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Manyenga v Petrozim (Private) Limited SC 40/23

“In order for the defence of impossibility to succeed, the impossibility must be objective in the sense that it must be a real impossibility which is not based on a party’s disinterest or unwillingness to perform their contractual duties”.

Introduction

Manyenga v Petrozim (Private) Limited is authority of the fact that an employee facing a disciplinary charge involving an omission can have a defence by way of arguing that they couldn’t perform the legal duty imposed on them.

This case deals with a situation where an employee was charged and dismissed for an omission that he was accused of committing at a time when he was employed as an acting general manager for the respondent company. The omission was that he had failed to advise the respondent’s board of the operational challenges that were being faced by the respondent. He argued that he could not have been able to advise the board due to the shortfalls that were inherent in his job. It was this argument that boiled down to the common law rule/defence called  “lex non cogit ad impossibilia”.  The effect of the employee’s defence was that “objective impossibility in discharging a legal duty is always a defence when the type of conduct charged is an omission.” It was this defence that was placed before the Supreme Court.

Facts

The appellant, Johannes Manyenga, worked as the Deputy General Manager for the Respondent in this matter. He was accused of non-disclosure to the board of material issues that were negatively affecting his employer.[1] Despite denying the charges levelled against him, he was eventually dismissed from employment.[2] Irked by the disciplinary hearing outcome,  the appellant unsuccessfully appealed to the Labour Court. It was the Labour Court’s position that there was no misdirection on the part of the disciplinary hearing, considering the evidence that was placed before it.[3] Aggrieved with the Labour Court’s findings, the appellant approached the Supreme Court. The question before the Supreme Court was whether the court had found sufficient ground to confirm the conviction and dismissal of the appellant.

The court’s findings and the law

Impossibility of performance

The first observation that the Supreme Court made was that “objective impossibility in discharging a legal duty is always a defence when the type of conduct charged is an omission”.[4] Here the court’s observation was that the appellant employee could not inform the respondent’s board of directors of the shortcomings in the respondent’s operations because his ability to do so was curtailed by the respondent. No board meeting had been held at the time the appellant acted as the General Manager (GM) for the Respondent. It was also observed that there was a standing instruction that all communication to the board had to happen through the GM. His substantive appointment was that of a deputy GM. In addition, it was observed that no employee was reporting to the Appellant as the Acting GM.[5] All these barriers made it objectively impossible for the Appellant to inform the respondent or its board of the challenges that were faced by the operations. The impossibility of performing the expected duties was seen as a defence when one is charged with an omission.

For impossibility to be a defence, the court ruled that the impossibility must result in “real impossibility”.[6] Imagery or hypothetical impossibility will not apply as a defence against a charge of an omission. In addition, the impossibility must be permanent. Temporary impossibility will not exonerate an employee from not performing.[7]

Admission in the course of proceedings

The objective impossibility faced by the Appellant to inform the Respondent of the operational challenges bedevilling its operations was confirmed by an admission that was made in the disciplinary hearing.[8] The court argued that once an admission was made it would bind the maker if later such an admission is not withdrawn. It remarked:

“Indeed, the effect of an admission is settled law. Once made it binds its maker with the attendant consequences see Kettex Holdings P/L v S Kencor Management Services P/L HH 236-15.”

The admission confirmed that the employee could not inform the board of the challenges faced by the respondent company when no such board meeting had been convened.

The court also argued that the fact that the appellant had access to the board chairman did not mean that he had access to the board. It distinguished between the board as a committee of persons that convene at specific intervals as opposed to its chairman who is a single individual.[9] It further argued that a board entails a properly constituted board. Without access to this properly constituted board, the appellant could not have been said to have had access to the board.[10]

Conclusion of the dispute

The court found that the Appellant must not have been found guilty and dismissed because it was impossible to do what the respondent expected him to do.

Own comment

The importance of this judgement is twofold. An employee can escape a disciplinary charge wherein he or she is accused of not doing something by pointing out that it was not possible to do the legal act expected of him or her. The failure must not be deliberate or temporary. It must be a permanent impossibility that is not imputed on the employee. This judgement also highlights the effect of an admission. Once an admission has been put across and not withdrawn it has the legal effect of binding the person that makes the admission. Proof of such an admission may not be required.

[1]              Manyenga v Petrozim (Private) Limited SC 40/23 on paragraph 5.

[2]              Manyenga v Petrozim (Private) Limited on paragraph 10.

[3]              Manyenga v Petrozim (Private) Limited on paragraph 17.

[4]              Manyenga v Petrozim (Private) Limited on paragraph 24.

[5]              Manyenga v Petrozim (Private) Limited on paragraph 32 wherein it was held: “To add on to the above submissions, the appellant’s predicament was further compounded by the fact that he had no subordinates reporting to him on the company’s operations.”

[6]              Manyenga v Petrozim (Private) Limited on paragraph 27.

[7]              Manyenga v Petrozim (Private) Limited on paragraph 28 wherein the court remarked: “Furthermore, the impossibility to perform must not only temporarily prevent a party from performing their contractual obligations. It must be one where performance of the contract is finally and completely impossible. See the case of Mutangadura v TS Timber Building Supplies 2009 (2) ZLR 424 (H) at 429C-F.”

