CIV

IN THE COURT OF APPEAL OF TANZANIA AT MBEYA CORAM: KOROSSO, J.A.. KENTE, J.A, And MGONYA, J.A CIVIL APPEAL NO. 304 OF 2022 MBEYA URBAN WATER AND SEWERAGE AUTHORITY..................................................... APPELLANT VERSUS FAIMA SIRAJI.......................................................................RESPONDENT (Appeal from the Ruling and Drawn Order of the High Court of Tanzania, at Mbeya) (Ebrahim, J.) Dated 26th day of November, 2021 in Labour Revision No. 5 of 2020 JUDGMENT OF THE COURT 14* & 27th February, 2025 MGONYA, 3.A.: This appeal arises from the judgment of the High Court of Tanzania at Mbeya (Ebrahim, J.) dated 26th November, 2.021 granting an application for Revision (Labour Revision No. 01 of 2020) instituted by the respondent, Faima Siraji, against the appellant, Mbeya Urban Water and Sewerage Authority. The revision originated from the respondent's claim instituted in the Commission for Mediation and Arbitration at Mbeya ("the CMA") in Labour Dispute No. CMA/MBY142/2015 for unfair termination claiming a total of Tanzania Shillings 607,741,169/= as terminal benefits and general damages for loss of her employment. Briefly, the facts of the case reveal that: Faima Siraji, the respondent herein, was an employee of the appellant as an Internal Auditor on a three years' contract starting on 01/01/2009. On November 2011 the contract was renewed for another three years which expired on 31/12/2014. After the expiration of the second term contract, the respondent worked for two months, January and February, 2015 and she was duly paid her salary inspite of absence of a renewed contract. On 23/02/2015, the respondent received a letter from the appellant informing her that the contract would not be renewed, and thus categorically ending the employee-employer relationship between her and the appellant. Upon receiving the said letter, the applicant approached the Commission for Mediation and Arbitration (the CMA) claiming a total of Tanzania Shillings 607,741,169/= being terminal benefits and general damages for unfair termination. As the process of mediation failed, the dispute was placed before the Arbitrator who evaluated evidence from both parties and at the end, the CMA decided in favour of the respondent, and ruled that the respondent's termination was unfair as the appellant had failed to prove that there were valid and fair reasons for termination of the respondent's contract of employment. Further the CMA awarded the respondent a total of Tshs. 31,713,000/= being one month salary in lieu of notice, one month salary for annual leave, 12 months' salary, compensation for unfair termination and subsistence allowance. Aggrieved, the respondent preferred the application for Revision in the High Court. The High Court determined the matter and at the end, made its findings and decision in favour of the respondent, upholding the CMA's finding that the respondent was unfairly terminated. It was ordered thus; the respondent is entitled to 34 months salaries being compensation for unfair termination. The High Court further upheld all other reliefs granted by the CMA. Dissatisfied with the High Court's decision, the appellant, has advanced two grounds of appeal to wit: i. The Honourable Judge erred in law for failure to make an analysis on the evidence on record which contained procedural irregularities and illegalities as the Arbitrator omitted to append signatures after the witness testimony; and //. That the Honourable Judge erred in law for awarding the remedies for breach o f contract while the findings were unfair termination. When the appeal was called on for hearing on 12th February 2025, Ms. Lightness Msuya, learned Senior State Attorney assisted by Messrs. Joseph Tibaijuka and Boaz Msoffe both learned State Attorneys, represented the appellant herein; whereas Mr. Isaya Mwanri, learned Advocate appeared for the respondent. At the outset, Ms. Msuya prayed for leave to drop the first ground of appeal and substitute the same with another ground of appeal. As the prayer was not objected by the respondent's counsel, the Court granted it. Ms. Msuya then presented a new ground of appeal as it appears herein below: "The High Court Judge erred in law to hold that the appellant terminated the respondent's employment without a fair reason." The matter was adjourned and both parties were availed with time to prepare and file their respective documents in Court in respect of the new ground. When the Court resumed on 14th February 2025 for hearing, notably, the same learned counsel for the parties entered appearance. It is also not insignificant to point out that counsel for the parties adopted their respective written submissions which had been lodged earlier in respect of the second ground and opted to orally submit briefly in respect of the first or