Zimbabwe Manpower Development FUND V Elias Chizema

### Preamble
IN THE LABOUR COURT OF ZIMBABWE
JUDGMENT NO LC/H/162/2016
HARARE, 4 NOVEMBER 2015 &
CASE NO LC/H/180/2015
18 MARCH 2016
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IN THE LABOUR COURT OF ZIMBABWE	         JUDGMENT NO LC/H/162/2016

HARARE, 4 NOVEMBER 2015 &				         CASE NO LC/H/180/2015

18 MARCH 2016

In the matter between

ZIMBABWE MANPOWER DEVELOPMENT				APPELLANT

FUND

Versus

ELIAS CHIZEMA								RESPONDENT

Before the Honourable R F Manyangadze J

For the Appellant	C Mucheche (Legal Practitioner)

For the Respondent	P Chakanyuka (Legal Practitioner)

MANYANGADZE J:

This is an appeal against an arbitral award handed down on 24 February 2015. In terms of the award, the appellant was ordered to reinstate the respondent without loss of salary and benefits, on the basis that the probationary assessment that resulted in the termination of his employment was procedurally and substantively unfair.

The factual background to this matter is as follows:

The respondent was employed by the appellant as Director, Management Training Bureau. Management Training Bureau is a training institution under the appellant organisation, and is based in the Msasa Industrial area of Harare.

The respondent signed, on 24 February 2014, a contract of employment for a period of thirty-six months, which would be subject to renewal. He commenced duty on 1 March 2014. The contract was subject to the successful completion of a three month probationary period.

Just a month after assuming duty, on 31 March 2014, the respondent received a letter terminating his employment, on the basis that the Minister of Higher and Tertiary Education, Science and Technology Development (“the Minister”) as Trustee of the appellant, had not approved his contract of employment. It however, turned out that the Minister had approved the respondent’s appointment on 24 February 2014. The respondent had, notwithstanding the purported termination, continued to report for duty, and received his salary until termination of his employment at the end of his probationary period.

The appellant terminated the respondent’s employment on 3 June 2014, after the latter underwent a three month probationary period running from 1 March 2014 to 31 May 2014.

Aggrieved by the termination of his employment, the respondent lodged a complaint with a Labour Officer. After conciliation failed, the dispute was referred to compulsory arbitration, resulting in the arbitral award in contention.

The grounds of appeal are stated as follows:

“1.	The arbitrator grossly erred and seriously misdirected himself on a question of law by holding that the respondent’s probation appraisal was procedurally and substantively unfair.

2.	The arbitrator grossly erred and seriously misdirected himself on a question of law by ordering the reinstatement of the respondent or alternatively payment of damages in lieu thereof, in the absence of a legal finding that he was unfairly dismissed.

3.	The arbitrator grossly erred and seriously misdirected himself on a question of law by arbitrarily ordering reinstatement of the respondent in a manner that usurped and undermines an employer’s right to put an employee on probation to assess suitability for the job.

4.	The arbitrator grossly erred on a question of law by deciding the matter based on technicalities contrary to established legal precedents that labour matters should not be decided on technicalities.

5.	the arbitrator grossly erred and seriously misdirected himself on a question of law in not realizing as he should have done that a probation contract is fixed term contract that automatically lapses at the expiry of the probation period where the employer chooses not to retain a concerned employee in employment.”

The respondent, in his heads of argument, raises two preliminary points. The first one is that the grounds of appeal do not raise points of law, as required by section 98 (10) of the Labour Act [Chapter 28:01]. The second one is that the grounds of appeal are too vague and generalised. These points were not argued during oral submissions. The parties went straight into arguing the merits of the appeal. It seems the points in limine were abandoned, without explicitly saying so.

In any case, the appeal, to a large extent, raises questions on the rights and obligations of parties to an employment contract during a probationary period. The grounds of appeal inevitably lead to a resolution of these questions, and are of a legal nature. The enquiry cannot therefore be said to be only factual. It will look into what the law is on the issue of termination of a contract of employment, when an employee is on probation. See Muzuva v United Bottlers (Pvt) Ltd 1994 (1) ZLR (S).

