Air Zimbabwe (Private) Limited v Modicai Magaisa

### Preamble
IN THE LABOUR COURT OF ZIMBABWE
JUDGEMENT NO. LC/H/298/2020
HARARE, 16 MARCH 2016
CASE NO.
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IN THE LABOUR COURT OF ZIMBABWE         JUDGEMENT NO. LC/H/298/2020

HARARE, 16 MARCH 2016                                                CASE NO. LC/H/784/15

AND 4 DECEMBER 2020

In the matter between: -

AIR ZIMBABWE (PRIVATE) LIMITED                                    Appellant

And

MODICAI MAGAISA                                                                  Respondent

Before Honourable B.T. Chivizhe, J:

For Appellant: Ms N. Chimuka (Legal Practitioner)

For Respondent: Mr T. Marume (Legal Practitioner)

CHIVIZHE, J:

There has been a delay in the handing down of this judgement which was prepared in 2017. I do hereby extend my apologies to the parties.

INTRODUCTION

The appeal was noted against an arbitral award handed down on the 30th July, 2015 per the Honourable Dr T.N Sambureni, Arbitrator. The appeal is opposed.

BACKGROUND FACTS

The Respondent was employed by the Appellant as a Senior Manager – Finance. On 16 December, 2009 the Appellant through its Human Resources Manager wrote to the Respondent notifying him of its intention to retrench him. The Respondent was subsequently sent on forced leave pending retirement. Between that time and 30th April 2013 the Respondent was receiving 40% of his salary with the remaining 60% being carried forward and reflected on his payslips. From 1 May 2013 the Appellant stopped carrying forward the 60% of the unpaid salaries without an explanation tendered to the Respondent. The Respondent wrote to Appellant seeking an explanation for its action. The Appellant did not provide such an explanation. The Appellant then stopped paying the Respondent his other benefits e.g. school fees allowances, fuel allowances and mobile phone allowances. The Respondent thereafter referred the matter to conciliation and when conciliation failed compulsory arbitration.

ARBITRATION

The issues referred for arbitration were as follows;

To determine whether or not the Appellant should pay Respondent his full salary and allowances as well as benefits at regular intervals under the subsisting contract of employment.

To determine the quantum of deferred arrear salaries and benefits owed to Respondent by Appellant and

To determine remedy.

The Respondent submission before the Arbitrator was that he was owed arrear salaries amounting to USD 31 031.63 as at 30th April 2013 which amount he was still owed as at the date of the award. In regards the period of 1 May 2013 to April 30 2015 the arrear salaries stood at USD 21 950.00. The Respondent further submitted that his benefits of fuel allowances, school fees and mobile phone allowances were also in arrears those benefits having been stopped after he was placed on forced leave, more particularly the mobile phone allowances payments had seized in October 2012 whereas the school fees allowances had ceased during the second term 2013, fuel allowances ceased in February 2013. The Appellant actions were therefore tantamount to a unilaterally variation of contract. The Respondent referred to numerous case authorities as well as authors.

The Appellant on its part raised a technical issue that the Respondent had cited Air Zimbabwe Holdings (Private) Limited as well as Air Zimbabwe Limited: that the Respondent could not sue both entities the two being separate and distinct entities. The Appellant further argued that Respondent ought to have cited both entities if the intention was to sue them both.

The Arbitrator in his analysis of submissions and evidence came to the conclusion that on the basis of the contract and other documentation before him the employer was Air Zimbabwe (Private) Limited. The Arbitrator further concluded that the Appellant had unilaterally varied the terms of the employment contract. He further found that Respondent not having been terminated either by notice or retrenchment process the Respondent remained an employee. The Respondent had however been put on forced leave because of a pending retrenchment exercise which had not been carried out at the time of the award. The Respondent was therefore entitled to his salary and benefits despite having been placed on forced leave.

The Arbitrator further found based on correspondence placed before him that Respondent remained an employee of Appellant. The cessation of the payment of fuel allowances, school fees allowances and cell phone allowances therefore amounted to a unilateral variation of the employment contract. The unilateral payment of a 40% of the salary by Appellant also amounted to a unilateral variation of the employment contract.

On the basis of his findings the Arbitrator upheld the claims by Respondent and granted an award as follows;

“

That the Respondent be and is hereby ordered to pay the claimant’s arrear salaries and benefits in the sum of $ 86 751.05.

That the Respondent be and is hereby ordered to pay claimant’s fuel salaries and benefits at regular intervals under the subsisting contract of employment

I so award.”

