CIVIL APPEAL NO 401 OF 2022 TANZANIA BREWERIES LIMITED VERSUS GIBSON NEVAVA

IN THE COURT OF APPEAL OF TANZANIA AT ARUSHA (CORAM: MKUYE. J.A.. RUMANYIKA. 3.A And MDEMU, 3.A.1 CIVIL APPEAL NO. 401 OF 2022 Reference No. 202211040000152 TANZANIA BREWERIES LIMITED..................................................APPELLANT VERSUS GIBSON NEVAVA....................................................................... RESPONDENT (Appeal from the Judgment and Decree of the High Court of Tanzania, Labour Division, at Arusha) (Gwae, 3.^ dated the 11th day of February, 2022 in Revision Application No. 10 of 2021 JUDGMENT OF THE COURT 26* February & 4th March, 2025 MDEMU. J.A.: The appellant in this appeal is challenging the decision of the High Court of Tanzania which confirmed the award of the Commission for Mediation and Arbitration (the CMA) by decreeing that, the termination of the respondent was not valid and stood grounded on unfair reasons and marred with procedural incompliances. Before the CMA, the respondent initiated a labour dispute contending for unfair termination by his employer, the Tanzania Breweries Limited, the appellant herein. Brief facts of the case are traced way back on 1st June, 2006 when the appellant employed the respondent as a Route Salesman Driver as per the engagement letter (exhibit Al), stationed at Moshi. Coming to 1st October, 2014, the respondent was appointed to man the position of a Warehouse Supervisor (exhibit A3), in Arusha, the post he served towards his termination effective from 2nd October, 2018. It is in the record of appeal that, prior to the termination, the respondent appeared before the disciplinary committee charged for dishonest and gross negligence. Let the relevant part in the record of appeal at pages 116 through 118 on the alleged misconducts speak by itself as hereunder: "Count one: 3.1.1 Dishonesty and major breach o f trust levelled against you as an offence which may constitute serious misconduct and leading to termination o f employee contrary to clause 5 o f the Employment and Labour Relations (Code o f Good Practice) Rules GN. No. 42 o f l& h February 2007 and clause 5(d) o f the Tanzania Breweries Limited, Managing Conduct and Relationships at Work Place (Code o f Good Practice) " "Count Two. 3.1.2 Causing loss o f the employer's property through gross negligence contrary to clause 8 o f the Employment and Labour Relations (Code o f Good Practice) Rules (GN. No. 42 o f W h February, 2007) and clause 4 (2) (b) o f the Schedule o f the Offences (Annexture H) found under the Tanzania Breweries Limited, Managing Conducts and Relationships at Work Place (Code of Good Practice) which constitutes serious misconduct and may lead to termination o f employment” Luckly, each count comprises of a set of particulars explaining how the two disciplinary offences were committed. In both counts, the respondent is alleged to have overstated 144 cases of castle lager beer increasing the total to 254 cases instead of the actual 110 cases, thus making a loss of T7S 1, 256,669.42. According to the statement issued on 5th August 2018, the respondent committed such offences on 17th and 18th 2018. It alleged that the respondent prepared and endorsed/certified a falsified report on 5th August and 6th August, 2018. Moreover, the disciplinary committee proceedings are missing in the record of appeal, so it is not known exactly when and where it was conducted. That besides, on 20th September, 2018 (exhibit A6) the respondent was found guilty on both disciplinary offences. The decision of the disciplinary committee at page 34 of the record of appeal partly reads as hereunder: "UAMUZIWA MWENYEKITI WA KAMATI. Baada ya kuzingatia ushahidi na maefezo yaliyotolewa kwenye shauri hill la nidhamu, maamuzi ya mwenyekiti wa kamati ya nidhamu yalikuwa ni kuvunja mkataba wa ajira (termination of employment contract). Maamuzi haya yamefanyika kwa kuzingatia kanuniya balance o f probability," Acting on this decision of the committee, as said, the appellant terminated the respondent. The latter sought intervention of the CMA alleging unfair termination. According to CMA Form No. 1, the respondent pleaded for the relief of reinstatement without loss of remuneration. In its award dated 15th January, 2021, the arbitrator found that the respondent's termination from employment was substantively and procedurally unfair. It thus decreed for the reinstatement of the respondent without loss of remuneration. Unhappily with the outcome of the award, the appellant sought indulgence of the High Court on revision. Unfortunately, it did not work in the appellant's favour because on 11th February, 2022, the High Court (Gwae J.) confirmed the award, thus dismissed the appellant's claim. The battle continued. Now before us is the appellant inviting the Court to determine the following grounds of appeal: 1. After having agreed on ground number 2 o f the application for revision fiied by the appeiiant at the High Court where by the appellant challenged the decision o f the presiding arbitrator for failure to differentiate between Geofrey Kimaro, Peter Kakulu and Felix Godfrey as to who was the complainant and who presided over the disciplinary hearing, the High Court Judge erred in law by upholding the decision for the CMA that termination o f the respondent was not fair, 2. After having agreed that the respondent was afforded right to be heard before the decision to terminate his employment, the High Court Judge erred in law in deciding that the termination o f the respondent was substantively and proceduraiiy unfair. 