Simbarashe Chisango & 23 Others v Lesway Joinery t/a Fredrick Sage

### Preamble
IN THE LABOUR COURT OF ZIMBABWE
JUDGMENT NO LC/H/326/16
HELD AT HARARE 8 FEBRUARY 2016
CASE NO
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IN THE LABOUR COURT OF ZIMBABWE			JUDGMENT NO LC/H/326/16

HELD AT HARARE 8 FEBRUARY 2016				CASE NO LC/H/1074/14

& 13 MAY 2016

In the matter between:

SIMBARASHE CHISANGO & 23 OTHERS			Appellants

And

LESWAY JOINERY t/a FREDRICK SAGE			Respondent

Before The Honourable R F Manyangadze, Judge

For Appellants			Mr D Munyika (Trade Unionist)

For Respondent			Mr J Chishava (Human Resources Manager)

MANYANGADZE, J:

This is an appeal against an arbitral award handed down on 4 November 2014, in terms of which the respondent was ordered to pay the appellants’ terminal benefits by monthly instalments.

The cause of the appeal is that the appellants wanted payment of the terminal benefits within one week of the date of the arbitral award.

The facts of the matter are common cause.  The respondent is a company in the construction industry which employed the appellants in various capacities.  There was a mutual termination of employment, as the company faced viability problems.  At the time of such termination, the appellants were owed a total amount of US32 530.98 in outstanding wages and terminal benefits.

There was a dispute on the payment of the terminal benefits.  The dispute was not on the quantum payable, as all this was agreed.  The dispute was on when the terminal benefits should be paid.  Conciliation failed and the matter was referred to compulsory arbitration.  This resulted in the following award;

“1.	Respondent pays to each claimant not less than US130.00 per month starting at the end of November 2014 until the full amounts as per the quantum (totalling US32 530.98) agreed by both parties are liquidated.

That failure by 30 days to pay by respondent will result in the while remaining amounts becoming immediately due to claimants.”

The appellants noted their appeal against the award on the following grounds:

“1.	The arbitrator grossly misdirected himself by determining the amount to be paid when the amount to be paid to the appellants was not an issue before him.  The arbitrator awarded the payment of not less than $130.00 per month when the matter before him was to determine the date of payment.  It is against the principle of natural justice when the arbitrator determined what to be paid when the amounts owed to each appellant was not an issue before him.  The arbitrator exceeded his mandate by deciding how much should be paid.

The arbitrator grossly erred at law by failing to award the date of payment.  In the arbitration award there is no date when the amounts are due.  The award is silent on when the claims are due.  (See terms of reference for compulsory arbitration attached)

The arbitrator erred at law by generalizing the economic situation of our country to that of the respondent.  The arbitrator misdirected himself at law by awarding the payment of not less than $130.00 per month to the appellants  some who are owed over three thousand dollars ($3000.00) meaning the appellants will wait for over two years for their dues to be cleared.  This is against the principle of common law and legislation…

The arbitrator misdirected himself at law by issuing a certificate in terms of section 98 (13) of  the Labour Act [Chapter 28:01] which cannot be registered because of its vagueness.  Honestly how can an appellant register an award which gives the respondent over two years to pay the amounts due to the appellants.”

The four grounds of appeal can be condensed into one principal issue, whether the

arbitrator acted within his terms of reference by ordering payment of the terminal benefits by instalments.

Mr Munyika, the trade union official who represented the appellants, argued that the arbitrator

“exceeded his mandate by determining how much appellants should be paid every month.”

The appellants contended that the matter before the arbitrator “was to determine the date of payment” and not the amount to be paid.

On the other hand, the respondent averred that the arbitrator was very clear on his mandate.  Submitted Mr Chishava, who represented the respondent;

“We deny that arbitrator misdirected himself.  He was directed by very clear terms of reference.   It was clear arbitrator should determine how much should respondent pay to liquidate its debt.  When they (appellants) left in December 2013, they were owed US$54 000.  The respondent did not dispute that.  Contention was on the amounts payable per month.   If the once off payment was accepted by the arbitrator, it means the respondent would close down.”

The submissions at the arbitral hearing show that the appellants wanted payment made within one week.  They show that the respondent wanted what it described as a “realistic payment plan.”  This is expressed in paragraph 5 of its heads of argument before the arbitrator in the following terms:

“It is important to place on record Fredrick Sage’s willingness to pay off the terminal benefits owed to Simbarashe Chisango  & 23 others on the basis of new and realistic payment plan that will balance the interests of both the ex-employees and business survival as anything short of that will cripple operations as the company’s financial position is currently precarious.”

It is clear from these submissions that the issue before the arbitrator was on a payment plan, not on the amount due and payable as terminal benefits.  The arbitrator’s terms of reference were couched in the following terms:

“The arbitrator is required to determine the date of payment.”

This, it seems to me, required an assessment of the facts placed before him.  The facts were that the respondent company was facing viability problems.  In recognition of such viability challenges, there was mutual termination of the appellants’ employment.  It was therefore a basically factual issue before the arbitrator.   The appellant have not shown how such a factual assessment is grossly irregular or irrational.  See Hama v National Railways of Zimbabwe 1996 (10 ZLR 664 (S). He had to balance the interests of the workers concerned with the need to ensure the survival of the company.  This is reflected in these remarks in the arbitral award;

“Both parties are agreeing that the respondent promised to have liquidated the full amounts within a given period and indeed made some payments but could not manage to liquidate the full amounts within the proposed period.  The view of this tribunal is that trying to ignore the current economic challenges facing our country would drive companies into insolvency thereby destroying the economic fabric of the industry and country at large.  This would in turn affect those employees still being employed.

It will be against the interest of all the stalk holders for this tribunal to make an award that goes beyond the reasonable capacity of the respondent to honour it.

My award is strongly guided by the case of Telone & Communications & Allied Services Workers Union of Zimbabwe, the courts ruled that it does not pay for a tribunal to make an award that goes beyond the reasonable capacity of the plaintiff.”

In the circumstances, the approach adopted by the arbitrator cannot be faulted.  He was well within his terms as the issue before him was basically that of an appropriate payment plan.  At the hearing of the appeal, the appellants’ representative indicated that the outstanding amount had in fact been whittled down to $13 000.00 from the initial amount of $32 000.00.  It means that the other employees were paid off, in terms of the arbitral award.

Significantly, the arbitral award, in paragraph 2, states that;

“Failure by 30 days to pay by respondent will result in the whole remaining amounts becoming immediately due to claimants.”

Thus, the award makes any outstanding amount immediately due and payable, in the event that the respondent defaults in its instalments.  It is within the appellants’ rights to seek enforcement of the payment of the whole of the outstanding amount, in the event of default on the part of the respondent.  If the appellants allege, as they infact did through their representative during oral submissions, that the respondent reneged on its payments, the award clearly gives them entitlement to the whole of the outstanding amount.  It appears they are asserting on appeal, a right that is available in the award being appealed against.

In the circumstances the appeal cannot be upheld.  It is accordingly ordered that;

The appeal be and is hereby dismissed.

Each party bears its own costs.