Rio Zim Limited v Lingililani Sandulizeni

### Preamble
IN THE LABOUR COURT OF ZIMBABWE
JUDGMENT
NO. LC/H/314/2013
HELD AT HARARE ON 21 MAY, 2013
CASE NO. LC/H/193/11
JUDGMENT NO. LC/H/314/2013
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IN THE LABOUR COURT OF ZIMBABWE		JUDGMENT NO. LC/H/314/2013

HELD AT HARARE ON 21 MAY, 2013		CASE NO. LC/H/193/11

AND 13 SEPTEMBER, 2013

In the matter between:

RIO ZIM LIMITED				-	APPELLANT

And

LINGILILANI SANDULIZENI		-	RESPONDENT

Before The Honourable B. T. Chivizhe: President

For Applicant	-	Mr A Mapanzure (Legal Practitioner)

Chinawa Law Chambers

For Respondent	-	Mr S. Pelewelo (Trade Unionist)

National Mine Workers’ Union of Zimbabwe

CHIVIZHE B. T.:

The Respondent was employed by the Appellant as an Electrical Assistant.  On 15th of October, 2009 he attained the age of 60 years.  In accordance with appellant’s retirement policy the Respondent was advised of his retirement with effect from the 31st of December, 2009.

The Respondent however challenged the decision to retire him and lodged instead a claim for unfair dismissal.  Upon failure to conciliate by the Labour Officer the matter was referred for compulsory arbitration.  The terms of reference were for the Arbitrator to determine whether or not the Appellant had been unlawfully dismissed from employment.

The Arbitrator after considering submissions by both parties came to a finding that termination procedures were not followed in that Appellant had not appended his signature to any document signifying his acceptance of termination.  On that basis the Arbitrator granted an award in the following terms;

“The Award

Having taken full account of the submissions from both parties and having carefully considered the position of the law in this matter Respondent should reinstate Appellant and then follow the stipulated procedure of termination of contract of employment.”

The Appellant was aggrieved and noted an appeal on the following grounds;

The learned Arbitrator erred in law in failing to appreciate that as the Respondent had attained the retirement age in terms of the Appellant’s retirement policy, the Appellant was entitled to retire the Respondent in terms of such a retirement policy.

The learned Arbitrator erred in law in holding that Respondent ought to have signed “termination documents” before the retirement was to be lawfully proceeded with.

The learned Arbitrator erred in law in holding that “termination procedures” were not followed when fact Respondent was duly advised of hid retirement orally and in writing.

The learned Arbitrator completely mistook a retirement for a dismissal when he directed Appellant to reinstate the Respondent.  If the Arbitrator had applied his mind to the legal issues before him, he ought to have approached that by virtue of reaching the retirement age and having been duly advised about the consequent retirement, Respondent’s employment terminated by the operation of law of a retirement and that no issue of retirement was competent as if there had been a dismissal.

The learned Arbitrator failed to appreciate that if an employee reaches retirement age, there is nothing unlawful in the employer executing the retirement.  This is termination of employment by operation of a retirement as opposed to misconduct related terminations which arise in terms of a code of conduct.

There are four issues raised for determination before the court.  I shall address the issues in the order as presented by the Appellant –

Whether or not the Appellant did have a mandatory retirement policy in operation is the first issue for determination.

It is Appellant’s submission that it did have a retirement policy in place.  Clause 1 (a) of that policy provides for the normal retirement age for all employees, both men and women at 60 years.  The Respondent in its response has not addressed himself specifically to the issue as raised in this appeal.  The Respondent has not for that reason denied the existence of the retirement policy.

The second issue is whether it was necessary for the Respondent to sign ‘termination documents’ before his retirement in order for that process to be valid.  The Appellant’s submission is that it was not necessary for the Respondent to do so.  The Respondent has in his response not addressed himself specifically to that point.

The Arbitrator found that the Respondent was required to sign ‘termination documents’ in order to validate the execution of the retirement policy against the Respondent.  The Arbitrator concluded that the Respondent was therefore unlawfully terminated because he had not signed termination documents.  The suggestion being made is that one would need to sign a document consenting to retirement on attainment of the retirement age.  According to the Arbitrator’s reasoning retirement therefore does not become effective by operation of law.