The grounds of appeal also set out on what issues the arbitrator is said to have erred. The court has to consider the issues set out, in the grounds of appeal, and determine whether the arbitrator erred as alleged by the appellant.

I need not dwell much on the preliminary points as no arguments were advanced, at the hearing, in support or elaboration thereof. For the brief reasons I have however indicated, I am unable to uphold the points in limine.

Turning to the merits, the appellant, in essence, is averring that the appraisal process was fair. So was the appraisal itself. In the first ground of appeal, what the appellant is asserting is that contrary to the arbitrator’s findings, there was nothing irregular or improper about the respondent’s appraisal. It was procedurally and substantively fair.

In order to clearly understand and appreciate the averment in the first ground of appeal, it must be viewed against the allegations of impropriety made by the respondent. The appeal, as I see it, is centred around the first ground of appeal. The appellant is asserting that there was nothing irregular in the conduct of the respondent’s appraisal and termination of his contract of employment consequent to that appraisal. The respondent is asserting that there were gross irregularities, which have the effect of rendering the entire probationary appraisal unfair, and his dismissal as a consequence thereof.

The respondent impugned the appraisal process on the basis of the composition of the appraisal panel/committee, the period of appraisal, and the rating method.

On the composition of the appraisal panel, the respondent averred that it was the Director of Standards Development & Quality Assurance (Director SDEQA) in the Ministry of Higher & Tertiary Education, Science and Technology (“the Ministry) and the appellant’s Chief Executive officer (CEO), who were supposed to appraise him. The CEO included the appellant’s Principal Director Finance & Administration, and the Senior Manager Human Capital Development in the appraisal panel. The respondent averred that the inclusion of these two officials was irregular.

The appellant maintained its position that there was nothing improper in the personnel who conducted the appraisal. Its reasoning was that the two officials roped in by the CEO brought in monumental technical wisdom, which was essential for the appellant’s recruitment process. They were technocrats who assisted the CEO in the conduct of the appraisal.

It is important, in resolving this issue, to look at the provisions of the performance contract entered into between the appellant and the respondent. This contract, first and foremost, provides for the reporting structure that governs the two parties’ employment relationship.

Clause 3.1.1, under the sub-heading “DUTIES AND RESPONSIBILITIES OF THE EMPLOYEE, provides that:

“3.1.1	You shall report to:

Director of Standards Development and Quality Assurance in the Ministry of Higher and Tertiary Education. Science & Technology Development for your training, academic policy and upkeep of the Centre.

The Chief Executive of ZIMDEF for your administrative financial and human resources issues.”

This clause clearly lays out a dual reporting structure, to the Director Standards, in the Ministry, and the CEO. It is couched in peremptory terms. Naturally or logically, appraisal is done by those to whom the person being appraised reports. There is no satisfactory explanation as to why the Director Standards was excluded from the process, and instead persons not specified by the performance contract included.

The performance contract further provides, under the sub-heading “PERFORMANCE TARGETS”, in Clause 4.1:

“The Director of Standards Development and Quality Assurance and the Chief Executive shall, establish performance targets with respect to their respective areas for the thirty six (36) months or other mutually agreed period which shall be subject to regular progress review.

The performance targets for each financial year shall be agreed upon by the Director Standards Development and Quality Assurance and the Chief Executive and the Director Management Training Bureau as soon as possible after the strategic plan for that year has been approved by the Chief Executive Officer and the Director SDEQA. If as a result of the review it is determined that there has been a material deviation from the performance targets due to factors outside the control of the Director Management Training Bureau, the performance targets will be adjusted accordingly. Depending on the outcome of the review process sub-clause 5.2 and 10.6 shall apply as appropriate.” (underlining added)

These clear and mandatory provisions require the involvement of the Director SDEQA in the process of setting and reviewing performance targets. The record does not show that this was complied with. The setting of performance targets done on 18 April 2014, did not involve the Director SDEQA. The discussion of performance targets done on 22 April 2014, barely a week after they were sat, did not involve the Director SDEQA.

