On 23 September 2020, we invited the parties to address the Court on a point in limine that arose after judgment was reserved in this matter.
The point in limine is whether the High Court, in the exercise of its powers to issue a declaratur, could properly issue one in a purely labour matter in the light of section 2A(3) of the Labour Act [Chapter 28:01] (“the Labour Act”) which provides, that, the Labour Act “shall prevail over any other enactment inconsistent with it” as read also with section 89(6) of the Labour Act, which provides for the exclusive jurisdiction of the Labour Court, in the first instance, to hear and determine any application, appeal or matter concerned with labour issues.
Both parties filed supplementary heads of argument.
It had been expected that the matter would be enrolled and viva voce submissions made. However, after receipt of the supplementary heads of arguments, it was considered that another hearing on the matter was not necessary, but the parties were given time to file any additional heads they deemed necessary in lieu of a hearing, which the respondents did on 11 April 2022.
FACTUAL BACKGROUND
The respondents were employed on contracts without limit of time by the appellant at its various branches across the country.
On 10 and 11 June 2015, the appellant wrote letters to the respondents advising them, that, due to viability constraints, their employment contracts had been terminated on three months notice.
In the same letter, the appellant offered to replace the terminated employment contracts with new ones which provided for remuneration based on productivity. The reason for so doing was that the appellant still required the respondents services.
The letters were couched in the following terms:
“The macro-economic challenges facing the country are seriously hampering the viability of the company. Particular reference is made to the poor performance of the company as reflected by the month-on-month sales figures from last year to date. The sales figures are well below operating costs. These figures show, that, it is impossible for the company to adapt the way it does business to its operating environment to ensure that it survives. The costs of the company must be aligned and positively correlated to productivity.
Your current contract of employment was concluded when the environment was not as hostile on manufacturers as it now is.
At the time that we concluded the employment contract, we agreed that the contract could be terminated on notice other than through dismissal. Because we still require your services, we wish to terminate your current contract on notice and replace it with one that provides for remuneration based on productivity.
We hereby give you three months notice for the termination of your current contract of employment. At the same time, we hereby offer you a new performance contract which aligns your remuneration to your productivity. Your new contract, if accepted, shall become effective on the date that the termination of your current employment contract becomes effective. Should you want to bring forward the effective date of your new contract, you will be required to waive the notice required to terminate your contract of employment.”…,.
There were several correspondences between the appellant and the respondents, through their legal practitioners, wherein, the respondents pointed out to the appellant that its decision to terminate the employment contracts and replace them with new ones was unlawful.
The appellant, however, remained adamant that its decision was lawful.
This prompted the respondents to approach the court a quo seeking an order declaring the termination. or variation of their employment contracts, to be unlawful on 4 September 2015.
The court issued the following declaratory order:
“1. The termination or variation of the applicants contracts of employment by the respondent be and is hereby declared unlawful.
2. The respondent be and is hereby ordered to reinstate the applicants to their employment without loss of salary and benefits.
3. In the event that reinstatement is no longer an option, the respondent be and is hereby ordered to pay the applicants damages to be determined by an arbitrator appointed by a Senior Labour Officer.
4. The respondent is ordered to pay the costs of suit.”...,.
The respondents case before the court a quo was that the purported termination of their employment contracts, and the offer of new contracts, was unlawful in that it was a calculated manoeuvre to circumvent the retrenchment procedures set out in section 12C of the Labour Act [Chapter 28:01] and the Regulations thereto.
The respondents argued, that, since the termination of the employment contracts had been necessitated by economic hardships, the appellant was in fact re-organising the undertaking, hence, the termination of employment contracts was a way to reduce costs.
The respondents thus prayed for an order declaring the termination or variation of their employment contracts to be unlawful....,.
The appellant contended, in opposition, that, the relief that was being sought by the respondents was within the powers of the Labour Court and hence they ought to have exhausted that remedy before approaching the High Court.
