CHIDYAUSIKU
CJ:
This is an appeal from a judgment of the Labour Court delivered on
28 March 2014 allowing termination of the appellants employment
contracts on notice.
The
facts of this case are common cause. They are as follows.
The
appellants were employed by BP Shell as Supply and Logistics Manager
and Finance Manager.
BP
Shell sold its services as a going concern to Zuva Petroleum, the
respondent. A transfer of undertaking was done in terms of section 16
of the Labour Act [Chapter
28:01]
(hereinafter referred to as “the Act”) and an agreement of sale
concluded. The appellants were transferred to the new undertaking
without derogation from the terms and conditions of employment that
they enjoyed when they were under BP Shell.
On
21 November 2011 the respondent offered its employees, who included
the appellants, a voluntary retrenchment package which was declined.
On
15 December 2011 the respondent served each of its employees,
including the appellants, with a compulsory notice of intention to
retrench.
The
appellants and the respondent could not agree on the retrenchment
terms.
Having
failed to agree on the terms of retrenchment, the parties referred
the dispute to the Retrenchment Board.
On
16 May 2012 the Ministry of Labour and Social Services directed the
parties to carry out further retrenchment negotiations for another
twenty-one days.
On
18 May 2012, and before the expiry of the twenty-one days, the
respondent wrote letters to the appellants, terminating their
contracts of employment on notice, as was provided for in the
contracts of employment signed by both parties, with effect from 1
June 2012.
The
respondent paid the appellants cash in
lieu
of notice and thus terminated the employment relationship.
The
appellants approached a labour officer, contending that their
employment contracts had been unlawfully terminated. The labour
officer failed to resolve the matter and referred it to compulsory
arbitration. The arbitrator concluded that the termination of the
contracts of employment was unlawful because the appellants had not
been dismissed in terms of a code of conduct.
The
respondent appealed to the Labour Court. The Labour Court allowed the
appeal. In its judgment the Labour Court had this to say:
“In
my view, therefore, the submission that section 12B came to do away
with the possibility of terminating a contract of employment on
notice is a misunderstanding of the law as it stands. In any event,
the provisions of section 12(4) of the Act are clear and allow no
ambiguity as also the provisions of section 12B. None of the sections
have the effect of doing away with the termination of a contract of
employment on notice.”
In
essence, the Labour Court came to the conclusion that neither section
12B nor section 12(4) of the Act abolished the employer's right to
terminate employment on notice.
I
respectfully agree with this conclusion.
The
appellants were aggrieved by the judgment of the Labour Court and now
appeal to this court on the following grounds:
“The
Labour Court erred and seriously misdirected itself on a question of
law by upholding the termination of the appellants contracts of
employment on notice and failing to find such termination to be
unfair dismissal.
The
Labour Court erred and seriously misdirected itself on a question of
law in failing to realise as it should have done that section 12(4)
of the Labour Act [Chapter
28:01]
does not provide for the termination of a contract of employment on
notice and that any such purported termination is contrary to section
12B of the Labour Act [Chapter
28:01].
The
Labour Court erred at law in allowing termination on notice as that
amounts to allowing an employer to terminate employment for no
justifiable and valid cause.”
The
appellants seek the setting aside of the Labour Court judgment and
its substitution with that of the arbitrator.
It
would appear on the papers that the bone of contention between the
parties is the legal status of the employer's common law right to
terminate an employment relationship on notice.
Counsel
are agreed that once upon a time both the employer and the employee
had a common law right to terminate an employment relationship on
notice. The point of departure appears to be that the appellants,
while acknowledging that the employer's right once existed, argue
that it has since been abolished.
The
respondent contends that the employer's right has not been
abolished and still subsists.
It
was contended for the appellants that section 12B of the Act
abolished the employer's common law right to dismiss an employee on
notice.
On
the other hand, the respondent argued that the common law right to
dismiss an employee on notice has not been abolished by section 12B
of the Act and is extant. The respondent further argued that section
12(4) of the Act reinforces its contention that that right exists,
and that section regulates the exercise of the right.
The
critical issue that falls for determination in this matter is
therefore what meaning should be ascribed to sections 12B and 12(4)
of the Act. In particular whether section 12B of the Act, on a proper
reading of that section, abolishes the employer's common law right
to terminate employment on notice.
The
appellants, in para 2 of their heads of argument, made the following
submission:
“2.
