This
is an appeal against the entire judgment of the Labour Court
upholding the arbitrator's decision that by inviting the
respondents for interviews after the termination of their fixed term
contracts, the appellant had created in them, a legitimate
expectation for their re-engagement as provided for and within the
contemplation of section 12B(3)(b) of the Labour Act [Chapter
28:01]
(hereinafter referred to as “the Act”).
The
facts leading to this appeal are as follows:
BACKGROUND
The
appellant is an international non-governmental organization providing
medical humanitarian services in Zimbabwe. The respondents were
employed by the appellant on fixed term contracts for various periods
running between one month to a full year from 2008 and 2011 in the
capacity of guards, with some being employed as “security
guard/gardener”.
During
the period 2008 and 2011, the appellant had, from time to time,
renewed the respondents' contracts of employment. The appellant
then faced funding challenges which resulted in the respondents'
contracts not being renewed beyond 2011. (Meanwhile, the appellant
had since obtained funding for projects in Mbare, Gutu and Chikomba
which required guards and gardeners from the areas in which the
projects would run).
The
respondents claimed, at some time that is not specified in the papers
before the court, that they had been unfairly dismissed. They
collectively alleged that the appellant still needed their services
and still had the funds to continue to engage them after their
contracts had expired and that they therefore had a legitimate
expectation to be re-engaged which expectation was unlawfully
frustrated by the appellant.
At
the time that the collective dispute of the alleged unfair dismissal
of the respondents by the appellant arose, none of the respondents
were employed by the appellant, all their contracts having expired at
the end of the specified periods in their various contracts of
employment. The allegation was made on the strength of section
12B(3)(b) of
the Labour Act [Chapter
28:01]
which reads as follows:
“(3)
An employee is deemed to have been unfairly dismissed -
(a)…,.;
(b)
If, on termination of an employment contract of fixed duration, the
employee -
(i)
Had a legitimate expectation of being re-engaged; and
(ii)
Another person was engaged instead of the employee.”
After
conciliation had failed to settle the dispute, it was referred to
arbitration, the terms of reference being to ascertain whether or not
the respondents had been unfairly dismissed, and, if so, to find the
appropriate remedy.
In
their Statement of Claim before the arbitrator, the respondents
alleged that sometime in 2010 they were advised that their contracts
would not be renewed due to funding constraints then afflicting the
appellant, unless the appellant managed to secure funding for
projects in Mbare, Gutu and Chikomba. They further alleged that they
were advised to apply for the same posts for renewal which they did
and they were duly interviewed - along with other people. All the
respondents were unsuccessful and twelve other people were engaged in
their stead. They made checks regarding the appellant's given
reason for taking other people, which was to the effect that the
appellant wanted to promote the communities where it would be
operating from. Their checks verified that indeed the people engaged
in their stead were people from the said communities.
Nonetheless,
the respondents maintained that they had formed a legitimate
expectation of renewal and that this was based on previous renewals
of their contracts of employment and also on “the undertaking that
the contracts would be renewed” allegedly made by the appellant.
According to the respondents, the explanation that the appellant had
failed to renew their contracts because they wanted to promote local
people from the places that they were going to operate from was not a
legally valid excuse.
The
appellant's defence was that there was no basis for the respondents
to have formed a legitimate expectation of the renewal of their
contracts. The appellant denied that there was any undertaking that
the contracts would be renewed if funding was secured.
The
arbitrator found in favour of the respondents. She found that having
invited the respondents for interviews, the appellant had thereafter
flouted section 12B(3)(b) of
the Labour Act [Chapter
28:01]
because the respondents' hopes for re-engagement were raised yet
the appellant employed other people instead. The arbitrator also
found that the Labour Act justifies legitimate expectation where the
fixed-term contract of employment of an employee is terminated and
another employee is engaged. The arbitrator dismissed the appellant's
defence that it had
to
employ people from other communities on the basis of lack of evidence
to justify such defence. Thereafter, an award was made reinstating
the respondents to their original positions within the appellant's
employ without loss of salary and benefits from the date of unlawful
dismissal, or, alternatively, one year's salary each in lieu
of reinstatement.
Aggrieved
by that decision, the appellant noted an appeal in the Labour Court.
As with the arbitrator, the Labour Court did not accord any
significance or validity to the appellant's reason that it had to
engage people from communities that they were to operate from. The
Labour Court found that once an employee shows that another person
was employed in their stead, they would have met the legal
requirements set out in the Labour Act for claim to legitimate
expectation to succeed. The Labour Court also concurred with the
arbitrator's finding that the invitation of the respondents to
interviews created, on their part, a reasonable expectation of
re-engagement.
