PATEL
JA: This
is an appeal against the judgment of the Labour Court setting aside
an arbitral award in favour of the appellants which upheld their
claim for the payment of arrear salaries and benefits.
Background
The
appellants, being 153 in number, were employed as security guards on
fixed term contracts renewable every three months. Their periods of
employment ranged from 2007 and 2008 until January and April 2011
when their contracts of employment expired by effluxion of time.
Their
contracts were not renewed because the project for which they were
employed was finally wound up in 2011.
In
July 2010, in a separate matter involving the respondent, its
workers' committee and its employees, the first arbitrator (Nasho)
ordered the payment of back pay, from 1 March 2009 to the date of the
award, in line with the multi-currency system.
In
conformity with that award, a Works Council Agreement was concluded
on 15 September 2010 to fix the back pay due to all employees and the
salary structure for non-managerial employees from 1 January 2010
onwards.
In
a subsequent matter, the appellants in
casu
challenged the termination of their employment on the basis that
their contracts had become permanent upon repeated renewal.
The
second arbitrator (Mugumisi) dismissed their claim of unfair
dismissal on 4 April 2012.
On
appeal, the arbitral award was upheld by the Labour Court. That
decision is currently pending an application for leave to appeal to
this court.
On
10 December 2012, following the rejection of their unfair dismissal
claim by arbitrator Mugumisi, the appellants filed a further claim
for the payment of arrear salaries and benefits. The third arbitrator
(Mambara) found in their favour and awarded the payment of arrear
salary and benefits, in accordance with the 2010 Works Council
Agreement, from 1 January 2010 to the date when each claimant was
retrenched.
The
respondent, being aggrieved by that award, applied to the Labour
Court for the review of the award.
Decision
Appealed and Grounds of Appeal
The
court a
quo
rejected two of the grounds of review mounted by the respondent.
It
found that the Mambara award did not improperly seek to review or
enforce the Nasho award. It also found that the prior decision of the
court upholding the Mugumisi award was different from the matter
currently before it because the former concerned back pay from the
date of termination to the date of reinstatement as opposed to salary
and benefits accrued before termination.
Consequently,
it was not necessary that the current matter be held in abeyance
pending the determination of the appeal in the earlier matter.
The
court a
quo
found in favour of the respondent on the remaining two grounds of
review.
(i)
Firstly, it held that the Mambara award did operate to review and
alter the court's previous decision that the appellants had not
been unfairly dismissed. This resulted in uncertainty on the
employment status of the appellants and the possible institution of
other unnecessary claims. Moreover, the arbitrator's findings that
the appellants had implied permanent contracts of employment and that
they had been retrenched were equally erroneous.
(ii)
Secondly, the court found that the issue of the appellants' grades
was not part of the arbitrator's terms of reference. Thus, the
arbitrator had misdirected himself in going beyond his remit and
basing his award on extraneous terms of reference.
The
court accordingly held that the review succeeded on these two
grounds.
The
arbitral award was set aside and substituted with the dismissal of
the appellants' claim.
The
grounds of appeal in
casu
are that the court a
quo
erred in the following respects:
(i)
in concluding that the arbitrator's award mandating the
quantification of an admitted liability had the effect of altering
the court's previous judgment.
(ii)
in placing any significance on the arbitrator's misuse of the word
retrenchment.
(iii)
in concluding that the arbitrator had effectively conducted a
re-grading exercise in determining what was due to the appellants.
(iv)
in concluding that there was a reviewable issue raised before the
court.
Jurisdiction
to Review Arbitral Awards
In
his heads of argument and at the hearing of the appeal, Adv. Mpofu,
for the appellants, embarked upon an excursus outside the stated
grounds of appeal into the review jurisdiction of the Labour Court.
He
submits that s89(1)(d1) of the Labour Act [Chapter
28:01]
limits that court to the same review powers as are exercisable by the
High Court. Therefore, since the review of arbitral awards cannot be
instituted in terms of the High Court Act [Chapter
7:06]
but only under the Model Law scheduled to the Arbitration Act
[Chapter
7:15],
it follows that the Labour Court, being a creature of statute and
having no inherent jurisdiction, cannot review the decisions of
arbitrators.
Adv.
Mpofu
relies for this proposition upon the decisions in Catering
Employers Association of Zimbabwe v Zimbabwe Hotel and Catering
Workers Union & Another
2001 (2) ZLR 388 (S) and National
Social Security Authority v Chairman, National Social Security
Authority Workers Committee & Others
2002 (1) ZLR 306 (H).
In
the Catering
Employers Association
case, it was held that Article 34(2) of the Model Law sets out the
sole grounds on which the High Court may set aside an arbitral award.
