Sandvik Mining and Construction v Misheck Mabeza

### Preamble
IN THE LABOUR COURT OF ZIMBABWE
JUDGMENT NO LC/H/576/2016
HARARE, 7 JULY 2016 &
CASE NO LC/H/10/2016
23 SEPTEMBER 2016
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IN THE LABOUR COURT OF ZIMBABWE	      JUDGMENT NO LC/H/576/2016

HARARE, 7 JULY 2016 &				                  CASE NO LC/H/10/2016

23 SEPTEMBER 2016

In the matter between

SANDVIK MINING AND CONSTRUCTION				APPELLANT

And

MISHECK MABEZA							RESPONDENT

Before the Honourable Muzofa J

For the Appellant	S Sadomba  (Legal Practitioner)

For the Respondent	V Mkwachari (Legal Practitioner)

MUZOFA J:

This is an appeal against an arbitral award.

The respondent was employed by the appellant as a contract manager at Unki Mine a subsidiary company of the appellant.

The respondent was entitled to various allowances including housing, education assistance and annual bonus.

Before the country migrated to the multi-currency system in 2009 the respondent received his housing allowance on a monthly basis. From January 2009 the appellant paid its employees in United States dollars and the respondent’s housing allowance was not paid from that time.

The respondent engaged the appellant on the issue. According to the respondent it was only in July 2015 that the appellant communicated that it would not pay the allowance.

The matter was referred to a labour officer including a claim for the 2014 bonus and educational allowance. Conciliation efforts failed and the matter was referred to arbitration.

The arbitrator dismissed the claim for the educational allowance and granted the claim for housing allowance and the 2014 bonus.

The appellant approached this court on appeal raising two issues, whether the claim for housing allowance had prescribed and whether the award of bonus was properly granted.

Prescription

The appellant argued that in terms of section 94 of the Labour Act [Chapter 28:01] (“the Act”) a dispute arises at the time a complete cause of action exists. In this case at the end of January 2009, the respondent realised that his housing allowance had not been paid, there was a complete cause of action. To that extent the dispute arose in January 2009. So by the time the respondent referred the matter to a labour officer in May 2015, the dispute had prescribed.

I was referred to a number of cases that illuminated the issue as to when a dispute arises. See Mukahlera v Clerk of Parliament & Ors 2005 (2) ZLR 365 (S), Zvapasi & Ors v Carnaud Metalbox (Pvt) Ltd LC/H/229/09 and Taruona v Zvarevadza & Ors HH 87-12.

For the appellant it was submitted that the dispute arose on 6 July 2015 when it was made clear to the respondent that the housing allowance would not be paid based on the authority of Nestoros v Innscor Africa Ltd 2007 (2) ZLR 267 (H) at 270-271.

The determinant issue in this case is when did the dispute arise.

Section 94 of the Act provides:

“(1)	Subject to subsection (2) no labour officer shall entertain any dispute or unfair labour practice unless—

It is referred to him; or

Has otherwise come to his attention, within two years from the date when the dispute or unfair labour practice first arose.

(2)	….

(3)	For the purpose of subsection (1), a dispute or unfair labour practice shall be deemed to have first arisen on the date when–

The acts or omissions forming the subject of the dispute or unfair labour practice first occurred…..”

In the case of Escom v Stewarts & Lloyds SA (Pty) Ltd 1979 (4) SA 095 W at 908 E it was held that a debt is due when it is “owing and already payable” or immediately claimable and payable at the will of the creditor”.

In the Mukahlera case (supra) the court held that a cause of action in relation to a claim is the entire set of facts which gives rise to the claim and includes every act which is material to be proved to entitle a plaintiff to succeed in his claim.

In this case at the end of January 2009 there was a complete cause of action, the appellant failed to pay the respondent’s housing allowance. The respondent was entitled by law to refer the unfair labour practice or dispute to a labour officer.

Therefore on a monthly basis the appellant continued to commit the same infraction which gave rise to the claim. In my view it was unnecessary to prove any other facts beyond these facts as a basis for the claim. For instance it was unnecessary to get a clear message that it would not been paid, for indeed the appellant had not paid and that was the complete cause of action.

The wording of section 94 (3) is clear. It is about the date when acts or omission forming the subject of the dispute first occurred.

