bank of africa vs bruce e massawe 2021 tzhcld 289 23 july 2021

IN THE HIGH COURT OF TANZANIA LABOUR DIVISION AT PAR ES SALAAM REVISION NO. 760 OF 2019 BETWEEN BANK OF AFRICA (T) LIMITED............................... APPLICANT VERSUS BRUCE E. MASSAWE............................................... RESPONDENT JUDGMENT Date of Last Order: 23/06/2021 Date ofJudgment: 23/07/2021 L.J. Itemba, J. The applicant Bank of Africa (T) Ltd has filed an application under section 91(l)(a), 2(a)(b) and (c), 4(a) and (b) and 94(l)(b)(i) of the Employment and Labour Relations Act, No. 6 of 2004 (ELRA) and Rule (1) (2)(a),(b),(c),(d),(e) and (f), 3(a)(b)(c)(d), 11(b), 28(l)(a)(c)(d)(e) of the Labour Court Rules GN No. 106 of 2007 read together with Rule 34(1) of the ELRA GN 47 of 2017 for the order that this Honorable Court revise and set aside the Commission for Mediation and Arbitration (CMA) award delivered on the 27th of August 2019 in Labour Dispute No. CMA/DSM/KIN/R.839/17/883 by Hon. Mbeyale, R, the Arbitrator. i A brief background of this case is that on 7th September 2017, the respondent filed a complaint before the CMA against the applicant for unfair termination of employment. The CMA decided in favour of the respondent, ordered his reinstatement and payment of remuneration amounting to Tshs. 156,377,484/=. The respondent was aggrieved with the said decision hence this revision application. During the hearing, Ms. Irene Swai, represented the applicant and the respondent was represented by Mr. Nzowa. The applicant had raised 6 grounds of revision as follows: (a) The trial Arbitrator erred in law in holding that the applicant failed to prove that there was a valid cause for termination of employment. (b) The trial arbitrator erred in law while determining the fairness of the reasons for termination, she failed to analyze and consider the whole evidence on record rather she based on her own opinions and assumptions. (c) The trial arbitrator erred in law and in fact in holding that the applicant did not adhere to fair procedure at the disciplinary hearing and that the decision was against the principles of natural justice. (d) The trial Arbitrator erred in law in holding that the act of the employer to afford the complainant an opportunity to be heard following the allegation of poor performance was contrary to law. 2 (e) The trial Arbitrator erred in law in ordering reinstatement, the relief which is not appropriate in the circumstances and considering the reasons for termination of employment. (f) The trial arbitrator erred in law in awarding entitlement of the sum of Tshs. 156,377,919/= without knowing how it is arrived. The applicant's counsel, referred the court to the respondent's termination letter, Exhibit DIO and pointed out that the grounds for termination were; continuous poor performance and insubordination on directives and instructions. She challenged the CMA analysis stating that, the arbitrator was wrong to conclude that the respondent's scoring of 58% was average performance while the job description was silent on that. She submitted that in the employer's analysis, performance of 58% was poor and unsatisfactory. She stressed that each employer sets and except the employee to perform at 100%. The applicant referred the Court to Rule 17(l)(a) of ELRA (Code of Good Practice) GN 42/2007, arguing that the first requirement mentioned is "meeting the performance standard". 3 On the issue of insubordination, she stated that Exhibit DIO, explained that the respondent was disobedient by using the Head of office premises up to midnight. She added that the issue of poor network in respondents office was not valid. Ms. Swai submitted that Mery Msuya DW1 and Mjabwa Hanzuruni DW2 were members of Disciplinary Hearing and the Disciplinary Hearing had a Senior member who was Niney Mndeme who was a chairperson. And that the said quorum is in compliance with the Guideline for Disciplinary Hearing GN 42, guideline No. 4(1) and 4(7) where senior member should be chairperson. In the last ground she questioned on how the arbitrator arrived to the amount of Tshs. 156,377,919/= without the analysis and prayed for the CMA decision to be revised. In response, the Counsel for the respondent Mr. Nzowa submitted that the arbitrator was correct because the applicant failed to prove that there was a valid point of determination against the respondent. With regard to reasonable standards, the counsel for the respondent argued that the standards must be reasonable and that the applicant 4 employer did not prove this. He argued that, in the last PIP, the respondent improved from 48% to 58% and that an increase of more than 5% is satisfactory performance even if it is below 75%. He added that, according to the testimony of DW2 and DW3 there were some contradictions on the minimum performance standard set by the employer. That the said standards are in the Human Resource manual but it was not tendered as an exhibit. He argued that the Court can draw the inference that the employee was not aware of the standards set by the employer. He stated that the respondent testified that poor performance was caused by the employer because "The job description was very long for a single Head" and that the respondent had no subordinates to assist him. He also argued that DW1 and DW2 attending the disciplinary hearing was unfair. As regard to insubordination, he