The
court cannot therefore rely on the grounds set out in s27 of the High
Court Act to set aside an arbitral award on review.
This
position was adopted in the National
Social Security Authority
case on the somewhat questionable basis that the general power to
review proceedings conferred by s26 of the High Court Act does not
extend to arbitral awards because an arbitrator does not fall into
any of the stipulated categories, i.e.
inferior courts of justice, tribunals or administrative authorities.
In
any event, it was reaffirmed that the narrow grounds on which an
arbitral award may be set aside are set out in Article 34 of the
Model Law, and recourse to the courts against an award may only be
made by way of an application under that article.
The
legislature had in enacting the Model Law, so it was held, deprived
the High Court of its inherent jurisdiction to review the conduct of
an arbitrator.
Adv.
Magwaliba,
for the respondent, submits that s89(1)(d1) of the Labour Act was
inserted by Act No.7 of 2005. Therefore, the earlier authorities
cited on behalf of the appellants do not apply. This position is
placed beyond doubt by the decision of this court in Zimasco
(Pvt) Ltd v Marikano
2014 (1) ZLR 1 (S) to the effect that the Labour Court has full
powers of review in addition to those of the High Court.
Moreover,
s92EE(1) of the Act, inserted by Act No.5 of 2015, makes it very
clear that the Labour Court can exercise review powers over the
decisions of arbitrators.
I
entirely agree with these submissions.
Section
89 of the Labour Act prescribes the functions,
powers and jurisdiction of the Labour Court. In particular, s89(1) in
its relevant portions provides that:
“(1)
The Labour Court shall exercise the following functions —
(a)
hearing and determining applications and appeals in terms of this Act
or any other enactment;
(b)……………………………………………;
(c)……………………………………………;
(d)……………………………………………;
(d1)
exercise the same powers of review as would be exercisable by the
High Court in respect of labour matters.”
The
interpretation of this provision was lucidly elaborated by Garwe JA
in the Zimasco
case (supra)
at 6F-7D, as follows:
“The
above provisions are, in my view, clear and unambiguous. In respect
of labour matters, the Labour Court shall exercise the same powers of
review as does the High Court in other matters. The jurisdiction to
exercise these powers of review is in addition, and not subject, to
the power the court has to hear and determine applications in terms
of the Act.…………….
The
suggestion…….. that the Labour Court has been given the same
power of review as would be exercisable by the High Court in respect
of labour matters is, in my considered view, incorrect and
inconsistent with the provisions of the Act. I say this for two
reasons.
Firstly,
the Act is clear that 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 s89(1) of the Act –
see s 89(6) of the Act.……..
Secondly,
it is clear that the interpretation given relies on a superficial
reading of the wording of s89(1)(d) [sic].
The section should be understood to mean 'the same powers of review
in respect of labour matters as would be exercisable by the High
Court' or alternatively 'the same powers of review, as would be
exercisable by the High Court, in respect of labour matters'.
Any
other reading of the paragraph would clearly result in an absurdity.”
I
fully endorse the above reasoning.
The
only possible meaning and effect to be ascribed to section 89(1)(d1)
of the Labour Act is that the Labour Court has the same power to
review any inferior proceedings in labour matters on the same grounds
of review as may be invoked by the High Court in the exercise of its
powers of review in relation to other matters not embraced by the
Labour Act.
The
interpretation propounded by Adv. Mpofu
is not only specious in that it divests the Labour Court of the full
breadth of its oversight in labour matters but also absurd in that
any procedural or other irregularity committed by an arbitrator would
be rendered wholly unreviewable, whether by the Labour Court or the
High Court.
That
surely could not have been the intention of Parliament in the
enactment of s89 of the Labour Act.
In
any event, any possible room for misconstruing s89(1)(d1) has been
inescapably shut down by the recently enacted s92EE which provides as
follows:
“92EE
Grounds of Review by Labour Court
(1)
Subject to this Act and any other law, the grounds on which any
proceedings or decision conducted or made in connection with this Act
may be brought on review before the Labour Court shall be –
(a)
absence of jurisdiction on the part of the arbitrator or adjudicating
authority concerned;
(b)
interest in the cause, bias, malice or corruption on the part of the
arbitrator or adjudicating authority concerned;
(c)
gross irregularity in the proceedings or the decision of the
arbitrator or adjudicating authority concerned.
(2)
Nothing in subsection (1) shall affect any other law relating to the
review of proceedings or decisions of inferior courts, tribunals or
authorities.”