On
the question of the award for damages, the Labour Court found that
the arbitrator erred in awarding damages without any evidence having
been led before her. In the result, the Labour Court upheld the award
in part, overturning it only in so far as it related to damages. The
appellant, in turn, now appeals against that decision before this
Court on the following grounds;
1.
The Honourable Court a
quo
erred in finding that the Honourable Arbitrator did not misdirect
herself in concluding that the requirements of section 12B(3)(b) of
the Labour Act [Chapter
28:01]
had been met.
2.
The court a
quo
erred and misdirected itself in that it failed to appreciate fully
the circumstances under which an expectation of re-engagement is
legitimate. The court failed to fully appreciate all the
circumstances of the case and accordingly arrived at a wrong
conclusion.
3.
More particularly, the court a
quo
erred at law in confirming the arbitrator's decision that the fact
that some respondents were called for interviews created a legitimate
expectation of renewal of employment on the respondents' part.
4.
The court a
quo
seriously misdirected itself on the facts and/or failed to appreciate
all the facts of the matter which misdirection is unreasonable in the
circumstances and amounts to a misdirection at law.
SUBMISSIONS
ON APPEAL
Counsel
for
the appellant argued that the arbitrator erred in finding that by
inviting the respondents for interviews, after their contracts had
terminated, the appellant created a legitimate expectation that they
would be re-engaged. He submitted that an interview is merely a
process of assessment, and, thus, one cannot form a legitimate
expectation by simply being called for an interview in the absence of
communication that one would be guaranteed a job placement whether or
not one performed satisfactorily in the interview.
In
order to emphasise that the appellant did not plant the idea of any
legitimate expectation of re-engagement in the minds of the
respondents, the appellant's counsel relied on a provision in the
letter that terminated the respondents' employment and paragraph 2
of all the respondents' contracts. The appellant's counsel relied
on one part of the letter which reads as follows;
“This
letter serves to notify you that your contract of employment which is
terminating on…, will not be renewed.”
Paragraph
2 of the contract, in turn, provided as follows:
“2.
Duration
The
contract is for a fixed duration starting on the…., to…,. At
the expiration of the period contracted for, this contract shall
terminate automatically. The Employer does not guarantee employment
beyond this contract.”…,.
In
light of the above, the appellant argued that there could be no way
that the respondents could have rationally formed a legitimate
expectation of being re-engaged by the appellant even if they had
been called in for interviews.
On
the other hand, counsel
for
the respondents argued that as it was known to the appellant that the
funds for the grant after the expiration of the respondents'
contracts were location specific, the question arising was why it
then invited the respondents for interviews when it was known that
they would not qualify on that basis. Questioned on the significance
that ought to be given to the contents of the letters written by the
appellant terminating the respondents' contracts of employment,
counsel for the respondents
conceded
that there could not be read therein any guarantee that the
subsequent invitations for interviews was an assurance of
re-engagement by the appellant.
ISSUE
ARISING FOR DETERMINATION
The
sole issue for determination is whether an employer's invitation to
his former employee for an interview for the same post that the
employee held during the subsistence of the fixed contract is conduct
which the employee can act on to form a legitimate expectation of
re-employment by the employer in terms of section 12B(3)(b) of the
Labour Act [Chapter 28:01]. In other words, can an employee who was
employed on a fixed-term contract basis successfully argue that after
the fixed term contract of employment expired he legitimately
expected to be re-employed because his former employer invited him
for an interview to fill in the same position?
As
stated earlier, the issue emanates, originally, from the arbitrator's
finding that the employer flouted the provisions of section 12B(3)(b)
of the Labour Act, which finding the Labour Court upheld.
THE
LAW
In
Magodora
v Care International
2014 (1) ZLR 397 (S)…, PATEL JA pronounced an interpretation on
section 12B(3)(b) of the Labour Act [Chapter 28:01]. He stated that
the plain meaning of section 12B(3)(b) of the Labour Act is that an
employee on a contract of fixed duration must have had a legitimate
expectation of being re-engaged upon its termination and was
supplanted by another person who was engaged in his stead. He further
stated, at 403A-C, that these requirements are patently conjunctive
and the mere existence of an expectation without the concomitant
engagement of another employee does not suffice.
In
UZ-UCSF
Collaborative Research Programme in Women's Health v Shamuyarira
2010
(1) ZLR 127 (S) ZIYAMBI JA made the point that the onus is on the
employee to prove the two requirements stipulated in section
12B(3)(b) of the Labour Act. The same reasoning is also found in the
South African case of Ferrant
v Key Delta
(1993) 14 ILJ 464 (IC), where the court held that the onus of proving
reasonable expectation rests on the employee. In another South
African case, Fedlife
Assurance Ltd v Wolfaardt
(2001) 22 ILJ 2407 (SCA), the court found
that to discharge that onus, the employee must prove that he or she
actually expected the contract to be renewed and that only then would
the question whether the expectation was reasonable arise.
