ISOQUANT INVESTMENTS PRIVATE LIMITED T/A ZIMOCO v MEMORY DARIKWA (CCZ 6/20)

“The analysis shows that there is a difference in the legal treatment of a party who has already obtained a final decision on a claim and one who has obtained “a draft ruling” in terms of s 93(5)(c) of the Act. The two parties are not similarly situated. The difference in the remedy available to them is justified by the nature and effect of the procedure adopted for the resolution of the dispute of right or unfair labour practice involving a dispute of right.”

Category: Conciliation process, powers of designated agents for the NECs.

Introduction

Act 5 of 2015 brought about important changes in our labour laws. These changes have to some extent resulted in confusion and misinterpretations. In this case, the CCZ took the opportunity to clarify the procedures that can be undertaken by a designated agent seized with an unfair labour practice matter. This case is also important in illustrating the importance of a draft ruling as well as the process a Labour officer or a designated agent should follow in order to come up with the draft ruling. It is important to note that the main question before the court was in connection with the referral of a constitutional matter from a lower court. The most important lesson from this judgement is that a lower court can only refer to the CCZ a matter that is within its jurisdiction.

Facts

Between 21 July 2015 and 14 August, 2015 ZIMOCO terminated on notice contracts for17 of its employees. The employees demanded minimum retrenchment packages as provided under section 12C of Act 5 of 2015. The matter was brought before a designated agent for the NEC: Motoring Industry. Conciliation was done and the designated agent proceeded to produce a determination. In the determination, she concluded that ZIMOCO had to pay the minimum retrenchment package as per the requirements of section 12C mentioned above.

The designated agent brought the matter before the LC to have her draft ruling confirmed as per the requirements of the LA as amended in 2015. The applicant company challenged the constitutionality of the confirmation proceedings on the basis that the whole process violated its constitutional right to equal protection of the law and administrative justice among others. For these reasons ZIMOCO requested that the matter be brought before the CCZ for a determination of the constitutional questions.

The Courts Reasoning

Referral of constitutional issues

The CCZ noted that the only question that was before it was whether the matter had been correctly presented to it for adjudication.

The court pointed out that for a subordinate court to refer to it a constitutional question the matter so referred must be in connection with proceedings that are validly before that subordinate court. In other words, the matter must be validly before the Labour Court for it to then be able to refer a constitutional question the CCZ. This further means that the matter must be before the subordinate court through “a method prescribed by the law”.[1]

The labour court as a creature of statute

The CCZ highlighted that the LC is a creature of statute. This meant that it can only do that which it is permitted to do by the enabling legislation, the Labour Act. Being a creature of the statute the labour court was bound to exercise jurisdiction over a matter falling within its competence, provided the correct procedure had been followed.[2] Part of this procedure is compulsory conciliation of a dispute brought before the      labour officer.

In the judgment, the CCZ in illustrating the importance of complying with the prescribed procedure stated that:

“This means that a matter that is not a product of compliance with the procedural and substantive requirements of these provisions would not fall within the class of matters over which the Labour Court would have jurisdiction in terms of s 93(5a) of the Act. It would not be a matter which would be the subject of the procedure for bringing such matters to the court a quo, as prescribed under s 93(5a) of the Act. Bringing such a matter to the court a quo, under the guise of invoking the procedure prescribed in the subsection, would not validly institute proceedings in that court in terms of s 93(5a) of the Act. The court a quo would not have a valid matter over which to exercise jurisdiction.”[3]

Conciliation of disputes

The CCZ made a finding that the conciliation of disputes is the compulsory method of resolving all disputes and unfair labour practises referred to a labour officer.[4] It explained the importance of conciliation as a method of resolving labour disputes by agreement. It also explained the functions of a conciliator as per the labour act.      One should go through pages 11-19 of the judgment to fully appreciate what should happen in the conciliation process.

Importance of a certificate of no settlement

When conciliation fails or at the expiry of the requisite time for the conciliation a labour officer is compelled to issue a certificate of no settlement. The court remarked that a certificate of settlement should be issued after parties, with the assistance of the labour, have gone through a genuine process of conciliation.[5] The court noted that conciliation does not require that parties submit a statement of claims and responses when it remarked as follows:

“It would not be compliance with the requirements of a compulsory process of conciliation, provided for under s 93(1) of the Act as a pre-condition for the issuance of a certificate of no settlement, to call upon the parties to submit statements of claims and responses followed by submission of heads of argument before a certificate of no settlement is issued.”