rather substituted ground of appeal. With respect to the first ground of appeal, Ms. Msuya submitted that, the High Court Judge erred in law to hold that the appellant terminated the respondent's employment without a fair reason. Submitting on this ground, it was the Senior State Attorneys assertion that, the respondent was employed as a Junior Internal Auditor, and since the position prior to her employment was for the Senior Internal Auditor, she was transferred to the Finance Department as an Expenditure Accountant. However, after the Controller and Auditor General's (CAG) Report showing that she had no qualification to sit in that post having no qualification of Certified Public Accountant (CPA), then the appellant had no any other option but to terminate her services by not renewing the respondent's contract as directed by the appellant's Board of Directors. It is for that reason, Ms. Msuya faulted the High Court in holding that the termination under the circumstances was without a fair reason. Referring to the respondent's termination letter dated 23/2/2015 at page 100 of the record of appeal, in which the appellant also referred to the respondent's letter dated 02/09/2014 notifying the respondent that her contract has come to an end, Ms. Msuya averred that, the said reason was clearly stated therein. The learned Senior State Attorney informed the Court that the reason for termination stated therein was fair for the respondent's termination. When probed by the Court as to why the appellant did not respond to the respondent's letter before the end of her contract and before she worked for the appellant for two months out of the contract while being paid her salaries as normal; it was Ms. Msuya's response that the appellant's Board of Directors had to convene a meeting before the final decision to grant or refuse her prayer for the new contract. Hence together with the CAG's Report, it was the learned Senior State Attorney's view that there were fair reasons for termination of the contract relying her submission in the case of Felician Rutwaza v. World Vision Tanzania, Civil Appeal No. 213 of 2019, (Unreported) at pages 15 - 16. To this end, the learned Senior State Attorney submitted that, they faulted the High Court's sentiments that therespondent wasunfairly terminated while there was a fair reason as pointed out in the respondent's termination letter. On his part, Mr. Mwanri contested the submission by the appellant's counsel that the respondent's termination was with fair reasons. It was the learned counsel's submission that the respondent did not get a fair termination. He referred us to section 12(1) (a) of the Employment and Labour Relations (Code of Good Practice) Rules, G.N. No 42 of 2007, herein to be referred as "the Code of Good Practice" which states that; Any Employer, Arbitrator of Judge who is required to decide as to termination for misconduct is unfair, shall consider whether or not the employee contravened a rule or standard regulating conduct relating to employment. Standing on this legal provision, it was the learned counsel's submission that, under the circumstances of this case, taken into account the CAG's Report, the respondent's termination ought to have been the last resort. Amplifying this point, Mr. Mwanri questioned the Civil Servants' Scheme of Service if it requires all the Accountants and Auditors to have a CPA qualification. Questioning further on the Scheme of Service, it was the learned counsel's submission that, if that was the case, then the said Scheme ought to have been tendered before the CMA as evidence. Pressing on this point, Mr. Mwanri referred us to the letter dated 4/8/2014 where the appellant identified the respondent as an Internal Auditor while at page 93 the letter dated 18/11/2011 when at the time the appellant was extending the respondent's contract of service, referred to her as an Accountant. He said, the said letters show that, despite the CAG's report, the appellant used to work in different departments and in different positions, as per appellant's wishes. From that trend, Mr. Mwanri said, under those circumstances, the appellant ought to have placed the respondent in any other department suiting her qualifications as he did earlier, instead of terminating her services. Concluding his submission in respect of the first ground, it was Mr. Mwanri's assertion that, the respondent was unfairly and illegally terminated from the service as the CAG's Report was fair, however, the appellant's implementation of the same was bad and prejudicial. Submitting on the second ground, that the Honourable Judge erred in law for awarding the remedies for breach of contract while the findings was for unfair termination, referring to the appellant's written submission, it was the appellant's observation that the High Court