PROFESSOR
MADHUKU L, Labour
Law in Zimbabwe,
Weaver
Press, 2015…, states:
“The
test for legitimate expectation is objective: would a reasonable
person expect re-engagement? This requires an assessment of all the
circumstances of the case. To be 'legitimate', the expectation
must arise from impressions created by the employer.”
In
other words, in order for an employee to show that he or she
reasonably expected that his or her fixed term employment contract
would be renewed, he or she must convince the court that there was an
objective basis for the creation of the “reasonable expectation”.
APPLICATION
OF THE LAW TO THE FACTS
The
question that arises is whether it is reasonable for an employee to
expect to be re-employed solely on the basis that he or she was
invited for an interview?
According
to the Cambridge Advanced Learner's Dictionary, “reasonable”
means based on or using good judgment, and, therefore, fair and
practical. The Collins English Dictionary defines “reasonable” as
using or showing reason, or sound judgment; sensible.
On
the basis of these definitions of the word “reasonable” could it
be said that the appellant, by extending the invitation for
interviews to the respondents, gave them the impression that it would
re-engage them and was this a practical or sensible basis upon which
the respondents could legitimately expect to be re-engaged?
Clearly
not.
An
employer, anywhere, invites people for interviews but that is not a
guarantee that the prospective employees will be engaged after the
interviews.
In
casu,
it was accepted by the respondents, in their papers, that the
appellant wanted to engage people in the communities that it would
operate from as a matter of policy. On that basis, the respondents
could not have expected to be re-engaged; moreso, if none of the
respondents had shown that they lived in the said places. On the
facts of this case, no basis has been shown for the respondents to
have reasonably expected to be re-engaged.
Some
of the contracts of employment were headed “Employment Contract for
a Fixed Period.” Paragraph 2 thereof headed “Duration”
provided:
“The
contract is for a fixed duration, starting on the…, to….,. At the
expiration of the period contracted for, this contract shall
terminate automatically. The employer does not guarantee employment
beyond this contract.”
Others
were headed “Fixed Term Employment Contract.” Under the heading
“Term of Contract” the provision reads”;
“The
present contract is for fixed term duration, starting from…, and
finishing on…,.”
That
the contracts of employment were fixed term contracts can therefore
not be open to any doubt on a plain reading of the provisions
thereof.
A
reading of the provisions of the contracts of employment in
conjunction with the letters that were written to the respondents
terminating their contracts exposes the fallacy of the respondents'
claim to justification for entertaining a reasonable expectation of
renewal. The letters read in relevant part:
“This
letter serves to notify you that your contract of employment for a
contract period of up to…, will not be renewed.”
The
letters further stated:
“We
would like to thank you for your services and dedicated time and to
wish you luck in your endeavours. We will however consider you for
interviews should any need arise within the organization in the
future.”
None
of the quoted provisions could be attributed with the capacity to
have blinded the respondents to the nature of their employment with
the appellant. Clear and unambiguous language stated the terms of the
contracts of employment. Clear language used in the termination
letters also laid beyond doubt that the clearly expressed employment
contract had finally come to an end. An indication of possible
consideration, should the need arise in the future, coupled with the
indication that interviews would be conducted for the satisfaction of
such future need does not create a reasonable expectation of renewal.
The
relevant clause of the employment contracts stated in clear terms
further employment or renewal was not guaranteed upon expiry.
In
Magodora
v Care International
2014 (1) ZLR 397 (S) and UZ-UCSF
Collaborative Research Programme in Women's Health v Shamuyarira
2010
(1) ZLR 127 (S), the point is made that the terms of a contract are
relevant in the determination of whether non-renewal of a fixed-term
contract constitutes a dismissal. That is so because the contract
itself indicates the intention of the parties. In the case of a fixed
term contract, the intention of the parties is that the contract and
employment relationship terminates on the date mentioned therein.
In
addition, GROGAN J in
Workplace
Law,
11th
edition, Juta and Co (Pty) Ltd, 2014…, makes reference to Foster
v Steward Inc
(1997) ILJ 367 (LAC) where the South African Labour Appeal Court held
that when establishing whether the non-renewal of a fixed term
contract constitutes a dismissal, the terms of the contract remain
relevant. The contract itself is an important indication that the
parties in fact intended the contract relationship to terminate on
the date mentioned. Reference is also made to the case of Swissport
(Pty) Ltd v Smith NO
(2003) 24 ILJ 618 (LC) where the point is made that it is a
fundamental principle of the law of contract, that, once parties have
decided to reduce a contract to writing, the document that they
produce will be accepted as the sole evidence of the terms of the
contract.
