Rangarirai Mudzingambiri v Health Service Board

### Preamble
IN THE LABOUR COURT OF
JUDGMENT NO. LC/H/366/25
ZIMBABWE HARARE, 12 and 23
CASE NO. LC/H/852/23
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IN THE LABOUR COURT OF ZIMBABWE HARARE, 12th and 23 MARCH, 2025

AND 07 OCTOBER 2025

JUDGMENT NO. LC/H/366/25 CASE NO.	LC/H/ 852/23

RANGARIRAI MUDZINGAMBIRI	APPLICANT AND

HEALTH SERVICE BOARD	RESPONDENT

Before the Honourable Chivizhe, J:

For Applicant	- Mr K. Masasire (Legal Practitioner) For Respondent	- Mr C. Chitekuteku- Civil Division

In attendance	- Mr C. Gutu, Respondent Legal Advisor

CHIVIZHE, J:

This is an application for quantification of damages in the form of salary backpays. The application is made pursuant to a judgment of this court rendered on 18 December, 2020 under reference LC/H/303/2020. The operative part of the judgement reads as follows:

“1. The application for review succeeds.

The appeal is upheld with costs.

The disciplinary proceedings before the Disciplinary Committee and in turn before (sic) the Health Service Board be and are hereby set aside.

The disciplinary proceedings before the Disciplinary Committee for a hearing denovo and in a procedurally correct manner within 60 (sixty) days of the date of this order.

The Applicant shall be reinstated to his original position with effect from the date of discharge and without any loss of salary and benefits.”

The application is opposed.

BACKGROUND FACTS

The material background facts are that the Applicant was employed by the Respondent as an Accounting Assistant. He was based at Kotwa District Hospital. He was discharged from service following a disciplinary process. Dissatisfied, the Applicant approached this court with a conjoined appeal/application for review. Through the judgment rendered on 18 December 2020, referred to supra this court directed the Applicant’s reinstatement without any loss of salary/benefits.

THE APPLICATION

Through his Founding Affidavit, the Applicant contends that he resumed his duties on 1 September 2022. He contends however that he was not paid his salary arrears for the period 6 March 2015 (date of discharge) to 1st September 2022 (date of reinstatement). The Applicant submits that he is entitled to be paid his salary backpay. It is a trite position that he is entitled to be paid backpay based on the prevailing salary rate as at the date of termination. The Applicant has filed a detailed claim, the sum total of the claim is for USD $62 028.00 to be payable in cash or the equivalent in local currency based on the interbank rate prevailing on the date of payment. The Applicant is also claiming interest at the prescribed rate from March 2015 to the date of payment. The Applicant further submits that he has been paid his salaries from September 2022 to date.

The Respondent, through its Notice of Opposition, contends that, the Applicant was reinstated and duly paid all his salary arrears. The Respondent further contends that the claim by Applicant is a fraudulent claim as the Applicant is not owed anything. The Respondent submits that Applicant wrote a letter to the Provincial Medical Director claiming his backpay on 29 August 2022. The Provincial Medical Director had referred the Assumption of Duty Forms to the Salary Service Bureau (SSB) in order for SSB to pay Applicant his salary arrears. The paymaster complied and paid the Respondent as evidenced by the SSB payslip attached as “Annexure 1” to Respondent papers. The Applicant is said to have also acknowledged receipt of his backpay. The Respondent’s prayer is for the dismissal of the application with costs on a higher scale.

In his Answering Affidavit, the Applicant disputes that he was paid the backpays and allowances including bonus from year 2015 to August 2022. He contends that he was only paid his salary from September 2022 to January 2023. He also admits being paid from February

2023 to December 2023 a period where he was already back at work. He contends that he received USD$2 720.00 and ZWL$ 1 234 712.00 which as reflected on the schedule was for the period September 2022 to January 2023. He disputes that the salary amount was also meant to cover the salary arrears for the period March 2015 to August 2022 as contended by the Respondent. He submits that according to Respondent’s calculations in the schedule tendered by it, he ought to have been paid US$4 875.90 in the year 2015, US$6 094.80 in the year 2016, US$6 044.16 in the year 2017, US$6 578.16 in the year 2018, US$1 1717.42 in the year 2019, ZW$275 118.13 for the year 2020, ZW$789 245.66 for the year 2022, The Respondent however has not included the year 2021. Even then the Applicant contends that the total of the US$ amount as reflected in the Respondent’s Schedule clearly exceeds the amount Respondent claims to have paid him. The Applicant therefore maintains that he is still owed the difference by the Respondent including, bonus for the relevant period which item was not captured by Respondent. The Applicant’s prayer is for his application to be granted with costs.

