Zimbabwe National Road Administration v Thomas Mutizhe

### Preamble
IN THE LABOUR COURT OF ZIMBABWE
JUDGMENT NO. LC/H/25/2020
HARARE, 30 OCTOBER 2019
CASE NO. LC/H/25/2020
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IN THE LABOUR COURT OF ZIMBABWE      JUDGMENT NO. LC/H/25/2020

HARARE, 30 OCTOBER 2019		                     CASE NO. LC/H/189/18

AND 31 JANUARY 2020

In the matter between:-

ZIMBABWE NATIONAL ROAD ADMINISTRATION		Appellant

And

THOMAS MUTIZHE							Respondent

Before Honourable B.S. Chidziva, Judge

For Appellant		Mr K. E. Kadzere (Legal Practitioner)

For Respondent		Mr K. Gama (Legal Practitioner)

CHIDZIVA, J:

This is an appeal against the arbitral award that was granted in favour of the Respondent by Honourable Arbitrator Kazembe on the 5th of July 2018. In the award the Respondent was granted damages in lieu of reinstatement amounting to $418 060-00.

The Respondent has also filed a cross – appeal in which he raised 3 grounds of appeal relating to leave days, back pay and damages.

BRIEF FACTS OF THE MATTER

The Respondent was employed as an accountant and he rose through the ranks to Finance Manager and Finance Director.

The Respondent was dismissed from employment on allegations of acts of misconduct under the National Employment Code of Conduct Regulations.

The matter was referred for compulsory arbitration and quantification.

The terms of reference for arbitration were

Whether or not claimant was unfairly dismissed.

The appropriate remedy

MAIN APPEAL

The grounds of appeal on the main appeal are as follows,

The Honourable Arbitrator grossly misdirected himself at law in his finding that there is no standard time frame within which a terminated employee should have secured alternative employment and hence refusing to consider what time it would have taken the Respondent to find alternative employment. The Arbitrator ought to have considered the time which the Respondent should have found alternative employment and in any event six (6) months is quite a reasonable time.

The Honourable Arbitrator grossly misdirected himself in his finding that “he would restrict himself to pay and benefits within the contract” when in fact he went on to award several benefits which were not contractual as follows,

Infra Link

Acting Allowance

Clothing Allowance

Interest of fixed deposit.

The Honourable Arbitrator grossly misdirected himself at law in awarding an Acting Allowance when Respondent had not worked in an acting capacity. It was not contractual and the Honourable Arbitrator could not pluck a figure of US$1 381-90 per month given that an acting allowance is only paid for the specific days one would have acted. The Honourable Arbitrator ought to have dismissed that claim.

The Honourable Arbitrator grossly misdirected himself in awarding the Respondent US$314-00 in medical aid allowance where no evidence was led to show that he paid such an amount to any Medical Insurance Company.

The Honourable Arbitrator grossly misdirected himself in awarding the Respondent an amount of US$6 909-50 x 2 in bonus when he had already found that the bonus is discretionary and not contractual. There was therefore no basis for the bonus granted.

The Honourable Arbitrator grossly misdirected himself on a legal point in awarding the Respondent what he termed Infra-Link. Infra – Link is a separate Legal personae.

The Honourable Arbitrator grossly misdirected himself in awarding the Respondent a holiday allowance where there was no evidence to prove that Respondent had gone for any holiday.

The Honourable Arbitrator misdirected himself in awarding the Respondent cash in lieu of notice where he already awarded the Respondent his salaries there is nothing called cash in lieu of notice for any employer who has been unlawful dismissed.

The Appellant prayed that the Respondent be paid six (6) months pay and benefits in damages for loss of employment and that he be paid US$44 357-00 as benefits.

In response Mr Gama indicated that they were abandoning the points in limine that they had raised because they would not resolve the issue before the court. The Respondent submitted that there is no need to consider items 4 – 12 (page 19). It was argued that what was in issue are the following items,

No. 2		-	Medical Aid

No. 3		-	Acting Allowance

No. 13		-	Bonus

No. 14		-	Infralink

No. 15		-	Interest of fixed deposit.

