LABOUR REVISION APPLICATION NO

IN THE HIGH COURT OF THE UNITED REPUBLIC OF TANZANIA LABOUR DIVISION AT ARUSHA LABOUR REVISION APPLICATION NO. 25 OF 2023 (Originating from Labour Dispute No. CMA/ARS/ARB/119/22/03/23) KULWANT SINGH PANWAR.................................................. APPLICANT VERSUS ORBIRT MULT SPECIALIST HOSPITAL (T) LT D ......................RESPONDENT JUDGMENT 08/05/2024 & 05/06/2024 NDUMBARO, J Aggrieved by the decision of the Commission for Mediation and Arbitration (CMA), the applicant has filed this application challenging the Award of the Commission and made the following prayers that; 1. This honourable Court be pleased to call for a record of the proceedings in the Commission for Mediation and Arbitration in the labour dispute No. CMA/ARS/ARS/119/22/03/22/23 between Kulwant Singh Panwar and Orbirt Mult Specialist (T) LTD revise and set aside the whole of the award of the Commission for Mediation and Arbitration dated 19 April 2023 delivered by Hon Lomayan Stephano. 2. An order be made that the applicant's resignation was caused by intolerable working conditions in place of employment caused by the respondent. 3. The applicant's resignation was in law a constructive termination and the applicant is entitled to the relief played in the Commission for Mediation and Arbitration as he was constructively terminated by the respondent. 4. Any other relief as the Court shall see and find it fit to grant. First, let's navigate into the facts of this matter. The applicant and the respondent entered into an employment relationship on 26th November 2019 where the applicant herein was employed in the position of Executive Director. According to the applicant's complaint, his employment was constructively terminated by the respondent on 22nd August 2021 for the reason that he was not paid his salary by the respondent. The applicant went on to state that, until the time his employment was terminated, the respondent had not paid the applicant his salary for the entire period of employment from November 2019 to August 2021. He termination and thereafter filed a complaint to the Commission for Mediation and Arbitration (CMA) claiming constructive termination and payment of USD 54, 000.00 equivalent to TZS 12,400,000 as salary arrears and daily substance allowance of 100,000 per day from October 2019 to August 2021. Repatriation costs to tune TZS 800,000 and unfair termination TZS 316,250,000. The said claim was denied by the CMA due to the reasons that, the applicant was employed as CEO from November 2019 to August 2021 he cannot claim that he was not paid salary while he was the accounting officer responsible for the payment of salaries for all employees. On the reason for termination, the Commission was of the finding that, termination of the applicant's employment was not contractively as the applicant did not prove intolerable condition made by respondent. Further, hold that, the applicant resigns on his personal interest after opening a similar business with that of his employer which leads to a conflict of interest hence misconduct, Maliciously and deliberately causing the applicant to resign. Nevertheless, the Commission went on dismissing the application. The parties chose to dispose of the matter by way of written submission. The applicant enjoyed the service of advocate Wilson Ezekiel and the respondent was represented by Daudi Haraka. The applicant lodged his written submission and pray an affidavit sown by applicant counsel Mr. Wilson Ezekiel form part of the 3 submission. In his affidavit, the applicant briefly narrated his case that he was employed by the respondent in the position of executive director from 15 November 2019 to 22nd July 2021 whereby he resigned due to unavoidable circumstances at work, that he was not paid a salary more than a year. The applicant filed a complaint to CMA thereafter claiming constructive termination and claiming among others payment of USD 54, 000.00 equivalent to TZS 12,400,000 as salary arrears; USD 137,500 compensation for unfair termination; TZS 800,000 as repatriation costs and USD 2000 payment in lieu of notice. The claim was heard in merit by the Commission for Mediation and Arbitration denied the claim. Dissatisfied with CMA decision hence this application before this court. The applicant raised two issues as whether the arbitrator was right in holding that there was no intolerable working condition caused by the respondent thus constructive termination and whether the arbitrator was right in denying the applicant payment of salary arrears, repatriation costs notice and compensation for unfair termination. Submitting on the first raised issue, Mr Wilson Ezekiel faulted the commission for holding that there was no constructive termination on nonpayment of salary for the entire period of his employment, argued nonpayment of salary is the good reason which may lead to constructive termination, in support of his argument cited a case of Edna Mduba and Upendo Kisite Vs Rainbow Colors