REV NO 18327 OF 2024 BENEDICTO PAUL VRS BAYPORT FINANCIAL SERVICE LIMITED

IN THE HIGH COURT OF THE UNITED REPUBLIC OF TANZANIA LABOUR DIVISION AT DAR ES SALAAM REVISION APPLICATION NO. 18327 OF 2024 CASE REFERENCE NO. 202407301000018327 BETWEEN BENEDICTO PAUL ............................ ...... .... ...... .... ........ APPLICANT VERSUS BAYPORT FINANCIAL SERVICES LIMITED...... ......................... RESPONDENT JUDGEMENT Date of last Order: 29/ 08/2024 Date of Judgement: 19/ 09/2024 MLYAMBINA. 3. The Applicant was employed by the Respondent in the position of Call Centre Agent since 15/08/2016. He was promoted to different positions up to the position of Senior Credit Officer which he held upon his termination. He was terminated from employment on the ground of gross negligence on 21/08/2023. Aggrieved by the termination, he referred the matter to the Commission for Mediation and Arbitration (herein CMA). After considering the evidence of the parties, the CMA dismissed the Applicant's complaint on the ground that the termination was fair both substantively and procedurally. Again, dissatisfied by the CMA's decision, the Applicant filed the present application on the following grounds: i. That, the alleged misconduct was not proved. ii. That, the Arbitrator erred in law through misapprehension of evidence leading to improper or irrational conclusion that the termination was fair. iii. That, the Arbitrator without any lawful justification erred in law and fact by ignoring the evidence of the Applicant that he was terminated from the employment while there was ongoing criminal/police case. iv. That, the Arbitrator mislead and misdirected herself that the composition of the hearing committee was proper for being chaired by the Respondent's employee without any legal justification. v. That, the Arbitrator deceived that the Applicant testimony sought for being issued warning instead of termination. The application proceeded by way of written submissions. The Applicant enjoyed the services of learned Counsel Lusajo Watson Mwakasege. On the other hand, Counsel Hassan Mussa, appeared for the Respondent. The first and second grounds are related, hence will be determined jointly. It was Counsel Mwakasege's submission that the Award was improperly procured as the Respondent failed to prove the alleged misconduct. He stated that the Applicant was not charged with gross negligence, but the accusation of approving loans to 14 customers with no affordability. However, he was terminated for gross misconduct. It was Counsel Mwakasege's view that the Applicant was terminated for the misconduct not charged with, hence denial of the right to be heard which is nullity and vitiates the whole disciplinary proceedings. In support of his submission, he referred the Court to the case of Alex Eriyo & 4 Others v. Bank of Africa, Application for Labour Revision 3 of 2020 [2020] TZHC 4392 (12 November 2020) accessed at tanzlii.org. It is was his strong submission that the alleged misconduct was not proved. That, the Applicant explained and proved to follow the required procedures on approving the loans whereas the Respondent never produced any evidence to show that the Applicant didn't follow the procedures and thus amounting to non­ proof of the alleged misconduct. He added that; the issue of affordability was allegedly committed at Uvinza District Council, whereas the moderator or administrator of Lawson Portal unlawful removed the deductions from those 14 customers. That, the Respondent never explained how the Applicant was involved in the incident in question. It was further submitted by Counsel Mwakasege that the Arbitrator believed that excel calculator is the same as CRM calculator, which was a mistaken belief. The Applicant testified that he used excel calculator to check the affordability and it passed all customers, while the Respondent instead of testing the Applicant's computer to see if it was with fault or not, she used another calculator which is CRM as testified by DW3. In reply, Counsel Mussa submitted that the Applicant is confusing between allegations and findings made by the disciplinary hearing committee. He stated that the Applicant's failure to check the affordability of the 14 Customers before issuing them with loan which is against the procedure and process to which he was tasked by the Respondent amount to gross negligence. That, the Committee based its findings on the investigation report (exhibit D7). He was of the view that the misconduct at hand is a serious one which warrants termination. He supported the argument with the Court of Appeal of Tanzania case in Civil Appeal No. 138 of 2022 between Platnum Credit Ltd v. Martin Joaqim. As regards to the affordability issue, it was submitted by Counsel Mussa in reply that