The recommendation to terminate the respondent’s contract, done on 2 June 2014, does not show any input from the Director SDEQA.

Clause 10.6 of the performance contract, under the sub-heading “TERMINATION OF EMPLOYMENT” reads:

“If in the opinion of the Director SDEQA and the Chief Executive the Director Management Training Bureau has failed to fulfil materially the performance targets agreed with the Director SDEQA and the Chief Executive and the Chief Executive can show that such failure was not occasioned by the lack of resource allocation to the Director management Training Bureau to facilitate the discharge of his duties then in any of such events stipulated above – the Chief Executive shall be entitled subject to the provisions of the Labour Relations Act of 2006 and any regulation made hereunder to terminate the engagement of the Director management Training Bureau with the Fund.” (underlining added)

Thus, provisions of the Performance Contract, in mandatory terms, require the involvement of the Director SDEQA in the entire appraisal process. This process covers the setting of targets, their review and assessment, and termination of the employment contract in the event of failure to meet the targets. The Director SDEQA was not involved at any of these stages. There is no explanation for his exclusion. There is no explanation for non-compliance with the peremptory requirements of the Performance Contract. This is the principal document that addresses the employment relationship between the appellant and the respondent.

In view of this, the arbitrator cannot be faulted when he held, inter alia, that:

“Further, in terms of the claimant’s contract of employment, the claimant was to report to the Director of Standards Development and Quality Assurance and the Chief Executive Officer in respect of his performance targets.”

The other aspect on which the appraisal process was impugned by the respondent was the period of assessment.

The respondent averred that he was given his performance targets on 18 April 2014. The probation period was to run for three months, with effect from 1 March 2014, the date he commenced work. The appraisal in question covered the period 24 February to 24 May 2014. It covered the period 24 February 2014 to the end of that month, when he had not yet assumed duty.  Effectively, from the date he was given his performance targets, 18 April 2014, to the end of the performance period, 24 May 2014, he was assessed for thirty-six days, against a probationary period of ninety days. This constituted serious procedural unfairness. The targets were set in less than half the period covered by the probation.

The other pertinent issue was the nature of the appraisal report. It showed a 50% mark. In the absence of any indication of a higher pass mark from the appellant, this constituted a pass mark and meant that the appraisal was successful.

The 50% mark puts into question the authenticity of the appraisal report, given that in most of the cases the respondent exceeded the set target. In this regard, the arbitrator remarked:

“(c)	The claimant was correct in arguing that he got a fifty per cent mark and was indeed successful in the appraisal. The respondent did not indicate the pass mark that the claimant should have obtained in order to be deemed to have successfully completed the probation period. The claimant cannot be faulted for arguing that he had passed the probation.

(d)	The tribunal finds that the respondent failed to prove the authenticity of the appraisal report results. For example:

The claimant was supposed to come up with three financial reports as per his target. He produced three, but his performance was rated three out of five.

The claimant was supposed to convene six Management Committee meetings, he convened twelve yet was given a rating of four out of five yet he had actually exceeded the target!

The claimant was supposed to hold quarterly reviews for four of his subordinates. He got a rating of one out of five when he had only been available for less than thirty-six days.”

The ratings were patently inconsistent with the achievements of the respondent, in terms of the set targets. In finding this kind of assessment to be irregular and unfair, the arbitrator cannot be said to have misdirected himself. I find no basis for such misdirection, given the facts the arbitrator was faced with.

The appraisal was an unusually truncated process in which the appraisee was not even given an opportunity to attend to the alleged shortcomings. This constituted another fundamental irregularity. In this regard, reference was made to the case of Kwangari v Commercial Bank of Zimbabwe HH 79-03.

