faraji shambe and 13 others vs zanzibar telecom limited 2021 tzhcld 525 24 september 2021

IN THE HIGH COURT OF TANZANIA LABOUR DIVISION AT PAR ES SALAAM REVISION NO. 77 OF 2020 FARAJI SHAMBE & 13 OTHERS APPLICANTS ZANZIBAR TELECOM LIMITED RESPONDENT JUDGMENT 4th August & 24th September 2021 Rwizile, J. This application is against the decision of the Commission for Mediation and Arbitration (CMA) in labour dispute No. CMA/DSM/KIN/R.210/16/271. The applicants are praying for the orders of this court in the following terms: - 1. That this Honourable Court be pleased to call for records, ■<s,. examine, revise, and set aside an arbitral award of the Commission for Mediation and Arbitration of Dar es salaam at Kinondoni in Labour Dispute No. CMA/DSM/KIN/R.210/16/271 delivered by Hon. Msina, H.H, Arbitrator, on 28th day of February, 2019. i 2. Any other order(s) and/or reliefs it may deem fit and just to grant. Supporting it, is the affidavit of Felix Edward Makene the applicants' advocate, that advanced ten grounds for determination by this court. It is the fact, that the applicants were variously and at different time employed by the respondent. The respondent, whose telecommunication business experienced a serious hit, found reason to make redundant some of its workers. On 15th February 2016, among many others, the applicants were retrenched. This was upon unsuccessful collective agreement. Dissatisfied with the process, they unsuccessfully challenged the same, as being unfair termination at the CMA. The applicants advanced a total claim of 612, 739, 014. 15, to cater for; compensation of 12 months salaries, severance pay, one month's salary, payment of accrued salaries to 15th February 2016, gratuity, repatriation, leave and certificate of service. Before this court the applicants were represented by Mr. Felix Edward Makene, learned advocate, whereas the respondent was represented by Mr. Jacktone Koyugi, learned advocate. The hearing was by way of written submissions at the wishes of the parties. 2 At the hearing, Mr. Makene argued together, ground I, II, & III, IV & VI, VII & VIII while ground V, IX and X were argued separately. On first, second and third grounds, it was submitted that applicants were terminated on 15th February 2016 based on operational requirements. The procedure of implementing the same, he argued, is provided for under section 38(1) of the Employment and Labour Relations Act, [Cap 366 R.E 2019]. The section, he said, directs that upon failure of consultation on retrenchment, the matter has to be referred to the CMA. In this application, he commented, consultation failed as per exhibit R-12, the Minutes of the meeting. To support his position, he referred this Court to the case of Metal Products Limited v. Mohamed Mwerangi and 7 Others, Revision No. 148 of 2008, High Court of Tanzania, Labour Division, at Dar es salaam (unreported). The counsel asserted that exhibit AP-2 which is a letter dated 23rd February 2016, justified the respondent's intention of referring the matter to the commission, as indicated at paragraph 3 of the same. Consequently, the respondent was aware of this procedure. According to him, this intimation 3 in a letter AP-2, is an afterthought as the applicants were terminated on 15th February 2016. On fourth and sixth grounds of revision, the counsel submitted that Rule 22(2) (b) of the Labour Institutions (Mediation and Arbitration Guidelines) G.N No. 67 of 2007 provides for various stages in arbitration process; which include opening statement and narrowing down issues. He went on, at CMA three issues were framed. One, was whether the applicants were paid their terminal benefits before retrenchment exercise. C'x The learned counsel held the view that the arbitrator erred in law by not addressing that issue. To justify his standpoint, he referred to exhibit R-17 that the payment was already made. Ih* It was further submitted that exhibit R-17 is an affidavit purportedly sworn by Dw4 who admitted that the contents of it did not belong to him. He just signed the same, after being directed to sign by the respondent's counsel contrary to Order XIX Rule 3(1) of the Civil Procedure Code Act, [Cap 33 R.E 2019]. He was of the view that failure to address the third issue is fatal. Supporting his position, he cited the case of Sosthenes Bruno & 4 Another v. Frola Shauri, Court of Appeal of Tanzania, at Dar es salaam(unreported). Arguing the fifth ground, it was submitted that the law does not permit an employer to re-open individual discussion upon collective agreement failure, under section 38(1). He stated that exhibit R-12, the minutes of the meeting paved the way for either party to refer the dispute to CMA for mediation. He was of the view that the email, exhibit AP-1 by the CEO to the employees didn't supersede f % 1 the decision reached in the consultation meeting. The counsel submitted further that the conduct of the applicant in emailing individual employees formerly represented by Telecommunications Workers Union of Tanzania ■ (TEWUTA), did not only amount to divide and rule, but also gravely offends section 67(1) of Employment and Labour Relations Act. He stated that the same would be proper if it were emailed to the exclusive bargaining agent of employees (TEWUTA). He was of the view that the Arbitrator's holding at page 31, of the award offends section 68(1) of the Employment and Labour Relations Act. 5 Regarding affidavit sworn by Dw4 which was argued as ground nine, the counsel