erroneously ordered the respondent to be paid 34 months salaries being compensation for the remaining period in the contract and other reliefs as granted by the CMA. Ms. Msuya was of the view that, the said remedies were not for unfair termination rather were for the breach of contract. Further, it was her complaint that this is the new issue in the cause of Revision as the respondent did not claim for compensation of the remaining salaries in the contract under Form No. 1, neither was the issue in the CMA's proceedings. Referring to the CMA Form No. 1 as pleadings, it is the appellant's submission that all the reliefs must originate from the said Form and form part of the record. Being guided by the principle that parties to be bound by their own pleadings, this Court was referred to the case of Barclays Bank (T) Limited, Civil Appeal No. 357 of 2019 (unreported), where it was held that parties are bound by their own pleadings and that any evidence produced by any of the parties which does not support the pleaded facts, or is at variance with the pleaded facts, must be ignored. In view of the foregoing submission, Ms. Msuya prayed for the Court to rule out that the remedies awarded to the respondent were for breach of contract and not for unfair termination. In his written submission in respect of the second ground of appeal, Mr. Mwanri in essence denounced the appellant's submission stating that, there is no law cited by the appellant which proclaims that in labour disputes, compensation for the remaining period is a suitable remedy for breach of contract only. Further that, the respondent has not departed from her own pleadings as all reliefs awarded emanated from what was claimed at CMA by the respondent. The learned counsel further responded that, compensation for the remaining period of a fixed contract is a suitable and fair remedy for the respondent as the employer terminated a fixed term contract unfairly. Mr. Mwanri asserted that, the employee can claim compensation as a remedy for such unfair termination under Section 40(l)(c) of the Employment and Labour Relation Act Cap. 366 R.E. 2019 (herein to be referred as the ELRA) which clearly gives discretional powers to an Arbitrator or Labour Court to order compensation of at least 12 months. The learned Counsel based his assertion in this Court's decision in the case of Felician Rutwaza v. World Vision Tanzania Civil Appeal No. 213 of 2019, and Sodetra (SPRL) Ltd v. Mezza & Another, Labour Revision No. 207 of 2008 (both unreported) where it was ruled that: Remedy for substantive unfairness attracts heavier penalty than procedural unfairness. From Felician Rutwaza (Supra), it was the learned counsel's submission that, the purpose of section 40(l)(c) of the ELRA is the imposition of penalties to an employer who terminated the employee unfairly. He said, that being the case, this Court adopted the mode of measuring the weight of unfairness; and ruled out that the discretion powers of determining the penalties must be exercised judiciously and not capriciously. In his conclusion, the learned counsel prayed this Court to disregard this ground of appeal and uphold the decision of the High Court on reliefs awarded to the respondent as according to him, they are fair, just and equitable. Having heard the contending submissions of the counsel for the parties to this appeal, there is no dispute that the respondent was the appellant's employee and that she was officially terminated by the appellant vide a letter dated 23/2/2015. In the said letter, the appellant informed the respondent that, her contract had come to an end as the appellant's Board of Directors, did not consider her request to renew her li employment contract. It is evident from the said letter that, the above was the only reason stated for her termination. It is on record that before the CMA, the respondent had complained for unfair termination of her fixed term contract of employment. She contended that, her termination was unfair both procedurally and substantively for the reason that the appellant did not have any good reasons for non-renewal of her contract and that she had expected renewal of the fixed term contract under the given circumstances. Admittedly, it is on record at page 762 of the record of this appeal that, the High Court Judge after considering that the CMA found that the contract by the applicant to the respondent was renewed by default as per section 36 (a) (iii) of ELRA and Rule 4(3) Code of Good Practice Rules, then it was her concerted view that the appellant terminated the respondent's employment without fair reasons. The issue now, in the first ground of this appeal is whether the High Court Judge was justified in her findings that the termination of employment of the respondent was without good and fair reasons. We will start