REV NO 24023 OF 2024 GSM TANZANIA LIMITED VRS SMART DEUS RWEHUMBIZA

IN THE HIGH COURT OF UNITED REPUBLIC OF TANZANIA LABOUR DIVISION AT PAR ES SALAAM REVISION APPLICATION NO. 24023 OF 2024 CASE REFERENCE NO. 202409261000024023 GSM TANZANIA LIMITED............................................................ APPLICANT VERSUS SMART DEUS RWEHUMBIZA.................................................... RESPONDENT JUDGEMENT Date of last order: 15/ 10/2024 Date of Judgement: 22/ 11/2024 MLYAMBINA. J. Briefly, the Respondent was employed by the Applicant as Brand & Marketing Coordinator (BMC). The employer/employee relationship turned hostile for the alleged misconduct of having conflict of interest with his employer). Such misconduct attracted disciplinary action against him, followed by termination. Being aggrieved with termination, the Applicant filed the matter to the Commission for Mediation and Arbitration (herein CMA), claiming for being unfairly terminated with no reason and un- procedurally. At arbitral stage, it was found that the Applicant's termination was substantially and procedurally unfair, hence awarded 24 months' salary, severance allowance and notice in lieu, to the tune of TZS 27,900,769.23/=. This triggered the present application. The application was accompanied by chamber summons and supported by an affidavit of Eva Raymond Mziray, Principal Officer of the Applicant. She deponed that the Arbitrator failed to analyze evidence, subsequently resulted to wrong Award. The application was disputed through a counter affidavit of the Respondent. By consent of the parties, the application was disposed of by way of written submissions. The Applicant was represented by learned Counsel Rabin Mafuru Muyenjwa while the Respondent was represented by learned Counsel Felix Fabian Mtunzi. Counsel Mafuru opted to start with the second issue. He was of the submission that the Arbitrator erred in fact and in law by disregarding exhibit "R9" (the Code of Good Conduct), particularly under the clause on conflict of interests by employees which further prohibits employees from involving themselves with clients or vendors. He stated that exhibit "R9" [the Company Code of Conduct (herein the "Code")] is explicit in its legitimate expectations that its employees will not be involved with its clients or suppliers under conflict of interest which the Respondent herein clearly contravened. "R9" clearly provides: ...Employees must not use their positions, or the knowledge gained because of their positions for private or personal advantage. Regardless of the circumstances, if employees' sense that a course of action they have pursued, or are presently pursuing, or are contemplating pursuing may involve them in a conflict of interest with their employer, they should immediately communicate all the facts to their supervisor... Counsel Mafuru added that the Respondent signed the Code. He knew the provisions of the Code and the Consequences of breach thereof yet acted in complete violation of the Code. He questioned on the following: First, the undisclosed interest of the Respondent to be involved with payment of Vendor's employees. Two, discussing budget deficit with the Vendor and agreeing with Vendor to underpay Vendor's dancers. Three, using his own money to pay dancers who were employees of the vendor. Four, being involved deeply in the internal affairs of the Vendor yet failed to report or inform the Applicant. The Applicant therefore implored this Court to invoke the test of a reasonable man to find fault in such gross conduct. That, the conduct of the Respondent in engaging directly with vendor's internal affairs is clear existence of conflict of interest which is strictly forbidden under employer's code of conduct and warrantee termination in the meaning of the Code and under the Employment and Labour Relations Act (herein ELRA). In clarifying the meaning of conflict of interest, he referred to Osborn's Concise Law Dictionary, Eleventh Edition, 2011, p. 105 which was cited with approval in the case of Sylvia Marita Barner v. Ahmed Zahran Said, Civil Appeal No 144 of 2024, Court of Appeal of Tanzania at Zanzibar (unreported) as: A situation when someone such as a lawyer or public official has a competing professional or personal obligation or personal financial interests that would make it difficult to fulfill his duties fairly. Counsel Mafuru was of submission that the Respondent by being deeply involved in the vendor's affairs to the extent of being able to discuss the underpayment of the vendor's employee and making such payment from his pocket without the employer's knowledge, implies that the Respondent's personal financial interest in the vendor's affairs, an act which defeats the Applicant's business and relationship with the vendor. Thus, the Respondent's termination followed event after such commission of gross misconduct. On that basis, Counsel