20050531 TZHC Dr es Salaam

...•.,. ,· : · .·. •. , IN.THE HIGH COURT OF TANZANIA: .. . .i . '·~;~h ,.• -.. ~. .. . . AT DAffES SALAAM. CIVIL CASE NO. ·253 OF 2001 MATHIAS NDYUKI ,.. & 15 OTHERS ........ PLAINTIFF VERSUS . ,.. . . . -~ : ;'"". THE ATTORNEY GENERAL ..... ....... DEFENDANT JUDGMENT MASSATI, l.: The· plaintiff and 15 others thought that the'.y could no longer"· . ( _,.... keep their grievances to their chests. They/decided to take therri.to the temple of justice. But before they did that they sent demand notices and statutory notice to sue to those whqm they believed were behind their plights. That done, they sought a·nd obtained leave of the court for the plaintiff now on record to institute a representative suit on behalf of the others. After these preliminaries they filed their suit on 31/7/2001 in forma pauperis. Then on 16/10/2001 they filed an amended plaint. ,t •• • . ',, l ~ I ' I I '•· I ------ I·- I J ·- ' • ,, The Plaintiffs claim is for the sum of shs.135,738,463/- being "the balance of their terminal benefits which have not been paid to them." This claim did not change even in their other amended plaint which they filed on 19/11/2001. The Defendant resists the claim because he believes that "what was paid to the plaintiffs was proper and in accordance with the laws and the employment terms and conditions" No amount of persuation could detract the parties from their respective positions, and so mediation was recorded unsuccessful. Therefore the suit had to go for full trial. The trial was in the able hands of Mr. Kambo learned counsel for the plaintiff's and Mr Ngwembe learned state attorney for the Defendant. After some haggling, the court framed the following issues for trial: 1. Whether the plaintiffs were entitled to terminal benefits at the rate of wages obtaining from 1/5/96? ii. Whether the plaintiffs were paid their terminal benefits promptly? iii. What is the effect of the Presidential approval of release of the plaintiffs in 1996? iv. To what reliefs are the parties entitled? 2 • In the next paragraphs, I will examine the evidence on record, and the submissions of the parties on each of the issues; and give my own opinion thereon. On the first issue, the plaintiffs' case as put by their representative MATHIAS NDYUKI who testified as PW 1 is that he - and othefs were-employed by URAFIKL TEXTILl:S _MI~t-S ~TQ~_ fr9_m 1967 to 1997 when employment for all factory employees ceased. Their letters of termination were dated 21/3/97. They were paid one month's salary in lieu of notice, gratuity, severance allowance, fare and luggage transportation costs for themselves and their families to their domiciles. He said however, these payments were not paid promptly. Eight of them, including PW 1, were paid on 12/12/97. Others were paid in March 1998. Yet others were paid on 17/2/99. PW 1 went on to testify that in 1995 their salaries were shs.17,500/- per month, but they were forced to go on leave without pay since February 1995. He said in 1996, the minimum wages shot up to shs.31,500/-, but in computing their terminal benefits, the defendants used the 1995 minimum wages scale. This is what led to the underpayment of their terminal benefits. On this issue, OW 1 ALOYCE DAMIAN CHUWA, testified that out of 2779 total employees of the factory, 2279 were sent on compulsory leave in two groups; on 10/4/95 and 16/1/95 3 respectively. 450 workers remained mainly in the administration department as the factory was closed. He said the company arranged for the transportation of the workers and their families to their places of domicile. However on 31/3/97, the company was wound up vide GN 82/97 published on 21.3.97, following which all the employees had to be terminated. He said that according to the Government Notice, all liabilities and assets of the factory were transferred to the government and by that time, the employees were still on compulsory leave. He said in terminating the employees the company was bound by the terms of the Voluntary Agreement exhibited in General Notice No.438 of 1991. That gazette was exhibited in Court as Exh. D2. He said although the Voluntary Agreement was initially valid for only 24 months; there was a provision that it would still remain in force unless any party had expressed any intention to renew the same or make another. So in 1997 that agreement was still in force. He said when the plaintiffs went on leave the minimum wage was shs.10,500/= per month which changed to shs. 17,500/= on 1/5/96. He said although the ex employees were paid in phases all of them were eventually paid their terminal benefits according to the Voluntary Agreement, although they had to increase the transport rates since the prevailing ones were too low. He penned off by saying there were no cases of underpayments. 