3. The High Court Judge erred in law for holding that termination was substantively and procedural unfair on the basis that, no investigation was conducted while the available evidence on record proves that the appellant conducted investigation before charging and summoned the respondent to a disciplinary hearing. 4. The High Court Judge erred in law for framing new issue which was not among the issues framed for the determination by the CMA at Arusha and determined the same without according both parties an opportunity to address on the same therefore infringed the appellant's right to be heard. 5. The High Court Judge erred in law for holding that admissibility o f documentary evidence at the CMA is governed by the law o f evidence Act, Cap. 6 RE2022 while ignoring the fact that the said law is not applicable before the CMA. 6. The High Court Judge erred in law for failure to distinguish between salary arrears, terminal benefits and reinstatement order and therefore arriving at a wrong decision with regard to the respondents final entitlements. The crux of the matter in the instant appeal is on the termination of the respondent from employment. This being the case, the question to be resolved is whether termination of the respondent was on valid and fair reasons both in terms of substance and procedure. Our response therefore to the forestated grounds of appeal will focus on that issue we have just raised. With this approach, we will only select some relevant portions in both written and oral submissions by the counsel in response to: one, whether the disciplinary proceedings followed the requisite procedures. Two, whether investigation was conducted prior to the holding of disciplinary hearing. Three, whether there were valid and fair reasons to terminate the respondent and last, whether the learned High Court Judge raised issues suo motu. In the determination of the forestated grounds of appeal in the raised issues, appeared before us on 26th February, 2025 Mr. Daniel Dannland Lyimo, learned counsel representing the appellant and Mr. Ezra Mwaluko, also learned counsel who ably represented the respondent. Both counsel stood by the contents of their written submissions which they had filed prior and also clarified orally on some key points. Submitting on the High Court raising issues suo motu, the appellant's counsel had in mind the repatriation order made by the learned High Court Judge at page 201 through 202 of the record of appeal. It was submitted that, the issue of repatriation was raised and determined by the learned High Court Judge without involving the parties and in fact, they were not heard at all. He condemned that move as it denied the parties the right to be heard. The case of Kumbwandumi Ndenfoo Ndossi v. Mtei Bus Service Limited (Civil Appeal No. 257 of 2018) [2021] T7CA 23(19 February, 2021 TanzLII) was cited to us for that purpose. Mr. Mwaluko, learned counsel responded that the issue of repatriation was raised by the appellant during examination in chief as seen at page 106 to page 107 of the record of appeal. For ease of reference, the learned counsel extracted that part of the record in his written submissions at page 6 and cited to us the case of Stella Temu v. Tanzania Revenue Authority [2005] T.L.R. 178 arguing that, the repatriation issue was not a new one and that the court rightly decided so. On our part, we think, for clarity, let first the record of appeal at page 201 to 202 speak by itself regarding the order of the learned High Court Judge on repatriation costs as follows: 11Before I conclude writing this judgment, I wish to comment on the pertinent issue on a right to repatriation costs in favour o f the respondent, since it evidentiaiiy dear that the respondent was recruited at Moshi and was in Arusha when was terminated, in law therefore, the respondent if he was not paid his repatriation costs as seemingiy the case, the applicant would not escape paying him his subsistence allowance which is equal to monthly salary from the date o f termination to the date of repatriation notwithstanding if the termination was found to be fair or unfair. (See the decision o f the Court o f Appeal in Attorney General vs. Ahamad R. Kakuti and Two Others, Civil Appeal No. 49 o f 2004 unreported)." We think, the issue of repatriation costs should not detain us. We entirely agree with Mr. Lyimo that the issue of repatriation was alien to the parties. It was raised by the learned Judge of the High Court suo motu. We do not therefore buy in the argument of Mr. Mwaluko that, the extract he referred to