The
purpose of s92EE, as I perceive it, is to bolster the review powers
of the Labour Court under s89(1)(d1) by spelling out in unambiguous
terms the specific grounds upon which those powers may be exercised,
viz.
the same grounds as are enumerated in s27 of the High Court Act.
Moreover, the provision makes it clear, ex
abundante cautela,
that the review powers of the Labour Court are exercisable over
arbitrators and adjudicating authorities in all labour matters.
To
conclude on this aspect, I take the view that the appellant's legal
point in
limine
challenging the jurisdiction of the Labour Court to review arbitral
awards, is utterly unmeritorious.
It
is accordingly dismissed.
The
Merits
Adv.
Mpofu,
for the appellants, submits that the arbitrator did not go outside
his terms of reference.
The
Mambara award found that the 2010 Works Council Agreement (the 2010
Agreement) applied to all of the respondent's employees, including
the appellants, in conformity with the Nasho award. It did not
re-grade the appellants but simply provided that each claimant be
paid in accordance with the 2010 Agreement from 1 January 2010 to the
date of termination.
As
regards the actual wording of the operative part of the award, he
proffers the strange argument that the reference to 1 January 2010 is
a mere typographical error and should have been a reference to 1
February 2009, which was the commencement date for payment claimed by
the appellants.
He
further argues, equally startlingly, that the use of the term
“retrenched” in relation to the closing date for payment in the
Mambara award is of no significance and must be regarded as being
inconsequential. Rather, it must be read and construed as relating to
the respective date of termination of employment of each appellant.
Adv.
Magwaliba
counters that the arbitrator clearly went beyond the terms of
reference set out at the beginning of his award.
Moreover,
he erroneously applied the terms of the 2010 Agreement to the
appellants by conflating various claims. The 2010 Agreement was
confined to permanent employees and did not extend to the appellants
who were employees on fixed term contracts.
Finally,
he notes that the references to 1 January 2010 and retrenchment in
the operative part of the arbitral award should not be regarded as
mere typographical errors.
On
the question of re-grading, arbitrator Mambara rejected the
respondent's argument that the appellants had no specific grade in
terms of their contracts of employment. Instead, he applied the Nasho
award, which ordered that the salaries of the respondent's
employees be regularised, coupled with the salaries specified in the
2010 Agreement.
The
court a
quo
found that the arbitrator misdirected himself in re-grading the
appellants and thereby going outside his terms of reference.
It
is common cause that the arbitrator's terms of reference raised an
unfair labour practice in the respondent's alleged failure to pay
arrear salaries and benefits due to them from 1 February 2009 to the
date of termination of their respective contracts of employment.
The
arbitrator dealt with this question by following the Nasho award and
adopting the lowest salary figure payable as stipulated in the 2010
Agreement.
In
my view, this did not entail any re-grading of the appellants but
simply involved applying the sums derived from the exercise conducted
by the Works Council.
I
am therefore unable to agree with the finding of the court a
quo
that the arbitrator exceeded his terms of reference.
The
appeal accordingly succeeds in this particular inconclusive respect.
On
the other hand, the operative part of the order delivered by the
arbitrator is extremely problematic. It states:
“That
the Respondent be and is hereby ordered to pay to each and every
Claimant arrear salaries and benefits per the 16 September 2010 Works
Council Agreement from 1st
January 2010
to the date each and every claimant was
retrenched.´
(The emphasis is mine).
I
have no doubt that the learned arbitrator was alive to the fact that
he was called upon to deal with claims for salaries and benefits from
1 February 2009 to the date of termination of each appellant's
contract of employment.
This
emerges clearly from his stated terms of reference and his comments
at the beginning and end of his award.
I
also have no quarrel with the trite proposition that technicalities
should not be allowed to impinge upon or obstruct the delivery of
justice in labour matters.
Nevertheless,
I take the view that the order made by a judicial tribunal
constitutes the decisive gravamen of its adjudicative process.
Moreover,
it is that order that must be capable of obedience and practical
enforcement by the parties concerned.
Its
precise wording and exactitude of expression are therefore of
paramount importance. Consequently, where it is recklessly
mispronounced, as it was in
casu,
it fails to achieve its fundamental purpose and cannot be condoned or
endorsed by an appellate court.
To
use the celebrated MacFoy
phraseology, it is an arrant nullity and everything founded upon it
must collapse.
In
the instant case, the miscitation of the date from which the
appellants' entitlement to their claims arose, i.e.
1 January 2010, is patently erroneous inasmuch as it fails to address
the preceding period from 1 February to 31 December 2009.
Again,
the reference to the date when each claimant was “retrenched” is
entirely misplaced in the context of termination of contracts of
fixed duration by effluxion of time.
