Lipton Teas vs Abdallah

IN THE HIGH COURT OF THE UNITED REPUBLIC OF TANZANIA (IRINGA SUB REGISTRY) AT IRINGA LABOUR REVISION NO. 28529 OF 2023 (Originating from Labour Dispute No. CMA/IR/MAF/07/2022 of the Commission for Mediation and Arbitration for Iringa at Maftnga before Hon. Amos Singo, Chairperson) LIPTON TEAS & INFUSIONS TANZANIA LTD (Former/]/ known as Unilever Tea Tanzania Limited) j................ APPLICANT VERSUS ABDALLAH NASIBU HAMADI ................................................ RESPONDENT JUDGMENT 23rd May & 31st July, 2024 I.CMUGETA, J: Briefly, the respondent was employed by the applicant as Assistant Manager on 11/102012. At the time of his termination on 18th February 2022, he held the position of Agricultural Excellence Manager. Aggrieved by his termination, he filed a labour dispute to the Commission for Mediation and Arbitration (CMA) for re-instatement without loss of remuneration from the date of termination to the date of re-instatement, payment of notice period Tshs. 25,959,279, payment of accrued annual leave due by 20/2/2022 Tshs. 8,653,093 and payment for a number of days worked up to 20/2/2022. i It was the applicant's evidence at the disciplinary committee and CMA that between October, 2019 and October, 2021, the applicant's harvest in tea deteriorated. By this time, the respondent who was employed in 2012 had been promoted to the position of company Agricultural Excellence Manager. The applicant's administration felt that poor performance was due to the respondent's failure to provide correct fertilizer specification leading to a loss of over Euro 1.4 million. In his evidence the respondent did not dispute the deterioration of the harvest which he attributed reasons other than incorrect specification of fertilizer. It was alleged by the applicant that at the same period, there was improper management of harvesting fuel woods leading to over-supply beyond the storage capacities at the factories. This occasioned a loss of approximately Euro 185,000. The two issues resulted into charging the respondent with three disciplinary offences to hold him accountable. The disciplinary committee found the respondent guilty of two allegations which led to the termination of his employment. These are firstly, neglecting to provide the correct specifications of fertilizer over the last 2 years leading to procurement of fertilizer with wrong specifications that is not suitable for sustainable tea production. Secondly, failing and/or 2 neglecting to properly manage the harvesting of fuel woods leading to an over-supply of fuel wood to the factories beyond the available storage capacity. He was acquitted in the third count which I find no reason to refer to as it is not subject of this application. After considering the evidence of the parties, the CMA held that the respondent's termination was unreasonable and the procedure for his termination was unfair. It ordered his reinstatement without loss of remuneration. The respondent was also awarded his salaries from when he was terminated to December 2023 and other payments amounting to Tshs. 204,678,919/=. The applicant faults the CMA award based on the following grounds: i. The Arbitrator was unjustified in finding that the respondent's termination was without valid reasons; ii. The Arbitrator was unjustified in finding that the respondent's termination was procedurally unfair; Hi. The Arbitrator was unjustified in ordering Reinstatement without loss of remuneration and any other monies entitled from the date of termination to the date of reinstatement, and; 3 iv. The Arbitrator was incorrect in awarding payment of annual leave earned but not taken and salary up to the date of termination. At the hearing of the application, the applicant was represented by Kyariga N. Kyariga, learned advocate. The respondent enjoyed the legal service of Amos Paul, learned advocate. Was the termination of the respondent without reasons as held by the CMA? The CMA found that the reasons on which termination was based were related to poor performance of work on part of the respondent which did not amount to a misconduct. Counsel for the applicant has argued that failure to provide correct specification and to manage fuel woods are negligent acts which amounts to a misconduct. In reply, counsel for the respondent argued that since it is alleged that the respondent was reckless in performance of his job, this is a poor performance issue and not a misconduct. It is my view that poor performance relates to incapacity to perform the job while a misconduct relates to ethics. If the respondent, indeed, failed to provide proper fertilizer specification and to manage harvest of 4 fuel wood, on the face of it, this is a question of capacity. However, it is hard in all cases to draw a line between the two as poor performance can sometimes overlap into a misconduct. Therefore, whether the issue relates to poor work performance or misconduct or both, is a matter of evidence in each case. Poor performance, as submitted by counsel for the applicant can be due to negligence which is, indeed, a misconduct. Let us examine if in this case, the allegation related to poor performance or a misconduct. At page 22 of the CMA decision, the arbitrator acknowledged the nature of the allegation as reflected in the notice to show cause (exhibit RE8). It partly reads: "... you have failed and/or neglected to carry out your responsibilities diligently..." By the word "neglected", in my view, the allegation was intended to address a misconduct which if proved leads to outright dismissal. According to Paulina Mosha, it is upon the Agriculture Excellence Manager to conduct soil analysis to determine nutrients deficiency in the soil in order to recommend the application of a fertilizer type that can replace the deficient nutrients. It is undisputed that the respondent was the Agriculture Excellence Manager. 