In enshrining the concept of unfair dismissal in section 12B, the
Labour Act [Chapter
28:01]
is outlawing any termination of employment for no reason.
Accordingly, the purported termination of the appellants contracts of
employment was unlawful on account of being a contravention of
section 12B of the Labour Act [Chapter
28:01].”
Section
12B of the Act, the subject of the contested interpretation, provides
as follows:
“12B
Dismissal
(1)
Every employee has the right not to be unfairly dismissed.
(2)
An employee is unfairly dismissed —
(a)
if,
subject to subsection (3), the employer fails to show that he
dismissed the employee in terms of an employment code; or
(b)
in
the absence of an employment code, the employer shall comply with the
model code made in terms of section 101(9).
(3)
An employee is deemed to have been unfairly dismissed -
(a)
if
the employee terminated the contract of employment with or without
notice because the employer deliberately made continued employment
intolerable for the employee;
(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.
(4)
In any proceedings before a labour officer, designated agent or the
Labour Court where the fairness of the dismissal of an employee is in
issue, the adjudicating authority shall, in addition to considering
the nature or gravity of any misconduct on the part of the dismissed
employee, consider whether any mitigation of the misconduct avails to
an extent that would have justified action other than dismissal,
including the length of the employee's service, the employee's
previous disciplinary record, the nature of the employment and any
special personal circumstances of the employee.”
As
I have already stated, it is common cause that once upon a time both
the employer and the employee had a common law right to terminate an
employment relationship on notice.
That
common law right in respect of both the employer and the employee can
only be limited, abolished, or regulated by an Act of Parliament or a
statutory instrument that is clearly intra
vires
an Act of Parliament.
I
am satisfied that section 12B of the Act does not abolish the
employer's common law right to terminate employment on notice in
terms of an employment contract for a number of reasons.
The
time-honoured and golden rule of statutory interpretation is that you
give the words of a statute their primary meaning. See
National Railways of Zimbabwe Contributory Pension Fund v Edy
S-141-88; Madoda v Tanganda Tea Company Ltd 1999 (1) ZLR 374 (S); S v
Masivira 1990 (1) ZLR 373 (HC); Maxwell on The Interpretation of
Statutes 12ed at p28; Nyemba and Watunga v R 1961 R & N 688 (SR)
at 691C-D; Mike Campbell (Pvt) Ltd v Minister of Lands and Anor 2008
(1) ZLR 17 (S) at 33-35; and Mawarire v Mugabe NO and Ors
CCZ-01-2013.
Applying
this golden rule of statutory interpretation, I see no words in
section 12B of the Act that either expressly or by necessary
implication abolish the employer's common law right to terminate an
employment relationship by way of notice.
It
is also a well-established principle of statutory interpretation that
a statute cannot effect an alteration of the common law without
saying so explicitly.
This
principle finds authority in the case of Phiri
and Ors v Industrial Steel Pipe (Pvt) Ltd
1996 (12) ZLR 45 (S) at 49, wherein the following was stated:
“There
is a presumption, in the interpretation of statutes, that Parliament
does not intend a change in the common law, unless it expresses its
intention with irresistible clearness or it follows by necessary
implication from the language of the statute in question that it
intended to effect such alteration in the common law; for 'construing
the statute by adding to it words which are neither found therein nor
for which authority could be found in the language of the statute
itself, is to sin against one of the most familiar rules of
construction …': per
Lord
Halsbury LC
in Bank of England v Vagliano
[1891] C AC 107 at 120.”
See
also PTC v Mahachi 1997 (2) ZLR 71 (H); Mushaishi v Lifeline
Syndicate and Anor 1990 (1) ZLR 284 (H) at 287D; and Johannesburg
Municipality v Cohen's Trustees 1909 TS 811.
Section
12B of the Act, as the main heading of that section reveals, deals
with dismissal and the procedures to be followed in those instances
where an employment relationship is to be terminated by way of
dismissal following misconduct proceedings.
The
section also sets out in some detail what constitutes unfair labour
practice which it outlaws.
Termination
of employment on notice is not among the conduct that section 12B of
the Act outlaws as unfair labour practice.
The
section that deals with termination of a contract of employment on
notice is section 12(4) of the Act. I shall revert to this section
later in this judgment.
It
is also instructive to note that section 8 of the Act sets out in
some detail conduct that is outlawed as unfair labour practice.
