Skyview Minerals v Samuel Chikwariro

### Preamble
IN THE LABOUR COURT OF ZIMBABWE
JUDGMENT NO. LC/H/696/2013
HARARE ON 16th OCTOBER, 2013
CASE NO. LC/H/389/2013
& 14TH MARCH 2014
JUDGMENT NO. LC/H/696/2013
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IN THE LABOUR COURT OF ZIMBABWE	     JUDGMENT NO. LC/H/696/2013

HARARE ON 16th OCTOBER, 2013		           	CASE NO. LC/H/389/2013

& 14TH MARCH 2014

SKYVIEW MINERALS	     			–	Appellant

SAMUEL CHIKWARIRO				–	Respondent

Before   The Honourables G Musariri & R.F. Manyangadze, Judges

For the Appellant	: Mr. S. Zvinavakobvu (Attorney)

For the Respondent	: Mr C. Takaendesa (Attorney)

MANYANGADZE, J.

This is an appeal against an arbitral award in which it was held that the Respondent had unfairly dismissed the Appellant from employment.

The brief facts of the matter are that the Respondent was engaged by the Appellant on 1 September 2012 as its Human Resources and Administration Officer. The Respondent was required to serve a probationary period of 3 months before he could be placed on permanent employment.

On 30 November 2012, the Appellant terminated the Respondent’s contract of employment. The reasons for the termination, subsequently supplied to the Respondent, included issues of insubordination, absenteeism, abuse of sick leave and conflict of interest.

The Respondent lodged a complaint of unfair dismissal with the Ministry of Labour on 17 December 2012. The matter was referred to compulsory arbitration, leading to the arbitral award being appealed against. The arbitral award granted on 29 May 2013, ordered that Appellant pay the Respondent a total of US$15 750.00, comprising notice pay and damages for unfair dismissal.

In its grounds of appeal, Appellant states that the Arbitrator grossly misinterpreted the legal principles governing a probationary contract.  In particular, Appellant contends that an employee who fails to satisfy the employer during probation period is not entitled to continued employment, and can have his contract of employment terminated on notice.

Appellant avers that the Respondent failed the probation test, and that perfectly entitled it to terminate his employment on notice.

Appellant further stated that the Arbitrator erred in quantifying damages without hearing evidence substantiating such damages.

The Appellant amplified its grounds of appeal in its heads Of Argument.

In its Heads , Appellant contended that the contract of employment, if probationary, can be terminated before or upon expiry as it is essentially a trial period. Such termination, argues the Appellant, does not constitute unfair dismissal. In this regard, the termination cannot be said to be a violation of Section 12B of the Labour Act (the Act), [Chapter 28:01], which enshrines the right not to be unfairly dismissed.

Appellant further contends that the termination in question was in terms of a contract of employment the two parties had concluded. In terms of this contract, the parties had agreed to 24 hours’ notice for the termination of the probationary contract. This is consistent with Section 12(7) of the Act, which allows for waiver of notice, argues the Appellant. There was therefore nothing unlawful in the manner in which Respondent’s contract of employment was terminated.

On the other hand, the Respondent contends that the termination of his contract of employment by the Appellant constituted unfair dismissal.

Respondent accepted the position that a probationary period in a contract of employment, is one that allows the employer to assess the employee’s performance. The employee may or may not be placed on permanent employment depending on the employer’s assessment.

Respondent however, contends that Appellant failed to observe both procedural and substantive justice when it terminated his probationary contract.

In his heads of argument Respondent argues that his termination fell foul of the provisions of Section 12(5) of the Act, which governs probationary periods in contracts of employment. In terms of this section, argued the Respondent, Appellant was required to give him not less than 2 weeks’ notice of termination of employment. The one day notice agreed to in the contract of employment was in contravention of legislative provisions and was therefore invalid.

Respondent goes on to argue that even if the 24 hour notice period is held to be valid, it was not complied with by the Appellant. The Appellant served the Respondent with the letter of termination on 30 November 2012, the last day of the probationary period. Thus, Respondent was served with the termination notice on the day of the termination, effectively terminating him forthwith.

Respondent further avers that he was never consulted on issues relating to his performance. The reasons for his termination came after the termination. He therefore contends that the termination was not justified, and amounted to unfair dismissal.

On the quantification of damages, Respondent avers that he led evidence on the basis of which the Arbitrator awarded him the damages in question. The Appellant did not respond to the issue of damages as averred in Respondent’s papers. That left the Arbitrator faced only with Respondent’s submissions, and cannot therefore be faulted on the award she made.

Two issues emerge from the summary of the two parties’ arguments. These are;

Whether the probationary contract was lawfully terminated

Whether the damages awarded were properly quantified

On the first issue, which is infact the gravamen of this appeal, both parties agree probation contracts are governed by Section 12(5) of the Act, and have made reference to the same.