submitted briefly that using the office for official duties cannot be insubordination. With regard to procedures for termination, the counsel for respondent submitted that the applicant did not adhere to fair procedures 5 because the proper procedure is found in Rule 13 of Code of Good Practice. He stated that because the reasons for termination were based on poor performance, the applicant had to follow Rule 18 of GN 42/2007. He stated that Rule 18(1) makes it mandatory for the employer to investigate the reasons for poor performance but investigation was not done. He further submitted that, if it is proved that termination was unfair both procedurally and substantively, and supported his argument with the case of NBC V. Ally Amin Meo (2014) LCCD Part II, 116. Mr. Nzowa argued that once the employee is reinstated, he is entitled to be paid the amount granted by the arbitrator counting from the date of termination to the date of judgment (Section 40(l)(a) of ELRA). On duplicity of charge complained by the respondent this Court agrees with that the applicant explained that the termination letter Exhibit DIO reads negligent/intentionally which means negligently or intentionally, this Court agrees with the applicant that was not a double charge. After careful examining the Court Records and rivalry submission by both parties, the Court will address the issue of whether or not the respondent termination was substantively and procedurally fair. 6 Unfair termination is defined under Section 37(2) of the ELRA as follows: '(1) It shall be unlawful for an employer to terminate the employment of the employee unfairly (2) A termination of employment by an employer is unfair if the employer fails to prove- (a) That the reasons for termination is valid; (b) That the reason is a fair reason- (i) Related to the employee's conduct, capacity or compatibility; or (ii) N/A (c)That the employer was terminated according to a fair procedure.' That means an employment cannot be terminated without fault. This position traces its validity from Article 4 of ILO Convention on Termination of Employment 158 of 1982 which provides that: 'The employment of a worker shall not be terminated unless there is a valid reason for such termination connected with the capacity or conduct of the worker or based on operational requirements of the undertaking establishment or service.' 7 In the present case the respondent was terminated for the reasons of continuous poor performance and insubordination. Starting with poor performance. Rule 17 of GN 42/2007 provides that: '17(1) Any employer, arbitrator or judge who determines whether a termination for poor work performance is fair shall consider- (a) whether or not the employee failed to meet a performance standard; (b)whether the employee was aware, or could reasonably be expected to have been aware, of the required standard; (c) whether the performance standards are reasonable; (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.' Being gauged by the above provision, it is evidence from the applicant that the respondent failed to meet the performance standard of 100% by scoring 48% and later 58%. It is evidence from DW1 Mery Msuya, that the respondent started demonstrating poor performance since the year 2015. On 28/12/2015 the respondent was required to give a 8 written explanation on his poor performance (Exhibit D4). It is a fact that the respondent did not have special training but the evidence shows that he had 'on job training' and qualifications that is why he was promoted. Due to continuous poor performance, on 12/05/2016 he was issued a warning letter (Exhibit D6) and given two (2) months to improve. However, the respondent did not improve and on 13/04/2017 he was issued a letter stating that he will be in Performance Improvement Plan (PIP), (Exhibit D7). An example that the respondent was not meeting deadlines is the respondent submitting a group report in March 2017 while it was due since November, 2016. The respondent could not meet even lowered the standard. The respondent was called for disciplinary meeting on 13/06/2017 (Exhibit D9) and he was terminated on 12/07/2017. I will quote a few lines from the said termination letter (Exhibit D 10) which demonstrated poor performance against the respondent; Item No. 3 states: 'Nevertheless, following your poor performance at your work for the period of year 2015 and the first quarter of 2016, management provided an opportunity for you to improve and between 22nd April 2016 and l$h February 9 2017 you were placed under Performance Improvement Plan (PIPs) that included an extension of the original plan to give you a room to exhibit an improvement in your performance, despite the extended opportunity still you failed to exhibit an improvement and yet scored unsatisfactorily performance for the year 2016.' In the past page the 2nd paragraph reads: ' The Bank has done a lot to support you but you failed miserably. Your line manager went further and marked down your KPI to the officer level to accommodate you to do your work but you still failed to deliver.' This evidence was not disputed by the respondent. It is also in record that, the respondent admitted that there are some duties which he did not discharge "kuna baadhi nilikuwa natimiza baadhi nashindwa." The respondent does not give any reasonable explanation apart from claiming that