I do not agree with the respondent’s exposition of the law in casu. The case relied upon by the respondent is distinguishable from the one before the court. In the Nestoros case it was necessary that a clear communication be made to complete the cause of action. In the absence of the communication that the promised allocation of shares would not materialize, there was no dispute, the other party remained expectant that the term of contract would be honoured.

In casu, the respondent’s employment contract entitled him to a housing allowance. That became a right. In January 2009 that right was arbitrarily withdrawn. To my mind the cause of action was complete.

The respondent argued that by engaging the appellant, he believed the issue would be solved amicably and referred the court to an e-mail by the Managing Director. According to the respondent the appellant had not decided and the matter was still alive. The dispute only arose on 6 July 2015 when it was made clear that the allowance was not to be paid. Therefore the referral to the labour officer was not out of time.

In the case of Zvapasi (supra) the court rejected the notion that negotiations interrupt prescription relying on the case of Masara & Ors v Forestry Commission & Anor 1999 (1) ZLR 174 where SMITH J said:

“Negotiations and correspondence intended to reach settlement are not court process and do not interrupt prescription.

Therefore, in this case the appellant’s negotiators with the respondent did not interrupt prescription. In view of all this I am satisfied that the appellants acted out of time.”

Even if the court accepts the respondent’s submissions, his claim would still fail. According to the respondent the dispute arose on 6 July 2015. The letter referring the dispute to a labour officer filed of record is dated 4 May 2015. To that extent the respondent referred the matter before a dispute arose. In any event approach is untenable.

The arbitrator clearly misconstrued the law in casu, he had no jurisdiction to deal with the matter. The claim stretching from January 2009 to March 2013 had prescribed when it was referred to a labour officer in May 2015.

The first ground of appeal succeeds.

2014 Bonus

It is not in dispute that the contract between the parties had the following clause:

“Company Bonus

Bonus is at all times at the discretion of the company. We operate on a performance related bonus to a maximum of a 13th cheque. The scheme is linked to company profitability, individual employee performance and length of service.”

Both parties conceded that bonus was at the appellant’s discretion based on the criterion set out in the contract and case law has confirmed this position. See First Mutual Life Ltd v Muzivi SC 9-07 and Chairman of the Public Service Commission & Ors v Zimbabwe Teachers Association & Ors SC 70-96.

To some extent the arbitrator also noted that the bonus clause meant it can only be paid after considering the company’s profitability, individual employee performance and length of service.

However the decision was based on the fact that other employees in the same grade and position as the respondent were paid bonus. There was no figure claimed by the respondent, he just claimed annual bonus for the year 2014. Clearly the claim was vague, and even the award vague, the appellant was not made aware of what amount should be paid. See First Mutual Life Ltd case (supra).

The fact that others were paid bonus may suggest that the company realised some profits. However that is not the only determinant factor, there was no evidence of his performance and what seven years employment meant to the company. These are the objective factors that the company had to consider in the exercise of its discretion. The appellant’s discretion was not exercised in a vacuum.

The position of the law is clear, he who alleges must prove. It was for the respondent to show that he met the requirements to sway the appellant’s discretion so as to award him a certain amount of bonus.

In any event the appellant also relied on a document titled “Variably Compensation Payment Guidelines 2014.” The arbitrator did not address the document although it was placed before him. I did not hear the respondent dispute the application of the document in casu.

Provision 2 of that document provides:

“No payment will be made if a position is terminated for cause …”

The appellant argued that the respondent’s contract was terminated for cause following disciplinary proceedings, to that extent he was not entitled to a bonus.

The respondent did not dispute this point.

I agree with the appellant the respondent is not entitled to the 2014 bonus. This is because the bonus is discretionary and would not accrue to the respondent in terms of the Variably Compensation Payment Guidelines 2014.

Accordingly the second ground of appeal succeeds.

From the foregoing clearly the appeal has merit the following order is made:

The appeal be and is hereby upheld.

The arbitral award in respect of the housing allowance and bonus is set aside and substituted by the following:

“The claims for housing allowance and bonus are hereby dismissed”.

There is no order as to costs.

Gill, Godlonton & Gerrans, appellant’s legal practitioners

T H Chitapi & Associates, respondent’s legal practitioners