The appellant argued, that, section 89 of the Labour Act endows the Labour Court with the same review powers as the High Court, hence the Labour Court has power to grant the relief that the respondents sought in the court a quo.
To that extent, the appellant argued further, that, the court a quo should have declined jurisdiction on the basis of section 89(6) of the Labour Act....,.
The court a quo found, that, the circumstances of the case warranted the granting of a declaratur as provided for by section 14 of the High Court Act [Chapter 7:06]....,.
On the point in limine raised mero motu by the Court, the appellant's main bone of contention is that the Labour Court has exclusive jurisdiction to hear matters which are labour in nature.
The appellant contends, that, the Labour Court is a specialised court empowered, in terms of section 172(2) of the Constitution 2013, to have jurisdiction to deal with matters of employment and labour as may be conferred upon it by an Act of Parliament.
The appellant further argued, that, the provisions of section 89(6) of the Labour Act gives the Labour Court some special protection that ensures that it is only the Labour Court that fulfils the constitutional obligation of dealing with labour matters and matters relating to employment.
In that regard, the appellant is of the view that section 89(6) of the Labour Act gives the Labour Court exclusive jurisdiction to deal with the matters that are referred to in section 89(1) of the Labour Act.
Furthermore, it was the appellant's submission, that, section 89(6) of the Labour Act must be read together with section 2A(3) of the Labour Act which provides that the Labour Act shall prevail over any Act that is inconsistent with it.
It was further argued, that, although the High Court is empowered to grant declaraturs in terms of section 14 of the High Court Act [Chapter 7:06], that power is discretionary and ought to be exercised in cases that are justifiable, and that, therefore, the High Court's power to grant a declaratory order in a purely labour matter is curtailed by section 2A(3) of the Labour Act which provides that the Labour Act shall prevail in the event of any inconsistency with any other Act....,.
Per contra, the respondents submitted that there does not exist any conflict of jurisdiction in labour matters between the Labour Act and the High Court Act.
In that sense, they argued that section 89(6) of the Labour Act does not bring all labour disputes exclusively under the jurisdiction of the Labour Court.
It was further submitted, that, section 14 of the High Court Act is not inconsistent with section 89(6) of the Labour Act.
In that sense, the respondents argue that section 2A(3) of the Labour Act is of no application in this matter.
It was further submitted, that, as section 171(1) of the Constitution gives the High Court original jurisdiction over all civil and criminal matters, there does not appear to be any provision in the Constitution that limits the original jurisdiction of the High Court over all civil matters.
In that regard, it was submitted that the proper approach is that the High Court enjoys jurisdiction over all matters, including labour matters, and that, in fact, any unconstitutionality lay in the extent that section 89(6) of the Labour Act seeks to oust the jurisdiction of the High Court.
The respondents finally argued, that, the present matter was distinguishable from the recently decided cases of Nhari v Mugabe & Ors SC161-20 and Chingombe & Anor v City of Harare & Ors SC177-20.
They therefore submitted, that, the nature of the dispute between the parties was such that it required a declaration of rights which only the High Court could hear.
However, in an apparent realization of the weaknesses of their submissions, the respondents posited that if the court was not persuaded by their arguments, this Court should exercise its powers of review, in terms of section 25 of the Supreme Court Act [Chapter 7:13], and proceed to find that the actions of the appellant were unlawful and confirm the decision of the High Court on that basis....,.
This appeal will be decided on the preliminary point of whether or not the court a quo, in the exercise of its power to issue a declaratur, could issue one in a purely labour matter in the light of the provisions of the Constitution and relevant legislation.
WHETHER THE COURT A QUO COULD ISSUE A DECLARATUR IN THE CIRCUMSTANCES
Section 14 of the High Court Act [Chapter 7:06] enjoins the High Court to exercise its discretion, in appropriate cases, and issue a declaratur. Specifically, the provision is couched as follows:
“The High Court may, in its discretion, at the instance of any interested person, inquire into and determine any existing, future, or contingent right or obligation, notwithstanding that such person cannot claim any relief consequential upon such determination.”