us as seen at page 6 of his written submissions is in respect of repatriation costs. It is in respect of the place where the respondent was recruited and also directs the place where he was at the time of termination. That perhaps is not relevant. The pressing question certainly should be whether the learned High Court Judge was legally justified to make an order of repatriation in circumstances where he had previously made an order to reinstate the respondent in terms of section 40 (1) (a) of the Employment and Labour Relations Act, Cap. 366 (the ELRA). We are saying so because, at page 201 of the record of appeal, the learned High Court Judge made a finding to reinstate the respondent as follows: "In our dispute, the termination o f the respondents employment was found to be unfair, both in terms of substantive and procedural aspect, the decision which I have no reason to defauit. It follows that, the order o f the reinstatement was in favour o f the respondent was, in the circumstances, justified as was rightly awarded by the Commission." Given the foregoing excerpt, it is clear to us that, the learned High Court Judge did uphold the award of the CMA to reinstate the respondent in his position of a Warehouse Supervisor. That is exactly what the respondent prayed for in CMA Form No. 1. Now, this being the case, where was he repatriating him to? He erred to this extent. That order, in our view, was made prematurely. It would have been relevant had the employer refused to reinstate the respondent in terms of section 40 (3) of the ELRA. The section reads: " Where an order o f reinstatement or re-engagement is made by an arbitrator or Court and the employer decides not to reinstate or re-engage the employee, the employer shall pay compensation o f twelve months wages in addition to wages due and other benefits from the date of unfair termination to the date of finaipayment "[emphasis ours] This ground of appeal is meritorious, accordingly, it is allowed. Next for our determination is whether investigation on the alleged disciplinary offences was conducted prior to the holding of a disciplinary hearing. In the written submissions of the appellant's counsel from page 4 to 6, we note three sets of facts submitted. First, there are cases where disciplinary hearing may proceed without the need to conduct investigation; second, that there is no prescribed format of the investigation report; and third, that the available correspondences between the employer's officials and the respondent afforded a forum thus making respondent aware of the disciplinary charges facing him. In his oral submissions, Mr. Lyimo also treated the said correspondences between the respondent and the appellant pertaining to the disciplinary offences to be reports within the meaning of the law. To this line of thinking, the learned counsel thought that, the holding of investigation preceding the disciplinary hearing is redundant and of no value. Mr. Mwaluko, on the other hand, had a different argument. His was straight away that, to the conclusion of the disciplinary hearing, if any, no investigation was ever conducted by the appellant to ascertain if there are grounds for hearing. To him, correspondences between the appellant and the respondent, in absence of any investigation report, is not investigation and nor does it make such correspondences a report within the meaning of rule 13 (1) of the Employment and Labour Relations (Code of Good Practice) Rules, GN No. 42 of 2007 (the Code of Good Practice) as alleged by Mr, Lyimo. He referred us to page 116 of the record of appeal by faulting the disciplinary committee for abdicating its role and turning itself to an investigatory forum instead. Mr. Mwaluko concluded that, failure to conduct investigation vitiates proceedings, thus making the termination of the respondent procedurally unfair. As correctly argued by Mr. Mwaluko, rule 13 (1) of the Code of Good Practice makes it mandatory for the disciplinary hearing to be preceded by investigation to ascertain if there are grounds for hearing. We stated in Severino Mutegeki and Another v. Mamlaka ya Maji Safi na Usafi wa Mazingira Mjini Dodoma (DUWASA) (Civil Appeal No. 343 of 2019) [2020] TZCA 310 (19 June 2020; TanzLII) at page 11 of the judgment regarding this important requirement that: "In terms o f sub-regulation (1) what entails an investigation to ascertain whether there are grounds o f the hearing includes as well, exhausting the prescribed internal measures in the employment institution reguiation operational aspects which are binding on both the employee and the employer" We are also in agreement with Mr. Mwaiuko that, in absence of investigation report, and in the circumstances of this case, it was not possible to conclude that any investigation was conducted. Mr. Lyimo implored us to consider correspondences between the appellant and the respondent as an investigation report within the meaning of rule 13 (1) of the Code of Good Practice. We are not persuaded to hold so in the circumstances of this case where the respondent was charged with