PARTIES SUBMISSIONS

The parties, when they appeared before the court, maintained their divergent positions on the issue as to whether or not on the basis of the evidence tendered by Respondent in the form of salary slip for January 2023 Annexure (I), the Applicant had been fully paid his backpays from March 2025 to 1st September 2022. The matter was heard on 12th March 2025 but had to be postponed to the 25th March 2025 to enable the Respondent to call for further evidence in the form of an official from the SSB who could speak to “Annexure 1” and outline for the court’s benefit how the amount paid in relation to the backpay was calculated. On the 25th March, 2025 the parties advised the court that they had found each other to the extent that they now agreed that the payment made through salary slip “Annexure 1” was covering both the first backpay (from 2015 to 1st September 2022) and the second backpay (from 1st September 2022 to January 2023 a period after the Applicant had resumed duties. The payment as reflected was of US$2 720.98 and ZWL Zig 2 016 800.00.

That was as far as the consensus went. It was apparent to the court that the parties were still not ad idem as to whether US$2 720.98 and Zig 2016 800.00 reflected the full payment of backpays to cover the period March 2015 to 1st September 2022. The parties were directed to file closing submissions on this very point. The parties were each to indicate clearly the rate of exchange that had to be utilised to convert the overpayment in ZWL to a value in US Dollars. They were also to indicate if there was still a variance i..e. amount outstanding after the

converted amount from ZWG to USD$ is taken into account. The parties both filed closing submissions.

The Applicant in closing submissions contends that the order issued by the court has retrospective application, he is therefore entitled to be paid his backpays from March 20, 2015 to 1st September 2022. His salary rate at the time of the termination of employment was pegged at USD$ 552.00 inclusive of allowances. He is essentially claiming 89 months backpay inclusive of leave days and bonus. The Applicant has outlined the applicable legal principles and submits that his application meets all the requirements. He has thus discharged the onus on him to prove the Respondent has not fully paid him his backpay.

The Applicant submits that he was owed USD$ 552.00 × 89 months = USD$ 49 128.00. He was also owed 210 leave days which translates to 7 months × USD$ 552.00 = USD$ 3

864.00. The Applicant also contends that he was entitled to Bonus, the Respondent even factored it in their submission as due and payable. Therefore, the issue of employer discretion to pay bonus therefore does not arise. He is therefore entitled to USD$ 364.00 in bonuses. He is therefore entitled to in total US$ 56 856.00. This figure however is subtracted by USD$ 2

839.21 that has already been paid by Respondent as evidenced by “Annexure 1”. He is thus entitled to USD$ 54 016.69 or the equivalent in local currency payable on the basis of the prevailing interbank rate at exchange on the date of payment. He submits this is based on the order for payment of the debt in the form of backpays having been made after the effective date

i.e. 22 February 2019. In reliance of this position of law the Applicant has referred to the provisions of S.I. 33 of 2019 as well as authorities in Unifreight Africa Limited vs Emily Mashinya CCZ 13/24: Ingagulu (Private) Limited and Another vs National Railways of Zimbabwe SC 42/22 and Magauzi vs Jekera and Another SC 54/22. The Applicant prayer is for the court to direct Respondent to pay the net sum of US$54 016.69 or equivalent in local currency based on the prevailing interbank rate of exchange on the date of payment.

The Respondent, in closing submissions, contends that the gross amount paid in January 2023 under Annexure ‘1’ is actually ZW$ 3 251 512 after adding statutory deductions of ZW$ 1 234 712 to the ZW$2 016 800 which is the Net Salary. The Respondent contends that this figure was also acknowledged as received by the Applicant during the hearing.