Clearly, the power granted to the High Court above is discretionary and can be exercised only in appropriate circumstances.
In casu, the matter at hand was a labour matter, and, the question that ought to be answered is whether the High Court could issue out a declaratur in a matter that is purely labour in nature.
It is prudent to first note, that, the Labour Court is a court of specialised jurisdiction: see Lowveld Rhino Trust v Dhlomo-Bhala SC34-20.
The Constitution 2013, in section 172(2), provides that the Labour Court shall have such jurisdiction over matters of labour and employment as may be conferred by an Act of Parliament.
Section 89(6) of the Labour Act gives the Labour Court exclusive jurisdiction to hear labour matters and it provides thus:
“89 Functions, powers and jurisdiction of Labour Court
(6) No court, other than the Labour Court, shall have jurisdiction, in the first instance, to hear and determine any application, appeal or matter referred to in subs (1)…,.”
The essence of the above provision is that the Labour Court has exclusive jurisdiction when it comes to issues dealing with labour matters at the first instance.
This is further cemented by the provision of section 2A(3) of the Labour Act which provides that the Labour Act shall prevail over any enactment that is inconsistent with it.
Section 89(6) and section 2A(3) of the Labour Act therefore have to be read together.
And, the import of both provisions is that the inherent jurisdiction of the High Court becomes limited by the fact, that, the Labour Court has exclusive jurisdiction in respect of all labour matters at the first instance.
The above vexed question has been answered differently in various episodes of our legal history, which can be identified as the period before the inauguration of the new Constitution in 2013, the immediate post 2013 situation, and the current position.
Before the coming into force of the new Constitution in 2013, the position was settled, that, the High Court had no jurisdiction in matters of labour and employment.
Thus, various decisions handed down by the courts in this period confirm this: for example, in DHL International Ltd v Madzikanda HH51-10; 2010 (1) ZLR 201 (H) it was stated at paragraph 14:
“The Labour Court has exclusive jurisdiction in matters relating to suspensions from employment and that the possession of the employer's property by an employee, in terms of the contract of employment, is so interdependently linked to the contract that one cannot decide one without deciding on the other.”
Similarly, in Moyo v Gwindingwi NO & Anor 2011 (2) ZLR 368 the court held:
“Section 89(6) is clear and unambiguous that 'no court' has jurisdiction over matters falling under the purview of the Labour Court. This court does not possess the machinery to jealously guard its inherent jurisdiction where the legislature has specifically taken it away.”
See also Zimtrade v Makaya 2005 (1) ZLR 427 (H) 429 wherein the court held as follows:
“I am of the opinion that matters relating to suspension from employment with or without salary, and matters relating to dismissals, are specifically within the purview of the Labour Court as these matters are provided for in the Act and the Regulations made thereunder; the jurisdiction of this Court is specifically ousted in respect of matters of dismissals and suspensions, as these are specifically provided for in the Act.”
However, with the advent of the new Constitution in 2013, there followed a period of conflicting decisions in the High Court, with some opinions plumping for the High Court having original jurisdiction on all matters, including those involving labour and employment, on the basis that section 171(1) of the Constitution trumps section 89(6) of the Labour Act.
On the other hand, contrary opinion favoured the view that the Labour Court exercised exclusive jurisdiction, in the first instance, in all matters involving employment and labour.
These cases are concisely discussed in Nhari v Mugabe & Ors SC161-20.
One of the pillars of the opinions which championed the overall and original jurisdiction of the High Court in all matters was that only the High Court has jurisdiction to issue a declaratory order, per section 14 of the High Court Act.
However, in my view, this was an incorrect understanding of the nature of the remedy of a declaratory order.