Mafuru was of the view that a man cannot benefit from his own wrong. In reply, to the Second ground, Counsel Mtunzi submitted that the purported "Conflict of interest" as asserted by the Applicant in this revision, is a new misconduct of which the Respondent was not charged with during disciplinary hearing. He referred to R3(notice of hearing), R4(hearing form) and R7 (termination letter). Thus, the Applicant's averment is baseless with intent to mislead this Court. He said that it's 4 crystal clear from the CMA Award, page 40, 12th line from the bottom and last paragraph of page 42 together with the first two lines of page 43 that the trial Arbitrator considered Exhibit R9. According to Counsel Mtunzi, it was the trial Arbitrator's finding that the offence of which the Respondent was charged with, was not clear in the said R9. Thus, if one takes a deep look on Exhibit R3(notice of hearing), R4(hearing form) and R7 (termination letter), it cannot not be gainsaid that the Respondent was charged for misconduct by acting contrary to the Applicant's code of conduct; firstly, by dealing with service; provider contrary to company expectations for personal financial gain and secondly, involved in direct paying service provider employee and paid them less. He stated that the above words are what calls for the attention of this Court. That, Rule 12(l)(a)(b) o fthe Employment and Labour Relations (Code o f God Practice), Rules 2007clearly mandates the employer before terminating employee to consider whether the employee contravened rule of standard and if the said rule is clear and unambiguous, which in this case is exhibit R9. Mr. Mtunzi added that the meaning of personal gain has not been defined in exhibit R9, however, from general meaning, it means income or monetary profit arising from a certain transaction or conduct. It is 5 evident from the records of the CMA and testimonies from all Applicant's witnesses (DW1, DW2, DW3 and DW4) that none of them testified how much did the Respondent herein gain financially from the project as asserted by the Applicant. It is again no where in the exhibit R9 shown to prohibit the Respondent from assisting service provider by paying his employees in the instructed manner. Again, on the issue of conflict of interest, it was Counsel Mtunzi submission that by assisting the vendor, the Respondent was performing his duties by ensuring smooth execution of all marketing activities as noticed in No.2 (1) of Exhibit RIO. Thus, the Applicant ought to have revealed the purported interest of the Respondent in assisting the vendor. By mentioning "undisclosed interest" reveals ambiguity which cannot prove violation of Exhibit R9 by the Respondent. It is a trite law that he who allege must prove as per Section 110(1) and (2) o f the Evidence Act [Cap 6 Revised Edition o f2019] case of Wolfgango Dourado v. Tito Da Costa, ZNZ, Civil Appeal No. 102 of 2002. Counsel Mtunzi was of reply submission that it is explicit clear for an employer to terminate employee must prove there was valid reason, failure to do so, renders termination unfair. He cited the case of Lucy Mandara v. Tanzania Cigarette Company Limited, Revision No 185 of 2020, High Court Labour Division at Dar es Salaam (unreported). It was the view of Counsel Mtunzi that the Applicant has vehemently failed to prove if the Respondent committed misconduct contrary to exhibit R9. Thus, even the definition of conflict of interest which was not defined in R9, as cited in the case of Sylvia Marita Barner is distinguishable from this case. The Sylivia Marita case (supra) defines an involved person being a lawyer or public official while in the instant case the Respondent is none of them. Having a disputed question regarding reason for termination, the pertinent provision regarding the reason for termination is section 37(2) o f the ELRA (supra) which provides that: A termination of employment by an employer is unfair if the employer fails to prove- a) That the reason for termination is valid; (b) That the reason is a fair reason- (i) Related to the employee's conduct, capacity or compatibility; or (ii)Based on the operational requirements ofthe employer, and (c) That the employment was terminated in accordance with a fair procedure. Further, the international and national standards requires to ensure fairness in ending or terminating employment contract. Again, Counsel Mtunzi asserted that it is a well-established principle of law that once there is a question of unfair termination, the duty to prove reasons for termination was valid and fair lies on the employer as per section 39 o f ELRA (supra) and the case of Amina Ramadhani v. Staywell Apartment Limited, Revision No. 461 of 2016, High Court Labour Division, at Dar es Salaam as was cited by this Court in the case of Boni Mabusi v. The General Manager (T) Cigarate Co. Ltd, Consolidated Revision No. 418 and 619 