The Respondent, although noting that the gross salary rate of USD $552 has been utilised by the Applicant as the applicable salary rate this figure actually excludes statutory deductions.

The Respondent however has no objection to the Applicant continuing to utilise the salary rate of US$552 in this application. The Respondent further submits that in computing the Applicant’s arrear salaries, for the period March 2015 to February 2019 it has converted the US$ 550 salary and deemed it to be valued in RTGS at a rate of 1:1. In doing so the Respondent has placed reliance on the provisions of Section 4 (d) of Statutory Instrument 33 of 2019.

The Respondent further submits that with the period after February 2019, the Applicant was entitled to arrear salaries which were to be converted to RTGS on the basis of the prevailing interbank rate of exchange on the date of payment. The Respondent has further placed reliance on Finance Act (No. 2) Act, 2019, Section 23(3) (a) and (b) thereof which is said to provide for the second effective date i.e. 21 August 2019. It is contended that with effect from this second effective date, the RTGS dollar was declared to be at par with the ZW dollar.

On the basis of these statutory provisions, the Respondent contends that from April 2015 to February 2019 the Applicant was entitled to ZWL$552 salary rate per month. From after February 2019 the salary rate applicable is USD$552. The Respondent contends that on this basis the Applicant was entitled for the period from April 2015 (as March was paid for) to February 2019 (total 47 months) to 47 × ZWL$552 to give a total of ZWL$ 25 944. This is based on the conversion ratio of 1:1. From April 2019 to January 2023 he was owed USD$25

944.00. The Respondent, notes that Applicant having accepted receipt of USD 2 720.98 and ZW$3 251 512 in January 2023 the amounts must be deducted from what is due to him. Respondent contends that the Applicant was overpaid the ZW component as he was paid ZWL$3 251 512. When $25 944 is subtracted from this amount it leaves a credit of ZW$ 3 225 568. The Respondent has converted this amount by dividing this amount with the rate of

799.31 supplied by the Applicant. This results in USD$4 035. The Respondent contends that this overpayment of USD 4 035 when added to the USD$ 2 720 already paid at gives a total of USD$6 755 paid.

The Respondent further contends that the amount of USD$ 6 755 when deducted from the USD$25 944 owing results in a balance of USD$ 19 189. The Respondent contends that this is what is owed to the Applicant. The Respondent is thus tendering the same amount as gross salary arrears. The Respondent has dismissed the Applicant claims for Leave Pay and Bonus. With regards Leave Pay the Respondent contends that there has been no justification laid for the claim in the form of evidence. The Respondent further contends that the Applicant in any event was credited with 205 arrear leave days in January 2023 as evidenced by

“Annexure 1” tendered. Respondent contends that these 205 leave days were utilised by Applicant as reflected on the December payslip attached as Annexure 1. He was therefore not prejudiced. The Respondent prays for dismissal of the claim as it has no basis.

On the issue of Bonus the Respondent contends that as correctly submitted by the Applicant himself, the issue of bonus is discretionary upon the employer. The Respondent further submits that even if the court were to accept the claim for bonus it is the position in Government that bonus is calculated on the basis of one’s pensionable emoluments. As the Applicant’s claim is not based on the same the claim is not justified and ought therefore to be dismissed.

EVALUATION

Based on the submissions as made by the parties and the authorities have referred to by them, there are three issues for determination before this court, firstly what salary rate is to be applied in quantification. The second issue is whether or not the Respondent owes the Applicant the amount of USD$ 54 016.09 as submitted by him. The last issue is what currency the damages shall be paid in.

The basic principle that should guide the court, is that, in the quantification process the onus to prove the claims on a balance of probabilities lies on the employee party. In First Mutual Life vs Muzivi the Supreme Court stated as follows:

In First Mutual Life Assurance Limited v Muzivi 2007 (1) ZLR 325 (S), CHEDA JA at p 328C-D said:

“The suggestion that the employer failed or refused to furnish the respondent with the appropriate salary scale suggests a wrong approach to the issue.

It is the respondent who had the onus to prove his claims.