5 Paulina testified further that the respondent pushed for purchase of fertilizer NPK25:5:15 while the discussion on its suitability was still ongoing and without a proper soil analysis report. She also testified, which testimony is supported by exhibits RE 20 and RE21, that the applicant used to apply fertilizer NPK25:5:10 as standard fertilizer until when the respondent recommended NPK25:5:15 which, upon application, led to lower yields of tea in the applicant's and out growers' fields. That, the respondent did this despite the caution raised by Gabriel Tuwei, the expert from of the Research and Development department of the applicant (Kenya). In response, the respondent testified that NPK25:5:15 was the right fertilizer which was approved for use by the company in a meeting held on 2/4/2019 before he became excellence agricultural officer (page 36 - 37 of the typed CMA proceedings). However, the minutes of that meeting is not part of the evidence on record. Under section 100 of the Evidence Act [Cap. 6 R.E 2002], oral evidence of the fact which ought to be reduced into writing is inadmissible. Existence of a meeting and its resolution is proved by minutes of the meeting. In a situation where the respondent alleged it was not his sole responsibility to provide the right fertilizer for use in the applicant plantations minutes of the team responsible for the approval 6 must be tendered to prove that fact. The foregoing notwithstanding, assuming, without concluding, that, indeed, the meeting approved the dispute fertilizer and, indeed, the respondent had not assumed the post of agricultural excellence officer, the decision is limited to the 2019/2020 fertilization year. I so hold because in 2020 there was another discussion on which fertilizer to apply as reflected in correspondences in exhibit RE In his evidence the respondent stated that he assumed the agricultural excellence Manager post in October 2019. This means the identification of the suitable fertilizer process for the year 2020/2021 was in his full control and he played a pivotal role in the choice of fertilizer as reflected in emails in exhibit RE20. Some of the correspondences supports the testimony of Paulina Mosha: that the respondent pushed for the purchase of the dispute fertilizer without basing the decision on soil analysis results contrary to the established practice that the choice of fertilizer ought to be supported by laboratory soil test results. This, in my view, amounts to acting negligently. It is not a poor performance issue which presupposes lack of skill. The respondent did not plead lack of skills in his evidence. 7 However, I agree with the evidence of the respondent that lower yields might have resulted from a combination of factors including reduced fertilizer and irrigation. Notwithstanding, those additional factors do not negate the fact that by exercising the powers under his docket he recommended the use of fertilizer without support of soil analysis report on its suitability. In the notice to show cause it was stated to him that he was in-charge of tea agronomy including fertilization and he never disputed it in his reply nor he did in his evidence. Therefore, if he failed to provide the right specification of fertilizer by neglecting to observe the prescribed methods, that amounts to negligence not poor performance issue, hence, a misconduct. What about the over harvesting of fuel woods? The evidence at the disciplinary hearing is clear that the over-harvesting of fuel wood happened in 2017 when the respondent had not assumed the role of Agricultural Excellence Manager. However, the applicant through Collins Bett tried to prove at the disciplinary hearing that the respondent continued to approve further harvest of fuel wood after he assumed the role of agriculture excellence manager and the piles of fuel wood stocks remained exposed to unfavourable weather to the extent of 10,800 metric tons becoming 8 obsolete. If this is true, the act amounts to both poor work performance and negligence. In his reply to the notice to show cause (RE9) to the disciplinary hearing proceedings, the respondent stated that the 10,800 metric tons of fuel woods were harvested when he had not assumed the post of agriculture excellence manager. I find this statement to be true. Further, he said when he assumed office, he found limited storage capacity and tabled a request for additional capex. That he went ahead to advise the management to reduce the fuel wood stock under the boiler consumption initiative and, consequently, the storage was cut from 18 to 14 months stock and after that no fresh harvest was left in the fields or exposed outside the sheds. In his evidence at the disciplinary hearing, Mr. Collins Bett stated that despite having a huge stock from the 2017 harvest, the respondent went ahead to approve further fuelwood to be harvested. However, Mr. Collins did not state the amount of fuel wood harvested by the respondent's approval which leaves the allegation against him unproved. The case report which is exhibit RE21 to the disciplinary hearing supports the respondent that there was no further harvesting during his tenure. At page 9 15 it refers to the same stock of 10,800 metric tons harvested in 2017. If the problem was storage capacity after excessive harvest, this cannot be blamed on the respondent. The charge on over harvesting of fuel woods was, therefore, not proved. Consequently, in terms of the first complaint, I hold, there was reasonable grounds for termination as far as failure to supply the right fertilizer is concerned. The over harvesting of fuel woods was not the respondents problem. Was the termination