No. 16 	- 	Clothing Allowance

No. 17		-	Holiday Allowance

No. 18		-	Pay in lieu of leave

What is to be decided in this matter is

Whether or not in quantifying damages the arbitrator was suppose to consider the period within which the Respondent was suppose to secure employment or the unexpired portion of the contract only.

Whether the arbitrator erred by awarding the benefits that were said to be in issue.

Whether or not in calculating damages the arbitrator was suppose to consider the period within which the Respondent was suppose to secure employment or the unexpired portion of the contract only

It is common cause that the Respondent’s contract was for the period 15 March 2013 to 15 March 2017. The Respondent last received his salary on 30 April 2015 and he was dismissed on 9 May 2015. The unexpired period of employment was 221/2  months.

The position of the law with regards to damages is stated in the case of Leopard Rock Hotel Co (Pvt) Ltd v Van Beek SE 2000 (1) ZLR 251 as follows,

“Back pay is thus a concept associated with reinstatement. If an employee is reinstated she will normally be awarded back pay. If she succeeds in proving wrong dismissal but is not reinstated, she will be entitled to damages a Major element of which will be back pay. Perhaps more correctly one should say the damages will be assessed by reference to the back pay cost. But the back pay will be limited to a period from the date of wrongful dismissal to a date which she could, with reasonable diligence have obtained alternative employment.”

In this case since the contract was to expire in the next 221/2 months, is the back pay/damages to be calculated within this period.

In the case of Gauntlet Security Services (Pvt) Ltd vs Leonard 1997 (1) ZLR 583 it was held that,

“The employee is entitled to be awarded the amount of wages or salaries he would have earned save for the premature termination of his contract by his employer.”

It has also been established by law that a claimant is also obliged to mitigate his loss when he is dismissed from employment. In the case of Ambali vs Bata Shoe Co Limited 1999 (1) ZLR 417 it was held that,

“I think it is important that this court should make it clear once and for all, that an employee who considers whether rightly or wrongly that he has been unjustly dismissed is not entitled to sit around and do nothing. He must look for alternative employment. If he does not, his damages will be reduced. He will be compensated only for the period between his unlawful dismissal and when he could reasonably have expected to find alternative employment. The figure may be adjusted upwards or downwards. If he could in the meanwhile have taken temporary or intermittent work, his compensation will be reduced. If the alternative work he finds is less well paid his compensation will be increased.”

I do agree with the arbitrator’s findings that all claims of employment, salary and benefits are specific to the period within which the claimant/Respondent was in that position. During the unexpired period of the contract the Respondent was suppose to mitigate his loss.

In his statement of claim before the arbitrator the Respondent submitted that,

He had registered with an employment agent called CV People in June 2015.

He had submitted several applications for employment to many organisations through the employment agent and directly but to no avail.

Upon inquiring why he was not invited for a single interview the employment agent advised him that his reputation had been tainted by negative comments published in the popular newspaper on 31 December 2014.

The article was authorised some six months before he was dismissed.

The Respondent has not produced any documentary evidence to show the applications that he made.  He has not produced any evidence to support the response that was given by the employment agent.  Any prospective employer had the chance to find out the truth about this case upon calling him for an interview.  In my view this issue about the Herald article is far fetched.  A period of 12 months is a reasonable period for him to secure employment after dismissal if he was serious about securing employment.

Whether the arbitrator erred by awarding the benefits that are said to be in issue.

Medical Aid

The Respondent submitted that his claim for Medical Aid was based on his contract of employment. A copy of the Medical Aid Card from CIMAS was produced (Page 99). However the card does not show whether the Respondent was paying premiums during the period in question.

The Medical Aid is money which was supposed to be paid to CIMAS and not for the Respondent to pocket it. If he had been paying subscriptions then he would have been entitled to the claim for Medical Aid.

Acting Allowance

The Respondent also claimed this allowance on the grounds that every month he would perform the duties of the Chief Executive Officer.

I agree with the Appellant’s submission that the Respondent is not entitled to this allowance because it is not an entitlement but it is an allowance that is paid when one is appointed to act in the absence of the respective official. If the Respondent did not act in any position during his period then he is not entitled to the allowance.