dishonesty, major breach of trust and causing loss of the employer's property through gross negligence. The other reason for our reluctance include: one, there was a shift system as testified by the respondent at page 107 of the record of appeal. Two, the respondent denied to have prepared the alleged fraudulent report. Three, one Emmanuel Oiso was in the second shift that day (page 108 of the record of appeal). Four, one Rajabu Said as seen at page 113 through 114 of the record of appeal is categorical that on 5th August, 2018 the respondent was absent and it is Emmanuel Oiso who prepared the alleged report. From the above infraction and since the report is the genesis of the allegations of dishonesty, breach of trust and causing loss to the empfoyer's property through gross negligence levelled against the respondent, it was necessary to conduct investigation. Mr. Lyimo argued that, there are instances where disciplinary hearing may proceed in absence of investigation report. He sounds correct. This Court in Patrick Muga v. National Bank of Commerce (NBC LTD) (Civil Appeal No. 459 of 2021) [2024] TZCA 1297 (23 December 2024; TanzLII) took similar position because the investigation report was with the police and that witnesses who conducted that investigation testified at the disciplinary hearing. It may not be the case here because, neither the report was submitted nor witnesses who conducted such investigation testified, leave alone living in suspense, if at all, any investigation was ever conducted by the appellant. We thus find substance and we have no reason to discount the position of the learned High Court Judge as seen at pages 195 through 197 of the record of appeal that, the circumstances of this case demanded the conduct of investigation prior to disciplinary hearing. This ground of complaint is dismissed as well. As we embark to the other issue we raised, that is, whether the disciplinary proceedings followed the requisite procedure, we have in mind what we stated in the foregoing ground of appeal regarding the conduct of investigation prior to the holding of a disciplinary hearing. We entirely agree with Mr. Mwaluko that, the disciplinary hearing did not follow procedure. We have the following observation. First, is what Mr. Mwaluko argued that, the holding of disciplinary hearing was in total violation of rule 13 (1) of the Code of Good Practice because it was not preceded by investigation. Second, there is no proceedings annexed; as such, it is not known who were members of the disciplinary committee. Third, the decision of the disciplinary committee as seen at pages 119 through 120 of the record of appeal does not contain names of members and also was not signed by the respondent. Fourth, it is glaring if the respondent exercised the right to mitigate which was informed to him in the notification of hearing appearing at page 118 of the record of appeal because the record is silent if he mitigated. The last issue we raised is in respect of whether valid and fair reasons to terminate the respondent existed. We discussed it at length in the foregoing ground that, the employer did not investigate the alleged misconducts prior to the disciplinary hearing. This to us was relevant because, as we alluded to, the evidence at the CMA indicates that there was a shift system and it is not so clear to us as who exactly was present on the day of the alleged misconducts. Again, it is not with certainty established who prepared the report which gave rise to the allegation of dishonesty, misconducts and gross negligence. In all this, we are of the view that, in terms of section 37 (2) of the ELRA, termination of the appellant was not on valid reasons, it was unfair and it was not in accordance with a fair procedure. See: Severino Mutegeki and Another v. Mamalaka ya Maji Safi na Usafi wa Mazingira Mjini Dodoma (DUWASA) (supra) at page 10 of the judgment On that account, we have no reason to interfere with the concurrent findings of the two courts below, save for the order of reinstatement which we think requires a rethinking further. We will demonstrate shortly. As we stated in the foregoing, two courts below concurred to redress the respondent by reinstating him without loss of remuneration in terms of section 40 (1) (a) of the ELRA for unfair termination. The respondent equally in the CMA Form No. 1 asked to be reinstated. The appellant, on the other hand, faults both the reasons for termination and the remedy of reinstatement. Meanwhile, the disciplinary charges levelled against the respondent range from dishonesty, lack of trust, gross negligence to occasioning loss. We are asking ourselves if such prevailing circumstances permit the existence of good relationship and conducive working environment and productivity. We have revisited the written submissions of the appellant at page 7 regarding reinstatement, and we think it would be of guidance going forward. It reads as follows: "Honourable Justices o f Appeal, coming to the sixth ground o f appeal which is to the effect that, the High Court Judge erred in