Paints Labour Revision No. 79 of 2022 unreported. That Non-payment o f salary amounts to an intolerable condition created by the respondent Define nonpayment as per section 36(a)(ii) of the Employment and Labour Relations Act Cap 366 RE 2019. Faulted that, the applicant was not paid a salary for two years from November 2019 to August 2021 the period during which the applicant worked for the respondent herein. Faulted further that, the resignation letter shows the applicant resigned due to unavoidable circumstances and health matters it cannot be said it does not disclose the reasons. The reasons were also disclosed during examination in chief to be unavoidable circumstances among others was nonpayment of salary. Claiming that the reasons were not considered by the Hon Arbitrator hence reached into the unjustifiable decision. In support of the argument cited a case of Jackson Christopher Mosha Vs Poltan African LTD Labour Revision No. 48 of 2021, unreported that the applicant had not received his salary for ten consecutive months, the court held that CMA ought to have concluded that, the applicant was subjected to the intolerable working condition that forces him to resign. The claim that the applicant took a loan on behalf of the respondent for his own benefit, from the face of the record the respondent is the one who took the loan and not the applicant. Therefore, the claimed misconduct is on the part of the respondent. The applicant faulted that the evidence was not evaluated on the claimed misconduct and on the effect that nonpayment of salary for two years warrants constructive termination. On the second ground Mr Wilson submitted that since the arbitrator was wrong in denying the relief prayed before him for unpaid salaries of nearly two years, for repatriation costs as the applicant was recruited from Delhi India and claimed unfair termination, if the Commission took into consideration all these facts, he would have not arrived in such a decision. Therefore, pray this court to reevaluate the evidence. Responding to the above submission, advocate Daudi Haraka argued the applicant was employed by the respondent as executive director on 26th November 2019, and he voluntarily resigned. The applicant was the accounting officer responsible for paying salary to another employee and himself. He was in charge of the affairs of the respondent and headed the management team, he was the decision-maker of the respondent. The applicant voluntarily departed from employment by tendering a resignation letter on 22nd July 2021. Faulted that applicant conducted grievous misconduct by abusing the position and jeopardising future sustainability of respondent, to avoid a claim of misconduct from the respondent, tender resignation on health grounds. On the first ground, no evidence from the record has been shown to support the claim that the resignation was due to non-payment of salary for the entire period of employment. The reasons shown were unavoidable circumstances at the workplace and health matters. In cross-examination page 3 of CMA proceedings the applicant witnessed being employed by the respondent in the position of Executive Director, before his employment with the respondent he was employed by NSK Hospital Arusha, he is one of the shareholders in the respondent company, used to attend the Board meetings, he was a signatory of respondent NMB account which is used for payment of salaries to the employee and admitted to have own a newly established company performing similar work with that of his employer with a name of Kush Polyclinic. Further faulted that he uses his position as Executive Director to offer a loan from his own instituted company to the respondent company for his own benefits claiming that he is sustaining the respondent company. The resignation was not constructive termination but rather a voluntary resignation. He added that the applicant misconducted himself, abused his position, and entered into a conflict of interest with the respondent's business. When the respondent noted the situation while in the process of intervening in the misconduct, the applicant tendered a resignation letter on health grounds, the fact never disputed in CMA. Argued the cited case on nonpayment of salary is irrelevant, each case is decided on its own fact. In this case, there was a conflict of interest and a CMA award was issued based on that. The applicant cannot deny owning Kush Group Company while there is ample evidence on record. The counsel maintained that the Commission was correct to find that there was no constructive termination on the basis that the applicant failed to prove the constructive termination. The decision of the arbitrator based on the credibility witness and exhibit tendered, adhered to the procedure and law. The dismissal by the Commission is justifiable on the reason that he failed to prove that there was constructive termination and that his termination was unfair. Mr Daudi also went further to submit that Rule 32 (1) of the Labour