all affordability check was done by the Applicant on behalf of Respondent and if anything was not done properly then it is the Applicant and not Uvinza District Council to be blamed and held responsible. He added that the allegation about Lawson Portal was never proved before the CMA. The misconduct gross negligence was defined by this Court in the case of Twiga Bancorp (T) Ltd. v. David Kanyika, Labour Revision, No. 346 of 2013 Dar es Salaam to mean: A serious careless, a person is gross negligent if he falls far below the ordinary standard of care that one can expect. It differs from ordinary negligence in terms of degree. The elements of negligence were established in the famous case of Donoghue v. Stevenson [1992] UHKL, 100 as follows: i. That there was a duty of care, ii. That there was a breach of that duty, iii. That the breach of the duty caused loss. The above elements were also adopted by our Court in the case of Tanzania Revenue Authority v. Thabit Milimo and Another, Labour Division Dar es Salaam Revision. No. 246 of 2014 [2015] LCCD 1 (191) where Nyerere J (as she then was) held that: In the law of negligence liability arises where: i. There is a duty of care and a person breaches that duty as a result of which, the other person suffers loss or injury/damage. ii. a person acts negligently, when he fails to exercise that degree of care which a reasonable man/person of ordinary prudence, would exercise under the same circumstances. iii. Negligence is the opposite of diligence or being careful. In this case, the Applicant was accused for the allegation that between February to July 2023 he approved loans to 14 Customers with no affordability which resulted in a significant loss of TZS 156,942,489.18 to the organization. The Applicant strongly denied such allegation. In his reply to show cause letter (exhibit D3), the Applicant admitted that he followed all the required procedures in approving the loan in questions. There is no any evidence tendered by the Applicant to prove that he followed the required procedures. On his part, the Respondent tendered the investigation report (exhibit D7), which revealed that the Applicant approved the loan in question without applying the affordability rule, that is examining if the customers had capacity to pay or not. The report also attached the questioned Client's salary slips which clearly shows that they had no ability to pay further loan since their salary would be less than 1/3. Therefore, the Applicant's allegation that he applied a certain calculator is unreasonable and cannot stand in the circumstance of this case. As rightly submitted by Counsel Mussa, the Applicant's duty was to make sure that the Respondent does not incur any foreseeable loss but he failed to 6 accomplish the same. It is therefore my view that failure to properly check and authorise loan to qualified Customers amounts to gross negligence, as rightly found by the disciplinary hearing. The allegation that the Applicant was charged and terminated with a different offence is of no value. He was charged and terminated for gross negligence as found by the disciplinary hearing committee. On the third ground, it was submitted by Counsel Mwakasege that the Arbitrator biasedly ignored the Applicant's testimony that he was terminated while there was a pending criminal case No. KJN/PE/53/2023 at Kijitonyama Police Post. As evidenced by Exhibit D7 at Page 5 (item 19) and Page 13, the Respondent clearly explained that; on 14/07/2023 she had instituted the referred case at Kijitonyama Police post which is contrary to the spirit of Section 37(5) o f the Employment and Labour Relations [Cap 366 R.E. 2019] (herein ELRA). It was Counsel Mussa's reply submission that the criminal case is only commenced at the Court by way of charge sheet. He added that at the CMA there was no the so-called police case with the mentioned numbers disclosed. That the case came up before this revision. As rightly argued by counsel Mwakasege, Section 37(5) (supra) restricts the employer to proceed with disciplinary processes when the matter is yet to be determined by the Court. The provision provides as follows: No disciplinary action in form of penalty, termination or dismissal shall lie upon an employee who has been charged with a criminal offence which is substantially the same until final determination by the Court and any appeal thereto. In the case at hand, in his opening statement before the CMA, the Applicant mentioned the named police case. He clearly stated that the investigation is still going on. Thus, Mr. Mwakasege's submission that the case was tabled and mentioned before this Court is contrary to the evidence available on record. It is my view that Section 37 (5) (supra) restricts the employer to proceed with the disciplinary