law for failure to distinguish between salary arrears, terminal benefits and reinstatement order and therefore arriving at a wrong decision with regards to the Respondents final entitlements. Honourable Justice o f Appeal, the evidence produced during hearing at the Commission for Mediation and Arbitration indicated that, the Respondent was an employee o f the Appellant in the post o f Warehouse Supervisor at Arusha post, the post which requires outmost good faith and trust In the case o f G. 4 Security Services (T) Ltd v. Peter Mwakipesife, Labour Court Digest No. 109 o f 2011, Hon. Rweyemamu, J. (as she then was) stated that: - "In deciding gravity o f a particular misconduct, one has to bear in mind the type o f the employer's business and the importance o f honest in the said businesses" The Respondent being empioyed as a warehouse supervisor had a roie o f counting stocks in the morning and in the evening after ending operations, aiso he had a roie o f baiancing the stocks, sorting ex-packing beer. Therefore, due to the nature o f the Respondent's empioyment and the employer's business, it was required o f the Respondent to be o f a high level o f trust and honesty as it was stated in the cited case above. Therefore, we would like to humbly submit that, the order by the High Court Judge in ordering the reinstatement o f the Respondent was not a proper remedy as the Respondent on the matter at hand was terminated on gross dishonest Rule 32 (2) (b) o f the Labour Institutions (Mediation and Arbitration Guidelines) Rules 2007 has indicated that, if the circumstances surrounding the termination are such that a continued employment relationship would be intolerable, the Arbitrator may grant compensation instead o f reinstatement. Honourable Justice o fAppeal, therefore, due to the nature o f employment o f the Respondent and the misconduct that has committed, if the relationship between the Respondent and his employer will continue, then the same would be intolerable as there is breach o f trust and honestly on the part o f the Respondent Again, going through the records, you will see that the Respondent counsel admitted that there was breach of trust therefore reinstatement o f the Respondent employment was not a good cause. Therefore, the order by the High Court Judge that the Respondent be reinstated by the Appellant is an erroneous one as the misconduct that has been done by the Respondent has led the Appellant to suffer loss as a result." It is clear in the foregoing excerpt that, the appellant is no longer willing to work with the respondent. It is further dear that, the appellant thought that the proper remedy for unfair termination in the circumstance of this case would have been a compensation as opposed to reinstatement. We agree with Mr. Lyimo that in the circumstance of this case where there are fears on the alleged dishonesty, lack of trust and given the nature of the appellant's business, together with the position of Warehouse Supervisor offered by the appellant to the respondent, it will not be in the interest of justice for both the appellant and the respondent to have in place the reinstatement order. This is the spirit behind rule 32(2) of the Labour Institution (Mediation and Arbitration) Rules, G.N No 64 of 2007 which provides; 32 (2) The Arbitrator shaii not order re-instatement or re-engagement where; (a) N/A (b) The circumstances surrounding the termination is such that a continued empioyment reiationship would be intolerable; (c) N/A (d) N/A." Had the learned High Court Judge considered those factors he would have opted to order compensation of the respondent. We thus quash and set aside the order of reinstatement and substitute in lieu thereof, an order for compensation following unfair termination of the respondent. The question which follows now is on the amount of compensation. Section 40 (1) (c) of the ELRA is to the effect that, where the court or arbitrator finds that termination of the employment of the employee by the employer is unfair, the remedy available is to compensate the employee for not less than twelve (12) months remunerations. See also Tanzania Cigarette Company Limited v. Lucy Mandara (Civil Appeal No. 187 of 2021 [2024] TZCA 128 (26 February 2024; TanzLII) and Amos Logan Masuluali v. Sunshine Industrial Company Limited (Civil Appeal No.439 of 2022) [2024] TZCA 1290 916 December 2024; TanzLII). In the end of it all, we make an order that, following unfair termination, the respondent is entitled to a compensation of twelve (12) months remunerations. The appeal is accordingly dismissed with no order as to costs. DATED at ARUSHA this 28th day of February, 2025. R. K. MKUYE JUSTICE OF APPEAL S. M. RUMANYIKA JUSTICE OF APPEAL G. J. MDEMU JUSTICE OF APPEAL The Judgment delivered this 4th day of March, 2025 in the presence of Mr. Daniel Lyimo, learned counsel for the Appellant and Mr. Lecktony Ngeseya holding brief for Mr. Ezra Mwaluko, learned counsel for the Respondent; through video conference from High Court Arusha, is hereby certified as a true copy of the original.