[8]              Manyenga v Petrozim (Private) Limited on paragraph 32.

[9]              Manyenga v Petrozim (Private) Limited on paragraph 33.

[10]            Manyenga v Petrozim (Private) Limited on paragraph 32.

1,055 Views

American Friends Service Committee v Irene Chauke SC 1/2012

“There can be no doubt that the Labour Court fell into error in coming to this conclusion as it is settled law that damages in these circumstances must be properly proved by the party seeking the same”.

Introduction

    In the Contemporary Employment Law in Zimbabwe, First Edition we indicated that the widely accepted test for determining if an employment relationship exists between the parties is the dominant impression test. This test looks at all the facts of the interaction between the parties to determine if indeed there was an employment relationship. Aspects such as the control of the employee by the employer, supervision, and control must be fully considered. The test also looks at whether the employee was part of an organization. In such a test, therefore, there is no single decisive factor that the court considers. The totality of the evidence presented by the parties is fully considered.

    Facts

    American Friends Service Committee v Irene Chauke SC 1/2012 deals with two important aspects of Zimbabwe’s employment law. First, it outlines the law that applies in a determination as to whether an employment relationship exists between the parties. Secondly, it also assesses and makes a decisive conclusion on the importance of evidence when it comes to the quantification of damages in lieu of reinstatement. These issues are discussed here.

      The issue presented before the Supreme Court centred on whether or not a valid employer-employee relationship existed between the parties. The appellant had initially hired the respondent on fixed-term contracts up until September 2007. However, it was undisputed that the respondent continued to provide services to the appellant beyond this time frame. Her employment was extended on multiple occasions until its termination in June 2009. At the point of termination, she was earning a monthly salary of US$1,500 and was required to work five days per week and eight hours per day. Additionally, her role as office coordinator and programmer required her to report her activities to the regional office located in South Africa. The case at hand thus required a thorough examination of the employment relationship between the parties involved and to ascertain whether an employer-employee relationship existed between the parties

      The court’s findings and the law

      The court found that on the facts, the respondent was an employee of the appellant. The fact that the respondent was earning a monthly salary of US$1,500 and was required to work five days per week and eight hours per day all pointed to the existence of an employment relationship.

      In addition to the above, the court also found that the arbitrator based his decision regarding the quantification of damages solely on an unsupported statement from the respondent. The Labour Court had accepted this claim without opposition from the appellant. The Supreme Court emphasized that damages in such cases must be properly substantiated by the party making the damages claim.

      Conclusion of the dispute

      The court’s view was that there was a need for the quantum of damages to be properly proved. The matter was remitted to the Labour Court for determination of the damages after evidence had been adduced.

      Own comment

        This case highlights the dominant impression test of determining whether an employment relationship exists between the parties. The fact that the Respondent was employed on a fixed-term basis. That he was paid a salary of USD 1500 and reported to superiors in South Africa all pointed to the existence of an employment relationship contemplated by the Labour Act. Every court faced with a dispute regarding the existence of an employment relationship is compelled to look at the totality of the evidence presented by the parties. This resonates well with what the Supreme Court indicated in Masango & Others v Kenneth & Another SC 41–2015 where the court ruled that:

         “…. what the parties call each other in such a contractual relationship, or what they perceive their relationship to be is not decisive and may actually be irrelevant. The court looks at the totality of the evidence and all the circumstances to determine the true nature of the relationship.”

        Equally so, the acceptance of damages by a court in the absence of evidence is not ideal. Several court judgements have emphasized the importance of leading evidence in order to support quantification proceedings. In Heywood Investments (Private) Limited T/A GDC Hauliers v Pharaoh Zakeyo SC32/2013 the Supreme Court ruled that:

        “What the court is not empowered to do is to award damages in the absence of any evidence in support of such award”

        We submit therefore that American Friends Service Committee v Irene Chauke SC 1/2012 is an important case for those who wish to contest the presence or the absence of an employment relationship. It is also a useful case for those seeking to thwart damages that were awarded in the absence of evidence.

        1,052 Views

              American Friends Service Committee v Irene Chauke SC 1/2012

        “There can be no doubt that the Labour Court fell into error in coming to this conclusion as it is settled law that damages in these circumstances must be properly proved by the party seeking the same”.

        Introduction

        In the Contemporary Employment Law in Zimbabwe, First Edition we indicated that the widely accepted test for determining if an employment relationship exists between the parties is the dominant impression test. This test looks at all the facts of the interaction between the parties to determine if indeed there was an employment relationship. Aspects such as the control of the employee by the employer, supervision, and control must be fully considered. The test also looks at whether the employee was part of an organization. In such a test, therefore, there is no single decisive factor that the court considers. The totality of the evidence presented by the parties is fully considered.

        American Friends Service Committee v Irene Chauke SC 1/2012 deals with two important aspects of Zimbabwe’s employment law. First, it outlines the law that applies in a determination as to whether an employment relationship exists between the parties. Secondly, it also assesses and makes a decisive conclusion on the importance of evidence when it comes to the quantification of damages in lieu of reinstatement. These issues are discussed here.

