Category: 2022 Case Law Review

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

Act 5 of 2015 removed the employer’s right to terminate a contract of employment on notice. It only prescribed that the right only exists when the employer terminates a contract through a code of conduct, mutual separation or when the employer is pursuing a retrenchment exercise. The same provisions were maintained in the Labour Amendment Bill of 2021. Despite the changes brought about by the 2015 amendments some employers still labour under the misconception that they can terminate a contract of employment on notice. Thankfully, the Supreme Court in CFI Holdings v Peggy Rambanepasi and Others SC 17 – 22 clarified this issue.

The facts

The facts of this are pretty much straightforward. The appellant employer terminated 3 senior managers’ contracts on notice on 26 January 2016. They were all given three months’ notice which they were not allowed to serve. Aggrieved, the respondents placed a dispute before a labour officer who ruled that the terminations were unlawful. The Labour Court confirmed the Labour Officers ruling as it also concluded that the terminations were unlawful.

The law

In reaching its conclusion, the Supreme court had to answer the question as to whether the employer complied with the law on termination on notice as provided under section 12(4a) of the Labour Amendment 5 of 2015.[1]

The court observed that the legislature’s intention when it came up with section 12(4a) was so that employees terminated on notice would not “walk away empty-handed”.[2] It further observed that section 12(4a) applied to employees in specified circumstances.[3] Through the so-called golden rule of statutory interpretation, the court concluded that termination on notice can only happen when there is full compliance with the section under discussion. The court thus argued:

“In order to comply with s 12 (4a) the parties could only terminate the contract of employment if there was a registered Code of Conduct for the workplace, or in the absence of such code, a model code, or there was mutual agreement to terminate the contract of employment. It is common cause that there was no code of conduct used. It is also common cause that there was no agreement as between the parties to terminate the contract.”

The court added that it is only when there is full compliance with section 12(4a) that the accompanying provisions that talk about payment of a minimum retrenchment package can be applied. In the absence of full compliance with section 12 (4a), section 12 (4b) cannot be applicable.

Conclusion

At the end of the dispute, the court concluded that the Labour Court was right in confirming the labour officer’s draft ruling that the employee’s contracts were terminated unlawfully.

Own Comment

The case has at the very least, confirmed that the blanket common law right to terminate a contract on notice is no longer part of our law. Termination on notice can now only happen in terms of section 12 (4a) of the Labour Act as amended. Full compliance with the mandatory provisions of that law must happen. Termination on notice can only happen if the termination is in terms of a code of conduct, a mutual separation or when retrenchment is being pursued. Outside these specified conditions, termination on notice is unacceptable. A similar approach was adopted in NMB Bank Limited v Ashton Kupara and 25 Others where the court argued that the employer must fit all terminations on notice within the provisions of section 12 (4a) of the Labour Act as amended in 2015.

We believe that these cases are correct and the clarity they bring is a welcome development in our labour law. The common law right that gave employers to end contractual relationships on notice ended in 2015. One cannot exercise rights that have since been statutorily abolished.

---

[1]           The section reads: (4a) No employer shall terminate a contract of employment on notice unless— (a) the termination is in terms of an employment code or, in the absence of an employment code, in terms of the model code made under section 101(9); or (b) the employer and employee mutually agree in writing to the termination of the contract; or (c) the employee was engaged for a period of fixed duration or for the performance of some specific service; or (d) pursuant to retrenchment, in accordance with section 12C.

[2]           CFI Holdings v Peggy Rambanepasi and Others SC 17 – 22 on paragraph 11.

[3]           CFI Holdings v Peggy Rambanepasi and Others SC 17 – 22 on paragraph 11.

The backbone of this case is the question of whether an employer can appeal against a decision of a disciplinary hearing. One viewpoint is that when an employer constitutes a disciplinary hearing, he appoints an agent to deal with the disciplinary issue on his or her behalf. This viewpoint suggests that the employer must abide by the outcome of the disciplinary hearing meaning that the employer cannot challenge the outcome of the proceedings by way of an appeal. This viewpoint is seemingly logical and plausible, however, in ZESA Holdings (Private) Limited v Obson Matunja SC 73–22 the Supreme Court argued that it is not consistent with the basic rules of statutory interpretation. The court in this case undertook an important investigation that one cannot afford to ignore regarding a fake Supreme Court judgement that purpoted to deal with this issues similar to the ones in dispute. The important findings of the court are discussed hereunder.