4 On the basis of this evidence Mr Kambo, learned counsel for the plaintiffs submitted that the statutory minimum wage in March 1997, was shs.31500/= per month, but the scale used in computing the plaintiffs' terminal benefits was shs.17,500/= per month. The case of SHIPPING LINE LTD v R (1976) LRT. 61 was cited in aid of the plaintiffs' case. For the defendant Mr Ngwembe, learned state attorney submitted that according to OW 1 the salary scale in 1996 was 17,500/=, but the Board _of Directors of FJM cha_nge-9 this toshs.32,965/= when the workers were on leave. He submitted however the new scale was used in calculating the final benefits. From the submissions of counsel, this issue may be subdivided into three. The first sub issue is what is the rate of salary scale that ought to have been used in paying/calculating the plaintiffs terminal benefits? Two, what salary scale was in fact used in computing the terminal benefits? And the third one is, depending on the findings on the two sub issues above, whether or not the plaintiffs were underpaid? , It is the evidence of OW 1 that although the plaintiffs were sent on compulsory leave, they were officially terminated following the dissolution of the Friendship Textile Mill by GN 82/97. It was also his evidence that all the employees were officially terminated on 21/3/97. That this is so is also established by PW 1, MATHIAS NDYUKI. Since terminal benefits, can only be paid on termination I 5 , . would conclude that the terminal benefits of the plaintiffs ought to be calculated on the basis of the salary scales prevailing at the date of termination, i.e on 21/3/97. The next question is what was the rate of the minimum wage on 21/3/97? According to PW 1 the minimum wage in 1995 was shs.17,500/= but this was increased to 31,500/= p.m. in 1996. But DW 1 said in .1995 the minimum wage was _10,500/--=,_ and was increased to 17,500/= per month on 1/5/96. In his submission; Mr Ngwembe submitted that the plaintiffs were paid according to the salary scale of 32,965. According to Exh .. P4 it is indeed true that PW 1 and RAPHAEL CHACHA (the 2nd Plaintiff) was paid shs.32,965/= in lieu of notice each. But according to PW 1 the salaries were adjusted according to what each plaintiff was getting at the date of the coming into effect of the new minimum wage. Mr Ngwembe has submitted that according to Government Circular No. 1 of 1994 the Board of Directors of parastatals had powers to effect changes in salary scales, as they did in Friendship Textile Mill; and so it was free to fix its own salaries. However as Mr Kambo, has rightly submitted the Board may have had powers to fix salary scales, but certainly to go upwards and not below the minimum wages. But if this was also true, and the Board had fixed the minimum of shs. 32,965/= then all plaintiffs would have been laid off under that salary scale. However as will be shown below, this was not the case. But whatever was the minimum wages in 1995 or 1996, it was wrong to use 1995/96 salary 6 0 scales iri computing the plaintiffs' terminal benefits. This is, because the plaintiffs were officially terminated in March 1997. For the reasons that will be clear shortly, I believe what PW 1 has testified on; that the salary scale of 31,500/= became effective in July 1996, and was in fore in March 1997. So on a balance of probabilities I find it as a fact that the salary scale obtaining in March 1997 when the plaintiffs were terminated, was that of 31,500/= per month, as a minimum wage. The last sub issue is what scale was actually used in computing the plaintiffs terminal benefits? Mr Kambo submitted that the 17,500/= was used; whereas Mr Ngwembe, submitted that the scale of 32,965/= per month was used. Mr Ngwembe also submitted that the plaintiff had failed to produce any documentary evidence to prove what was paid to them. With respect, I don't agree with him I think exh P4 gives a lot of insight. From it, there are shown certain payments which the plaintiffs acknowledge receipt. According to column titled "PAID NOTICE" by which I understand to mean an amount paid to each of the plaintiffs in lieu of notice, the amount paid ranges from shs.32,965/= to shs.23,360/=. The defence has not shown better evidence to contradict these figures. Now if that is the case, if as Mr Ngwembe would want the court to believe, the plaintiffs were paid according to the salary scale of shs.32,965/= how come some of them got as low as 7 . shs.23,360/=? On a balance of probability, I again, find that the plaintiffs were not paid according to the minimum wages of shs.31,500/= prevailing in March 1997. And looking at the maximum and the minimum figures shown in the column in Exh. P4; and given that the salaries were adjusted each in accordance with his previous salary; I cannot but irresistibly conclude that the salary scale used in computing the plaintiffs' terminal benefits was that of shs.17,500/= p.m. So, this disposes of the. first main issue. __ _ The second main issue is whether or not the plaintiffs were paid promptly? On this issue, we have the testimony of PW 1. According to him of the plaintiffs, 8 were paid on 12/12/97, others in March 1998, and the rest on 17/2/99. None of the defence witnesses has specifically refuted this piece of evidence. I have also