Once a certificate of no settlement has been issued, the court remarked, the next stages in dispute resolution would kick in. In the case of a dispute of right, the labour officer will proceed to produce a draft ruling which has to be confirmed by the court. In the case of a dispute of interest, the matter will be referred for arbitration.

Draft ruling

Once conciliation fails, the parties are no longer responsible for the settlement of the dispute as the labour officer is now duty-bound to come up with a draft ruling on the merits of the matter as per the requirements of the LA. This applies to all disputes of right.

The CCZ pointed out that a draft ruling is not enforceable. It cannot be appealed or reviewed against. It is made pending the final court outcome.[6] It also confirmed the position found in Drum City v Brenda Garudzo SC57/18 which case is an authority to the fact that an employee must be joined in confirmation proceedings before the LC.

Drum City v Brenda Garudzo SC57/18

THE CCZ noted that this case had been used as authority to the proposition that a draft ruling made against an employee should not be confirmed by the LC. It ruled that this was not the case and it remarked:

“One cannot interpret the Drum City (Pvt) Ltd case supra as authority for the proposition that it would only be cases where a “draft ruling” has been made against the employer that confirmation proceedings would ensue. The remarks were made as an obiter dictum. The ratio decidendi of that case is that an employee must be joined in confirmation proceedings”

The importance of these remarks is that draft rulings either made for or against an employee will have to be confirmed by the LC as a matter of compliance with the procedure prescribed by the LA.

Confirmation of the Draft Ruling

The court process of confirming a labour officers draft ruling was described by the CCZ as follows:

“Confirmation of a draft ruling is a legal process. The judicial officer in the Labour Court is tasked with applying the principles of the law to the facts. He or she is not merely rubberstamping the “draft ruling” of the labour officer. The judicial officer is required to thoroughly investigate the matter. A judicial officer is bound by the law of confirmation. He or she must research the procedure and the applicable law”

The role of a designated agent

The CCZ noted that Designated Agents of NECs are empowered to redress/remedy an unfair situation in their areas of jurisdiction. This is in terms of section 63(3a) read together with (63b). Once the designated agent has redressed the dispute in terms of these sections, then section 93 of the LA does not apply. The matter can only be brought before the LC by way of an appeal or a review.

It also noted that a designated agent can redress a dispute or to attempt to redress the dispute.[7] Section 93 will therefore only apply if the dispute has not been redressed. In this instance, the designated agent would have attempted to resolve the dispute through conciliation. Critically the court mentioned:

“Section 93 of the Act does not create an avenue for the validation of a final decision that is made by a designated agent in terms of s 63(3a) of the Act. It only creates an avenue where a designated agent adopted the process of attempting to settle the dispute through conciliation in accordance with the provisions of s 93 of the Act.”

In the present case, the court argued that the designated agent had made a final decision which was final. Section 93 of the act could not apply. A certificate of the settlement could not be issued. In the absence of the certificate of the settlement, she couldn’t be deemed to have been attempting to settle the dispute.  No dispute could be resolved by way of conciliation. It was on this basis that the court concluded that the proceedings before the LC were a nullity as section 93 could not be used as the basis for approaching Labour Court.[8]

Conclusion

As a result of the above reasoning, the court concluded that the matter was not properly before the labour court. The LC could not, therefore, refer these constitutional questions to the CCZ. In the result, the application was dismissed with the consent of the parties.

*END*


[1]           Isoquant Investments Private Limited T/A ZIMOCO v Memory Darikwa (CCZ 6/20) p8

[2]           Ibid at p9

[3]           Ibid at p28

[4]           Ibid at 10

[5]         Ibid at 11-19

[6]           Ibid at p22

[7]           Ibid at p30

[8]           Ibid at p31

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2 thoughts on “ISOQUANT INVESTMENTS PRIVATE LIMITED T/A ZIMOCO v MEMORY DARIKWA (CCZ 6/20)”

  1. I am very happy with the CCZ judgement as it stands to reinforce conciliation procedures to resolve labour disputes. In most of the cases labour officers/DAs were no longer interested in conciliation. They were not following conciliation procedures preferring to write draft judgments. Employees were on the receiving end most of the time losing clear cases because Labour officials were afraid to appear before the Labour Court for confirmation because Labour Court judges would take them to task in order to confirm their rulings.

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