submitted that it is on record that, Dw4 admitted, which is contrary to Order XIX Rule 3(1) of the Civil Procedure Code Act, 2019. Lastly, it was submitted that due to misconduct practiced by the presiding arbitrator on 11th September 2017, the applicants decided to write a letter dated 2nd October 2017 requesting her to recuse from presiding over the matter, for conflicting Rule 5(a) &(b) and Rule 7(1) & (2) of Labour Institutions (Ethics and Code of Conduct for Mediators and Arbitrator) G.N No. 66 of 2007. Strengthening his position, he cited the case of Zabron Pangamaleza v. Joachim Kiwaraka & Another [ 1987] T.L.R, Court of Appeal of Tanzania, at Dar es salaam(unreported). Thus, the counsel prayed, the award be revised, gw Opposing the application on first ground the respondent's counsel submitted that there was no evidence before the CMA indicating there was any resolution during group consultation barring the employer from terminating employment contract according to law. It was further argued that the parties did not reach consensus on the retrenchment package. However, individual employees accepted the package offered. The email to 6 the employer accepting the retrenchment package is evidenced by exhibit R-14. To support this position, he cited the case of Emmanuel Urassa & Others v. Shared Networks Tanzania Limited, Revision Application No. 467 of 2019 High Court of Tanzania, Labour Division, at Dar es salaam (unreported). He added that, the respondent was right in retrenching - employees as they voluntary accepted the package offered and that they did so in writing. On second ground the counsel submitted that the said letter was clear that employees who accepted retrenchment package would be retrenched and paid accordingly. However, those who did not accept, they would file formal labour dispute at CMA. On the basis, he was of the view that the said letter doesn't mean there was no consensus in the meeting. The counsel submitted further that, the respondent's witness Dw2 and Dw3 testified that the consultative meeting was conducted directly by involving ' -' K employees themselves, and indirectly by associating selected employees' representatives and by sending email to the employer justifying that the retrenchment exercise was voluntary agreed. He referred this court to the case of Resolution Insurance Limited v. Emmanuel Shio & Others, 7 Revision No. 642 of 2019, High Court of Tanzania, Labour Division, at Dar es salaam, (unreported). On the third ground it was submitted that the employer had the right to retrench the employees provided they had agreed to the retrenchment package. Therefore, the issue whether consultative meeting was an individual agreement or by group is illogical. He insisted that there was no need of applying retrenchment procedures in check list fashion as was discussed in the case of Mainline Carries Ltd v. Delifrida Filbert Libaba & 7Others, Revision Application No. 264 of 2019, High Court of Tanzania, Labour Division, at Dar es salaam, (unreported). Ms Regarding their entitlements, the respondent counsel submitted that, it ft : ftsft' " was testified by Dw4 supported by exhibit R-17 to prove that applicants were paid their terminal benefits, in retrenchment exercise and the same allegation was proved by Dw3, a bank officer. On whether it was lawful to invite individual communication after failure of group consultation, the counsel submitted that the law does not bar employer to act on the same. He stated that the email from CEO to all staff regarding the latest retrenchment package, does not contain duress or 8 threat as alleged. First the employees' package was above minimum statutory payments, instead of offering seven (7) days basic wages for each complemented year of service, they were offered 21 and 9-days basic wage as severance pay. Again, instead of offering 28 days' notice pay for termination of employment, they were offered six months (6) and three months' basic salary as payment in lieu of notice of termination of employment. Coercion or duress, the learned counsel argued, for the same to be established, it must be shown that the threat was illegitimate, false, fraudulent and unlawful and that the applicant had no reasonable option against the threats. He submitted; the applicants failed to prove the same as per exhibit R-14. His view was that the allegation is baseless. To support his stand, he made reference in the case of Pao On v. Lau Yiu Long [1980] A.C. 614. On the sixth ground, that the payment was not specific by not stating the date and the amount paid, the counsel stated that it is an afterthought as the same was not raised at CMA. He stated that exhibit R-14 discloses the amount and date when retrenchment package was paid. Exhibit R-14, the 9 counsel submitted, was admitted without objection. It was served as referred by Dw3 belatedly as directed by commission. The counsel proceeded to submit on the nineth ground regarding affidavit­ exhibit R- 17 that during cross examination, Dw4 stated that he did not prepare the affidavit but confirmed, it contained true Bank transactions, that were confined to facts within the knowledge of the witness and does not violate any law. He said, the applicants are now estopped from complaining regarding the admissibility of exhibit R-17. I On the last ground regarding arbitrator's recusal, the counsel submitted that the arbitrator directed applicant's advocate to file the formal * % d application regarding this allegation. The letter