This is a partial appeal against the judgment of the Labour Court (the court a quo) LC/H/2/19 dated 7 February 2019. The appeal is against the court a quo's ruling on the question of citation of the parties and the arbitrator's failure to award damages as an alternative to reinstatement....,.
BRIEF SUMMARY OF THE CASE
The 56 appellants were employed by the respondent, Freda Rebecca Mine Holdings Limited, in various capacities at its mine in Bindura. Owing to virulent economic hardships at the time, the respondent ceased its mining operations sometime in 2008 without terminating the appellants respective contracts of employment.
Sometime in 2009, the respondent sought to resuscitate its mining operations.
In doing so, it unilaterally sought to re-engage the appellants on inferior contracts different from those obtaining as at the time it ceased operations in 2008.
A dispute then arose concerning the appropriate terms of employment upon resumption of mining operations.
Following failure to resolve the dispute, the respondent arbitrarily wrote to the appellants terminating their original contracts of employment.
The termination letters were written on a standard letterhead bearing the name FREDA REBECCA GOLD MINE. The letters were signed by one T Chivonivoni who designated himself/herself as the GENERAL MANAGER-FREDA REBECCA GOLD MINE.
Dissatisfied by the turn of events, the appellants took the dispute to the Designated Agent.
The Designated Agent referred the dispute to conciliation.
Upon failure of the conciliation process, the conciliator issued a Certificate of No Settlement and completed a Reference to Arbitration on a standard form in which he designated the parties as “Freda Rebecca Mine alleged unfair labour practice of E Mapondera and 60 others.”…,.
The reference form is dated 12 May 2010.
It is common cause that the proper citation of the respondent, as a party to legal proceedings, ought to have been Freda Rebecca Gold Mine Holdings Limited.
TERMS OF REFERENCE
The arbitrator's terms of reference were “to determine whether the dismissal of E. Mapondera and 60 others was lawful or not.”
At the hearing before the arbitrator, the respondent took the preliminary objection, that, apart from Edmond Mapondera, the rest of the remaining appellants had no locus standi because their names had not been listed as claimants and E. Mapondera was not authorised to represent them.
Counsel for the appellants argued, that, the respondent had always been aware that the case involved 61 employees whose identities had not been placed in issue at conciliation stage. It was only at the arbitration stage that the respondent belatedly sought to make it an issue.
During the course of the arbitration proceedings, the arbitrator was then provided with a list of the concerned employees comprising a total of 58 claimants. The list of the claimants who were party to the proceedings was availed to the respondent.
The arbitrator dismissed the objection in limine on the ground, that, the appellants had a real and substantial interest in the matter and that right from the initiation of the legal proceedings the respondent knew the identity of its adversaries.
Having dismissed the preliminary objection, the arbitrator proceeded to make an award in favour of E. Mapondera and 57 others on 12 January 2011. The award was couched in the following terms:
“1. That, the claimants are hereby reinstated to their positions without loss of salary and benefits with effect from the date of unlawful dismissal.
2. Each party to meet its own costs.”
Dissatisfied with the arbitral award, the respondent appealed to the court a quo with partial success. It took the following four (4) grounds on appeal:
“1. The Honourable arbitrator unprocedurally accepted evidence submitted by the claimants subsequent to the arbitration hearing in respect of the purported hearing in respect of the purported identity of the innominate (sic) 60 other claimants who had not been included by name in the original claim.
2. The Honourable arbitrator fundamentally misdirected himself in finding, that, since the alleged 60 other employees had a substantial interest in the matter they did not need to be identified and to be made parties in arbitration proceedings before him. The fact that the employees have any kind of interest in the matter did not dispense with the entitlement of the appellant to know who the said appellants were at the commencement and during the course of the proceedings. The production of the names of the employees subsequent to the hearing, and without an opportunity for the appellant to challenge the accuracy of the names and the positions so stated for the employees, violated the appellant's right to a fair hearing before an independent and impartial tribunal.
3. The Honourable Arbitrator fundamentally misdirected himself in failing to find that the contracts of employment for the said employees, E. Mapondera & 60 Others, had terminated by operation of law and the appellant could only re-engage the employees in terms of new contracts of employment. The said former employees, having refused to sign new contracts of employment, the appellant lawfully confirmed the termination of their contracts of employment by operation of law on the 5th of March 2010.
4. The Honourable arbitrator fundamentally misdirected himself in ordering the reinstatement of E. Mapondera & 60 other employees without affording the Appellant an opportunity to pay damages in lieu of reinstatement. The order of reinstatement, without the alternative for the payment of damages, is not consistent with the ordinary rules of the law of contract and the specific circumstances of the appellant.”
THE RELIEF SOUGHT
On the basis of the above grounds of appeal, the appellant sought the following relief:
“(i) That the claimant's claim be and is hereby dismissed.
(ii) Alternatively, that, in the event that the Honourable court finds that the contracts of employment for the Respondents were not lawfully terminated, that the Appellant is hereby directed to pay the Respondents damages in lieu (sic) of reinstatement.
