access bank tanzania limited v benson mutayabarwa 2023 tzhc 17453 30 may 2023

IN THE HIGH COURT OF THE UNITED REPUBLIC OF TANZANIA TABORA DISTRICT REGISTRY AT TABORA LABOUR REVISION NO. 7 OF 2021 (Originating from the Commission for Mediation and Arbitration, Application No. CM/TAB/TBR-MJN/92/2020/16) ACCESS BANK TANZANIA LIMITED (Currently Known as Access Microfinance Bank Tanzania Limited).......APPLICANT VERSUS BENSON MUTAYABARWA.......................................................... RESPONDENT RULING Date of Last Order: 22/5/2023 Date of Ruling: 30/5/2023 KADI LU, J, Before the Commission for Mediation and Arbitration of Tabora (CMA) Benson Mutayabarwa (the respondent herein) lodged a claim for unfair termination of employment via CMA/TAB/TBR-MJN/92/2020/16 against his employer ACCESS BANK TANZANIA LIMITED who is currently known as Access Microfinance Bank Tanzania Limited (the applicant). Upon hearing of the said dispute, the CMA made an award in favour of the respondent and the applicant was ordered to pay him a total of Tshs: 10,200,000/= being twelve months salary compensation for unfair termination hence, this application for revision. The application was preferred under the provisions of Section 91 (3) of the Employment and Labour Relations Act, [Cap 366 R.E 2019], Rule 24 (1), (2), (a),(b),(c),(d),(e),(f), 24(3)(a)(b)(c)(d) and 24 (11) (b) i of the Labour Court Rules, 2007 GN No. 106 of 2007. The application is supported by an affidavit sworn by Happiness Mangowi, the Legal Counsel for the applicant. The applicant prays this Court to revise and set aside the award of the Commission for Mediation and Arbitration on the following grounds: - 1. That, the honourable Arbitrator erred in law and fact for adjudicating the complaint in favour of the respondent on the ground that the respondent's termination was procedurally unfair. 2. That, the honourable Arbitrator erred in law and fact for relying on the evidence of the respondent that could not suffice and/ or warrant the so-called unfair termination due to poor performance. 3. That, the honourable Arbitrator erred in law and fact for failing to evaluate properly the evidence adduced by the Applicant's witnesses. 4. That, the trial Arbitrator erred in law and fact by holding that the Applicant was supposed to offer training to the respondent. 5. That, the honourable Arbitrator erred in law and fact by awarding the respondent Tshs. 10,200,000/= as a total compensation for unfair termination for 12 months while the same is unjustified. Before delving into what was argued by the parties in respect of the revision application, it is paramount in brief to give the background of the matter leading to this application. The respondent was employed by the applicant on 1/8/2015 as a Junior Loan Officer on a fixed-term contract that was expected to last for three years from the date of commencement of the contract. On 01/08/2018 after the expiry of the first contract, the respondent was offered permanent employment by the applicant and the contract was signed by both parties on 03/08/2018. After signing the second contract, the respondent continued to serve the bank as a Microloan 2 officer until when he was transferred to the Loan Recovery department where he worked until when the commotion started. It is the applicant's complaint that the respondent's work performance dropped below the standards set by the Access Bank Performance Management Guideline (Exhibit ABT-2) which led to failure to meet the employer's business target. On 30th June 2020, the applicant terminated the respondent's employment. The respondent was aggrieved by both the reason and procedure for termination hence, he referred the matter to the CMA. The CMA after considering the evidence and exhibits tendered before it, issued an award to the effect that, the termination was both substantively and procedurally unfair. The respondent by virtue of section 40 (1) (c) and 42 of the Employment and Labour Relation Act No. 6/2004 was entitled to be awarded a compensation of not less than 12 months' salary equivalent to 10,200,000/=. The present application was argued by way of written submissions whereby both parties filed their submissions as per the scheduling order of this Court. Ms. Happiness Mangowi learned Advocate for the applicant filed written submission in support of the application whereas Mr. Elibahati Akyoo also learned Advocate fended for the respondent. Arguing in support of the application, Ms. Mangowi submitted that the evidence adduced by DW1 and DW2 indicate that all procedures used in terminating the respondent's employment were valid as they clearly observed the legal requirements including conducting an investigation which was in the form of documented feedback where the applicant and respondent sat to discuss reasons for his unsatisfactory performance. To 3 reinforce her argument, Ms. Mangowi referred this Court to the Case of Justa Kyaruzi vs NBC Ltd, Rev. No. 79 of2009, where the Court held that: "What is important is not the application of the code in a checklist fashion, but rather to ensure the process used to adhere to the basics of fair hearing in the Labour context depending on the circumstances of the parties, so as to ensure the act to terminate is not reached arbitrarily. Admittedly, the procedure may be dispensed with as per rule 13 (12) of the Code." Regarding the procedure for termination, the counsel submitted that the respondent never requested training although several Performance Improvement Programs (PIP) were conducted in 2018, 2019, and 2020 and performance monitoring discussions to give the respondent reasonable time to improve under the guidance, but he continued to underperform hence termination of his employment. It is Ms. Mangowi's standing that the applicant's program named Performance Improvement Program (PIP) is a fit slot for the requirement of rule 18 (2) of the Employment and Labour Relations (Code of Good Practice) GN. No. 42 of 2007 which requires the employer to give appropriate guidance, instructions or training, if necessary to an employee before terminating the employee for poor work performance. She stated further that, the respondent himself agreed to have never needed a training so, his response cleared doubts that indeed he needed no training and that the guidance offered sufficed. Regarding the award of twelve months' salary compensation to the respondent for unfair termination, the learned Counsel submitted that the complainant (respondent) asked for reinstatement, but the Commission 4 awarded him the sum of Tshs: 10,200,000/= contrary to the pleadings. She referred the court to the case of NMB Bank PLC vs Seiph Idd Seiph, Civil Appeal No. 12 of2022where the Court held that; "In