processes only when the matter is before the Court waiting for final determination. In this case, the matter was just before the police for investigation. It was not brought to Court already. It is, therefore, my position that Section 37 (5) (supra) does not apply to the circumstances of this case. Thus, this ground lacks merit. The Arbitrator properly ignored the allegation in question. The ground would have stand if the Applicant brought proof of the Court case number which he did not. Coming to the fourth ground, that the Arbitrator mislead and misdirected herself that the composition of the hearing committee was proper for being chaired by the Respondent's employee without any legal justification; it was Counsel Mwakasege's strong submission that the Disciplinary hearing committee was badly composed as the Chairman was an employee of the Respondent which is contrary to Guideline 4 (2) o f the Guidelines for Disciplinary, Incapacity and Incompatibility Policy and Procedures GN. No. 42 o f 2007, He argued that the position of the law is clear that the enquiry committee should be chaired by the person outside the organization unless the circumstances are impossible for getting one out of the organization. It was further submitted by Counsel Mwakasege that in the Applicant's case, there was no explanation on why the Chairman of the committee did not come from outside the organization. He was of the view that the result of such Chairman being an employee of the Respondent is that he was bias. He submitted that bias is seen on the hearing committee. The Complainant was not given the documents used as evidence against him so that he could properly defend himself. He added that the notice for disciplinary hearing (Exhibit D4) was not attached with the Investigation report (Exhibit D7), and Exhibit D7 was not given to him during hearing, instead it was read by the Respondent's Witness and the Applicant was not given a chance to ask questions on the report or to read the said report. That, evidence against him was not properly presented to him contrary to Rule 15 (5) o f GN No. 42 o f2007. In response to the fourth ground, Counsel Mussa had the position that the disciplinary committee was properly composed. He stated that it is accepted procedure a chairperson of the committee should be a Senior Manager who works in a different department from the accused employee. As to the allegation of investigation report, it was submitted that the Applicant was afforded the right to be heard and nothing was raised as an issue during the disciplinary hearing. Thus, it was in compliance with Rule 15 (5) ofGN. No. 42 o f2007. To start with the composition of the disciplinary committee members. Its composition is guided by Rule 13 (4) o f GN. No. 42 o f 2007 which is of the following effect: The hearing shall be held and finalized within a reasonable time and chaired by a sufficiently senior management representative who shall not have been involved in the circumstances giving rise to the case. The above provision reads together with Guideline 4 (2) o f the Guidelines for Disciplinary, Incapacity and Incompatibility Policy and Procedure o f GN. 42 o f 2007 (herein the Guidelines) which is to the effect that: The chairperson of the hearing should be impartial and should not, if possible, have been involved in the issues 10 giving rise to the hearing. In appropriate circumstances, a senior manager from a different office may serve as chairperson From the above provisions, it is not mandatory in all circumstances disciplinary hearing to be chaired by a person from other organization. In my view the requirement to outsource the chairperson depends on the circumstances of the case and the position held by the accused employee. On such basis, it is my findings that counsel Mwakasege misinterpreted the above provisions. The circumstance upon which would have disqualified the chairperson in the case at hand, is as if he was involved in the circumstances giving rise to the case at hand. Looking at the evidence on record there is no any factor which justify his disqualification from being the chairperson. Thus, such ground has no merit. The Applicant also alleges that he was not served with the documents/evidence relied upon so as to enable him to defend himself. The allegation was also pleaded in the CMA FI. The Respondents stated that the Applicant was served with the alleged documents together with the notice to attend disciplinary hearing. I have gone through the notice to attend disciplinary hearing (exhibit D4). It is not stated that the notice is attached withthe investigation report or any other documents to be relied upon. Further examination of the records shows no proof that the Applicant was served with any documents. In the nature