by referring to section 36(a) (iii) of the ELRA where termination of employment provides: "36(a)(iii) a failure to renew a fixed term contract on the same or similar terms if there was a reasonable expectation o f renewal; Besides, rule 4(3), of the Code of Good Practice provides: "(4) Subject to sub-rule (3), the failure to renew a fixed term contract in circumstances where the employee reasonably expects a renewal o f the contract may be considered to be an unfair termination ' ' Going by above provisions of the law, it is clear that, an employer may be held liable for unfair termination if he fails to renew a fixed term contract, where there was a reasonable expectation of renewal. (See the case of Ibrahim s/o Mgunga & Others vs African Muslim Agency (Civil Appeal 476 of 2020) [2022] TZCA 345 (13 June 2022); TANZLII. Now, what are the criteria for the existence of an expectation of renewal of a fixed term contract? This Court in the case of Asanterabi Mkonyi v. Tanesco (Civil Appeal No. 53 of 2019) [2022] TZCA 96(7 March 2022); TANZLII quoted with approval the case of Dierks v. University of South Africa (1999) 20 ID 1227, where the Labor Court of the Republic of South Africa restated that: "A number o f criteria have been identified as considerations which have influenced the findings o f past judgments o f the Industrial and Labour Appeal Courts. These include an approach involving the evaluation o f all the surrounding circumstances, the significance or otherwise o f the contractual stipulation, agreements, undertakings by the employer, or practice or custom in regard to renewal or re-employment, the availability o f the post, the purpose o f or reason for concluding the fixed term contract, inconsistent conduct, failure to give reasonable notice, and nature o f the employer's business. " As was established in the case of Ibrahim s/o Mgunga & Others v. African Muslim Agency (supra), it is the employee who has the onus to prove that there were circumstances which resulted into her to believe there was renewal of the fixed term contract by default. That, whenever an employee challenges the fairness of termination on the grounds of reasonable expectation of renewal of a fixed term contract, it is the employee who alleges the existence of the expectation who assumes the duty to prove the basis of his expectation. The issue under consideration is whether the respondent in this case has managed to discharge that burden. Going by the evidence at page 233 of the record of appeal, the respondent testified that she expected the renewal of the contract because; first, her contract was subject to renewal as per clause 3 of her letter of appointment (Exhibit Cl); and second, on 2nd September, 2014, she wrote to the employer, appellant herein informing her that her contract was about to expire. However, there was no any response to the letter until on 23/2/2015 when she received the termination letter and after working for two months out of her contract. During trial at the CMA, the respondent testified that, apart from the employment contract she entered in 2011, she also had another contract with the appellant regarding an agreement for the appellant's permission and sponsorship of studies for the respondent. According to that agreement, during subsistence of her studies, she was barred from applying for work in any other organization or company, and upon completion of her studies, she was required to work with the appellant for a period of not less than two years. It was her testimony that, she graduated in December 2014 and tendered her transcripts to the appellant's office. Thereafter, she went on with her duties until her employment was terminated on 23/2/2015. For ease of reference, below is part of the respondent's testimony at the CMA to that effect: "Mkataba wangu wa kazi unatakiwa kuisha Desemba, 2016. Ninachomlalamikia mwajiri ni kwanza, amevunja mkataba wa masomo a/iosema nisitafute kazi kwingine. Piii, amevunja mkataba wa ajira kwa sababu mimi nilimwambia tangu mwezi wa 9\ na alindelea kunipa makujukumu ya kazi na aiikuwa akiniiipa mshahara na posho zangu zote, hivyo niiiona mkataba wangu tayari unaende/ea - umekuwa renewed. " The respondent's detailed complaints in respect of her unfair termination can easily be referred in the respondent's "Opening Statement for the Complainant" at page 80 - 82 of the record. From the above, it is our considered view that the respondent had successfully discharged her burden of proof regarding the existence of her expectation on renewal of her fixed term contract. As we have found that there was a valid expectation, the termination would have been fair if she had followed the legal requirement by having a valid reason. However, the respondent's termination is ruled out to have been unfair for the above-mentioned legal