APPEAL

Dissatisfied with the award the Appellant noted the present appeal on the basis of the following grounds;

The Honourable Arbitrator grossly erred and misdirected himself on the law and on the facts such misdirection amounting to a question of law by awarding fuel allowance when it was clear in terms of the contract of employment that fuel allowance was not provided for.

The Honourable Arbitrator grossly erred and misdirected himself on the law and on the facts such misdirection amounting to a question of law by ignoring a clear provision in terms of the Respondent’s contract that he (Respondent) would be allowed to draw fuel from Air Zimbabwe (Pvt) Ltd premises, or he will be reimbursed for such fuel expenses on production or receipts.

The Honourable Arbitrator grossly erred and misdirected himself on the law and on the facts such misdirection amounting to a question of law by awarding fuel allowance in the sum of US$9360-00 when the Respondent did not produce any proof of such fuel expenses as per his contract of employment.

The Honourable Arbitrator grossly erred and misdirected himself on the law and on the facts such misdirection amounting to a question of law by ignoring a clear provision in terms of the Respondent’s contract that a company vehicle will put at your disposal for both business and reasonable personal use and consequently the Respondent was only entitled upon demonstration and production of the receipts a pro-rata share of fuel expenses.

The Honourable Arbitrator thus grossly erred and misdirected himself on the law and on the facts such misdirection amounting to a question of law by awarding 100% “fuel allowance” to the Respondent.

The Honourable Arbitrator grossly erred and misdirected himself on the law and on the facts such misdirection amounting to a question of law by treating the issue of fuel as a right, when it was clear that it is simply a privilege extended by the employer to an employee hence could be withdrawn by the employer.

The Honourable Arbitrator grossly erred and misdirected himself on the law and on the facts such misdirection amounting to a question of law by ignoring the fact that the Respondent was not coming to work and hence he could not be given fuel when he was not rendering any service for the employer.

The Honourable Arbitrator grossly erred and misdirected himself on the law and on the facts such misdirection amounting to a question of law by awarding cell phone allowance when it was clear in terms of the contract of employment that cell phone allowance was not provided for.

The Honourable Arbitrator grossly erred and misdirected himself on the law and on the facts such misdirection amounting to a question of law by treating the issue of cell phone allowance as a right, when it was clear that it is simply a privilege extended by the employer to an employee hence could be withdrawn by the employer.

The Honourable Arbitrator grossly erred and misdirected himself on the law and on the facts such misdirection amounting to a question of law by ignoring the fact that the Respondent was not coming to work and hence he could not be given cell phone allowance when he was not rendering any service for the employer.

The Honourable Arbitrator grossly erred and misdirected himself on the law and on the facts such misdirection amounting to a question of law by awarding school fees in the sum of US$22 400-00 when the Respondent did not produce proof of the US$22 400-00 as per the provisions of the contract of employment.

The Honourable Arbitrator grossly erred and misdirected himself on the law and on the facts such misdirection amounting to a question of law by making a decision which is wholly unreasonable such that any person apply his mind to the facts would not arrive at such a decisions.

POINT OF LIMINE

The Respondent in its Notice of Response took a point in limine that no question of law arose from the appeal. On that basis therefore there was no appeal before the court. The Respondent prayer was for the point in limine to be upheld and the appeal be dismissed with costs.

The Appellant in counter submitted that the appeal raised questions of law and was consequently properly before the court by virtue of Section 98 (10) of the Labour Court Act which provides  that an appeal against an arbitral award has to be on a question of law.

Section 98 (10) of the Labour Act [Cap 28:01] governs an appeal against an award of an Arbitrator. The section provides as follows;

(10) An appeal on a question of law shall lie to the Labour Court from any decision of an arbitrator appointed in terms of this section.

The issue as to what constitutes a ‘question of law’ has been extensively debated in this jurisdiction. The leading case is the celebrated case of Muzuva vs United Bottlers (Private) Limited 1994 (1) ZLR 217 (SC) where Gubby CJ (as he then was) held that;

“The phrase “question of law” has three distinct, though related, meanings;

A question which the law itself has authoritatively answered to the exclusion of the right of the court to answer the question as it thinks fit, in accordance with what is considered to be the truth and justice of the matter;

A question as to what the law is. An appeal on a question of law means one in which the question for argument and determination is what the true rule of law is on a certain a matter;

A question which is within the province of the Judge instead of the jury.”