If he was dismissed when he was in a certain grade, it was for him to tell the court what salary scale applied to him at the time of his dismissal. He could not just claim that he was a certain grade whose salary scale he did not know. This would suggest that he did not know what he was claiming.”

The second principle is that quantification of damages is based on the salary rate that was applicable as at the date of termination. In this case the parties are ad idem that the applicable salary rate as of the date of termination i.e., March 2015 was USD$552. The third principle that ought to guide this court is the principle that was laid in the oft-cited decision in Zambezi Gas (Pvt) Ltd vs N.R. Barber (Pvt) Ltd SC 3/20 where Malaba CJ in interpreting s 4(1)(d)

of SI 33/19 the Court held that contractual obligations valued in United States dollars immediately before the effective date were to be paid in RTGS dollars at parity or at a one-to- one rate. The court stated the following at p 13 of the cyclostyled judgment

“Section 4(1)(d) of SI 33/19 states that for such sui generis liabilities, including judgment debts, a rate of one-to-one between the United States dollar and the RTGS dollar will apply. The transactions entered into after the effective date would fall under the provisions of s 4(1)(e) of SI 33/19

It is clear on the basis of this authority that for a liability to be covered by what is now commonly referred as the 1:1 rule the liability should have arisen before the effective date. In other words, the judgment/order must have been determined before February 2019. In a judgment by my brother J Murasi J in Wellington Muneka and Olivine Industries (Private) Limited LC/H/920/22-) the court in addressing the same point relied on the authority in Regis Maganzi vs Francis Jekera and Another SC 52/22 where Uchena JA stated as follows:

“The order granted in Case No. HC 1449/18 was granted on 22/2/2019 and such was not granted immediately before the effective date of promulgation of S.I.33 of 2019. The order was granted on the effective date but after it had come into effect, it can therefore not be valued in RTGS dollars at the rate of 1:1 as it falls under the provisions of Section 4 (1) e of S.I. 33 of 2019.”

It is also necessary for this court to, for completeness, put matters in their proper context. Both parties in these proceedings have made submissions based on S.I. 33 of 2019. It however needs to be clarified the present status of S.I. 33 of 2019. The Statutory Instrument was enacted in terms of Section 2 of the Presidential Powers (Temporary Measures) Act (Cap 20:10). By virtue of Section 6 (1) of that Act S.I. 33 of 2019 lapsed after the expiry of 180 days. Tthe provision of S.I. 33 of 2019 especially Section 4 thereof however have been re- enacted with some changes through Section 22 of the Finance (No 2.) Act, 2019 (Act No 7 of 2019). This act was promulgated on 21 August 2019 and came into effect on the same date. Most importantly for the purpose of this matter, Section 22 of this Finance Act re-enacts the the provisions of section 4(1)(d) and (e) of S.I. 33 of 2019. Section 22 (3) as also submitted by Respondent validates the use of the RTGS currency with effect from the first effective date.

Turning to the issue in dispute between the parties, the Applicant contends that the salary arrears have to be quantified on the basis of US$552 payable on the basis of the

prevailing interbank rate on the date of payment. Applicant placed reliance on provisions of

S.I. 33 of 2019 which are now contained in the Finance Act, 2019 as well as authorities referred. The Respondent counter submission is that the claim has to necessarily be split into two. The first tranche i.e. for the period from April 2015 to February, 2019 (the first effective date) the salary rate shall be converted on the basis of 1:1 rate to ZWL$ 552. The second tranche shall thereafter be payable on the basis of a monthly salary of USD$552 by operation of law.

There has clearly been a misapprehension by the Respondent of the effect and application of S.I 33/2019 and the subsequent legislation in the Finance Act, 2019. The present matter is a quantification of damages matter. In Zambezi Gas P/L vs N.R. Barber (Pvt) Ltd the Supreme Court laid down the principle to be applied when one is claiming damages. It is clear that the value of such a claim has to have been expressed in US$ dollars before the effective date. The liability itself is created when there is a judgment granted directing payment of the judgment debt by the debtor. Where the judgment is granted before 22 February 2019 then the 1:1 formula applies in converting the value of that debt from United States Dollars to the local currency which was RTGS then.