shortcomings. We base our finding on section 37 of the ELRA. The same provides: "37. (1) It shall be unlawful for an employer to terminate the employment o f an employee unfairly. (2) A termination o f employment by an employer is unfair if the employer fails to prove- (a) that the reason for the 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 o f the employer, and (c) that the employment was terminated in accordance with a fair procedure. (3) It shall not be a fair reason to terminate the employment of an employee - (a) for the reason that the employee - (i) discloses information that the employee is entitled or required to disclose to another person under this Act or any other law; (ii) fails or refuses to do anything that an employer may not lawfully permit or require the employee to do; (Hi) exercises any right conferred by agreement, this Act or any other law; (iv) belongs, or belonged, to any trade union; or (v) participates in the lawful activities o f a trade union, including a lawful strike; (b) for reasons - (i) related to pregnancy; (ii) related to disability; and (Hi) that constitute discrimination under this A c t " We take note that, the termination letter was silent as to the basic reasons for the respondent's termination. The letter simply informed the respondent that, the Board of Trustees did not intend to extend the fixed term contract for another term. The appellant contends that, the reason behind was that, the respondent was unqualified for the post she was holding of Accountant according to the report by the CAG. The question emerges, as to why the said reason was not stated in the termination letter? Again, we wish to quote the said letter for ease of refence as herein below: "KUMB. NA. UWSA/MB/F.1016/42 23/02/2015 MS. FAIMA SIRAJl S. L. P. 6327, MOROGORO. YAH: KUTOHUISHWA KWA MKATABA WA KAZI. Rejea barua yako ya tarehe 02/09/2014 inayotoa taarifa ya kumaliza mkataba wako na ombi ia kuongezewa mkataba wa ajira. Napenda kukufahamisha kuwa Bodi ya Wakurugenzi katika kikao chake cha tarehe 17/02/2015 haikuridhia ombi lako la kukuongezea mkataba mwingine wa ajira. Hivyo unatakiwa kukabidhi ofisi kwa mkuu wako wa Idara. Tunashukuru kwa ushirikiano kwa kipindi chote cha utumishi wako katika Mamlaka ya Majisafi na Usafi wa Mazingira jijini Mbeya. Imesahiniwa na: Eng. Simeon M. Shauri MKURUGENZIMTENDAJI MAMLAKA YA MAJISAFI NA USAFI WA MAZINGIRA JIJINI MBEYA. Nakala: • Mwenyekiti wa Bodi - Mamlaka ya Majisafi na Usafi wa Mazingira Jijni Mbeya, • Meneja Fedha - Mkuu wa Idara." From the record, it was the appellant who allowed the respondent to go for studies so as to have sufficient knowledge and qualifications for the position she was holding. Nonetheless, the appellant had employed the respondent in 2009 at the position of Internal Auditor. After a year, there was internal transfer and she was shifted to the post of Accountant. That is to say, since the first employment contract was for the post of an Internal Auditor which she had qualified. As correctly held by the High Court Judge, the appellant could opt to return the respondent to her previous position in case she was not fit in the accountancy position. That was not done. Under the circumstances and the qualifications of the respondent, she could fairly be moved to another department and still work with the appellant instead of the abrupt termination as it happened. In our considered view, in deed, termination under those circumstances, would have been the last resort. Again, it was the appellant who sponsored the respondent to pursue studies so as to fit in the position of accountant. All in all, there were no good reasons to terminate her for the position she was studying for. By being allowed to go to studies for the position and upon signing the binding contract in that respect, we hold that the respondent indeed had higher expectations of the renewal of her employment contract, especially where she was allowed to work beyond her contract period for two months being paid salaries as normal. We are guided by Rule 3(4)(3) and (4) of the Code of Good Practice which provides: "(3) Subject to sub-rule (2), a fixed term contract may be renewed by default if an employee continues to work after the expiry o f the fixed term contract and circumstances warrants it (4) Subject to sub-rule ('3), the failure to renew a fixed term contract in circumstance where the employee reasonably expects a renewal o f the contract may be considered to be an unfair termination." Since we have also ruled that the respondent's termination was unfair and without good reasons, as concurrently held by the CMA and the High Court, it is our opinion that the High Court Judge's findings and remedy awarded were justifiable. Thus, this ground of appeal is devoid of merits. With regard to the second ground of appeal, that