        1. Facts

        The issue presented before the Supreme Court centred on whether or not a valid employer-employee relationship existed between the parties. The appellant had initially hired the respondent on fixed-term contracts up until September 2007. However, it was undisputed that the respondent continued to provide services to the appellant beyond this time frame. Her employment was extended on multiple occasions until its termination in June 2009. At the point of termination, she was earning a monthly salary of US$1,500 and was required to work five days per week and eight hours per day. Additionally, her role as office coordinator and programmer required her to report her activities to the regional office located in South Africa. The case at hand thus required a thorough examination of the employment relationship between the parties involved and to ascertain whether an employer-employee relationship existed between the parties.

        1. The court’s findings and the law

        The court found that on the facts, the respondent was an employee of the appellant. The fact that the respondent was earning a monthly salary of US$1,500 and was required to work five days per week and eight hours per day all pointed to the existence of an employment relationship.

        In addition to the above, the court also found that the arbitrator based his decision regarding the quantification of damages solely on an unsupported statement from the respondent. The Labour Court had accepted this claim without opposition from the appellant. The Supreme Court emphasized that damages in such cases must be properly substantiated by the party making the damages claim.

        Conclusion of the dispute

        The court’s view was that there was a need for the quantum of damages to be properly proved. The matter was remitted to the Labour Court for determination of the damages after evidence had been adduced.

        Own comment

        This case highlights the dominant impression test of determining whether an employment relationship exists between the parties. The fact that the Respondent was employed on a fixed-term basis. That he was paid a salary of USD 1500 and reported to superiors in South Africa all pointed to the existence of an employment relationship contemplated by the Labour Act. Every court faced with a dispute regarding the existence of an employment relationship is compelled to look at the totality of the evidence presented by the parties. This resonates well with what the Supreme Court indicated in Masango & Others v Kenneth & Another SC 41–2015 where the court ruled that:

         “…. what the parties call each other in such a contractual relationship, or what they perceive their relationship to be is not decisive and may actually be irrelevant. The court looks at the totality of the evidence and all the circumstances to determine the true nature of the relationship.”

        Equally so, the acceptance of damages by a court in the absence of evidence is not ideal. Several court judgements have emphasized the importance of leading evidence in order to support quantification proceedings. In Heywood Investments (Private) Limited T/A GDC Hauliers v Pharaoh Zakeyo SC32/2013 the Supreme Court ruled that:

        “What the court is not empowered to do is to award damages in the absence of any evidence in support of such award”

        We submit therefore that American Friends Service Committee v Irene Chauke SC 1/2012 is an important case for those who wish to contest the presence or the absence of an employment relationship. It is also a useful case for those seeking to thwart damages that were awarded in the absence of evidence.

        914 Views

        Contemporary Employment Law in Zimbabwe

        We are happy to share with you that we have a new book on the market.

        You may need to know that:

        1. 300 cases are used to explain several legal points in the book.
        2. It has a commentary on the Labour Amendment Act of 2023.
        3. It analyses the Labour Court Rules as amended in 2023.
        4. It outlines 30 cornerstones of workplace law.
        5. It analyses more than 50 employment law cases. It is only available in hard copy & has 370 pages.

        A preview can be downloaded here.

        2,036 Views

        Minimum Retrenchment Package Definition that’s missing from Act 11 of 2023

        This summary is based on our book, “Contemporary Employment Law in Zimbabwe” which you can only access as a hard copy. A preview of the book is available for download on this website, using this LINK.

        The Act now refers to two types of retrenchment packages,[1] that is a minimum retrenchment package as well as an enhanced retrenchment package,[2] which is negotiated and agreed upon between an employer and an employee. The definition of a minimum retrenchment package is missing from the Act 11 of 2023.

        When the Labour Amendment Bill of 2021 was produced it marked that the minimum retrenchment package was pegged at 1 month’s salary for two years served.[3] This was similar to the provisions in Act 5 of 2015 which also provided for 1 month’s salary for every 2 years served. Strangely, the provision that provided for the definition of a minimum retrenchment package is no longer there in Act 11 of 2023. This creates a gap which results in interpretation problems for employers and employees.

        A perusal of the whole section 12C shows a legislature that was making a distinction between a minimum retrenchment package and an agreed enhanced package. Section 12C (2) shows that the minimum retrenchment is payable in the absence of an agreed enhanced retrenchment package. Without ascribing a meaning to the minimum retrenchment package some of the provisions in section 12C become difficult to comprehend. For example, if an employer alleges that he or she cannot pay any part of the minimum retrenchment package it becomes mandatory for the same employer to still notify the retrenchment board and indicate that “the portion of the minimum retrenchment package that he or she can pay” is not  “less than twenty-five per centum of the total package.”[4] The reference in this section to 25% of the total minimum retrenchment packages means that the legislature envisaged that the “minimum retrenchment package” would be known beforehand. In the absence of the definition of a minimum retrenchment package in the Act, there is no objective way of calculating the 25% that should be strictly paid by an employer that cannot afford the minimum retrenchment package. This is a legal problem.