Section
8 of the Act provides as follows:
“8.
Unfair labour practices by employer
An
employer or, for the purpose of paragraphs (g)
and (h),
an employer or any other person, commits an unfair labour practice
if, by act or omission, he -
(a)
prevents,
hinders or obstructs any employee in the exercise of any right
conferred upon him in terms of Part II; or
(b)
contravenes
any provision of Part II or of section eighteen;
or
(c)
refuses
to negotiate in good faith with a workers committee or a trade union
which has been duly formed and which is authorized in terms of this
Act to represent any of his employees in relation to such
negotiation; or
(d)
refuses
to co-operate in good faith with an employment council on which the
interests of any of his employees are represented; or
(e)
fails
to comply with or to implement -
(i)
a collective bargaining agreement; or
(ii)
a decision or finding of an employment council on which any of his
employees are represented; or
(iii)
a decision or finding made under Part XII; or
(iv)
any determination or direction which is binding upon him in terms of
this Act; or
(f)
bargains
collectively or otherwise deals with another trade union, where a
registered trade union representing his employees exists; or
(g)
demands
from any employee or prospective employee any sexual favour as a
condition of —
(i)
the recruitment for employment; or
(ii)
the creation, classification or abolition of jobs or posts; or
(iii)
the improvement of the remuneration or other conditions of employment
of the employee; or
(iv)
the choice of persons for jobs or posts, training, advancement,
apprenticeships, transfer, promotion or retrenchment; or
(v)
the provision of facilities related to or connected with employment;
or
(vi)
any other matter related to employment; or
(h)
engages
in unwelcome sexually-determined behaviour towards any employee,
whether verbal or otherwise, such as making physical contact or
advances, sexually coloured remarks, or displaying pornographic
materials in the workplace.”
It
is apparent from the above section that termination of employment on
notice is not among the conduct outlawed by section 8 of the Act.
It
is also very clear that, on a proper reading of section 12B of the
Act, it deals with the method of termination of employment known as
“dismissal”.
While
dismissal is one method of termination of employment, it is not the
only method of terminating an employment relationship. It is only one
of several methods of terminating employment.
In
this regard, section 12C of the Act provides for the method of
termination of employment known as “retrenchment”. Termination of
employment by way of retrenchment is not a dismissal.
This
court has held that termination of employment can be effected in
other ways than dismissal.
In
the case of Commercial
Careers College (1980) (Pvt) Ltd v Jarvis
1989 (1) ZLR 344 (S) at 349E-G, this court made the following
observation:
"It
is easy to conceive of a situation in which, albeit no blame
whatsoever attaches to the employee, the inescapable inference is
that the personal relationship between him and the employer has
broken down to the extent that trust in one another has been lost.
For a court to order reinstatement against such a backdrop of
animosity and ill-will, solely because an employee unreasonably and
out of wounded pride seeks it, would be to permit the continuation of
an intolerable personal relationship - one which would make it
impossible for the employee to perform his duties either to his own
satisfaction or to that of his employer."
In
the Commercial
Careers College case supra
it was common cause that the personal relationship between the
applicants and the respondent was totally destroyed.
The
applicants stance was simply that the respondent, the employer,
cannot terminate their employment contracts on notice at law, but
they can resign from employment willy nilly.
That
proposition was rejected.
The
same proposition that where the relationship between the employer and
the employee has deteriorated to untenable levels through no fault of
either party the relationship can be terminated was accepted in
Winterton,
Holmes & Hill v Paterson
1995 (2) ZLR 68 (S).
Quite
clearly, the appellants case is predicated on the proposition that
dismissal means all forms of termination of employment. Put
differently, all terminations of employment are dismissals.
This
proposition is not tenable on the authority of the above cases. That
proposition is clearly erroneous.
The
proposition that there are other methods or forms of terminating
employment apart from dismissal was clearly articulated in the case
of Samuriwo
v Zimbabwe United Passenger Company 1999 (1) ZLR 385 (H), wherein
GARWE J
(as
he then was) had this to say at 388E:
“The
code, in compliance with section 101 of the Act, steers clear of
other matters that have nothing to do with misconduct, such as
termination for other reasons. Whilst it must be accepted that the
code makes no provision for the managing director himself to be the
subject of disciplinary proceedings, it seems to me that this is
irrelevant as the termination in the present case is not sought on
the basis of the code but in
terms of the contract of employment.”