(iii) The Respondents shall pay the costs of suit.”
Upon consideration of the facts and the law, the court a quo found that the arbitration proceedings were a nullity at law because the claimants had cited a non-existent person and that the 2nd to 60th employees were not a party to the arbitration proceedings.
It also found, that, the arbitrator had no discretion to award reinstatement without an alternative of payment of damages for unlawful dismissal. It therefore ordered as follows:
“It is accordingly ordered that -
1. The appeal be and is hereby allowed on grounds 1, 2, 4 and 5.
2. The appeal falls on ground of appeal 3.
3. Overly, the appeal succeeds as the proceedings were a nullity due to wrong identity of the employer.
4. Each party to bear its costs.”
Aggrieved by the above order, the appellants appealed to this Court challenging the court a quo's order on the following grounds:
“GROUNDS OF APPEAL
1. The court a quo erred at law in finding that the citation of the respondent, through its trade name 'Freda Rebecca Mine' was such an irregularity whose effect rendered the entire proceedings a nullity.
2. The court erred at law in finding that 2nd to 61st appellants were not properly cited before the Arbitrator and that the extent of the impropriety was such that they were all not party to the arbitration proceedings.
3. The court a quo erred at law in finding that the Arbitrator has no power to order an employer to reinstate an unlawfully dismissed employee without giving the same employer the option to pay damages in lieu of reinstatement to the employee.”
On the basis of the above grounds of appeal, the appellants prayed for the following relief:
1. That the appeal succeeds with costs.
2. That the judgment of the court a quo is partially overturned and the order substituted with the following:
“(a) The preliminary point raised by the Appellant relating to its mis-citation be and is hereby dismissed.
(b) The preliminary point raised by the Appellant relating to the proper citation of the 2nd to the 61st Respondents be and is hereby dismissed. The 2nd to 61st Respondents are hereby held to be properly before the court.
(c) The appeal be and is hereby dismissed with costs and the arbitration award be and is hereby upheld.”
ISSUES FOR DETERMINATION
The grounds of appeal raise the following three cardinal issues for determination:
1. Whether or not the alleged improper citation of the respondent rendered the entire proceedings a nullity.
2. Whether or not the appellants were properly before the Arbitral Tribunal.
3. Whether or not it was proper for the Arbitral Tribunal to order reinstatement of the appellants without an alternative of payment of damages in lieu of reinstatement.
ANALYSIS AND DETERMINATION OF THE ISSUES
WHETHER OR NOT THE APPELLANTS WERE PROPERLY BEFORE THE ARBITRAL TRIBUNAL
It will be remembered, that, the arbitrator's terms of reference were “to determine whether the dismissal of E. Mapondera and 60 others was lawful or not.”
It is trite, that, an arbitrator is bound by the given terms of reference. He has no jurisdiction outside the terms of reference.
The respondent's objection sought to amend the terms of reference by limiting the terms of arbitration to E. Mapondera to the exclusion of the 60 other employees.
This the arbitrator could not do as it would amount to a violation of his terms of reference.
Placing reliance on the High Court cases of Panganai and 20 Others v Kadir and Sons (Private) Limited HH26-95 and Prosser and 35 Others v Ziscosteel Company Limited HH201-93, the learned judge a quo held, that, apart from E. Mapondera, the other 60 employees were not properly before the arbitrator. He reasoned, that, this was because the arbitrator had not been provided with a list of their names and they had not filed affidavits professing joinder to the arbitral proceedings.
It is rather ironic, if not irrational, that, the respondent sought validation of dismissals that were carried out in the name of a non-existent person styled Freda Rebecca Gold Mine which it disowns.
It was therefore a serious misdirection, that, after holding that the proceedings before the arbitrator were a nullity, the learned judge proceeded to determine the appeal on the merits. This was despite his ruling that there was no respondent before him.
What escaped the learned judge a quo's attention is that the two precedents he relied upon…, above were determined by the High Court in terms of the High Court Rules, which are not strictly applicable to arbitration proceedings in terms of the Labour Act.
Again, the learned judge failed to distinguish arbitral proceedings from trial proceedings in a court of law.
Conscious of his obligation to determine the complaint of the 60 other employees by reference, the arbitrator properly sought and obtained clarification on the identities of these other employees.
That clarification was communicated to the respondent thereby giving it an opportunity to be heard on the authenticity of the list of names provided. There was therefore no prejudice to the respondent, real or imagined.
In my view, the arbitrator did not misdirect himself in any way as that was the correct thing to do to facilitate the proper discharge of his mandate in terms of the reference.
Thus, again, the learned judge a quo misdirected himself and fell into error by holding that the other 60 appellants were not properly before the arbitrator.
Having come to the conclusion that the 60 other employees were not properly before the arbitrator, it was remiss of the learned judge a quo to proceed to deal with the merits of the appeal before him.
He, again, erred in this respect.
The proceedings beyond that finding were therefore a legal nullity. They cannot stand in light of the gross misdirection by the learned judge a quo.