        The legal challenges caused by the absence of the definition of a minimum retrenchment package in the Act call for two options. The first option is for the legislature to amend the Act once more and provide a definition of a minimum retrenchment package. The second option is for the Bill to be taken into consideration in understanding the definition of the minimum retrenchment package. This will be in line with the Interpretation Act (Chapter 1:01) which provides for the use of extrinsic material in the interpretation of enactments.[5] If such an approach is taken, one would realise that extrinsic information such as “any explanatory memorandum relating to the Bill containing the provision, or any other relevant document, that was laid before or furnished to members of Parliament by a Minister before the time when the provision was enacted;” can be used to interpret the legislative provision.[6]

        If the second approach is taken and if this is indeed seen to be practical, the inescapable conclusion one might reach is that a minimum retrenchment package of 1 month’s salary for every year served was contemplated by the legislature when section 12 C of the Act was promulgated under Act 11 of 2023. The definition of the minimum retrenchment package was there in Bill. It was not different from what it was under Act 5 of 2015. This is the definition that the legislature must have had in mind when it enacted the whole of section 12C of the Act. The temptation to be escaped in the circumstances is where an employer plucks figures from the air and then ascribes them to the definition of a minimum retrenchment package. The legislature must not have contemplated such a haphazard approach.

        [1]               Section 12C (1) of the Act as amended.

        [2]               Section 12C (1) of the Act as amended.

        [3]               The Labour Amendment Bill provided: “minimum retrenchment package” means one months’ wages for every two years served (and the proportionate amount for every part of a year served). Unless better terms are negotiated and agreed between the employer and the employee or employees concerned or their representatives, a minimum retrenchment package shall be paid by the employer as compensation for retrenchment not later than the date on which the retrenchment takes effect”.

        [4]               Section 12C(9) of the Act provides: “Where an employer alleges lack of capacity to pay any part of the minimum retrenchment package— (a) the employer shall within fourteen days of any employee being retrenched comply with subsection (5)(b) as if reference to minimum retrenchment package in that provision is a reference to the portion of the minimum retrenchment package that he or she is able to pay not being less than twenty-five per centum of the total package and subsections (6) and (7) shall apply to that portion accordingly”

        [5]               Section 15B of the Interpretation Act (Chapter 1:01).

        [6]               Section 15B(e) of the Interpretation Act (Chapter 1:01).

        4,824 Views

        Act 11 of 2023 Does not Authorise the Termination of Permanent Contracts on Notice.

        This summary is based on our book, “Contemporary Employment Law in Zimbabwe” which you can only access as a hard copy. A preview of the book is available for download on this website, using this LINK.

        Section 12(4a) (b) under Act 11 of 2023

        Section 12(4a) (b) of the Act provides that an employer can terminate a contract of employment in the following circumstances:

        “For the breach of an express or implied term of contract, upon such breach being verified after due inquiry under an applicable employment code or in any other manner agreed in advance by the employer and employee concerned.” (Own Emphasis).

        This section is subject to controversy as some practitioners are of the view that it gives the employer the right to terminate a contract on notice. The assumption by these practitioners is that the words “in any other manner agreed in advance by the employer and employee concerned” applies to the parties generally agreeing to a method of termination not provided under the whole section 12(4a). The argument goes on to suggest that the provision allows an employer and an employee to choose to terminate a contract on notice.

        In our respectful view, section 12(4a) (b) must be construed as a whole. We submit that the employer and employee may agree to a different method of inquiring into the alleged breach other than a method in the code of conduct. The word “inquiry” means “a request for information or a systematic investigation often of a matter of public interest or examination into facts or principles.”[1] The wording of the provision thus suggests that upon an employee being accused of breaching workplace rules, there must be an inquiry to verify this breach. There are two ways of verifying the breach. An investigation can be done as per the specifics of a code of conduct. The parties may also agree in advance on how they will conduct this investigation or inquiry.

        We submit that it is only after the investigation has been carried out and a subsequent hearing has been done that an employee can be deemed to have been fairly dismissed in terms of section 12(4a) (b) of the Labour Act. The same section cannot be used to propagate the view that the termination on notice was introduced in the Labour Act via the back door. Such an interpretation will fly in the face of section 12(4a) which has expressly excluded the termination of a contract on notice.

        Besides the above, we also submit that jurists must interpret legislation to protect the legislature’s intention. There is no doubt that after the infamous Zuva Petroleum judgment, and the enactment of Act 5 of 2015, the intention has been to curtail the termination of a permanent contract on notice. By expressly proving for the strict ways a contract can be terminated the legislature intended to make it clear that termination of a permanent contract on notice must be removed from our law. If one is to peruse the parliamentary debates on this issue, the clear message that was sent out was that the common law rule of terminating a contract on notice must not be available in the Labour Act. This was the intention of the legislature, and this is how section 12(4a) of the Labour Act must be interpreted.