of the circumstances of this case, where investigation report form the basis of accusation against the Applicant, it is my view that failure to serve the Applicant amounts to the infringement of the right to be heard. This is also the Court's position in the case of Severo Mutegeki v. Mamlaka ya Maji Safi na Usafi wa Mazingira Mjini Dodoma (DUWASA), Civil Appeal No. 343 of 2019, Court of Appeal of Tanzania, Dodoma it was held as hereunder: It is our considered view that, though the Internal Auditor's ultimate reporting responsibility lies to the Director General it is not in dispute that, those actually audited were the appellants and it is the audit report which triggered the charges against them. In that regard, the non-involvement of the appellants and subsequent conviction based on that report was irregular because they could not adequately prepare for the hearing before the disciplinary committee of the Respondent. Instead, it is the Respondent who being in possession of the report had all the ammunition to make a stronger case which was to the disadvantage of the appellants which rendered what followed to be unprocedural. Again, in the case of Kiboberry Limited v. John Van Der Voort, Civil Appeal No. 248 of 2021 it was held as follows: The report, according to RW1, was the basis of the disciplinary proceedings against the Respondent. As we held in Severo Mutegeki (supra), the failure to involve the appellant in the investigation that led to the formulation of the report coupled with the omission to share a copy thereof with the Respondent was a serious irregularity. Inevitably, we uphold the concurrent finding by the courts below that the appellant failed to demonstrate that the impugned termination was for a valid and fair reason Therefore, in the matter at hand since there is no proof that the Applicant was served with the investigation report before being summoned to the disciplinary hearing vitiated the disciplinary hearing. Turning to the last ground, that the Arbitrator deceived that the Applicant sought to be issued with warning instead of termination; it was Counsel Mwakasege's submission that, during testimony before the CMA, the Applicant never admitted to commit the misconduct and prayed that the Respondent was supposed to punish him with lenient punish of warning. That, it was a deceit by the Arbitrator to record evidence which was not testified by the Applicant. He was 13 of the believe that the bias shown of inserting words in the Applicant's mouth was for purpose of favouring the Respondents. He therefore, urged the Court to set aside the CMA's decision. In response, it was Counsel Mussa's submission that the allegations for deceit against the Arbitrator is a very serious allegations which cannot be made lightly as did the Applicant. He stated that the Applicant denied to have stated during his testimony that he thought he will be warned rather than being terminated. He stated that in the nature of this case, termination is the appropriate sanction. As rightly submitted by Counsel Mussa, allegations against the Arbitrator should not be lightly made by the Applicant. What the Applicant is challenging amounts to forgery. That the Arbitrator forged the proceedings. Such kind of allegation needs sufficient evidence to be proved. In absence of any proof, the allegation stands baseless. I further subscribe to the wisdom of this Court in the case of Danford Evans Omari v. Tazama Pipeline Limited, Revision. No. 684 of 2019 where it was held that: One cannot just throw anything he/she wish, simply because decision reached did not please him/her. It is my conviction that parties to the dispute should not turn mediator/arbitrator as punching bag, simply because their decision was not in their favour. Furthermore, basing on the nature of misconduct committed termination is the appropriate sanction as submitted by counsel Mussa. This is pursuant to Rule 12 (3) (d) o f GN. No. 42 o f 2007where gross negligence is listed as one of the misconducts which justify termination. In the result, I find the present application to have partly succeeded. Since the termination of the Applicant was fair substantively and unfair procedurally only, that the Applicant was not served with the investigation report prior disciplinary hearing, I find the Award of one month (1) will serve justice. As such, the CMA's Award is revised and set aside. The Respondent is ordered to pay the Applicant a total of TZS 4,000,000/= as compensation for unfair termination as analysed. It is so ordered. Y. J. MLYAMBINA JUDGE 19/09/2024 Judgement pronounced and dated 19th September, 2024 in the presence of Counsel Lusajo Watson Mwakasege for the Applicant and Ridhiwani Mbaga holding brief of Hassan Mussa for the Respondent. Right of Appeal explained.