most of his time was used in attending meetings, something which other employees did and still managed their workloads. He also admits that his circumstances had changed after he was given one more person and his line manager was changed. io According to testimony by DW1 the respondent was Credit risk and Maintaining Manager. Among his roles, he was supposed to go through the credits issued to customers and verify on several aspects including Bank security, default charges and asses if the credit is risky. Due to sensitive nature of this duty in the banking industry a standard performance of 100% is reasonable. Based on evidence on record, poor performance was not contributed by the employer. The respondent knew what the applicant expected from him. He maintained poor performance despite being warned and being given opportunity to improve and even after being given an assistant as he requested. Therefore, the applicant had valid and fair reason to terminate the respondent. The second limb of this matter lies on procedure. The respondent was accused of 2 violations; poor performance and insubordination. Poor performance falls under "Incapacity" therefore the procedure to be followed is under rule 15 to 18 of GN 42/2007. The offence of insubordination falls under "Misconduct" which is provided for under rule 11 to 13 of GN 42 /2007. Insubordination is ii mentioned under rule 12(3)(f). Therefore, the applicant ought to have used different procedures in dealing with the respondent; that is both procedures under rules 11 to 13 and under rule 15 to 18 of GN 42/2007. With regard to poor performance, Rule 18(1) GN 42/2007 states that: 'it is mandatory for the employer to investigate the reasons for poor performance in order to reveal the extent to which is caused by the employee.' As correctly argued by the respondent's counsel it is from evidence on record that no investigation was done against the respondent. This was proved by DW1 who stated; " There was no need of investigation as he was given a chance to improve but he did not." This was an important aspect which was skipped by the applicant and it creates the procedural irregularities on the part of the applicant. Looking at the accusations of insubordination, it is stated that the respondent did not follow directives and instructions given by the applicant despite being reminded. A situation which was given was staying in the office until past midnight. Rule 12 (2) GN 42/2007 states that the employee shall not justify termination unless it is proved that the misconduct is so 12 serious that makes a continued employment relation intolerable. Rule (3)(f) of the same act explains that a misconduct which leads to termination is 'gross insubordination'. The evidence is silent on which level of insubordination was caused by the respondent. Rule 13 of GN 42/2007 imposes the duty to investigate on the part of the employer. As mentioned earlier, investigation on this matter was important to understand the nature of misconduct. The respondent had explained in his defence that he was using a Head of Office until midnight because of network problems in his office. Investigation was important to know what exactly was the respondent doing in the head of office until midnight? Was there any network problem? Was there any other employee who has testified to have similar network problem? What about the person whose offices were used by the respondent have they complained that the office is missing something or is not in good shape? The applicant insisted that the defence is not valid but he does not explain how he reached that conclusion and most of the questions remained unanswered. In this situation a benefit of doubt goes to the respondent. It is an established principle that for the termination of 13 employment to be considered fair, it should be based on valid reasons and fair procedure. (Section 37(2) ELRA). The applicant had a duty to prove that termination was fair which included fairness of procedure. This was also held in the cases of Muhimbili National Hospital Vs. Constantine Victor John, Civil Appl. No. 44/2013 and DAWASCO Vs. Abdul Swamadu Rwegoshora, Rev. No. 259 of 2008. Therefore, in this case there was no fairness of procedure. The applicant was procedurally unfair for not conducting investigation prior to terminating of the respondent's employment. In the case of Elisha J. Sima v. Geita Gold Mining Ltd, Lab. Div, MZA Revision No. 20/2014 it was held that, if it is proved that termination was procedurally unfair the employee is entitled to compensation of 12 moths salaries as provided for in section 40(1 )(c ) of ELRA. The CMA arbitrator erred in holding that termination of the respondent was unfair both substantively and procedurally. Termination of the respondent was substantively fair and procedurally unfair. As the termination of the respondent was substantially fair, the respondent is not 14 entitled to reinstatement without loss of remuneration. I therefore set aside the order of reinstatement without loss of remuneration. As the termination was procedurally unfair, I find that the respondent is entitled to a compensation of 12 months salaries as provided for section 40(l)(c) of the ELRA. On that basis the CMA award is revised to the extent that the respondent be paid a compensation of 12 months salaries. It is ordered. LJ. Itemba JUDGE 23/07/2021 15