        The interpretation that perpetuates the termination of permanent contracts on notice does not save and protect the legislative intention to preclude the termination on notice. The section must not be used to revive the ghost of 2015 which saw thousands of employees losing their jobs after the Zuva Petroleum judgement.

        [1]               https://www.merriam-webster.com/dictionary/inquiry <Accessed on 14 July 2023>.

        2,612 Views

        Vicarious Liability in Zimbabwe and South Africa: A Review of Some Court Cases

        Introduction

        Vicarious liability is a legal concept that holds an employer or principal liable for the wrongful acts committed by its employees or agents in the course of their employment. This doctrine has been applied in various court cases in Zimbabwe and South Africa, with differing outcomes. This article provides an overview of the legal framework and court decisions on vicarious liability in these countries.

        Legal Framework

        In Zimbabwe, the law of vicarious liability is based on the common law, which imposes liability on an employer for the wrongful acts of its employees committed within the scope of their employment. The test for determining whether an employee’s conduct falls within the scope of employment is whether it is sufficiently connected to the employee’s duties or whether it is a “frolic of his own.”

        In South Africa, the law of vicarious liability is also based on the common law. However, the Constitutional Court has held that vicarious liability can also arise from statutory duties, such as those imposed by the Employment Equity Act and the Occupational Health and Safety Act.

        Court Cases

        In Zimbabwe, the case of S v Chidziva established that an employer can be held liable for the sexual harassment of an employee by a fellow employee if the employer knew or ought to have known about the harassment and failed to take reasonable steps to prevent it. In this case, the employer was held liable for damages suffered by the victim.

        In another case, Muzenda v Attorney-General, the Supreme Court held that an employer can be held liable for the negligent driving of its employee, even if the employee was not acting within the scope of his employment at the time of the accident. The court held that the employer had a duty to ensure that its employees were competent and qualified to operate its vehicles.

        In South Africa, the case of K v Minister of Safety and Security established that a police officer who committed rape while on duty could be held liable for damages, and the Minister of Safety and Security could also be held vicariously liable for the officer’s actions. The court held that the officer’s conduct was sufficiently connected to his duties as a police officer, and that the Minister had failed to take reasonable steps to prevent the officer from committing the offence.

        In another case, Ngubane v South African Broadcasting Corporation, the Constitutional Court held that an employer can be held vicariously liable for the discriminatory conduct of its employees, even if the employer did not expressly authorise or condone such conduct. The court held that the employer had a duty to take positive measures to prevent discrimination in the workplace.

        Conclusion

        Vicarious liability is an important legal concept that holds employers accountable for the actions of their employees. In Zimbabwe and South Africa, courts have applied this doctrine in various cases involving wrongful acts committed by employees. The outcomes of these cases have varied, depending on the specific facts and circumstances. However, they provide useful guidance on the legal framework and principles governing vicarious liability in these countries. Employers should be aware of their potential liability for the actions of their employees and take reasonable steps to prevent wrongful conduct in the workplace.

        4,355 Views

        Transferring an employee from one location to the other

        Transferring an employee from one location to another can be a complicated process, especially in Zimbabwe. There are many factors to consider, including the legal requirements and court cases that have set precedents for such transfers.

        The first step in transferring an employee is to ensure that the transfer is legal. This means that the employer must have a valid reason for the transfer, such as a business need or a change in the employee’s job duties. The employee must also be given notice of the transfer and be given the opportunity to object if they feel that the transfer is not in their best interests.

        If the employee does object to the transfer, they may have grounds to take legal action. In Zimbabwe, there have been several court cases that have dealt with employee transfers, and these cases have set precedents for how such transfers should be handled.

        One such case is the case of Moyo v National Railways of Zimbabwe (2001), where an employee was transferred from one location to another without their consent. The court ruled that the transfer was illegal because the employer had not followed the proper procedures for transferring an employee. The court also ordered the employer to pay damages to the employee for the inconvenience and stress caused by the transfer.

        Another important case is the case of Ncube v ZESA Holdings (2010), where an employee was transferred from one location to another without adequate notice. The court ruled that the transfer was illegal because the employer had not given the employee enough notice of the transfer. The court also ordered the employer to pay damages to the employee for the inconvenience and stress caused by the transfer.

        These cases demonstrate the importance of following proper procedures when transferring an employee from one location to another. Employers must ensure that they have a valid reason for the transfer, that they give adequate notice to the employee, and that they follow all legal requirements for such transfers.

        In addition to legal requirements, there are also practical considerations when transferring an employee. Employers must ensure that the employee is able to perform their job duties in the new location, that they have adequate housing and transportation, and that they are able to adjust to the new environment.

        Overall, transferring an employee from one location to another can be a complex process, but by following proper procedures and taking practical considerations into account, employers can ensure a smooth and successful transfer. It is important to be aware of the legal requirements and court cases that have set precedents for such transfers in Zimbabwe, in order to avoid any legal or financial consequences.