dated 2 October 2017 was not served to the respondent so as to be afforded with the right of T, jf' ’ challenging the same. There was no evidence supporting recusal as held in the case of Golden Globe International Services Ltd v. Mic Tanzania Ltd, Millcom Tanzania NV, Millcom International Cellular SA & Shai Holdings, Misc. Commercial Case No. 118 of 2016, Commercial Division, at Dar es 10 salaam, (unreported). He thus prayed for the application to be dismissed. In rejoinder the applicant reiterated his submission in chief. Having considered submissions, I have to say, this Court is called upon to determine, whether retrenchment was lawfully in terms of % procedure? and whether applicants were paid terminal benefits upon retrenchment? And last whether the arbitrator was justified to decline recusal when so asked? To start with, I have to comment that there is no dispute as to the validity of the reason for retrenchment. It was purely grounded on the reasons explained to the applicants. But on termination, there ought to be procedural fairness on retrenchment process. The legal position is that even if the employer has a valid reason to retrench, still she has to adhere to mandatory procedures in retrenchment exercise. In our labour laws, procedure for termination on retrenchment based on operational requirement is provided for under section 38 of the ELRA, read with Rules 23 and 24 of the rules and Guidelines under the Employment and Labour Relations (Code of Good Practice) GN. 42 of 2007. Section 38 of the law provides that; - ii "In any termination for operational requirements (retrenchment), the employer shall comply with the following principles, that is to say, be shall: (a) give notice of any intention to retrench as soon as it is contemplated; (b) disclose all relevant information on the intended retrenchment for the purpose of proper consultation; (c) consult prior to retrenchment or redundancy on:- (i) the reasons for the intended retrenchment; J (ii) any measures to avoid or minimize the intended retrenchment; (Hi) the method of selection of the employees to be retrenched; (iv) the timing of the retrenchments; (v) severance pay in respect of the retrenchment. From the above position it is clear that in establishing the validity and fairness of retrenchment exercise, the responsible authority has to observe the law and protect, integrity of the entire process. Even if termination arises from fair reasons, it can still turn to be unfair if the employer fails to 12 act reasonably and follow the procedure required to effect fair redundancy. Here, the record notes that three consultative meetings were conducted as evidenced by exhibit R-12, the minutes of consultative meeting. The purpose for the same were and indeed did inform the reason for retrenchment, measures to avoid or minimize the intended retrenchment, the method of selection of the employees to be retrenched, the timing of the retrenchment and severance pay in respect of the retrenchment. The respondent observed the required principles as provided by the law and discussed in the case of Bernard Gindo and 27 others v. TOL Gases Ltd, Revision No. 18 of 2012, High Court, Labour Division at Dar Es Salaam. In the circumstance the question that locked the parties was a % retrenchment package. Section 38(2) of the Employment and Labour JI Relations Act, requires parties to refer their dispute to the Commission to mediate them in case no agreement reached. However, no party, upon failure to agree on retrenchment package, that referred the same to the Commission. Therefore, the applicants' allegation regarding resolution, respondent's letter addressed to TEWUTA, admission of exhibit R-14, which is an individual acceptance of retrenchment package and reopening an 13 individual bargain did not, in my view conflict the law. I find the same in the scope of section 38(2) of the Employment and Labour Relations Act. The procedure laid down in the section, is designed to come to an amicable solution between the parties. The offer was given to them and accepted. Had it been otherwise, the matter would have been referred to the Commission. On ground four and six the record reveal that applicants were paid on different dates and amounts basing on individual claim as justified by exhibit R-17, the payment of terminal benefits and the affidavit. The same ‘•T. is supported by the testimony of Pwl. He admitted that there was money deposited in her account. I hold the view therefore that I see nothing to fault in the arbitrator's decision on the aspect. It was right in admitting exhibit R-17 in evidence, this position was also discussed in the case of Tanzania Milling and Co. Ltd v. Zacharia Aman t/a All Gold Co. & Another, Civil Application No. 415 of 2018, HC at DSM, where it held that; 'If an affidavit mentions another person, that other person has to swear an affidavit. However, I would add that is so 14 where information of that other person is material evidence because without the other affidavit it would be hearsay.' Regarding recusal, I agree with the arbitrator. Upon hearing the applicants, it was found, there was no reason to warrant recusal. The case of Golden Globe International Service, (supra) is relevant. The reasons for recusal were not apparent but based on fear of losing the case, but not that arbitrator was really biased. Having said so, I find the application to have no merit and it is dismissed in its entirety. No costs awarded to the parties. JUDGE 24.09.2021 15