A reading of the appellant’s submissions does not show any meaningful or cogent explanation for the irregularities highlighted by the respondent. In paragraph 16.1.18 of  its heads of argument, the appellant avers that:

“16.1.18	In respect to the period of the appraisal and also the ratings that were awarded to the respondent, it is worth to note that the appellant took into account the whole period until the contract came to a conclusion.

16.1.19	Contrary to the tribunals finding and also the respondent’s allegations of conducting many meetings, the Honourable Court is implored to consider that it is not all about meetings and/ or how a structure has been established. It is the synergies and strategies implemented as per policy and the results even for a short space of time.”

This is too broad, bald, and general a rebuttal, given the specific averments made by the respondent. It is difficult to appreciate how the “synergies and strategies” referred to could be implemented in what the appellant itself acknowledges to be “a short space of time.”

One cannot therefore fault the arbitrator for holding that:

“(b)	The claimant was only appraised for thirty-six days instead of ninety days of the probationary period. The tribunal takes note that this is only a third of the trial period. Consequently, this did not provide a fair period for assessment of the claimant’s performance. The respondent did not proffer any cogent reason why the actual appraisal period was drastically reduced. Consequently, the assessment was indeed unfairly done and cannot be allowed to stand.”

The appellant, it seems, relied much on the contention that the respondent signed the appraisal. By appending his signature, he accepted the contents thereof. By so signing, the respondent waived any right to contest or challenge the appraisal. In this respect, the appellant referred to the case of Chidziva v ZISCO Steel 1997 (2) ZLR 368 (S). In that case the employees who accepted the retrenchment package waived any right they had to contest the retrenchment package offered. The court held, inter alia that:

“The conduct of the majority of the retrenched employees by accepting the retrenchment package was inconsistent with the enforcement of the right to have the matter referred in terms of section (6) of the Regulations to the retrenchment committee and clearly evinced an intention to surrender the right. With acceptance of such payments the rights of the appellant perished.”

Mr Mucheche, for the appellant emphasized this point during oral argument when he submitted:

“On signature, the legal position is very clear that a party who signs a document without raising any objection is bound.”

The respondent, on the other hand, vehemently denied acquiescence to the appraisal. His signing of the appraisal simply signified acknowledging what had taken place, and not agreement with it. This is expressed in paragraph 17.2.0 of his heads of argument:

“The argument on waiver of rights by the appellant is most unfortunate. The respondent never at any stage either expressly or impliedly acquiesced to the unfair appraisal process. His signing of the appraisal form did not imply that he was in agreement with the manner the process was done. He simply acknowledged what had taken place. The cited case of Chidziva v Zisco Steel 1997 (2) ZLR (S) actually supports the respondent’s cause.”

The court sought clarification from Mr Mucheche on this point, as to what the employer took the respondent’s signature to mean. The following is the exchange that took place on this aspect:

”Q:	There is reference to signing of appraisal in the heads of argument, what does that, from the employer’s point of view, signify – acknowledgement that an appraisal has been done, or agreement with the contents thereof, that it has been done properly.

A:	It signifies both acknowledgment and agreement with the contents thereof. It boils down to the caveat subscriptor rule.”

An examination of the appraisal form shows a page titled “PERFORMANCE REVIEW FOR THE PERIOD 24 FEBRUARY 2014 TO 24 MAY 2014.” It has, among other things, columns for targets, ratings, and comments. The columns indicating whether the targets were “achieved” or “not achieved” are blank. So is the column on “comments”. The only column that is filled in is the one on ratings. This is followed by the final page of the form, with the appraisee’s signature and that of the appraiser, as well as the signatures of those who assisted the appraiser. A provision for comments on how the appraisal was done is conspicuous by its absence. In my view, such a space is critical in any appraisal form, as it shows whether or not the appraisee agrees with what was done. It gives the appraisee an opportunity to comment on the appraisal. There are no such comments. One cannot therefore unequivocally conclude that the signature appearing on such a form signifies agreement with the appraisal.

