ZIYAMBI
JA:
[1]
This
appeal from the judgment of the Labour Court raises the issue whether
an Arbitrator can, in
a compulsory arbitration,
dictate the terms of a collective bargaining agreement between the
parties.
[2]
Collective bargaining agreements are governed by Part X of the Labour
Act [Chapter
28:01]
(“the Act”). They are to be negotiated by the parties mentioned
therein as the following provisions demonstrate:
“PART
X
COLLECTIVE
BARGAINING AGREEMENTS NEGOTIATED BY TRADE UNIONS AND EMPLOYERS
ORGANIZATIONS
74
Scope of collective bargaining agreements
(1)
This Part shall apply to collective bargaining agreements negotiated
by
registered trade unions, employers and employers' organizations or
federations thereof:
Provided
that nothing in this Part contained shall prevent an unregistered
trade union or employers' organization from negotiating a
collective bargaining agreement.
(2)
Subject to this Act and the competence and authority of the parties,
trade unions and employers or employers organizations may negotiate
collective bargaining agreements as to any conditions of employment
which are of mutual interest to the parties thereto.
(1)
Without derogation from the generality of subsection (2), a
collective bargaining agreement
may
make provision for —
(a)
rates of remuneration and minimum wages for different grades and
types of occupations;
(b)
benefits for employees;
(c)
deductions which an employer may make from employees' wages,
including deductions for membership fees and union dues, and
deductions which an employer may be required or permitted by law or
by order of any competent court to make;
(d)
methods
of calculating, or factors for adjusting rates of pay, and the dates,
times and modes of payment;
(e)
all issues pertaining to overtime, piece-work, periods of vacation
and vacation pay and constraints thereon;
(f)
the demarcation of the appropriate categories and classes of
employment and their respective functions;
(g)
the conditions of employment for apprentices;
(h)
the number of hours of work and the times of work with respect to all
or some of the employees;
(i)
the requirements of occupational safety;
(j)
the maintenance of, and access by the parties to, records of
employment and pay;
(k)
procedures for dealing with disputes within an undertaking or
industry;
(l)
housing and transport facilities or in their absence, an allowance
for the same;
(m)
measures to combat workplace violence and handling its aftermath …”
(The emphasis is mine)
[3]
The
list of subjects set out in subs (3) are suggestions as to matters
that may be included by the parties in a collective bargaining
agreement. Thus the parties may elect to include all or any of the
suggested topics in their agreement. The point being made is that
the statute does not confer a right on any of the parties, without
agreement of the others, to have included in their collective
bargaining agreement, any of the subjects on the list. This is
understandable since a collective bargaining agreement is a contract
between the parties to it and only they can set the terms by which
they will be bound. It follows that any benefits to be included in
the collective bargaining agreement must be agreed by the parties.
They cannot be imposed by the Arbitrator, or indeed any court, in the
same way that a court cannot write a contract for the parties.
What
occurred in this case was totally improper. The Labour Officer, the
Arbitrator and the Labour Court all missed the point.
THE
BACKGROUND
[4]
The proceedings on record commenced on the 27th June 2007, when the
General Secretary of ZARWU
wrote to the designated agent of the Railway Employment Council in
the following terms:
“Dear
Sir
RE:
DISPUTE HOUSING ALLOWANCE AND EDUCATIONAL ASSISTANCE
On
the full council meeting on 21 June 2007 there was disagreement
between Labour and Management on the above issue.
Labour
through ZARWU are referring the matter to your office for
Concilliation (Labour Act Section 63).
We
wait to hear from your office”
Thereafter,
all the parties were notified of a hearing to be held on 12 July 2007
and later postponed to 19 July 2007.
[5]
On 19 July 2007, the parties appeared before a conciliator. The
latter required each of the parties to state his position on the
matter and enquired as to whether any of the parties had varied its
position on the dispute. The parties had not. He therefore issued a
certificate of no settlement and, by agreement with the parties,
referred the matter to an arbitrator for compulsory arbitration. The
terms of reference were agreed to be whether the respondents were
entitled to:
(a)
Housing allowance, and if so, the quantum thereof (the claim was
stated at $7,500,000.00 per month);
(b)
Education allowance calculated at government school rates, whether
boarding or day school for up to a maximum of three children or
registered dependents;
(c)
The effective date of such award.
The
Arbitrator appointed to deal with the matter was Mr Chinjeruke.
[6]
The point was taken before the Arbitrator, in
limine,
that the matter was not properly before him since no conciliation had
taken place. That point was dismissed on the basis that the parties
could, in terms of section 93(1) of the Act, agree, and did in fact
agree, to refer the matter to arbitration.
[7]
As to the merits, it was contended before the Arbitrator that the
appellant had not refused to negotiate on the allowances but proposed
rather that the negotiations be centered on basic pay. Accordingly,
the appellant's refusal to accede to a request to negotiate on the
allowances did not indicate bad faith on its part. However, in the
event that the arbitrator came to the conclusion that the appellant
had refused to negotiate, the most he could do was to order the
parties to negotiate. He could not impose 'unagreed' terms and
conditions on the parties. In that submission the appellant was
correct. It was, however, ignored by the Arbitrator.
[8]
It was further contended on behalf of the appellant that the dispute,
having arisen from the respondents' assertion that they are
entitled to the allowances in terms of section 74(3) of the Act, was
a dispute of interest as opposed to one of right since that section
provides for discretionary collective bargaining negotiations. The
Arbitrator appeared to accept this reasoning. He said:
“… the
dispute in its current form is a 'dispute of interest'. Because
of “may” … in section 74(3), the matters are negotiable.”