In
the case of South
African Rugby Players Association & Ors v SA Rugby & Ors
(2008) 29 ILJ 2218 (LAC), some professional rugby players alleged
that failure by their employer to renew their contracts of employment
on the same terms and conditions constituted constructive dismissal.
Their contracts of employment included a provision which was captured
as follows;
“3.2
As this is a fixed term contract, it shall automatically terminate on
the date set out in paragraph 1.2 of schedule 11 hereof (30 November
2003) and the player acknowledges that he has no expectation that
this contract will be renewed on the terms herein contained, or on
any other terms.”
In
interpreting the contract in the determination of the dispute that
had arisen, the South African Labour Appeal Court held as follows;
“[46]
Clause 3.2, stating that the contracts automatically terminated on
the dates set out and that the players acknowledged that they had no
expectation that their contracts would be renewed on the terms
contained therein or any other terms is to me of critical importance.
This clause, and other exclusionary clauses referred to above, were
deliberately included in the contracts in order for them to be part
of the contracts and to mean what they were intended for. It
would, therefore, be expected of the appellants to place more
credible facts to make their expectation reasonable in the face of
clause 3.2. A mere ipse
dixit that
there is an expectation, based on flimsy grounds, would not
suffice.”…,.
From
the authorities cited above, it is clear that the employee's burden
to prove that they had a legitimate expectation of re-engagement
after the expiration of the contract of employment must be
discharged. The employee has to show that, despite the contract of
employment having been one for a fixed term, the employer acted in a
manner upon which the employee could have formed a legitimate
expectation to be re-engaged.
In
casu,
the
contracts expressly provided that the employer did not guarantee
employment beyond the duration of the fixed term. I agree with the
appellant's counsel that there was thus no reasonable basis to
justify the expectations by the respondents to be re-employed after
termination.
In
the South African case of Magubane
& Ors v Amalgamated Beverages
(1997) 18 ILJ 1112 (CCMA), the court held that whether there was a
reasonable expectation of renewal must be determined from the
perspective of both the employer and the employee. In light of the
duration clause of the contracts of employment in casu,
it is evident that from the perspective of the employer, no
reasonable expectation of renewal could have been formed. Neither
could the respondents have reasonably expected to be re-employed
because the contract that they entered into with the appellant was
clear that there was no guarantee of employment beyond the contract.
Counsel
for the respondents failed to direct us to any evidence that the
appellant acted in a way that could have resulted in the respondents
forming a reasonable and legitimate expectation of re-engagement
beyond the duration of their fixed term contracts. In the absence of
evidence showing that the employer guaranteed an employee employment
notwithstanding the former employee's performance in the interview,
it cannot be said that by merely inviting employees for an interview
the employer gave the employee reason to entertain a legitimate
expectation for re-engagement.
As
correctly argued by counsel for the appellant,
an
interview provides a platform for an employer to assess, among other
things, the competence of a prospective employee. The employer has
the discretion to engage an employee on the basis of his or her
findings and satisfaction regarding the suitability of the
interviewee as exposed by the interview. It is an interviewee's
performance in the interview which forms the basis of whether one
will be employed. In the absence of evidence that the employer
guaranteed employment regardless of performance in the interview,
there can be no justification for forming a legitimate expectation of
re-engagement before the establishment of the employee's
performance in the interview. An invitation to attend an interview
cannot be reasonable basis upon which the employee forms a legitimate
expectation for re-engagement. This is moreso considering that the
employer conducts the interview, or, in this case, intended to
conduct the interviews, in order to be satisfied that the
interviewees suit the employer's requirements.
The
arbitrator, and, consequently, the court a
quo
erred in finding that an employee can reasonably form a legitimate
expectation for re-employment by the mere fact of being invited for
an interview by a former employer. In addition, the contracts that
the respondents in casu
had
with the appellant clearly stated each was for a fixed term. By
reason of the burden that the law places on them, the respondents had
to place more evidence before the court to show that in light of all
the circumstances pertaining to their matter, they reasonably
expected to be re-engaged in the appellant's employ - which they
failed to do.
In
the result, it is ordered as follows;
1.
The appeal be and is hereby allowed with costs.
2.
The judgment of the Labour Court be and is hereby set aside in its
entirety and substituted as follows:
“(i)
The appeal against the arbitral award dated 8 May 2014 be and is
hereby allowed.
(ii)
The arbitral award be and is hereby set aside in its entirety.”