The appellant sought to rely on an appraisal assessment dated, 27 May 2014. In that assessment, there is a paragraph that reads:

“Following the above procedure all the eleven items were covered. At the end the appraiser and appraisee agreed to all the ratings and appended their signatures to the document.”

It is rather misleding for the appellant to rely on this. The record shows that this is in fact an assessment report going up the administrative ladder. It originates from the CEO, who makes recommendations to the Deputy Minister, who in turn makes recommendations to the Minister. It has no space for the appraisee’s comments. It is a report by the appraiser to the Minister.

There is nothing on record that clearly and unequivocally shows that that the respondent agreed to, and accepted the appraisal report as a correct assessment of his performance, with all its glaring anomalies.

Having regard to the foregoing, the arbitrator did not misdirect himself by holding that the appraisal was procedurally and substantively unfair. Termination of the respondent’s contract of employment was based on this appraisal. It was a consequence of this fundamentally flawed appraisal. The termination was a result of what the appellant deemed poor performance, during the probationary period.

It was not termination by mutual agreement. It was not termination by effluxion of time, such as occurs at the expiry of a fixed term contract of employment. The appellant tried to draw an analogy of the probationary period with a fixed term contract. It contended that the probation was a fixed term contract, which “came to its automatic expiration.”  In this regard, the appellant referred to the case of Magodora & Ors v Care International Zimbabwe SC 24-14 where it was held that the appellants were bound by the fixed term contracts that they entered into.

It is difficult to appreciate the applicability of the Magodora case in casu. The respondent entered into a thirty-six month fixed term contract. It was not terminated at the expiry of the thirty-six months. It was terminated when it was still at its infancy, based on unsubstantiated poor performance, following an appraisal riddled with gross irregularities. That is certainly not the same thing as termination by effluxion of time. The expiry of the thirty-six month contract was still way ahead. Termination, in the circumstances looked at, constituted an unfair dismissal.

The appellant contended that the arbitrator fell into error, by regarding it as an unfair dismissal, as the issue of unfair dismissal was not before the arbitrator. It seems the appellant was mixing up issues. The arbitrator correctly held that the dismissal of 31 March 2014 was no longer an issue, as it had been overtaken by events. That dismissal, as already indicated, was based on the mistaken view that the respondent’s appointment had not been approved by the Minister. It turned out that such approval had in fact been obtained, rendering the dismissal a non-issue. Thus the dismissal in issue is the one that followed the alleged poor performance during the probationary period. This is what the arbitrator meant when he stated:

“This left this tribunal with only one main issue for determination, that is, to inquire into the fairness of the claimant’s dismissal which was based on the challenged performance, assessment and results.”

I do not see how that can be said to be a misdirection on the part of the arbitrator. I do not see how one can de-link the termination of the respondent’s employment from the alleged poor performance, which was based on an impugned appraisal. Termination in such circumstances inevitably constituted unfair dismissal.

The consequence of an unfair dismissal, in terms of appropriate remedies, would be reinstatement or an award of damages in lieu of reinstatement. This is precisely what the arbitrator did. It is not like he imposed an employee on the employer, without an alternative of damages. The employee’s contract was unfairly cut short. It was a thirty-six month contract cut only after three months, with no justifiable basis for doing so. There was, in my view, no misdirection in the arbitral award.

In the circumstances, the first ground of appeal cannot be upheld.

In considering the first ground of appeal, the issues raised in the second, third, fourth and fifth grounds of appeal have also been considered and resolved. These include the appropriateness of the order for reinstatement or damages, and the question as to whether the probationary period was a fixed term contract that automatically lapsed on its expiry. For the reasons stated, the appeal cannot succeed on these other grounds.

In the result, it is ordered that:

The appeal be and is hereby dismissed.

The arbitral award granted in favour of the respondent on 24 February 2015 be and is hereby upheld.

The appellant shall bear the respondent’s costs.

Matsikidze & Mucheche, appellant’s legal practitioners

Chakanyuka & Associates Attorneys, respondent’s legal practitioners