The meaning of the term ‘question of law’ has been varied and extended over the years. In the case of National Foods vs Mugadza SC 105/1995 (aptly referred by Appellant) it was held that a serious misdirection on the facts amounts to a misdirection in law. In Leopard Rock Hotel Company (Private) Limited vs Van Beek 2000 (1) ZLR 251 (S) a situation where the Tribunal has misdirected itself on the law as to the criteria to be taken into account in assessing damages raises a question of law. Finally in Chinyange vs Jaggers Wholesalers SC 24/03 the Supreme Court found that “a serious misdirection on the facts amounts to a misdirection of law if it is so unreasonable that no sensible person applying his mind to the facts would have arrived at such a conclusion.’’

On the basis of the authorities referred to supra as to what constitutes question of law jurisdiction there is no doubt in my mind the present appeal falls within the ambit of Section 98 (10) of the Labour Act [Cap 28:01]. This is essentially so as the grounds of appeal raise question of law. In grounds number 1, 2, 3 and 4 the Appellant attacks the award on the basis that the Arbitrator erred and misdirected himself on law by awarding fuel allowances on the basis of no evidence. It is trite that to award on the basis of no evidence. In grounds of appeal numbers 8, 9 and 10 the Appellant once again is raising the issue that the Arbitrator grossly erred and misdirected himself by awarding cell phone allowances in the absence of evidence. Ground of appeal number 11 raises the same argument in respect of the school fees claim before the Arbitrator. The Appellant in this ground once again raises the issue of the Arbitrator awarding school fees in the absence of evidence having been tendered before him.

I shall proceed to determine the issues as presented.

Fuel Allowances

The first issue taken by the Appellant is that Arbitrator grossly erred and misdirected himself at law and on the facts when he awarded fuel allowances when in terms of the contract of employment the fuel allowances was not provided for. The Appellant has relied on the provisions of the contract which according to Appellant was creating a privilege and a not a right. The Appellant further submits that in any event the fuel that Respondent was entitled to was for business and reasonable personal use. The fuel allowances was also claimable where Respondent drew directly from the employer i.e. Air Zimbabwe Private Limited or upon production of proof where the Respondent had refuelled outside the employer premises. Such proof required would be in the form of receipts. The Appellant submission is the Respondent having failed to tender any proof the Arbitrator clearly erred in awarding the fuel allowances. Such an award which was not based on facts and evidence was clearly susceptible to be set aside. The Appellant submission is Respondent had the onus of proving the claims made as the claimant in the matter.

The Appellant further submitted that the Arbitrator erred and misdirected himself at law by drawing an award based no evidence. The claim being for salary and benefits arrears evidence had to be adduced by the Arbitrator. The Appellant relied on the decision of American Friends Service Committee vs Irene Chauke SC 1/2012.

The last issue raised by Appellant in respect of the fuel allowance claim is that the Arbitrator grossly erred and misdirected himself and law and on the facts when he awarded the fuel allowance in circumstances where the Respondent was not coming to work and hence he could not be given fuel when he was not rending any service for the employer.

The Respondent counter submission is that there is no basis for this court to interfere with the award made by the Arbitrator. The award was properly arrived at by the Arbitrator considering that the Appellant did not before the Arbitrator dispute the claims made. In regards to fuel allowances the Appellant did not dispute that Respondent was entitled to the same on the basis of contract.

The issue being raised by Appellant that Respondent was not entitled to the fuel allowances as he was not rendering service at the material time was only being raised for the first time before the Labour Court. The court was however bound to issues as confined to the record of proceedings in the tribunal a quo. The same with the issue as to whether or not the fuel allowance was an entitlement as a right or a privilege extended to the Respondent. As the issue was not taken up before the Arbitrator, that issue was improperly placed before the Labour Court. On this basis It was Respondent position that the grounds of appeal pertaining to the issue of fuel allowance had no merit and stood to be dismissed. The Respondent was entitled to the reinstatement of fuel expended on reasonable personal use. In his final award the Arbitrator found that the employer, based on the evidence placed before him was Air Zimbabwe (Private) Limited. He further found that Respondent still remained the Appellants employee. Further, they had been unilateral variation of the contract by the Appellant through cessation of payment or fuel allowances, school fees, allowances and cell phone allowances. They had been further variation through Appellant’s conduct of paying only 40% of the salary. On this basis the Arbitrator found that the Respondent was liable to pay Respondent’s arrear salarys and benefits in the sum of USD $ 86 751.65. The Appellant was further directed to pay Respondents full salarys and benefits at regular intervals in terms of the contract of employment.