respect to this appeal and the way the trial Court decreed, I ha ve no slight doubt the trial court failed to heed to its statutory duties, instead it turned into a mediator or issued a compromise decision contrary to the pleadings." Replying to the issues advanced by the applicant's Counsel, Mr. Elibahati Akyoo, learned Advocate stated that, since the respondent's employment was terminated on grounds of poor performance, the employer had a duty to make a thorough investigation to know the source of such problems before taking any action. To nail his argument, he made reference to Rule 17 (1) and Rule 18 (1) of the Employment and Labour Relations (Code of Good Practice) GN No. 42 which provide: Rule 17(1) "... an employer, arbitrator orjudge who determines whether a termination for poor performance is fair shall consider: (d) the reasons why the employee failed to meet the standard and (e) whether the employee was afforded a fair opportunity to meet the performance standard. Rule 18 (1): The employer shall investigate the reasons for unsatisfactory performance, this shall reveal the extent to which is caused by the employee." The learned Counsel stated further that, the applicant ignored the rules of procedure in terminating the respondent's employment because 5 no investigation was conducted in accordance with the cited provisions of the law rendering the whole process of termination invalid and purely labour malpractice. On the issue as to whether the respondent's evidence warrants unfair termination as decided by the CMA, Mr. Akyoo stated that, it was the duty of the applicant to provide the respondent with full training to improve work performance. It is his further submission that, the respondent asked for such training but the employer replied that the same was not necessary. He made a reference to page 5 of the CMA award which reads: "...alipoulizwa na wakiH wake, shahidi alijibu kwamba siyo tazima mtu akiwa kwenye PIP ape we mafunzo, mafunzo yanatolewa panapostahili na kuwa mlalamikaji hajawahi kuomba kupewa mafunzo yoyote zaidi ya minor support kwa sababu mlalamikaji aiikuwa miongoni mwa maafisa wazoefu." Submitting on the last ground regarding the award of compensation for unfair termination, the learned Counsel stated that it is the discretion of the Arbitrator conferred to her under Rule 32 (1) of the Labour Institutions (Mediation and Arbitration Guidelines) GN. No. 67 of 2007 which stipulates: 'Where an arbitrator finds a termination to be unfair, the arbitrator may order the employer to reinstate, re-engage the employee or pay compensation to the employee..." Finally, the learned counsel prayed the Court to dismiss the application with costs for being devoid of merit. 6 From the analysis of the submissions and the records in this matter, there is no dispute that the respondent was an employee of the applicant, and his employment was terminated on the allegation of poor performance and failure to meet the target/standards set by the applicant. I have examined the record and considered the contending written submissions made for and against the application, the major issues calling for determination of this court are whether the termination of the respondent's employment was fair and whether the award of twelve months' salary was justifiable. Both parties firmly agree that the respondent's performance of work dropped below the standards set by the Access Bank Performance Management Guidelines. The question is whether the respondent was afforded a fair opportunity to meet the performance standard. The evidence adduced at the CMA reveals that on different occasions in 2018, 2019, and 2020 the respondent's work performance was recorded to be below the requirement of the employer. This fact was not opposed by the respondent, but he raised a claim that he used to work as a Junior Loan Officer since 2015 but when he was signed a new contract, the applicant transferred him to Loan Recovery Department while having no any experience and without affording him any training, that is why he failed to perform to the required standard. Although the applicant claimed to have introduced the respondent into Performance Improvement Programs, there is no evidence that was tendered in the CMA to prove that the applicant took measures to identify the cause of the respondent's underperformance as the law requires and considering the fact that the respondent had been in the employment for three years. The evidence of the respondent that he was transferred to a 7 department that he had no experience with seems to be the more believable cause of his failure. Moreover, the Law under rule 17 (1) (e) of the Employment and Labour Relations (Code of Good Practice) GN. No. 42 mandatorily requires the employer to provide the employee with an opportunity to meet the performance standard. The submission by Ms. Mangowi that the respondent was introduced to Performance Improvement Program seems to be a mere word of mouth that lacks proof because no exhibit whatsoever was admitted to prove that the respondent went through such training and under supervision of his seniors as claimed. It is on record that the respondent's underperformance started in April 2018; the question that pops into my mind is why the applicant considered the respondent for a long-time contract while he was not working up to the expected standards. The record reveals further, that the respondent's first contract which started in 2015 lapsed in July 2018 and the second contract was signed on 03 August 2018. It is surprising that three days after signing a new contract, the respondent was issued with a warning letter regarding poor performance. With all those unspoken inconsistencies, I find no reason to disagree with the learned Arbitrator on the finding that the respondent's termination was substantially and procedurally unfair. Regarding the award of twelve months salary awarded to the respondent by the CMA, the law is crystal clear that where the Arbitrator finds the circumstances of the case do not support the order of reinstatement or re-engagement as prayed by the complainant, he may order compensation. For that reason, I find that there was nothing wrong 8 for the learned Arbitrator to order compensation to a wrongfully terminated employee as he did. Having found so, I uphold the decision of the Commission for Mediation and Arbitration. Consequently, the application is found unmeritorious and hence dismissed. Being an employment dispute, I make no order as to the costs. KADILU, MJ., JUDGE 30/05/2023 Ruling delivered in Chamber on the 30th Day of May, 2023 in the presence of Mr. Patrick Suluba, Advocate for the applicant, and Mr. Kelvin Lushiba, representing the respondent. KADILU, M J., JUDGE 30/05/2023 9