The Arbitrator clearly erred in reaching the conclusion that an employee would need to consent to retirement upon attainment of the retirement age. He failed to lay down the legal basis for his conclusion.  If it was the position at law or in the company policy the Arbitrator ought to have clearly stated so.  A perusal of the Retirement Policy however in paragraph 2 ‘Clarification of Retirement Policy’ clearly shows that one is automatically retired upon attainment of the age of 60.  Paragraph 2 reads;

Subject to the conditions contained in an employee’s Agreement of Service, his employment shall continue until the end of the calendar month during which he attains the age of 60 years.  In other words, when he reaches the age of 60 years, he will automatically retire from permanent employment.

The Arbitrator clearly erred in his conclusion.

The next issue raised is centred on the termination procedures themselves.  The Arbitrator in his award found that the termination procedures were not followed.  The Appellant’s submission is that in terms of Clause 2 (a) of the Retirement Policy as outlined above the procedures included 6 months’ notice.  These procedures were followed in this case.  Respondent had been notified verbally on the 31st of July, 2009 that he was due to retire in December, 2009 after attaining 60 years.  The Appellant had followed up with a written letter dated 21 August, 2009.  Although the letter does not form part of the record it is however an undisputed fact.  In view of this it was Appellant’s submission that procedures were followed.

The Respondent’s position is that Appellant did not follow the correct procedure.  It was his submission before the Arbitrator Appellant should have, after receiving a recommendation from the company doctor, retired him on medical grounds. The Respondent would have been entitled to payment of all the consequent benefits.  The Respondent referred to the document in Rio Tinto Conditions of Serve and Company Policies covering Disability Income Benefit Fund as well as Section 25 (i) of the relevant code being Statutory Instrument 152 of 1990.   The Respondent however disputes that he had been notified on 31 July of 2007 of his pending retirement in December 2007. The Appellant in reply raised the issue that the Respondent appeared to be raising new claims before the Labour Court.

Although the Respondent disputes that he was served with letter dated 21st of August, 2009 advising of his pending retirement on 31st December, 2009 ( a point also raised before the Arbitrator) The Respondent has not disputed attending a meeting between him and the Respondent Superintendent on the 31st of July, 2009 at which he was verbally advised of the same issue.  As clause 2 (a) of retirement policy does not preclude verbal notice it is the court finding that the Respondent was indeed notified in terms of the policy provisions.

I would also agree with the Appellant that the Respondent appears to be raising new issues before this court.  He seems to be now claiming his entitlement to medical benefits and other benefits based on the Rio Tinto Disability Income Benefit Fund.  That document was not placed before the Arbitrator.  The present proceedings being appeal proceedings are based on the record.  The court cannot proceed to determine an issue which was not before the Arbitrator.  It is however pertinent to note that in his submissions to the Arbitrator, Respondent referred to a visit to a company medical consultant prior to retirement.  He also referred to the letter by the consultant recommending early retirement for Respondent.  With these documents placed before him the Arbitrator however, failed to address and resolve the issue amicably.  The Respondent before this court also failed to show clearly what prejudice, if any, he suffered by being retired normally instead of being retired on medical grounds if ever there is that provision in Rio Tinto Disability Income Benefit Fund although the court was not referred to any.  If the Respondent suffered prejudice in that he was entitled to some medical benefit the Respondent would  have, in my view, only been entitled to claim those benefits prior to retirement.  Upon attaining the normal retirement age however under the Respondent’s retirement policy there was automatic termination of the contract by effluxion of time.

The last issue raised by this appeal is whether it was competent at law for the Arbitrator to order reinstatement where the Respondent’s employment contract had terminated by retirement.  The Arbitrator in his award directed the Appellant to reinstate Respondent and then follow stipulated procedures for the termination of the contract.  The court has already concluded that the Appellant did follow the procedure as laid down in its retirement policy.  There was no need for the Respondent to consent to termination by retirement.  Having reached retirement age by effluxion of time, the Respondent automatically became eligible for retirement.  The Respondent was also verbally notified of the pending retirement.  The award by the Arbitrator directing reinstatement is clearly incompetent for the above reason and ought to be set aside.

It is accordingly ordered as follows;

The appeal be and is hereby allowed.

The Arbitral Award handed down on 5th of August, 2010 be and  is hereby set aside.

Chinawa Law Chambers Representatives for the Appellant.

National Mine Workers Union of Zimbabwe Representatives for the Respondent.