of 2019 at page 14 of the Award. I have dutifully considered the arguments of both parties in line with the records before the CMA. In resolving the question as to whether there was a valid reason, the Applicant contended that the Respondent termination was initiated with a valid reason. The reason was the Respondent's admission of working with the vendor who contracted with the Applicant, while his role was just to supervise as an employee. On other hand, the Respondent maintained that nothing was wrong for the Applicant to work with the vendor as he was requested to do so. It was further submitted that there was no valid reason for termination as the charge sheet was not clear. Having such contention in mind, I have gone through exhibit R4 (the Disciplinary Hearing Form and Exhibit R2 Respondent's written explanation). I noted with certainty that the Respondent admitted to had discharged the duties of the Vendor(supplier). Such admission was contrary to the provision of exhibit R9. In numerous cases, it has been an established principle that parties are bound by their own contract. In the case of Hotel Sultan Palace Zanzibar v. Daniel Laizer & Another, Civil. Appl. No. 104 of 2004 it was held that: It is elementary that the employer and employee have to be guided by agreed term governing employment. Otherwise, it would be a chaotic state of affairs if employees or employers were left to freely do as they like regarding the employment in issue. From the case of Hotel Sultan (supra), since the Respondent agreed to be employed by the Applicant and not as a vendor, he had a duty of consulting his employer as to whether he could assist the supplier who contracted with the Applicant or not. However, the facts are different in this application. The Respondent worked with the vendor illegally by paying less amount to the dancer contrary to the amount agreed by the Applicant and supplier(vendor). The dancer was to be paid 30,000/= per day. Since the vendor had a duty to pay dancer and the Respondent's duty was to supervise, that means, the Respondent by engaging himself not only to do payment, but by paying less as per exhibit R-l (payment voucher), automatically it defeated the interest of the employer as per exhibit R-9 (the code). This alone fall under the ambit of Rule 12(4) ofG.N No. 42 o f2<%>7basing on seriousness of the offence as it contravenes such rule and standards of the employer. On that basis, the Respondent's allegation that the offence charged with was not clear lacks merits. Therefore, the Arbitrator's findings that there was no valid and fair reason in terminating Respondent's employment holds no water. That takes the Court to consider the next ground. As regards to ground 3, Counsel Mafuru submitted that the Arbitrator erred in fact and in law by refusing to consider vivid and clear admission of the Respondent as per exhibit R4 (the Disciplinary Hearing Form) and (exhibit R2 the Respondent's written explanations admitting to discharging the duties of the Vendor). Similarly, the same was cemented by the testimony of PW2 (Vendor) who admitted delegating his duties to the Respondent without disclosing consideration thereto. Counsel Mafuru further made reference to the admission of the Respondent in his own testimony as captured in pages 33 and 34 of the Award which states: "... mimi niliomba tuwe na flat rate ya elfu 20 lakini akasema nitaambiwa ndio maana siku ya 1 tuliwalipa elfu 15 siku ya pili elfu 20. Also, page 5 of the R4 (the Disciplinary form) which the Respondent stated "...ni jukumu la (sic) service provider ila aliniomba nilipe mimi because yeye alikua haji kwenye activity". Under pages 37 paragraph 2 of the Award, the Vendor admitted "... Kwamba makubaliano yalikuwa kati yake na GSM lakini yeye ndiye alikuwa anamuomba Smart amsaidie kuwalipa." Mr. Mafuru added that exhibit R4 queries the Respondent how he paid vendor's dancers from his own pockets contrary to company procedures. Similarly, all witnesses of the Applicant, DW1, DW2, DW3 and DW4 in their testimony before CMA testified that it was against company code and policy to be involved with vendor as well as to make payment. In response to ground 3, the Respondent reiterated the submission in ground 2 and stated that the trial Arbitrator was correct, hence rendered a fair and just decision. He stated that, the clear words from page 5, last paragraph of exhibit R4 was: "Mimi niliomba tuwe na flat rate ya elfu 20, ila yeye akasema itambana kutokana na budget". Thus, such words of the Respondent indicate that he was advising the vendor in order to ensure smooth execution of marketing activities. It is clear from records that the "Duka kwa Duka" was the third project of which the Applicant involved the vendor. It was also testified by PW-1 and PW-2 that the Respondent has been supervising the vendor in previous projects of the Applicant. Basing on the fact that