference from conciliation were formulated as;

“The terms of reference given to me by the designated agent were:

Whether the claimants are entitled to notice pay or not.

If they are entitled, then for what period.

The remedy thereof.”

The respondents maintained their argument that they were on a contract

without limit of time and were entitled to 3 months notice pay.  They averred the employment contract was terminated at the instance of the employer, who was then obliged to pay them the requisite notice pay.  For this contention, they relied on the proviso to section 7 of the Labour Act, [Chapter 28:01] (the Act),

“Provided that where the termination is at the instance of the employer, the employee shall have a right to payment for a period corresponding to the appropriate period of notice required in terms of subsection (4) or (5).”

The respondents further made reference to section 12 (3) of the Act, which defines what constitutes a contract without limit of time.  It reads:

“A contract of employment that does not specify its duration or date of termination, other than a contract for casual work or seasonal work or for the performance of some specific service, shall be deemed to be a contract of employment without limit of time on the day that his period of engagement with a particular employer exceeds a total six weeks in any four consecutive months.”

Thus, respondents’ entitlement to cash in lieu of notice, is premised on the averment that they were on contracts without limit of time.  These contracts were terminated at the instance of the employer.

If such are the facts proved or accepted,  i.e. that the contracts were without limit of time, and were terminated at the instance of the employer, then this would be a simple and straight forward matter.  The terminated employees would be entitled to notice pay as per the proviso to Section 7, supra.

However, this matter is complicated by the nature of the arbitral award.  The award, made up of two bullets has been cited above.  The first bullet dismisses the claim for unfair dismissal, among other claims.  In fact, the award shows that the question of the fairness or otherwise of the termination of employment was not decided.  The award is worded;

“I hereby dismissed the claimants’ claim over matters concerning the fairness or unfairness of the dismissals…”

This then becomes inconsistent with the next bullet, which orders payment of cash in lieu of notice.  Such an order would ordinarily, be predicated upon a finding that the termination of employment was unlawful.  That question was not decided, as clearly seen in the first bullet.

It may be necessary to refer to the submissions the parties made before the arbitrator.   These submissions show the issues that were placed before the arbitrator, and how they were argued and resolved.

The respondents (then claimants) in the “CLAIMANTS STATEMENT OF CLAIM,” set out the background to the matter as follows:

“For the avoidance of doubt the brief factual background in this matter is stated as follows:

The claimants were employed on contract without limit of time.

Claimants were engaged in different months starting May 2011. See Annexure “A”

The claimants were unfairly dismissed in November 2011.”

Out of this factual background arises the claim for, inter alia, notice pay,

outstanding allowances, and damages for loss of employment.

In the respondent’s statement captioned “RESPONDENT’S HEADS OF ARGUMENT”, the respondent raised the point that these issues did not emanate from conciliation.  They were not part of  the terms of reference from conciliation.  The respondent submitted;

“The respondent’s position is that the claimants or applicants are not entitled to any cash in lieu or notice pay.  Therefore, the second term of reference is automatically rendered null and void.

The claimants’ submissions on page 1, point 3 (c) notes that the claimants were unfairly dismissed in November 2011.  For ease of reference, find attached and marked Annexure ‘B’

The respondent contests the fresh allegations but as indicated, this honourable court has no jurisdiction to assess the fairness or unfairness of the dismissals.

The most important point to sieve out from the claimants’’ representatives is that the employees in question were unfairly dismissed.  The question that the respondent would like to pose to this honourable court is that ‘is a dismissed employee entitled to cash in lieu of notice or is notice pay a remedy for unfair dismissal?’  The answer is a crystal clear NO.”

My understanding is that the respondent, essentially, raised a preliminary point, which was to the effect that the arbitrator had no jurisdiction to deal with the issue of the unfairness or otherwise of the respondents’ dismissal, as it was not dealt with at conciliation.  So were the other issues ancillary to the alleged unfair dismissal, such as outstanding allowances and damages for loss of employment.

The ruling in the first bullet of the arbitral award implies that the arbitrator upheld the respondent’s preliminary point.  Having done so, he could then not go on to delve into the merits of respondents’ termination, and consequently their entitlement to notice pay.  It is not clear how the arbitrator de-linked notice pay from the question of unlawful dismissal.  It seems to me one flows from the other.  During oral submissions, Mr L Mazhawidza, the human resources officer who appeared on behalf of the appellant, clarified the point this way;

“So the arbitrator could not go into the notice issue without first hearing how the employment relationship subsisted and ended… it is like giving a prescription without a diagnosis first.”

Having ruled that he had no jurisdiction to determine the question of unfair dismissal, the arbitrator could not go on to determine issues ancillary to that question.  That included the question of notice pay.  The issue is not whether he was correct in making that ruling.  The fact is he made a definitive ruling, which is an integral part of his award.  That made the question of notice pay redundant.  It is not clear why the conciliator referred an ancillary issue, that of notice pay, without the main issue of unfair dismissal, from which the ancillary issue arises.

The appellant, as already indicated, did not make submissions on the issue of whether or not the termination was fair.  Instead, he raised the preliminary point that the issue of dismissal was not before the arbitrator.  The arbitrator upheld the preliminary point.  The matter should have ended there.  It was open to the parties to return to conciliation, with the issue of unfair dismissal.  Depending on how it would be resolved, it could find its way to compulsory arbitration, for it to be properly and fully argued.

As matters stand now, that issue was determined without the benefit of argument from the respondent.  It was determined without the respondent being heard, as he expected, rightly in my view, a ruling on the preliminary point.  There was therefore no hearing on the fundamental question of whether or not the respondents were unfairly dismissed.  In the light of this, I consider that there is merit in the appeal.

The appellant submitted that the arbitrator should have remitted the matter to conciliation.

In my view, litigation would be unduly and unnecessarily protracted if this course of action is adopted at this stage.  Probabilities are that the parties would be deadlocked at conciliation, resulting in the issuing of a certification of no settlement.  The matter would then be referred to compulsory arbitration.  There seems to be no point in referring the matter to conciliation, where it would inevitably end up at compulsory arbitration.

In the circumstances, the most appropriate course of action would be to remit the matter to arbitration, for determination of the issue of whether or not the respondents were unfairly dismissed, and the appropriate remedy.  The entitlement to notice pay will, inevitably, depend on the fairness or otherwise of the termination of the respondents’ employment.

In the result, it is ordered that;

The appeal be and is hereby allowed.

The second part of the arbitral award handed down on 12 February 2016 awarding cash in lieu of notice to the respondents, be and is hereby set aside.

The matter is remitted to a different arbitrator, for a determination of the question of whether or not the respondents were unfairly dismissed, and the appropriate remedy.

Each party bears its own costs.