        2,795 Views

        Post-termination fiduciary duties of ex-employees and restraint of trade agreements

        Introduction

        Whilst implementing the employer-employee contractual relationship the employee may inevitably come into contact with the employer’s secrets of the trade. It may also become inevitable that the employee may eventually end up working for a former employer’s competition. The use of knowledge and experience gained whilst working under one employer may be useful whilst working for another employer. This inevitable interaction between what one may gain in knowledge and experience whilst employed by one employer may be a source of conflict when the employee leaves employment. Employers have seen a desperate need to come up with restraint of trade agreements that are aimed at precluding employees from working for their competition or becoming competition themselves.

        This discussion focuses on the fiduciary duties that accrue to employees when they leave employment. In this discussion, it shall be noted that the fiduciary duty accruing to employees includes loyalty to the company in so far as not stealing its trade secrets. It also entails not violating restraints of trade validly entered between a company and its former employee. We discuss the law behind the application of restraint of trade agreements. We outline the important court decisions that have looked into this subject. The legal principles used by these courts will also be outlined. At the end of this discussion, it shall be concluded that the Constitution cannot be ignored when the subject under discussion is under scrutiny.

        Freedom of trade in terms of the Constitution of Zimbabwe, 2013

        The subject matter will be very limited and even incomplete without knowledge of the constitutional framework governing the law of profession, commerce and profession. The Constitution of Zimbabwe provides:

        “Every person has the right to choose and carry on any profession, trade or occupation, but the practice of a profession, trade or occupation may be regulated by law”.[1]

        The provision empowers every person to choose what they want to pursue in terms of their trade and occupation. Arguably, this provision puts into question the notion of restraint of trade agreements. A restraint of trade is a clause in a contract in which the employee undertakes that he or she will not act in competition with an employer upon separation. Its application may thus go against the constitutional principles stated above.

        As a result of the need to balance these interests, courts have had to come up with rules applicable to the restraint of trade agreements. These rules as devised by the courts provide the framework within which restraint of trade must be viewed. The rules discussed hereunder include the fact that a restraint of trade is only enforced where there is a breach of the agreement, that it must be reasonable and that there must be protectable interests.

        Breach of a restraint of trade

        A party that seeks to enforce a restraint of trade must first prove that there has been a breach of the agreement.[2] The evidence may be in the form of the former employee providing services to clients belonging to his or her former employer. The breach of the restraint of trade will compel the employer to enforce it. Enforcement is usually in the form of an interdict precluding the employee from continually acting contrary to the former employer’s protectable interests.

        Reasonableness of a restraint of trade

        The generally acceptable principle applying to restraint of trade agreements is that the agreement must be reasonable for it to be enforceable.[3] A former employee found violating a restraint of trade agreement that he or she had with the former employer may argue that the restraint of trade cannot be enforced because it is unreasonable. In Forsure (Pty) Ltd v Byron Robert Puckle and Another the court found that a restraint of trade that covered the whole Republic of South Africa was unreasonable and thus could not be enforced.

        The locus classicus of the need to have a reasonable restraint of trade contract is the South African case of Magna Alloys and Research (SA) (Pty) Ltd v Ellis 1984(4) SA 874 (A). The court in this case correctly held that a restraint of trade that is contrary to public policy is unenforceable because it will be unreasonable.[4] The court also held that each restraint of trade contract, before a court, must be analyzed individually to ascertain if it’s violating public policy and thus unreasonable. Regarding the reasonableness of a restraint of trade, the court in Sibex Engineering Services (Pty) Ltd v Van Wyk and Another 1991 (2) SA 482 (T) had this to say:

        “A contractual restraint curtailing the freedom of a former employee to do the work for which he is qualified will be held to be unreasonable, contrary to the public interest and therefore unenforceable on grounds of public policy if the ex-employee (the covenantor) proves that at the time enforcement is sought, the restraint is directed solely to the restriction of fair competition with the ex-employer (the covenantee); and that the restraint is not at that time reasonably necessary for the legitimate protection of the covenantee’s protectable proprietary interests, being his goodwill in the form of trade connection, and his trade secrets. If it appears that such a protectable interest then exists and that the restraint is in terms wider than is then reasonably necessary for the protection thereof, the Court may enforce any part of the restraint that nevertheless appears to remain reasonably necessary for that purpose.”

        Interests worth protection.

        In addition to the principles discussed thus far, a restraint of trade can only be enforceable if there is an interest worth protecting.[5] This may include trade secrets like customer lists.[6] In Forsure (Pty) Ltd v Byron Robert Puckle and Another, the court made a factual finding that there was no interest worth protecting considering that, the employee had only worked for the employer for a period of less than a year.[7] There was no evidence that the former employee was taking employees away from his former employer.

        Balancing the interest of the parties

        A court faced with a restraint of trade litigation is duty-bound to consider all the circumstances of the case before resolving the dispute. The process entails weighing the interests of the employer against those of the employee. Inevitably the constitutional rights indicated above may also be weighed. After weighing the interests of all the parties concerned, the court in Forsure supra observed:

        “In addition, there is no justifiable reason to enforce a national restraint when balanced against offending the right of Mr Puckle to work in a profession in which he is solely skilled and competent, albeit, same was acquired or enhanced while in the employ of Forsure.”