there was neither proof of contractual terms limits nor limit from RP on Respondent's involvement in the project, it was on the similar line of Applicant and vendor working practice whereby the Respondent did not commit a misconduct. In establishing as to; whether the Arbitrator disregarded the Respondent's admission in relation to offence, the record available including CMA Award reveals as follows: The Respondent in his own testimony as captured in pages 33 and 34 of the Award which state,"... mimi niliomba tuwe na flat rate ya elfu 20 lakini akasema nitaambiwa ndio maana siku ya 1 tuliwalipa elfu 15 siku ya pili elfu 20". Again at, page 5 of the R4 the Disciplinary form which the Respondent stated "...ni jukumu la(sic) service provider ila aliniomba nilipe mimi because yeye alikua haji kwenye activity". Pages 37 paragraph 2 of Award the Vendor admitted "... Kwamba makubaliano yalikuwa kati yake na GSM lakini yeye ndiye alikuwa anamuomba Smart amsaidie kuwalipa." The above admission supports the Applicant's allegation that there was a conflict of interest basing on nature of the employer's business. The Arbitrator ought to have considered the principle of considering evidence in making decision as expounded in the case of Anurali Ismail v. Regina 1 TLR 370 cited in Seifu Mohamed Seifu v. Zena Mohame Jaribu, Misc. Land Application No. 84 of 2021, High Court of Tanzania, at Dar es Salaam in which it was stated at pp8-9 that: A good judgement is clear, systematic, and straightforward. Every judgement should state the facts of the case, establishing each fact by reference to the particular evidence by which it is supported, and if should give sufficiently and plainly the reasons which justify the finding. If should state sufficient particulars to enable a Court of appeal to know what facts are found and how. From the above legal basis, this Court is alerted in exercising its revisional power, it must satisfy itself that every judgement should state the facts of the case, establishing each fact by reference to the particular supporting evidence. Such principle applies in this application. The evidence was properly analysed in establishing misconduct. Therefore, this grounds also warrantee revision in this matter. As per the evidence tendered, it was the duty of the Arbitrator to consider the clear admission of the Respondent through the Disciplinary Hearing Form and the Respondent's written explanations. The Respondent clearly admitted to had discharged the duties of the Vendor contrary to his contract terms. It is a further cardinal principle of law that'ex turpi causa non oritur actio' meaning no one should be allowed to take undue advantage of his own wrong to gain favourable interpretation of the law. On ground four, that the Arbitrator erred in fact and in law by holding that the Respondent had a legal obligation to summon the Vendor in the disciplinary hearing proceedings, while it is trite in law that matters concerning conflict of interest and rule against bias are construed in strict and prohibitor manner. Counsel Mafuru had two points: Firstly, that it was already an undisputed fact that the Respondent and Service Provider were involved with each other's business contrary to the Code of Conduct. He stated that the Respondent admitted in R2. Secondly, cases of conflict of interest need not strictly proof of evidence rather it is premised on test of reasonable man whether there is likelihood of conflict of interest. It was further asserted that; the Arbitrator erred in fact and in law by failing to draw negative inference against the Complainant/Respondent's witnesses (PW1) and the PW2 whose testimonies were both tainted with contradictions and inconsistencies throughout their testimonies. Counsel Mafuru pointed that the Arbitrator deliberately failed to take notice of inconsistencies in testimony of PW1 and PW2. PW1 (the Respondent), stated he was the supervisor of activation as per R2. Yet, he did not attend the activation as per page 29 of Award and R4. PW1 testified at page 32 of Award, that PW2 did not come to the activation yet he would bring him money at the activation grounds to pay his dancers. PW1 testified there was a deficit of budget as per R4 and discussed with 14 PW2 to ration the dancers pay. But during his testimony, he could not remember the amount of deficit. PW1 in R4 used his own money to pay dancers claiming to have been authorized by General Manager so that he could claim reimbursement from company. Yet, he testified before the CMA that he was refunded by the PW2. PW1 and PW2 accounted on when they realized the deficit in the market activation budget and when PW2 was reimbursed his money was contradictory. In response to ground four, Counsel Mtunzi argued that taking into account the nature of this case, the Applicant had two main a statutory and legal duties before termination: Firstly, to conduct investigation