procedurally fair which is the second ground of complaint? The CMA found that it was unfair for several reasons. One is that the allegation against the respondent did not state the rule which he breached for failure to provide the right specification of fertilizer. The learned arbitrator cited rule 12(1) of the Employment and Labour Relations (Code of Good Practice) Rules G.N No. 42 of 2007. Rule 12(l)(a) states that in deciding if the termination for a misconduct was unfair it is important to consider whether or not an employee contravened a rule or standard regulating conduct relating to employment. io The said rule has two disjunctive parts. Firstly, breach of a rule and secondly, standard regulating conducts. The learned arbitrator missed the second part. In evidence through Paulina Mosha, the applicant proved that the standard practice for recommending a new fertilizer involves observing soil analysis results which establishes the nutrients deficiency in the soil that would be replaced by the fertilizer to be applied. There is undisputed evidence by the applicant through Paulina that the decision by the respondent to push for the application of NPK25:10:15 for the year 2020/2021 was not based on laboratory soil analysis results. The learned arbitrator erred to hold that no rule was cited as contravened by the respondent. He contravened the established standards of conduct to rely on science when deciding the right fertilizer. According to the CMA decision, other aspects of procedural unfairness are found in the respondent being denied the right to cross examine some witnesses, not being involved in the investigation process and being denied the right to mitigate after being found guilty. It is settled that in the disciplinary hearing, cross examination of witnesses and the right to mitigate where the hearing results in the employee being found guilty are fundamental matters the breach of which 11 vitiates the proceedings or the decision as the case may be. The disciplinary proceedings show that the respondent was afforded the opportunity to cross examine Collin Bett but that opportunity is not reflected in the proceedings in relation to the testimony of Gabriel Tuei. Denying any party to the case the right to cross examine a witness is a procedural irregularity. Regarding the mitigation, it neither appears in the proceedings after conviction nor in the chairman's decision. The two irregularity vitiated the disciplinary proceedings and the decision. The finding that the respondent was not interviewed during the investigation is unjustified because, as argued by counsel for the applicant, the interview was done in writing through his response to the notice to show cause. According to the record in this case, no witness from both sides was orally interviewed during investigation stage. Therefore, the unfairness of the procedure is limited to the denial of the right to cross examine the witness and the right to mitigate after being found guilty. The remaining two grounds of complaint covers the remedies awarded. 12 The CMA ordered re-instatement of the respondent which constitutes the third complaint. Indeed, no reason was provided for this order as argued by counsel for the applicant. He submitted that re-instatement in this case shall lead to intolerable employment relationship between the parties. Further, the learned counsel argued, the post of the respondent has already been filled in by another person who testified as Paulina Mosha. He prayed that in case the court finds that the termination was unreasonable or procedurally unfair, it should order compensation. I agree with him. The evidence on record shows that the applicant attempted mutual separation with the respondent which, upon failure, resulted into disciplinary proceedings. This history and the vacancy having been filled in does not support issuance of orders for re-instatement or re­ engagement. In lieu thereof, I order compensation taking into account all the benefits already paid to the respondent as entitlement upon the illegal termination for procedural unfairness. Regarding the fourth complaint, I agree with the applicant that orders for payment of annual leave are unjustified. There is no evidence that the respondent had pending full unpaid accrued annual leave in his leave rotation which runs from his date of engagement on 11/10/2012. 13 Since he was terminated on 20/2/2022, as argued by the counsel for the applicant, he cannot be entitled to full leave pay as he had not completed the leave circle. His entitlement in that regard is limited to months worked. The argument by counsel for the respondent that the computation ought to be based on the date of the promotion to the agricultural excellence manager office is misconceived. Promotion date is not engagement date. Even if it is, that date was not proved in evidence. In conclusion, I agree the applicant had good reason to terminate on ground of failure to provide right fertilizer specification but the process was procedurally unfair. However, he cannot be reinstated for reasons that his position has been filled up by another person and the working environment between the parties would be intolerable. In lieu thereof, I order payment of 12 months salary to the respondent as compensation for the procedural unfairness during termination. The respondent shall also be paid salary and leave for days worked up to the date of termination if the same are not yet paid. The application is allowed to the stated limited extent. No orders as to costs. 14 I.C. Mugeta JUDGE 31/7/2024 Court: Judgment delivered virtually in the presence of Kyariga N. Kyariga, advocate for the applicant, Amos Paul, advocate for the respondent and the respondent in person. Sgd. B.T. Maziku DEPUTY REGISTRAR 31/7/2024 35