Bonus

The Respondent also claimed bonus and argued that the performance bonus was not discretionary. The Respondent was required to pay it if his organisation performed well. The Appellant paid bonus in 2012, 2013, and 2014. It should explain why bonus should not be paid in 2015, 2016 and 2017 if it had not lawfully dismissed the Respondent, Clause 5:3 of the Respondent’s contract of employment states that,

“The Director Finance shall be entitled to a performance bonus to be determined by his overall performance during any financial year.” (page 45).

Annexure B of the contract of employment (page 48) states that the performance bonus is at the Board’s discretion. This clearly shows that it would only be paid after the work performed has been evaluated. If there was no work performed or if the board found that the performance was not satisfactory then Respondent was not to receive anything unless he proves otherwise.

Infralink

Respondent submitted that ZINARA owns a company called Infralink. Respondent was the Chief Finance Officer of that Company from 2011 up to the time of his dismissal. The Appellant would pay him $3 000-00 every month for the work he did for this subsidiary Company. During the period in question the Respondent did not perform any duties for the Company. It is my view therefore that he is not entitled to any payment.

Interest of fixed deposit

It has been submitted that this was money paid to the employees to mitigate the effects of monthly bank deductions for housing loans. These loans would accrue interest and it is these interests that were paid to the employees on a monthly basis.

There is nothing on record to show that this payment was contractual. The Respondent is therefore not entitled to this claim

Clothing Allowance

The Respondent also submitted that he was entitled to $4 000-00 annually to enable him to buy clothes befitting a Director. During the period in question the Respondent was not going to work. There is no proof of any purchases of the clothes in question for that period. I am therefore of the view that Respondent is not entitled to this claim.

Holiday Allowance

The contract of employment shows that the Respondent was entitled to a holiday allowance. The Respondent was not at work at the relevant time. There is nothing to prove that he went on holiday. If he had gone on holiday may be this court would have granted the claim.

Pay in lieu of Notice

The Appellant also submitted that the arbitrator erred by awarding pay in lieu of Notice because the contract came to an end through dismissal. The Respondent has submitted that they never asked for pay in lieu of notice and this could have been a typing error by the arbitrator.

The Respondent has also filed a cross appeal in which he raised 3 grounds of appeal. The grounds of appeal are as follows,

The honourable arbitrator erred at law in disallowing the respondent’s claim for damages for unlawful dismissal despite the fact that Appellant refused to reinstate Respondent.

The honourable arbitrator erred at law in not ordering back pay and benefits to be paid from the date of dismissal to the date of the order of reinstatement.

The honourable arbitrator erred at law in not ordering back pay and benefits to be paid from the date of dismissal to the date of the order for reinstatement.

The honourable arbitrator erred at law in not awarding the respondent pay leave.

The Appellant opposed the cross-appeal and argued that this was a fixed contract and every benefit and damage were to be decided within that time period. The Respondent was employed on a fixed term contract which was to expire in March 2017. The arbitral award was handed down on the 5th of July 2018 well after the contract had expired. In his judgment he stated that,

“A contract with a limit of time is time specific. All claimants of employment salary and benefits are specific to the period within which the incumbent contract holder is in that position” (page 18).

In the case of ZIMRA v Chester Mudziwaora SC 4/18 Gowora JA dealt with the law of assessment of damages for employees on fixed term contract. The court stated that,

The arbitrator was suppose to have assessed and made a finding as to what Respondent could have reasonably earned by securing alternative employment. This is exactly what he did. As has been stated in the main appeal he only erred by making awards on the following items,

Infralink allowance

Acting allowance

Clothing allowance

Bonus

Medical Aid

Holiday Allowance

Pay in lieu of notice

In his claim before the arbitrator the Respondent had claimed pay leave and not pay in lieu of notice. The arbitrator could have made a typing error when he made the award.

In the circumstances the main appeal being merited I order as follows,

The Appellant is ordered to pay Respondent damages in lieu of reinstatement follows,

The claim for Medical Aid, Acting allowance, Bonus, Infralink Allowances, Interest in fixed deposit, Clothing allowance, Holiday allowance, Pay in lieu of notice be and are hereby dismissed.

The cross-appeal being unmerited be and is hereby dismissed.

The Respondent shall bear costs.

Messrs, Kadzere, Hungwe & Mandevere, appellant’s legal practitioners

Gama & Partners, respondent’s legal practitioners