Where however the judgment that imposed the liability is made after 22 February 2019 the conversion of the value of the liability is made under the provisions of Section 4(1) (e) of

S.I. 33 of 2019, which provides as follows

‘that after the effective date any variance from the opening parity rate, shall be determined from time to time by the rate at which authorised dealers under the Exchange Control Act exchange the RTGS Dollar for the United States dollar on a willing-seller willing-buyer basis….

It needs to be emphasised that for quantification of damages the most crucial date therefore is the date of the judgment. It is therefore not correct for the Respondent to contend that the value of the liabilities in the form of arrear salary could be altered by the employer on its own, by, firstly changing the currency from USD to RTGS and, secondly, altering the value of the liability which was ordinarily sounding in United States Dollars to RTGS dollars. The court also does not subscribe to the interpretation as accorded by the Respondent that Section 23 (3) (a) and (b) operated to change the liability owing based on initially a salary rate of USD 552 Dollars which was then altered by operation of law to RTGS $552 and thereafter to

$ZWL552 dollars. The relevant Section reads as follows:

“23 Zimbabwe dollar to be the sole currency for legal tender purposes from second effective date

For the avoidance of doubt, but subject to subsection (4), it is declared that with effect from the second effective date, the British pound, United States dollar, South African rand, Botswana pula and any other foreign currency whatsoever are no longer legal tender alongside the Zimbabwe dollar in any transactions in Zimbabwe.

Accordingly, the Zimbabwe dollar shall, with effect from the second effective date, but subject to subsection (4), be the sole legal tender in Zimbabwe in all transactions.

For the avoidance of doubt, it is declared that, from the second effective date—

references to the Zimbabwe dollar are coterminous with references to the following and to no other forms of legal tender or currency—

the bond notes and coins referred to in section 44B of the principal Act; and

the electronic currency prescribed for the purposes of section 44C of the principal Act, that is to say to the RTGS dollar;

the above-mentioned bond notes and RTGS dollars are at par with the Zimbabwe dollar on and after the second effective date, that is to say each bond note unit and each RTGS dollar is equivalent to a Zimbabwe dollar, and each hundredth part of a bond note unit and each hundredth part of a RTGS dollar is equivalent to a Zimbabwean cent;

From my reading of the provision as referred to, it would appear that the purpose of these amendments was to formally abolish the multi-currency system and declare ZWL to be the sole legal tender. The provisions therefore would have no effect on the Respondent’s liability/indebtedness towards the Applicant which indebtedness was confirmed by this court through the judgement number referred to supra. The court therefore agrees entirely with the Applicant submission that the liability was created through a judgment of this court handed down on 18th December, 2020. The order directed reinstatement without loss of salary/benefits. It had a retrospective provision for payment of salary/benefits. The obligation to pay having arisen after the 1st effective date the indebtedness must on the basis of the authority in Wellington Muneka and Olivine Industries LC/H/920/22, Regis Maganzi vs Francis Jekera and another SC 52/22 be discharged in terms of section 22(1)(e) of the Finance Act which is the replication of section 4(1)(e) of Statutory Instrument 33 of 2019.

It must follow therefore that the Respondent has to pay to the Applicant the amount of USD$552 X 89 MONTHS = USD$49128.00. less the amount that has already been paid i.e. USD$ 6755.00. The total due and payable is USD$42373.00 The Applicant’s claim for Leave Days is dismissed. The Respondent submitted that Applicant had already been paid for outstanding leave days. He did not deny. It is a principle of law what is not denied is taken to be admitted. He has also claimed Bonus for 7 years. The Respondent contended however that

the bonus should be calculated on the basis of one’s pensionable emoluments. The Applicant’s claim has not been based on his pensionable emoluments. The claim not having been fully justified by the Applicant has to be dismissed.

In the result it is ordered as follows:

The application for quantification of damages in the form of backpay and allowances be and is hereby granted.

The Respondent shall pay to the applicant USD $42373 forty two thousand three hundred and seventy three United States dollars) or the Zimbabwean dollar equivalent at the prevailing interbank rate on the date of payment.

Interest shall be paid at the prescribed rate of 5% per annum from March 2015 to the date of payment.

Each party shall bear its own costs