(the emphasis is mine)
Samuriwo's
case supra
places beyond dispute the fact that there are other ways of
termination of employment different from dismissal in terms of codes
of conduct following disciplinary proceedings as provided for in the
codes of conduct.
The
proposition that an employer has a right to terminate an employment
relationship on notice in circumstances other than dismissal for
misconduct finds further support in the case of Gertrude
Kwaramba
v
Bain
Industries (Pvt) Ltd
SC
39/01,
where this court accepted the employer's right to terminate the
employment contract on notice in no fault situations.
This
case was followed in Chirasasa
and Ors v Nhamo NO and Anor
2003 (2) ZLR 206 (S) where this court held that:
“In
this case, the appellants agreed that there was no act of misconduct
alleged against them. The parties had failed to agree on the new
terms and conditions of employment proposed by the second respondent
to meet the operational requirements of its business. The second
respondent had a right to terminate the contracts of employment with
the appellants by giving them one calendar month's notice and could
exercise it without obtaining prior written approval of the Minister.
The decision in Kwaramba's
case supra
is, in my view, correct, whilst that in Masundire's
case supra
is wrong.”
I
am satisfied section 12B of the Act does not deal with the general
concept of termination of employment. It concerns itself with
termination of employment by way of dismissal in terms of a code of
conduct. It sets out that which must be followed or done in terms of
either an employment code of conduct or a national code of conduct.
It does not concern itself with termination of employment by ways
other than dismissal.
Section
12(4) of the Act is the section that deals with the concept of
termination of employment on notice in terms of a contract of
employment. It regulates the period of notice. It provides as
follows:
“12.
Duration, particulars and termination of employment contract
(4)
Except where a longer period of notice has been provided for under a
contract of employment or in any relevant enactment, and subject to
subsections (5), (6) and (7), notice of termination of the contract
of employment to be given by either party shall be —
(a)
three months in the case of a contract without limit of time or a
contract for a period of two years or more;
(b)
two
months in the case of a contract for a period of one year or more but
less than two years;
(c)
one month in the case of a contract for a period of six months or
more but less than one year;
(d)
two weeks in the case of a contract for a period of three months or
more but less than six months;
(e)
one day in the case of a contract for a period of less than three
months or in the case of casual work or seasonal work.”
The
wording of section 12(4) of the Act is so clear that it leaves very
little room, if any, for misinterpretation.
It
governs the time periods that apply when employment is being
terminated on notice.
It
stands to reason that the notice periods do not apply when an
employee is dismissed.
In
instances of dismissal no notice is required. The periods of notice
referred to in section 12(4) of the Act can only apply where there is
termination of employment in terms of a process involving the giving
of notice provided for in a contract of employment.
I
accept the appellants contention that section 12(4) of the Act does
not create a right to terminate employment on notice. Indeed, this
contention appears to be accepted by the respondent.
The
respondent's case is that the right to terminate employment on
notice is created by common law and not by statute or section 12(4)
of the Act. It contends that section 12(4) of the Act simply
regulates the exercise of that right conferred on the employer by
common law.
Section
12(4) of the Act explicitly applies to both the employer and the
employee.
There
is no possible explanation, and none has been advanced, why, despite
the explicit language of the section, it should apply to the employee
only and not to the employer; or why the section should exist to
regulate a non-existent right.
As
Mr Mpofu
aptly submitted, providing “for a time period for a right that does
not exist is a puerile exercise, one which could never have been
engaged in by a sane legislator”.
The
presumption is that Parliament must be taken to have intended its
enactments to have meaning.
Section
12(4) of the Act can only have meaning if there is a substantive
right, in this case the common law right to terminate employment on
notice, to which it pertains. This is especially so when one
considers that all that section 12(4) of the Act does is to
facilitate the exercise of an existant common law right.
It
is for these reasons that I agree with the conclusion of the Labour
Court that the respondent was entitled at law to give notice
terminating the employment of the appellants in terms of the
contracts of employment between the parties.
Accordingly,
the appeal fails and is hereby dismissed with costs.
GWAUNZA
JA:
I agree
GARWE
JA:
I agree
HLATSHWAYO
JA:
I agree
GUVAVA
JA:
I agree
Matsikidze
& Mucheche,
appellants legal practitioners
Atherstone
& Cook,
respondent's legal practitioners