The facts

The appellant charged the respondent for contravening the national employment code of conduct. It appointed a hearing official that made a finding that the respondent was not guilty. The hearing concluded that the charges were baseless and unsubstantiated. Aggrieved, the employer appealed to the Labour Court. The Labour Court struck the appeal off its roll. It ruled that the employer did not have the right to appeal against the verdict of a disciplinary hearing. The Supreme Court did not agree.

The law

The apex court observed that there are two conflicting judgements in the Zimbabwe Law Reports. The judgements pertain to Pioneer Transport v Mafikeni. One of the judgements is shown to have been issued in 2017 and the other one was issued in 2018. After its investigation, the court ruled that the 2017 judgement is fake.[1] The judgement suggested that an employer cannot appeal against a decision of a hearing. This is the judgement that the respondent employee was relying on in arguing that an employer cannot appeal against a disciplinary hearing outcome.

The court looked at the appeal provisions in the Labour Act[2] and national code[3] and realised that these provisions granted “a person” aggrieved by the decision of a hearing official the right to appeal to the Labour Court.  It looked at the basic rule of statutory interpretation relies on the words in a statute to constue the intention of the legislature and decided that the word “person” also included artificial persons such as a corporation created in terms of the law. The employer being a legal person, the Supreme Court argued that it had the right to appeal against the decision of the hearing. The court thus decisively observed:

“There is, therefore, no doubt whatsoever in light of the foregoing authorities, that on a proper interpretation of s 92 D of the Act, an employer is a person. An employer qualifies as a person who can be aggrieved by a determination made under an employment code. That is the only ordinary grammatical meaning of that section”.

The employer thus retains a right to appeal against a decision of a hearing official. The court also added that there is no statutory bar against an employer appealing a decision of a hearing.[4]

Conclusion

The appeal was allowed thus giving an aggrieved employer the right to appeal against the decision of a hearing.

In addition, the court ordered that the registrar of the Supreme Court must issue a corrigendum removing the judgment of “Pioneer Transport v Douglas Mafikeni SC 45/17 (2017 (2) ZLR 71) from the list of Supreme Court judgments and asserting that the authentic judgment of this Court is Pioneer Transport v Douglas Mafikeni SC 65/18.”[5]

Own Comment

We fully agree with the conclusion reached by the Supreme Court in this case. It has been mentioned elsewhere in this publication that the purpose of labour law is to balance the interests of the employer and the employee. It would not be in the interest of justice to provide one party to the employment relationship with rights that are not given to the other party.

The right to be heard is fundamental to the resolution of disputes in labour law. It would be unfortunate to take a position that such an important right is reserved for the employee alone. An employer in the form of a company is a legal person that can be aggrieved by decisions of a disciplinary hearing outcome.

---

[1]           ZESA Holdings (Private) Limited v Obson Matunja SC 73 – 22 on page 2.

[2]           Section 92D of the Labour Act reads: “Appeals to the Labour Court not provided for elsewhere in this Act: A person who is aggrieved by a determination made under an employment code, may, within such time and in such manner, as may be prescribed, appeal to the Labour Court”.

[3]           Section 8(6) of Statutory Instrument 15 of 2006: “A person or party who is aggrieved by a decision or manner in which an appeal is handled by his or her employer or the Appeals Officer or Appeals Committee, as the case may be may refer the case to a Labour Officer or an Employment Council Agent, as the case may be, within 7 working days from the day of receipt of such decision”.

[4]              ZESA Holdings (Private) Limited v Obson Matunja SC 73 – 22 on page 13.

[5]              ZESA Holdings (Private) Limited v Obson Matunja SC 73 – 22 on page 14.