He
then went on to find:
“However,
allowances such as Housing and School Fees, have to exist in one form
or the other” and awarded, without giving reasons for so doing,
school fees and housing allowances totaling 55 per cent of the basic
salary of the employees. The appellant was aggrieved by the award
and appealed to the Labour Court.
[9]
Before the Labour Court, one of the main grounds of appeal was that
the allowances sought and obtained by the respondents were not a
right or entitlement but were to be negotiated. In the appellant's
words, the Arbitrator had elevated a 'negotiable to an imperative'
and thereby committed an error of law. A further ground of appeal
was that the Arbitrator's award was premised on 'serious
misdirections of fact which amount to misdirections in law'. In
particular, it was alleged that the Arbitrator erred in his finding
that allowances such as Housing and School fees 'have to exist in
one form or the other'.
[10]
The Labour Court dismissed the appeal. Its concern was:
“This
award was handed down on the 9th
November 2007. Three years down the line the respondents'
grievances have not been resolved. On page 6-9 of the record it has
been shown that referring the matter back for conciliation will not
assist as each party maintained its original position. This will
further delay the finalization of this case.”
ISSUES
ON APPEAL
[11]
The grounds of appeal are far from clear and concise. However, the
main issue which clearly arises for determination and which is
dispositive of the appeal, is whether the Arbitrator could properly
impose, upon the parties, the terms of a collective bargaining
agreement and whether the court a
quo
was correct in upholding the decision of the Arbitrator to do so.
[12]
As already stated above, the matters listed in section 74(3) of the
Act are matters which the parties may, at their discretion, decide to
include in their collective bargaining agreement. The appellant's
position at all times was that it preferred to negotiate on basic
salaries and not allowances. In my view both the Labour Court and the
Arbitrator ought to have found that the allowances, not having been
negotiated by the parties and therefore not forming part of their
collective bargaining agreement, were not a right or entitlement
available for appropriation by the respondents. This is a matter for
the parties to bargain and reach agreement on. It is not a matter
where a court can intervene. A court can only intervene to enforce
any agreement the parties will have concluded.
[13]
The Arbitrator could not, therefore, impose terms and conditions in
the collective bargaining agreement. His finding that housing and
school fees allowances 'have to exist in one form or the other'
was misguided, devoid of any legal basis and irresponsible. So, too,
was the subsequent award of the said allowances in percentages
lacking evidential foundation and, as submitted by the appellant,
“plucked out of the air”. Clearly, the Arbitrator acted outside
his powers when he purported to set the terms of the collective
bargaining agreement between the parties and the Labour Court erred
in law when it upheld the arbitrator's award.
[14]
An additional issue arising from the grounds of appeal is whether the
Labour Court erred in failing to find that the referral to
arbitration by the Labour Officer, before attempting to conciliate
the matter, was a nullity.
It
was submitted, in support of this ground of appeal, that the matter
ought to have been conciliated by the Labour Officer before the
referral to arbitration and that the failure to conciliate rendered
the referral to arbitration a nullity.
[15]
It seems to me that in terms of the provisions of section 93(1) of
the Act, the Labour Officer could properly refer the matter to
arbitration by agreement with the parties and it is clear that this
is how the matter was referred to the Arbitrator. The terms of
reference were agreed by the parties. However, in view of the fact
that there was no legal right which was being sought to be enforced,
the dispute being one of interest only, the Arbitrator's role in
those circumstances would merely be a conciliatory one. Thus both the
Labour Officer and the Arbitrator misconstrued their respective roles
in the matter.
[16]
I may comment here that while the Act provides no bar to a referral
to arbitration by agreement, the Labour Officer ought to have
assisted the parties in coming to some agreement. Since the dispute
was one of interest, his role in conciliating the matter and
assisting the parties to reach agreement, was invaluable. He ought to
have attempted to settle the dispute by conciliation. Section 93(1)
of the Act provides:
“(1)
A
labour officer to whom a dispute or unfair labour practice has been
referred, or to whose attention it has come, shall
attempt to settle it through conciliation or,
if agreed by the parties, by reference to arbitration.”
(My underlining)
[17]
The referral to the Arbitrator merely shifted the responsibility to
conciliate the matter. The appellant's position was 'I will pay
you the best salary that I can pay in the circumstances but I would
rather not commit to pay allowances'. There is nothing wrong with
that approach. Each undertaking is beset with its own peculiar
circumstances. The fact that one employer considers it appropriate to
pay allowances puts no obligation on another employer to do the same.
Apart from dismissing the claim as being devoid of merit, the
arbitrator had no meaningful role to play in this matter save to urge
the parties to negotiate further on the issues in dispute. He could
not, as he purported to do, create a contract for the parties.
[18]
It follows from the above that the Labour Court committed an error of
law when it dismissed the appeal against the Arbitrator's award.
[19]
It is, therefore, ordered as follows:
1.
The appeal is allowed with costs.
2.
The order of the Labour Court is set aside and substituted with the
following:
'The
appeal is allowed with costs.
The
Arbitrator's decision is set aside.'
GWAUNZA
JA: I
agree
GUVAVA
JA: I
agree
Mbidzo,
Muchadehama & Makoni,
appellant's legal practitioners
Sinyoro
& Partners,
respondents' legal practitioners
1.
It is not clear whether these are the initials of the 4th
or 1st
respondent
2.
The percentages amounted to 55 per cent of the employees' salaries