the Honourable Judge erred in law for awarding the remedies for breach of contract while the findings were unfair termination; we are aware that the circumstances of this case are that the respondent's employment was terminated after the expiry of the second term of the fixed term contract and after she had already worked for two months without renewal of a new contract. Since it is settled that the respondent had a genuine expectation for renewal of the employment contract and given the fact that the respondent worked for the appellant for 2 months out of contract and was paid salaries, as we have seen above, the law recognises that there was a renewal of the contract in default. That being the case, there was still 34 months before the lapse of another employment contract. It is an established principle that, for a fixed term contract, the foreseeable relief to redress unfair termination is payment of salary in respect of the remaining months in the fixed term contract. This was stated in the case of Good Samaritan v. Joseph Robert Savari Munthu, Revision No. 165/2011, High Court Labour Division at Dar-es- salaam (unreported), the case which was cited with approval by this Court in the case of Peter Ng'homango v. Messa Secondary School (Civil Appeal No. 325 of 2021) [2024] TZCA 753 (16 August 2024); TANZLII where it was held that: "When an employer terminates a fixed term contract; the loss o f salary by employee o f the remaining period o f unexpired term is a direct foreseeable and reasonable consequence o f the employer's wrongful action..." The appellant also maintained that parties are bound by their own pleadings, hence the respondent cannot be awarded reliefs of the remaining months salaries since the respondent did not claim the same from the beginning. In determining this ground, we had to refer to Form No. 1 in the record of appeal which in principle, initiates the case at the CMA. From the same we have noted that, the respondent claimed compensation of 50 months (see item V at page 10 of Volume 1 of the records of appeal). Further, when the respondent testified at the arbitral trial maintained and prayed to be awarded her benefits as presented in the schedule of claims. (See page 237 of Volume 1 of the records of appeal). For ease of reference, this is what she said: "Ninachoiomba Tume, kwanza barua haijaainisha haki ninazo stahiH kulipwa kama naachishwa kazi. Naomba Tume inisaidie nipate haki zangu. Haki hizo ninaomba kama nilivyowasilisha kwenye schedule o f claims. Ni hayo tu." After the hearing at CMA, the respondent was awarded only 12 months salaries as compensation for procedural unfair termination. However, in Revision before the High Court, Hon. Judge exercised her discretional power after having found the termination was both substantively and procedurally unfair, and that there was a new contract in default, revised the CMA Award by ordering the respondent to be awarded 34 months compensation on account that, its direct and foreseeable remedy emanated from the remained period of a fixed contract. Therefore, the term 'remained period of a fixed contract' has been used by the Judge as justification on the computation of the penalty which we subscribe to as just and equitable remedy. We are aware that, procedural law is made to facilitate the process of justice. The rules of pleading are merely for the court and the parties to know what is the claim they are seeking for. Rules of the pleading are intended to be the basics of a fair trial and for reaching a reasoned decision. So, the court must implement them. To construct or build a good pleading it must be kept in mind that it is not the expression of the art. It is a word that how relief is sought effectively. The facts must be conveyed by reading all the plaint, and it has to be cleared what relief is being sought. In the event therefore, it is our firm view that, from the contents of Form No. 1, before the CMA, the respondent pleaded what she was rightly awarded, being the 34 months compensation, for the abrupt termination of her employment contract. We are further satisfied that the relief of 34 months compensation granted to the respondent was in respect of both unfair termination and for breach of contract. In the vent, we proceed to declare that the second ground of appeal too is devoid of merits. In the final analysis, we hold that the appeal is unmerited. We hereby dismiss it in its entirety. DATED at MBEYA this 27th day of February 2025. W. B. KOROSSO JUSTICE OF APPEAL P. M. KENTE JUSTICE OF APPEAL L. E. MGONYA JUSTICE OF APPEAL The Judgment delivered this 27th day of February, 2025 in presence of Mr. Joseph Tibaijuka and Ms. Edna Mwamlima both learned State Attorneys for the Appellant and Mr. Isaya Mwanri, for the Respondent through virtual court, is hereby certified as a true copy of