Institutions (Mediation and Arbitration Guidelines) G.N No. 67/2007 8 provides for remedies available upon unfair termination. The counsel was of the view that in awarding compensation, the arbitrator must exercise his discretion based on the factors mentioned under rule 32 (5) (a-f) of G.N No. 67 of 2007. Thus, it was his stand that the applicant's claim of 52 months' salaries is unjustifiable and it aims at enriching himself with benefits he is not entitled with. Therefore, the Commission was right to rule that the respondent on the balance of probability proved the applicant was not entitled to what he prayed before the Commission. In his short rejoinder, the applicant basically reiterated what he stated in his submission in chief. Further stated that the loan acquired was not for his own benefit the loan was from Kush International Polyclinic to Orbit Mult Specialist. The applicant's resignation was due to health matters and unavoidable circumstances at the workplace among other nonpayment of salary by the respondent and pressure from the supplier, cited the case of Crescent Implex (T)LTD Vs Mtibwa Sugar Estate Limited Civil Appeal No. 455 of 2020 (Tanzilii) the respondent out to prove he paid salary to the applicant. That burden of proof is upon the parties who deny, and pray the application be granted. After reading the application and parties' submissions together with the record from the CMA the main issue to be determined by this court is whether the applicant herein was constructively terminated. In trying to disprove constructive termination, the respondent raised the issue of misconduct by the applicant, that he opened a business similar to that of the respondent and created a conflict of interest. However, the evidence from the record is insufficient to prove misconduct, as an institution taking a loan needs the approval of the Board, if no approval was made by the Board Meeting the respondent would raise the said misconduct. However, no evidence was tendered by the respondent, and the court records nothing therein on non-approval of the said loan was shown. Going back to unfair termination, under the law, the term unfair termination includes constructive termination. That term refers to "a termination by an employee because the employer has made continued employment intolerable for the employee." In plain language, an employee resigns because the employer's behaviour or treatment of the employee is so unreasonable as to make the employment relationship unworkable. That is the import of Section 36 (a) (ii) of the Employment and Labour Relations Act, Cap 366 R.E 10 2019 read together with Rule 7 (1) to (3) of the Employment and Labour Relations (Code of Good Practice) Rules GN 42/2007. Constructive termination occurs when an employee terminates the employment or agrees to termination, but this termination or agreement was prompted or caused by the employer's conduct. The fact that the employee was caused to terminate his employment as a result of an employer's actions means that the termination was at the initiative of the employer. See the decision of this court in the case of Girango Security Group v. Rajabu Masudi Nzige, Labour Revision No. 164 of 2013, at Dar es Salaam where Mipawa, J (retired) where it was held as follows; "In my view what constitutes employment intolerable may depend on the facts of each case and circumstances. However, what the above-quoted case of Pretoria I Society for the case of the retarded Vs. Loots seem to suggest, [which is the clear interpretation of what may make an "employment intolerable" in my opinion] that the enquiry by the court on what makes employment intolerable is two folds: - 1. Firstly, the employee must establish that there was no voluntary intention by the employee to li resign - the employer must have caused the resignation. 2. Secondly, the court must look at the employer's conduct as a whole and determine whether its effect, judged reasonable and sensibly is such that the employee cannot be expected to put up with i t " In the instant case, I think the major issue to be determined by this court is whether the applicant was constructively terminated and if the answer is in the affirmative, to what relief is the applicant entitled to. It is an undisputed fact that the applicant and the respondent were in an employment relationship which came to an end on 22nd August 2021. That he was employed as executive director and accounting officer of the respondent company, attending the board meetings and being responsible for paying salaries to employees. Nevertheless, what this Court finds to be at issue is whether the applicant herein was forced to resign from his work due to intolerable working conditions created by the respondent which is nonpayment of salary for the entire period of employment; and whether no salary was paid to the applicant for entire period of his employment. 