20131204 TZHC Arusha

. I ! I

IN THE HIGH COURT OF TANZANIA

LABOUR DIVISION

ATARUSHA !' REVISION NO. 45 OF 2013 TANZANITE ONE MINING LTD ...................................... APPLICANT

VERSUS . MAYSARA SAID ....... ~ ..........................•........ RESPONDENT i ! I

JUDGMENT 29/11/2013 & 04/12/2013 S. A. N. WAMBURA, J. ,... / ' ! i ' The applicants Tarizanite One Mining Ltd who were herein represented by Mr. Buhoma are seeking to have the _award of CMA ·set aside. It has been alleged that CMA exercised it is jurisdiction with material irregularity in that it dwelt on and made findings on matters not part of the pleadings; in respect of which no evidence was adduce9 by either party as . j • ! I ' I ' issues were not formulated and agreed upon by the parties at the commencement of arbitration proceeding. The arbitrator who found that there was a reason _to retrench the respondents and that the retrenchment procedures were adhered to ordered erroneously the applicants to pay the respondents severance .allowance worth three months. salary each which· ,. . . : ! I , . : was a gross irregularity. · 1 I . ' : i i' It was Mr. Buhoma's submission that in doing so the arbitrator flawed the procedures set by the law under Section 24 (4) and Rules 25 (1), 26 - - - ( z7-an<:J-2-1-0f-tt-le-MeEliati0n-and-Ar-bitr-atio11-Guldeli.nes-GN_No.,_6.7_o.L20HZ._ _ __ Mr. Asubuhi who appeared for the 69 respondents bitterly challenged the . 1 application' stating that the order was in· conformity to the spirit of justice. The issues which this_ court is called upon to resolve are:- 1. Whether or not , the respondents were entitled to the said remedy. .

2. Whether or not the order of the arbitrator was in conformity with the . I law., 1 !, 1. Whether the respond~nts entitled to such remedy? Whereas Mr. Buhoma admits that they were entitled to be paid severance allowance which was included in their retrenchment package i and that was why it was ~ot an issue before CMA, Mr. :Asubuhi alleges the same was not to be calculated and paid under normal termination as provided for under Section 42 but under Section 38 of Employment and Labour Relation Act (ELRA). It is undisputed therefore that the respondents were entitled to be .paid severance allowance Ialong with other terminal benefits as ordered at CMA.

2. Was the arbitrator's order justified? It is in record that the arbitrator realized that a number of issues . I were left out when negbt1ating on the retrenchment procedures such as 2 criteria and procedure for retrenchment, terminal benefits, handshake including special severance amount to be paid. In fact he stated that the collective bargaining agreement which had not been concluded was expected to deal with these issues. In so long as the same was not done he decided to issue the said order accordingly. Let me point out that as stated by Mr. Asubuhi it is the duty of the arbitrator to point out any irregularities found in the procedures. It will be unbecoming if the same are noted and ignored simply because they were not raised .as issues. , 1 However, I believe the order was improper in that he was challenging the issue of collective bargaining . which was different from the retrenchment process. Now, although the arbitrator alleged that retrenthment procedures were in order, I find that the procedures were not adhered to as no notice was issued to the respondents before the exercise commenced. Section 38 (1) of ELRA provides and I quote:- ''S.38 (1) In any termination for operational requirements 1 (retrenchment), the employer shall comply with the following principles, that is to say, he shall - (a) give notice oF any intention to retrench as soon as it

is contemplated; (b) disclose , all relev,ant ' I information on the intended-retrenchment for the purpose ofproper consultation; 3 (c) consult prior to retrenchment or redundancy on - (i) the reasons for the-intended retrenchment; ' (ii) any measur~si to avoid or minimise the intended retrenchment; (iii) th? method of selection of the employees to be retrenched; (iv) severance pay in respect of the retrenchments; (d) shall give the notice, make the disclosure and consult in terms of , this. subsection/ ! ! . with-. . (i) any trade union recognised in te;rms of section 67; {ii) any registered trade union with members in the workplace not represented by a recognised trade union; .(iiiJ any emplor1es not represented by a. recagnised or registered trade union. " · · · [Emphasis is mine]. The alleged notice that was issued on 09/02/2009 (Exhibit D 1) was not seen in the file {but I believe I . it is the same as Exhibit P III} which . was . • f 1 j • : in respect of restructuring of the company and not. retrenchment.. These are two different procedures with · two different effects. In restructuring one can be transferred from one department or assigned different duties and or retrenched. In retrenchment one has no option but to leave. In fact one can retrench I the employees without restructuring the • • I • ' company. In undertaking these exercises consultations are of

paramount importance as provided for under Section 38 (1) of ELRA. The same was 4 I I also so emphasized in the case of SOUTH AFRICA between JOHNSON AND JOHNSON (Pty) LIMITED Vs. CHEMICAL WORKERS INDUSTRIAL UNION (1999) 20 IU 89 (LAC). The ELRA is in pari 1 materia to'the Labour Rela tion Act of South Africa. It appears during discussions on restructuring was when the issue of retrenchment arose. The same is also proved by Exhibit D 6 whereby employees were told that the retrenchment exercise would not take off as negotiations were still under way. 1 Surprisihgly though, oh 12/05/2009 a notice of retrenchment was issued stating that the exercise commenced on 11/05 and would continue to 16/05/2009. This was not a proper notice. The same was mere information that the exercise to retrench employees had commenced so cannot in a real sense be said to be a notice if the exercise was already in process. The notice should have been 'issued before t~e exercise began. In fact if the letter which was issued on 09/02/2009 is said to be the notice, why did the applicants decide to issue another notice after the retrenchment exercise had begun. I believe it is because they realized that they had not issued prior notice as required by the law. Again the fact that the exercise took place while the applicants had filed a matter at CMA which was not heard ·means the respondents were taken by surprise. In the circumstances, I find that there was no prior notice that was issued and so the retrenchment exercise was not legally adhered to. ' ' Consultations held were to'the effect of restructurering the company only. 5

I I I I • _3. Remedies entitled to each party. Secti?n 40 (-1) ot i ~LRA provides that where the court fincls termination to be unlawful it may order the following:- (i) Reinstatement as claimed by the respondents. (ii) Re-engagement However _time -has lapsed and may be the restructuring · ; exercise is thrbugh arid the posts m~y .be taken up or not· . avaflable.. by now. so· it will be useless to· m_ake··such orders. - - · -- - - More so as the respondent:s may have also ·been paid t_heir terminal benefits .. (iii) -Compensation -of not less than ·twelve ·months salary which I .. - .I . ..- , accordin_gly grc1nt to all the respondents.• : This should be in- addition to the terminal benefits already paid to them. S.A~a. I. 0411212013 1- \ I ; ! I. 6 i . I.