closely looked of Exh. P4 and Exh. D3. According to Exh. D3, the 7th and 9th plaintiffs must have been paid in March 1998. According to Exh. P4, only 5 and not 8 of the plaintiffs were paid on 12/12/97, another 4 were paid in March 1998 and the rest in February 1999. That the plaintiffs were paid on different dates is further confirmed and conceded by Mr Ngwembe, learned state attorney in his submission. He has, however, submitted that this was so because FTM was bankrupt, it was the care taker committee that had to pay. Mr Kambo, submitted that being sent on leave, did not necessarily mean 8 • ·- that all the employees necessarily proceeded to all their places of domicile. I am of the view that even if it was not Friendship Textile Mill Ltd which had to pay the terminal benefits, the care taker committee stepped into its shoes and in terms of GN.82/97, those terminal benefits, had to be paid according to law, and unless the contrary intention was shown-with the-sameJegal consequences._ On the above premises, I will proceed to find that the plaintiffs have established that they were not only underpaid, but also that whatever they were paid, they were not paid promptly. The third issue is as to the effect of the president's approval of the release of the plaintiffs in 1996? This issue was proposed by Mr Ngwembe. However no evidence or argument was led on this issue. I do not see the significance of this issue to the decision of the case, and so I will say nothing more about it. The fourth and last issue is, to what reliefs are the parties entitled? After going through the pleadings, the evidence and the submissions of the parties, I am settled in my mind that the plaintiffs were entitled to the following reliefs: 1. One month's salary in lieu of notice at the 9 " ~ ~ - -~ -- --- -· -- -- - -·--- - - -- - - --.---- ---- --- -·· ···--- --~~- ··- --- -~- v•-~•~ •••• - • - ~ - - - - - - () scale of 31,500/= p.m. 2. Gratuity calculated at the rate of Shs.31,500/= per month. 3. Annual leave pay for deserving cases 4. Transport Allowance 5. House Allowance 6. cash payments for the transportation of each -- -employee and family of 4 _______ _ 7. Cash payment for transportation of luggage in a deserving class. According to s. 53 of the Employment Ordinance (cap 366) items (6) and (7) are part of repatriation expenses called subsistence allowances. Counsel have locked horns as to whether the plaintiffs are entitled to subsistence allowances. Mr Ngwembe has submitted that the plaintiffs do not deserve it because according to him the plaintiffs had been repatriated in compulsory leave. For that proposition, he cited the decision of the Court of Appeal in NICHOLAS HAMISI & 1013 OTHERS v TANZANIA SHOE co. TLD Civil Appeal No. 62 of 2000 (unreported). With unfeigned respect, I think Mr Ngwembe is wrong and in fact HAMISI's case is clearly distinguishable. The decision in that case was based on the interpretation of s. 53 of the Employment Ordinance. The Court of Appeal was categorical that:- --------------- t "Subsistence allowance is payable upon repatriation following termination of employment, to the former employee's place of engagement on his place of domicile." I_!1_the present case, _ the plain!iffs _"!'l_ay hay_e been transported to their --- place of domicile in January 1995, but there was no termination then. As found above, the plaintiffs were terminated in March 1997; so they could not have been repatriated in 1995. In the present case, repatriation is contained in the Voluntary Agreement so the repatriation expenses are payable as a matter of contract. Although the plaintiffs could claim for each of them their spouses and at most 4 children in the present case, the plaintiffs have fronted a modest claim for only one person. As there is no dispute on the figure of Tshs.7,500/= per day, I find it and declare that the plaintiffs are entitled to subsistence allowances as claimed. Since, there 'is no claim for continuous damages I will put the dates on which they were paid their benefits to be the cut off date for the computation of the subsistence allowances and as claimed by the plaintiffs. I will also proceed to award the other claims as prayed, except that of golden handshake as I am unable to find any basis or proof on this claim; either in law or in the Voluntary Agreement; 11 -- ------ -, 0 apart from a bare assertion in the plaintiffs' amended plaint. I will therefore knock off shs.53,400,000/= from the plaintiffs' claims which are otherwise granted as prayed. So, in the event, I am satisfied that the plaintiffs have, on a balance of probabilities, proved their case. I will therefore enter judgment in their favour jointly and together, for the sum of 82~338~463f-~only,together~with~interest~at~~31-%~rrem--3-1.3.97~te----~ that of this judgment and therefrom, interest on the decretal sum of 7% up to the date of payment in full. Since this is a legal aid case, I make no order as to costs. Order accordingly. ~~~-·_..,._,,__ S.A. MASSATI) I \ JUDGE ·. ~ .J.1 31/5/2005 ~..,,___.- // .. 12