It seems to me that the Respondent raises two valid objections. Firstly on the basis that the issue as to whether or not Respondent was entitled to fuel allowance claimed as he was not rendering service at the time. Secondly the issue as to whether or not fuel allowance claims was an entitlement or a privilege. The two issues not having been placed before the tribunal a quo are improperly taken in these proceedings. It is a trite position at law that the Labour court in sitting to determine an appeal against an arbitral award is confined only to the issues in the record. The two issues clearly stand to be struck out as I hereby do.

It seems to me however that the Appellant raises a valid ground of appeal. The Arbitrator in this case may have failed to apply a crucial principle of law in quantification proceedings. He had as one of his mandates “to determine the quantum of deferred and arrear salaries and benefits owed to the claimant by the Respondent, and......”. The Arbitrator was duty bound to determine the quantum of arrear salary and benefits. An assessment of damages is a trial cause. No assessment can be done on the papers unless the parties indicate that there is no dispute as to quantum. That being the case damages cannot be assessed without evidence being led and placed before the Arbitrator (See Triangle Limited vs Phis SC 107-04; Clan Transport Company (Private) Limited vs Clan Transport Workers Committee SC 1/02 and Gauntlet Security Services (Private) Limited vs Leonard 1997 (1) ZLR 583). It is very clear on the basis of the record that no evidence was placed before the Arbitrator on the aspect of fuel allowance or the other claims for matter.

The Respondent has however submitted the Appellant did not challenge the figure of USD $ 9360.00 claimed as fuel allowance. Appellant did not raise the further issue that the figure represented 100% fuel allowances. The Respondent submission is if the issue had indeed been raised then the Arbitrator would have been required to conduct a factual enquiry. The Arbitrator in his award submitted that Appellant had not made any submissions on the merits. The Appellant had instead raised a technicality that Respondent had made an improper citation. On this basis the Arbitrator had reached the conclusion that Appellant was liable to pay the amount claimed in fuel allowances.

The Arbitrator as indicated above clearly erred and misdirected himself at law. He could not have proceeded with the matter as if on “motion” where the issue of damages in the form of arrear salaries and benefits was the subject. The issue must be subjected to trial and there has to be leading evidence. The record clearly shows contrary to Arbitrator’s findings that Appellant did not object to the claims of fuel and cell phone allowances, on page 11 of Appellant’s submissions paragraph 6 and 7 Appellant submitted before the Arbitrator there was no basis for claiming both allowances when he had not been rendering services. Having raised the ground of objection the Arbitrator was clearly required to address the ground as raised. The Arbitrator would have required Respondent to lead evidence in support of his claims as a matter of law. Indeed in his papers before the Arbitrator, Respondent had indicated that he was going to lead evidence on the day of oral hearing in justification of his claims. It baffles the mind therefore as to why the Respondent did not then lead evidence on the day of oral hearings. If he did lead the record of proceedings certainly does not reflect that. This also applies to the claims for cell phone allowances as well as for school fees. The Respondent did file a statement of claim and submission before the Arbitrator. It is however a trite position at law the submissions are not evidence. The court was referred to the case of American Friends Service Committee vs Irene Chauke SC 1/2012 where the Supreme Court stated as follows;

“The second issue for determination is whether or not the court a quo misdirected itself in confirming the award made by the arbitrator on the quantum of damages due to the respondent.  The record shows that there was no evidence upon which the arbitrator based his award other than an unsubstantiated statement of claim by the respondent.  The Labour Court accepted the claim on the basis that the appellant had not opposed it.

There can be no doubt that the Labour Court fell into error in coming to this conclusion as it is settled law that damages in these circumstances must be properly proved by the party seeking the same. Indeed, Mr Zinyengere for the respondent did concede that both the arbitrator and the court a quo had erred in this respect.”

The same sentiments apply with equal force in this matter.

On the basis it is very clear that a gross error and a misdirection on law was committed in this case. The award handed down certainly cannot be allowed to stand, it must be set aside. Considering the time this case has taken, I feel that the matter should, upon remittal, be dealt with in the shortest time possible. In view however of the decision in Eastern Highlands Plantations vs Farayi Mapeto & 136 Others SC 43/2016 the matter can no longer be remitted to an Arbitrator. It has to be placed before the Labour Court.

In the result the following order is handed down;

The appeal be and is hereby allowed.

The arbitral award of Dr. T.N Sambureni, dated 30 July 2015 be and is hereby set aside in its entirety.

The matter be and is hereby referred to the Labour Court for quantification purposes.

The fresh hearing shall be conducted within 60 days of the date of this order.

Messrs Mutamangira & Associates, applicant’s legal practitioners

Matsikidze & Mucheche, respondent’s legal practitioners