as per Rule 13(1) o f Employment and Labour Relations (Code o f Good Practice), Rules 2007, GN No.42 to ascertain whether there was misconduct, which he never did and, Secondly, to call the material witness (a vendor). The bottom-line issue calling for this Court to determine is absence of material witness during the disciplinary hearing. He averred that, it was vendor's testimony that he had a contract with the Applicant as they have been calling him whenever there is a project. In the light of the above averments, Counsel Mtunzi posed a question; why did the Applicant neither investigate the matter by involving the vendor nor summon him during disciplinary hearing? He further cited 15 the case of Hemedi Saidi v. Mohamedi Mbilu [1984] TLR 113 and Veronica Failos Massawe v. Saimon Paulo Nhumbi & Others, Land Case No. 191 of 2022, High Court of Tanzania at Dar es Salaam (unreported) p. 13 in which it was held that: Where, for undisclosed reasons, a party fails to call a material witness on his side, the Court is entitled to draw an inference that if the witnesses were called they would have given evidence contrary to the party's interests. From wording of the case of Veronica Failos Massawe (supra), Counsel Mtunzi was of the view that had the employer summoned the vendor during disciplinary hearing, it would have truly revealed vendor's duties and contractual limit on the project, failure of which rendered unfair termination of the Respondent. In the circumstances of the afore submissions on the procedural violation, it is the findings of this Court that the allegation of investigation and summons against the vendor, as contested by the Respondent, could have legal merits if the Respondent himself did not admit to the offence of engaging in payment by paying less amount. Therefore, the requirement to comply with Rule 13 o f G.N No. 42 (supra) in initiating investigation is just to afford right of hearing. In this matter, the same was established by the Respondent and supported by PW2(vendor). Therefore, investigation being conducted or not could not exempt the Respondent from liability based on his own admission. Equally, I find the fifth ground, regarding activation and shortage of fund was not an issue at CMA. It could not be tabled at this revisional stage. This principle of being bound by parties pleading has been addressed in several cases including the case of Astepro Investment Co. Ltd v. Jawinga Investment Limited, Civil Appeal No. 8 of 2015 (unreported) in which it was held that: ...parties are bound by their own pleadings...the function of the pleading is to give notice of the case to a party must therefore state his case that his opponent will not be taken by surprise. If is also to define with precision the matters on which the parties differ and the points on which they agree, thereby to identify with clarity the issues on which the Court will be called upon to adjudicate and determine the matter in dispute. The first and final ground for revision were that the Arbitrator erred in fact and in law by failing to properly evaluate the evidence presented before the CMA which subsequently resulted to this unfair Award. Mr, Mafuru called upon the Court to grant the same based on the sight of plain evidence and outright admissions of facts by the Respondent and the weighty testimonies and documentary evidence of the Applicant himself. Mr. Mtunzi, in reply, reiterated his submission and added that, in her very long decision of 47 pages, the Arbitrator spent almost 9 pages deeply discussing evidence and testimonies rendered by parties with the aid of authorities and case laws. Thus, the Arbitrator clearly examined and evaluated the evidence on records. As the parties contested each other as to whether the evidence was properly analysed, I find wise to borrow wisdom used in the case of Crescent Impex (T) Limited v. Mtibwa Sugar Estates Limited (Civil Appeal No.455 of 2020) in which the Court of Appeal of Tanzania at page 10 had this to say: It is aiso elementary that the standard o f proof, in civil cases, is on a balance o fprobabilities which means that the Court will sustain such evidence which is more credible than the other on a particular fact to be proved. The above principle justifies this Court by holding that the Arbitrator was not right in his findings in relation to the evidence adduced by the Applicant. The acts initiated by the Respondent against the Applicant warrantee termination for misconduct, as it was against employer's policy. In the end result, I find that the Respondent was fairly terminated from his employment. The application is therefore allowed. I hereby quash and set aside the CMA Award. I give no order as to the costs. JUDGE 22/11/2024 Judgement pronounced and dated 22nd November, 2024 in the presence of learned Counsel Rabin Mafuru Muyenjwa for the Applicant and the Respondent in person. 22/11/2024