Section 12(5) of the Act provides as follows:

“A contract of employment may provide in writing for a single, non-renewable probationary period of not more than –

One day in the case of casual work or seasonal work; or

Three months in any other case;

During which notice of termination of the contact to be given by either party may be one week in the case of casual work or seasonal work or two weeks in any other case.”

The contract in casu, being of a 3 month duration, falls under paragraph (b) in respect of which a two week notice period is stipulated.

It is Respondent’s contention that this two week period is mandatory. Failure by Appellant to observe this renders the termination unlawful.

The Appellant drew the court’s attention to Section 12(7) of the Act, which allows for waiver of notice. The section reads;

“Notwithstanding subsection (4) or (5), the parties to any contract of employment may, by mutual agreement, waive the right to notice”

The section is clearly deferring to the principle of the sanctity and privity of contracts, in so far as the issue of notice periods is concerned. In this regard, the parties’ contract of employment provides, in clause (4) thereof;

“You shall be required to serve a three (3) months probationary period during which mutual compatibility will be assessed. Notice during this period will be twenty-four (24) hours from both parties presented in writing.

Should you successfully complete your probation period, your permanent employment with the company will be confirmed.”

The Respondent clearly accepted the terms and conditions of the contract of employment which he entered into with the Appellant, which terms and conditions include this clause which deals with the probationary period of the contract. He has not commented on Section 12(7) of the Act, which allows for flexibility in specific contractual provisions the parties may agree to. I am therefore unable to uphold his contention that the matter be disposed of on the basis that Appellant failed to observe the two week notice period provided for in Section 12(5) of the Act.

The other dimension to the issue is that Appellant did not even observe the 24 hour notice period. He served the letter of termination on 30 November 2013, the last day of the probation period. However, as Appellant explained during its oral submissions, this is rendered inconsequential as it was cured by the fact that Respondent was paid his full salary for the probationary period.

The issue of notice periods, in the circumstances, cannot be the basis for vitiating the termination of the probationary contract.

What remains to be determined, which appears to be the real issue between the parties, is the procedure; if any, that must be complied with before termination can be effected lawfully. Should the employer conduct a hearing? Is he required in any way to justify the termination, and if so, what is the extent of his obligations?

It is significant to note that both parties agree that an employee on probation is not automatically entitled to permanent employment. He is on trial. Depending on the employer’s assessment of his performance and conduct, he may be placed on permanent employment. If he is below par, the contract may be terminated, and that can be done during or at the end of the probationary period.

It appears the parties have a common understanding of the legal position regarding probationary contracts. They have both made reference to the case of Kwangwari v Commercial Bank of Zimbabwe Ltd HH 79/2003, 2003 (1) ZLR 551(H). Both parties have quoted the case extensively. The passages quoted are so fundamental to the dispute in casu it is necessary to restate the pertinent portions thereof.

The Respondent quoted from the cyclostyled judgment, at page 10 as follows;

“As alluded to above, at common law these clauses give the employers absolute power to terminate the contract on expiration of the probationary period. The courts, however, do not take such a liberal view of probationary clauses, and require employers to justify the dismissal of probationary employees in much the same way as they are required to do in the case of any other employee, with the possible proviso that the court may be disposed to accept, in the case of the dismissal of a probationary employee, reasons slightly less compelling than they would require in the case of employees of longer standing.”

The appellant quoted the case more extensively, citing from the reported judgment at pages 559to 561 as follows;

“Probationary clauses typically reserve for the employer the right to terminate the contract after a specific period if the employee’s performance is found to be unsatisfactory. At common law, a probationary clause apparently empowers the employer to terminate, at will, at the conclusion of the stipulated period. The question is whether such termination amounts to dismissal or a mere non-renewal of contract. Probationary clauses provide for a trial period during which the reciprocal periods of notice required for termination are shorter, and which purportedly give both parties the right either to confirm or not to confirm the contract at the conclusion of the probationary period. As alluded to above at common law these clauses give the employers absolute power to terminate the contract at the expiration of the probationary period.

For a probationary employee must know that he is on trial, and must therefore establish his suitability for the post. I agree with this approach. The employer however, must give the employee a proper opportunity to prove himself, and give a warning if the required standards are not being met …………..

The proper test of fairness, in casu, is whether Mr Kwangwari, the probationary employee, was made aware of his failings and given a last opportunity over a reasonable period to show that he can do the job. In my view, he was made aware and given a reasonable opportunity to remedy his weakness. He failed to do so. His position was of vital strategic importance to CBZ and, therefore, CBZ was justified, in the circumstances, to dismiss him. The dismissal was fair in the circumstances. He was given sufficient notice and fully paid during the notice period and, therefore, he is not entitled to any further payment according to the evidence before me.”