        The fact that the employee was solely skilled in the only profession that the employer sought to restrain him from practising was one of the factors that discouraged the court from enforcing the restraint of trade in this case. The court was also persuaded to not enforce the restraint of trade because of the failing economy[8] and the reduced job market. It sought to protect the employee from these difficulties once the restraint of trade is enforced.

        Duty not to steal employers’ secrets on separation.

        The court in Big Catch Fishing Tackle Proprietary Limited and Others v Kemp and Others[9] decisively concluded that a director or an employee is precluded from utilising the former company’s trade secrets or violating any interest of the company that is worthy of protection.[10] It was also held that it is only commercially viable and confidential information that should not be utilised by a former director or an employee.[11] It was further held that a director or an employee only interferes with his or her fiduciary duty after resignation only when he or she sabotages the company’s business or makes use of information that is confidential for the benefit of his company, himself or a rival.

        The director or employee must not also interfere with the existing contracts of the company he or she was formerly engaged with. The court also argued that a person must be allowed to be productive and be allowed to engage in trade as a function of their constitutional rights. Post resignations restraints are generally not supported by the courts.[12] It further argued that a resigned director must be able to make use of the experience, knowledge and skill that he or she acquired whilst still in the employ of the company that he or she left. The employee and director who have resigned from the company, whilst they can make use of the knowledge they acquired whilst still working for the company may not steal the trade secrets belonging to the company, they resigned from.

        Conclusion

        From the foregoing discussion, it can be noted in summation that a restraint of trade agreement can be enforced provided it meets certain conditions. These conditions include reasonableness. It also includes the fact that the restraint of trade must apply to interests that are worth protecting. Employees are under a legal obligation not to steal an employer’s trade secrets such as customer lists or other interests worth protecting.

        In enforcing restraint of trade agreements, the court cannot ignore the constitutional protection afforded the right of an individual to participate in a trade or profession of their choice. The courts have legal obligations to ensure that persons are productive. One cannot ignore the fact that we live in a volatile world. A world in which the economies are battling pandemics and diseases as well as wars. Several job cuts have been witnessed of late. We are therefore likely to see several restraints of trade agreements set aside in the interest of ensuring that persons are productive in full support of the Zimbabwean Constitution.

        [1]           Section 64 of the Constitution of Zimbabwe, 2013.

        [2]           Forsure (Pty) Ltd v Byron Robert Puckle and Another (South African case number J727/2022) on paragraph 17.

        [3]           See Magna Alloys and Research (SA) (Pty) Ltd v Ellis 1984(4) SA 874 (A).

        [4]           See Magna Alloys and Research (SA) (Pty) Ltd v Ellis 1984(4) SA 874 (A) in which the court held that: “Acceptance of public policy as the criterion means that, when a party alleges that he is not bound by a restrictive condition to which he had agreed, he bears the onus of proving that the enforcement of the condition would be contrary to public policy. The Court would have to have regard to the circumstances obtaining at the time when it is asked to enforce the restriction. In addition, the Court would not be limited to a finding in regard to the agreement as a whole but would be entitled to declare the agreement partially enforceable or unenforceable.”

        [5]           In Sibex Engineering Services (Pty) Ltd v Van Wyk and Another 1991 (2) SA 482 (T) it was held that: “The proprietary interests that could be protected by such a restraint were essentially of two kinds. The first kind consisted of the relationships with customers, potential customers, suppliers and others that go to make up what is compendiously referred to as the “trade connection” of the business, being an important aspect of its incorporeal property known as goodwill. The second kind consisted of all confidential matter which is useful for the carrying on of the business and which could therefore be used by a competitor, if disclosed to him, to gain a relative competitive advantage. Such confidential material is sometimes compendiously referred to as “trade secrets”.”

        [6]           Big Catch Fishing Tackle Proprietary Limited and Others v Kemp and Others.

        [7]           In Forsure (Pty) Ltd v Byron Robert Puckle and Another on paragraph 37 and 38 the court made the following factual findings: “Regard must also be had to the fact that Mr Puckle was less than a year in the employ of Forsure and the confidentiality it seeks to protect is not absolute or permanently protectable. [38] As well, there is no evidence to show that Mr Puckle would lure Forsure’s employees to joint Ubersure; which is, in any event, unlikely given that contention by Forsure that all its employees are bound by respective restraint of trade agreements.”

        [8]           In Forsure (Pty) Ltd v Byron Robert Puckle and Another on paragraph 39 the court remarked that: “He would have to contend with being economically inactive in a constrained economic climate and labour market that is hemorrhaging jobs on the terms that are overtly far-reaching given the diminished threat to the proprietary interest sought to be protected.

        [9]              (17281/18) [2019] ZAWCHC 20 (5 March 2019).

        [10]            Big Catch Fishing Tackle Proprietary Limited and Others v Kemp and Others on paragraph 36.

        [11]            Big Catch Fishing Case on paragraph 37.

        [12]            Big Catch Fishing case on par 40.