As
was quite correctly observed by the court a
quo,
the Mambara award operates to alter the earlier findings of the
Mugumisi award, as confirmed by the Labour Court, that the appellants
had not been unfairly dismissed.
The
attendant implication of permanent employment status results in lack
of certainty and the potential creation of other unnecessary claims.
In
the event, I take the view that the two critical errors in the
operative part of the order delivered in the impugned award are so
fundamental to its validity that they cannot be disregarded and swept
away as mere technicalities or typographical errors.
This
conclusion effectively entails the dismissal of the remaining three
grounds of appeal.
Scope
of 2010 Agreement
Having
disposed of the stated grounds of appeal, I still think it necessary,
in the interests of justice and the finality of litigation, to
consider a crucial aspect of the matter that was canvassed before the
arbitrator and the court a
quo
but not properly addressed or determined by either tribunal.
This
aspect concerns the exact scope of the 2010 Agreement and its
possible extension to the appellants.
The
arbitrator noted that the Nasho award required the appellants'
contracts to be regularised in line with the multi-currency system
from 1 March 2009 onwards. He then turned to the 2010 Agreement and
concluded that it applied to the appellants.
In
so doing, he referred to the minutes confirming the Agreement and
signed by the parties on 27 September 2011. However, he did not
reproduce the relevant portions of the Agreement or the confirmation
minutes to explain or justify his conclusion that the benefits
accruing from the Agreement extended to the appellants.
The
court a
quo
also noted the operative part of the Nasho award that called upon the
respondent to regularise its employees' contracts. It then referred
to the subsequent 2010 Agreement in which “it was resolved that a
net salary of $500 per month be paid to all employees across the
board for the period 1 March 2009 to December 2009”.
It
further noted that “the Works Council agreed to a salary structure
for 1 January 2010 to date for its non-managerial grades” ranging
from $500 to $1,092.
Again,
the court did not reproduce the relevant clauses of the 2010
Agreement. Nor did it call for any evidence to be adduced, as it was
statutorily empowered to do, from the signatories to that Agreement
to clarify or explain its provisions and scope of coverage.
In
the event, the court did not proceed to consider the precise ambit of
the Agreement and its implications for the appellants' claims
before the arbitrator.
Indeed,
it made no finding whatsoever on this critical aspect of the matter,
despite having recognised some sequential and causal nexus between
the Nasho award and the 2010 Agreement.
It
appears to be common cause, although even this may need
clarification, that the present 153 appellants were part of the 1,078
claimants and beneficiaries of the Nasho award rendered in July 2010.
That
award also ordered the parties involved to reconvene through the
Works Council to regularise the employees' contracts in line with
the multiple currency system with effect from 1 March 2009.
Thereafter,
the Works Council was convened in September 2010 and concluded the
Agreement presently under consideration.
If
this sequence of events is correct and if the 2010 Agreement was
designed to embrace all of the respondent's employees, it would
follow that the appellants have an eminently justifiable claim to the
benefits accruing from that Agreement.
In
the circumstances, it seems just and equitable that this matter be
remitted to the court a
quo
to clearly determine whether or not the scope of the 2010 Agreement
extended to all of the respondent's employees, including the
appellants in
casu.
This
will not only serve to ensure that justice is attained but also to
secure finality to the protracted and costly litigation between the
parties.
As
regards costs, in view of the partial success coupled with the
partial failure of the appeal, as well as the impending remittal of
the matter to the court a
quo,
I think it fitting that each party should bear its own costs.
In
the result, it is ordered as follows:
1.
The appeal succeeds in respect of Ground 3 and is dismissed in
respect of Grounds 1, 2 and 4 in the Notice of Appeal.
2.
The judgment of the court a
quo
is set aside insofar as it relates to Ground 3 in the Notice of
Appeal.
3.
The matter is remitted to the court a
quo:
(i)
to determine, on the basis of the specific provisions of the Works
Council Agreement concluded in September 2010 and the minutes
accompanying the Agreement, and having regard to sworn evidence from
the signatories to the Agreement, whether or not the salaries and
benefits stipulated in that Agreement were intended to apply to the
appellants; and
(ii)
if the answer to that question is in the affirmative, to quantify the
salary and benefits due to each appellant in terms of the Agreement,
from 1 March 2009 to the respective date of termination of each
appellant's contract of employment, subject to the deduction of
such payments as each appellant may have received by way of salary
and benefits during the relevant period.
4.
Each party shall bear its own costs in respect of this appeal.
GWAUNZA:
I
agree
MAVANGIRA
JA: I
agree
Muringi
Kamdefwere,
appellants' legal practitioners
Chitapi
& Associates,
respondent's legal practitioners