While section 14 of the High Court Act captures this remedy in its broadest and classical form as a “gentle order” which may be issued with or without any consequential relief, there is absolutely no doubt in my mind that the Labour Court, in its daily operations, does routinely issue declaratory orders; holding, for example, that an employee has been wrongfully dismissed or certain actions constitute unfair labour practices and then proceeding to grant consequential relief.
I make this point to emphasize, that, even in the absence of Nhari v Mugabe & Ors SC161-20, the view of this Court would have been to uphold the Labour Court's exclusive jurisdiction in employment and labour matters.
Moreso, because it would have taken very clear and explicit provisions in the new Constitution to oust the legal regime established and solidified before its enactment.
Happily, the vexed controversy over the exclusive jurisdiction of the Labour Court on all labour matters versus the High Court's unlimited, original jurisdiction on all matters, which had led to “an unhappy state of law” has been put to rest in Nhari v Mugabe & Ors SC161-20 as follows…,.:
“The same Constitution that conferred original jurisdiction on the High Court over all civil and criminal matters also made provision for the creation of other specialised courts, whose jurisdiction over specialised areas of the law, and the exercise of such jurisdiction, was left entirely to Acts of Parliament.
In other words, it is the Constitution itself which has permitted the establishment of these specialized courts, and, in the same breath, provided for the issue of jurisdiction and exercise of such jurisdiction to be left to an Act of Parliament.
Section 172 of the Constitution, which establishes the Labour Court, is not made subject to section 171 which creates the High Court.
The two sections are in pari materia and must therefore be construed together.
In making provision for the establishment of specialised courts in Acts of Parliament, the Constitution has not in any way attempted to fetter or restrict the jurisdiction that is to be conferred upon such courts, or to make such jurisdiction subject to section 171 which creates and provides for the jurisdiction of the High Court.”
The learned Appeal Judge then goes on to give examples of specialised courts such as military tribunals, tax courts, and customary law courts, and concludes, that, not only would it be absurd to extend the jurisdiction of the High Court to all such specialized courts, but it would get the High Court “bogged down in matters over which it may have very little expertise or petty matters that should ordinarily not detain the court.”
Nhari v Mugabe & Ors SC161-20 was followed recently by Chingombe & Anor v City of Harare & Ors SC177-20, where, following their suspension from employment, the appellants unsuccessfully sought a declaration at the High Court that such suspension was unlawful and consequential relief.
The Supreme Court held that “the High Court had no jurisdiction to issue a declaratur in respect of issues of labour and employment” and that “Section 2A of the Labour Act makes it clear, that, notwithstanding the powers of the High Court to issue declaraturs, the Labour Act prevails over all other laws inconsistent with it.”
Accordingly, it this Court's conclusion that the High Court erred in assuming jurisdiction in a purely labour matter. It should have declined jurisdiction.
In light of the above, it is evident that section 25(2) of the Supreme Court Act confers upon this Court the power of review over matters that have come before it by way of appeal. The powers of review are exercisable upon the discovery of any irregularity in the proceedings which took place in the lower court.
In the circumstances, the matter in the High Court was a matter brought about as a result of the appellant's termination of the respondents contracts of employment on notice and replacing those terminated contracts with new ones which provided for remuneration based on productivity.
That, in my view, is purely a labour matter as enshrined in section 89(1) of the Labour Act.
The High Court did not have jurisdiction to hear the matter. Such an irregularity cannot stand.
Giving due regard to the submissions made by the parties, and the considerations of the law thereon, the court a quo ought to have declined its jurisdiction on the matter as it was a purely labour issue.
This Court, in the exercise of its review powers, sets aside the decision of the court a quo.
Accordingly, it is ordered as follows:
1. The appeal succeeds with each party bearing its own costs.
2. The Court, in the exercise of its review powers, in terms of section 25(2) of the Supreme Court Act [Chapter 7:13], hereby sets aside the decision of the court a quo and substitutes it with the following:
“The application is struck off the roll with costs.”