12 The above-cited case of Girango Security Group we are reminded that what constitutes employment intolerable may depend on the facts of each case and circumstances. However, there are standards set to determine what the intolerable conditions are; first; that the employee had no any intention to resign from his work and that it is the employer who caused his resignation. Secondly; the conduct of the employer must be looked at in a way that the employee could not put up with such conduct. I am also subscribed to the decision of the Court of Appeal of Tanzania in the case of Kobil Tanzania Limited vs Fabrice Ezaovi (Civil Appeal 134 of 2017) [2021] TZCA 477 (16 September 2021). In this case, the Court posed some questions to be considered while determining whether the employee was constructively terminated, the following are the questions; 1. Did the employee intend to bring the employment relationship to an end? 2. Had the working relationship become so unbearable objectively speaking that the employee could not fulfil his obligation to work? 3. Did the employer create an intolerable situation? 13 4. Was the intolerable situation likely to continue fora period thatjustified termination o f the relationship by the employee? 5. Was the termination o f the employment contract the only reasonable option open to the employee?" Guided by the above decisions together with the facts of this case, I am not convinced that the respondent's working relationship became so unbearable that the employee could not fulfil his obligation to workov respondent created an intolerable situation for the applicant which forced him to resign from his employment for the following reasons; One, from the evidence tendered at the Commission, it is not disputed fact from both parties that, the applicant tender resignation letter due to the reasons that health issues and unavoidable circumstances. The applicant explained in his rejoinder that, unavoidable circumstances include nonpayment of salary. It should be remembered that the applicant never disputed that was employed as chief executive officer, he was an accounting officer among other duties he was responsible for the payment of salary to all employees, and used to attend Board of Directors meetings in the respondent company. 14 In cross-examination, he testified that he provided a loan to the respondent yet did not pay himself a salary. It is my view that, human being in nature is selfish, can't think o f another stomach while his stomach is empty unless he is an angel. Despite this fact, the applicant did not show that the claim of nonpayment of salary was communicated to the respondent before termination. The claims were raised after termination. We expect the said claims of salary for the entire period of his employment to be communicated before termination to the employer or the Board Meeting if the employer did not take any initiatives. However, no evidence shows that the matter was raised to the employer or Board meeting considering that the applicant was a member of the employer's Board Meeting. The reasons claimed to be constructive termination were not communicated before resignation, it was communicated on the date of resignation that health issues and unavoidable circumstances. The term unavoidable circumstances were explained in CMA cross-examination and claimed to be nonpayment of salary. In that regard, it is my firm 15 view that the claim of nonpayment of salary for the entire period of employment has no merit hence no intolerable situation was caused by the respondent herein. The above said, this court is fully satisfied that constructive termination was not proved and therefore the applicant here was not forced to resign from his work. Therefore, the Commission was correct to hold that there was no constructive termination by the respondent. On the issue of nonpayment of salary considering that he was the Chief executive officer responsible for paying employee salary he cannot claim that he was not paid salary, all mandates on payment of salaries were in his hand. As in common sense CEO entrusted to hire, pay of salary and fire another employee. If he finds any challenge in paying himself salary he ought to bring the matter to the Board Meeting. However, no evidence shows that the matter was reported to the Board Meeting. Therefore cannot claim payment of his salary after his resignation. Following the above finding of this court, the applicant is thus not entitled to the benefits from the constructive termination as to salary and all other claimed benefits. Since the applicant was the one 16 responsible for payment of salary on the affairs of the respondent company, and since did not prove that he asked for unpaid salary to the employer who is the Board before rendering a resignation letter. This court is of the view that he cannot claim to have not paid a salary for the entire period of employment as constructive termination was not proved. As alluded to above, it is the holding of this court that this application is without merit and is consequently dismissed. No order as to costs is issued. It is so ordered 17