It is clear, from this case, and other cases referred to in the Heads Of Argument, that the law places a less onerous burden on an employer who wishes to terminate the employment of an employee on probation. There is no requirement for launching disciplinary proceedings with all the formalities attached thereto. What the employer is dealing with is an employee on trial, in respect of whom the employer has to make a decision whether or not to place on a permanent contract of employment. If unsatisfied with the performance and/or conduct of such employee, the employer can terminate the contract on giving the required notice. This is basically what is coming out of the cases.

What is however, also coming out from the cases, in particular the one quoted at length, is that the employer cannot terminate at will. There has to be some form of appraisal process, in the course of which the employee is made aware of his shortcomings and given an opportunity to remedy them. Put differently, the termination must be justified and there should be some evidence of such justification.

It can thus be said that giving an employee the right to be heard, in the context of a probationary contract, does not necessarily mean the conduct of disciplinary proceedings. It can be a simple process of communicating to him any faults, inadequacies or incapacities noted, and requiring him to attend to these.

Respondent avers that the letter of termination came to him as a surprise. He was never warned of the shortcomings complained of. There was never any consultative monitoring of the trial period.

Appellant, on the other hand avers that Respondent was warned and never changed. In paragraph 21 of its Heads Of Argument, it states;

“It is clear that the employer was not required to conduct a disciplinary hearing but just to conduct an appraisal and give prior warning to the employee. This was done in casu and the respondent cannot allege the contrary. There is evidence on record that respondent was warned and instead of changing for the better, he intensified his campaign to prove his unworthy.”

Appellant further states in paragraph 23;

“During the tenure of the contract, warnings were given by the employer and the employee was requested to reform and instead of changing for the better, he became worse thus frustrating the purpose of the probation.”

By such averments, Appellant is inviting the court to closely examine the evidence on record, to verify whether what it is claiming it did was infact done. Respondent, by making averments to the contrary, is also urging the court to see if the record bears any evidence of probationary appraisal.

What is in fact filed of record are a number of e-mail correspondences between Respondent and one Sidney Ziyambi, who appears to be Respondent’s supervisor, and as such, an agent or representative of the employer. The e-mails are worth noting.

On 12 November 2012 Respondent transmitted, via email what he termed “PPE required for all departments.” The response from the supervisor was “Many thanks”, with instructions for further tasks Respondent was to carry out.

On 9 November 2012, in response to a proposal to adopt some driving proficiency procedures for employees, Sidney Ziyambi, emailed;

“Thank for the procedures. Yes, the format is ok …………….. the initiative is noted ……………..”

The supervisor went on to instruct that the proposed procedures be presented to a meeting of all Heads of Departments.

On 29 October 2012, Respondent advised of the death of one of the employees’ father. The supervisor thanked him, and issued instructions on further actions to be taken in connection with the bereavement.

On 4 October 2012, the supervisor wrote;

“Thanks for the jids received so far. I think we are on track …………….. Otherwise job well done.”

The Respondent submitted that these emails are an indication that his employer was commending him for doing well in his work.

Appellant did not dispute these emails. Its explanation was that they were related to specific tasks or assignments, and should not be treated as an indication of Respondent’s all round performance.

On the Appellant’s side, apart from the mere saying so by Appellant, there is not even a single documented warning, caution, or some other indication of  concern over Respondent’s alleged shortcomings.

The reasons for the termination are supplied in a letter dated 11 December 2012. This was 10 days after the termination, and only after Respondent had insisted on being supplied with the reasons for his termination.

There is therefore no evidence at all, on record, of the Respondent being made aware of his alleged short comings before the probationary contract was terminated. He was served with a termination letter on the very last day of the probation period.

In my view, Appellant fell far short of meeting even the less onerous requirements of terminating the employment of a probationary employee, as postulated in the cases referred to, some of which Appellant itself quoted at length. Appellant should at least have documented some of the discussions, warnings or any caution it claims it issued to the Respondent. There is none on record. Appellant has itself to blame for not doing so. I do not think it was an onerous task to document and file any appraisal discussions held with the Respondent, if they were held at all.

In the circumstances, I am unable to uphold Appellant’s averment that it lawfully terminated Respondent’s probation.

The Court however, is of the considered view that an award of 4 months worth of damages, for a probationary employee who had been with the Appellant for only 3 months, is  on the high side.  There seems to be no justification for it to exceed the period served on probation, or even equal it.  It should, in the circumstances, be reduced to 1 month.

The court cannot also uphold the 2 weeks’ notice pay of $1 750.00. This is in the light of the finding that the parties had contractually bound themselves to a shorter notice period of 24 hours. This, as already indicated, was catered for as Respondent was paid for the full probation period.

In the result, it is ordered that;

The appeal be and is hereby partially allowed

The arbitral award dated 29 May 2013 be and is hereby varied so that the Appellant shall pay the Respondent damages in the sum of one month’s salary, being US$3500.00.

Each party shall bear its own costs.

……………………………

R.F. MANYANGADZE

JUDGE

……………………………	I agree

G MUSARIRI

JUDGE