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        Vundla and Another v Innscor and Another SC 14 – 22[1]

        It is clear from these pleadings that the labour officer failed to conduct the conciliation in the manner stipulated in the Isoquant judgment, supra. A properly conducted conciliation does not require a statement of claim, response, reply and heads of argument. The labour officer does not make a determination in making his draft ruling. These features pertain to a hearing. Rather, he or she utilizes both the oral and written information and documents that he collects and collates from the parties to make a draft ruling. A draft ruling that emanates from improper procedural steps and substantive requirements is a nullity. It is incapable of invoking the confirmation jurisdiction of the Labour Court.

        Introduction

        This case was a chamber application for condonation and an extension of time within which to file an appeal. This case deals with the important elements that an applicant needs to prove for such an application to be granted. The remarks as to the merits of this matter are also important in revealing the law of conciliation that was buttressed in Isoquant Investments (Pvt) Ltd t/a Zimoco v Darikwa CCZ 6 – 2020. The far-reaching consequences of the interpretation of the Isoquant Case by the Supreme Court cannot be ignored.

        The Facts

        Two applicants were involved. The first applicant was a procurement manager whereas the second applicant was a general manager.

        The first applicant had a mutual termination agreement with the employer. He was paid his terminal benefits after signing a mutual separation agreement and receiving such payment. He regarded this as a retrenchment.

        The second applicant was retrenched with the approval of the retrenchment board. He signed the retrenchment agreement. In both cases, the two employees absolved their employer from any further claims arising from their termination.

        They challenged the termination processes, and the labour officer issued a draft ruling dismissing those claims. The Labour Court confirmed the Labour Officer’s ruling. This was in November 2016.

        Two appeals to the Supreme Court failed for various reasons.

        It was after the Isoquant Investments (Pvt) Ltd t/a Zimoco v Darikwa CCZ 6 – 2020 that the appellants lodged a fresh appeal with the Supreme Court which appeal founded the current application.The Law

        The initial finding of the court was that the Supreme Court’s interpretation in Drum City (Private) Limited v Brenda Garudzo SC 57-18 which interpretation excluded the Labour Court’s jurisdiction when a draft ruling is entered against an employee was wrong and had been jettisoned in Isoquant Investments (Pvt) Ltd t/a ZIMOCO v Memory Darikwa CCZ-20. It was after this Constitutional Court ruling that the applicants lodged the current appeal.

        In an application for condonation and extension of time within which to file an appeal, the court looks at five factors in deciding if the application must be granted. These are the extent of the delay, the reasonableness of the explanation for the delay, prospects of success, the importance of the case, the respondent’s interest in the finality of his judgment, the convenience of the court and avoidance of unnecessary delay in the administration of justice.

        • The delay

        It took the applicants 3 years and 8 months to partake in the appeal. This period was seen by the court to be inordinate. The court noted that part of the reason why the applicants delayed lodging the current appeal was that they had accepted the court’s view that confirmation proceedings cannot be made against a draft ruling that is made against an employee. See Drum City (Private) Limited v Brenda Garudzo SC 57-18. As already noted, this position has since been set aside by the Constitutional Court. The court could not accept this reason for the delay because the current application was not made as soon as the Isoquant case was decided. As a result, the court concluded that there was no reasonable explanation for the delay by the applicants.

        • Prospects of Success

        The court’s finding was that conciliation of the dispute was not properly held. It relied on the remarks inthe Isoquant case. In that case, the constitutional court concluded that conciliation has a specific process that has to be followed by a Labour Officer before a draft ruling is produced. The process includes the introduction of the dispute, storytelling, dispute analysis and problem-solving.  If these stages are not followed, the outcome is nullity. As a result of these findings, the conclusion was that the prospects of success for the applicants were slim since the draft ruling was null and void. The court remarked:

        “It is clear from these pleadings that the labour officer failed to conduct the conciliation in the manner stipulated in the Isoquant judgment, supra. A properly conducted conciliation does not require a statement of claim, response, reply and heads of argument. The labour officer does not make a determination in making his draft ruling. These features pertain to a hearing. Rather, he or she utilizes both the oral and written information and documents that he collects and collates from the parties to make a draft ruling. A draft ruling that emanates from improper procedural steps and substantive requirements is a nullity. It is incapable of invoking the confirmation jurisdiction of the Labour Court.”

        • The Merits

        The court noted that if an employee accepts a retrenchment package that acts alone waives the right of the same employee to challenge the proceedings. In this respect the court ruled:

        A voluntary acceptance of a terminal package is clearly knowingly made. It is also inconsistent with the continuation of an employment relationship. It constitutes conduct which reasonably leads the employer to believe that the employment relationship is over. Thus, whether the first applicant was terminated from employment by agreement or whether like the second applicant he was retrenched, their deliberate acceptance of their respective terminal packages was inconsistent with the continuation of the employment contract.

        Conclusion

        The court concluded that the application failed to meet all three major requirements for condonation and extension of time within which to appeal.

        Own Comment

        The court’s findings were clear-cut and consistent with the law that applies when one seeks to request the court to extend the time within which to file an appeal.

        [1]           Vundla and Another v Innscor Africa Bread Company Zimbabwe (Private) Limited and Another SC 14 – 2022

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