tuico froliana makero and 924 others vstanzania china friendship textile ltd 2020 tzhcld 420 16 october 2020

IN THE HIGH COURT OF TANZANIA LABOUR DIVISION AT PAR ES SALAAM REVISION NO.58 OF 2019 BETWEEN TUICO (FROLIANA MAKERO & 924 OTHERS)........... APPLICANTS VERSUS TANZANIA CHINA FRIENDSHIP TEXTILE COMPANY LTD................................ RESPONDENT JUDGMENT Date of Last Order: 30/09/2020 Date ofJudgment: 16/10/2020 Z. G. Muruke , J. TUICO (FROLIANA MAKERO & 924 OTHERS) the applicant, being partly aggrieved by the award of the Commission of Mediation and Arbitration [herein to be referred as CMA] in the Labour Dispute No. CMA/DSM/ILA/R.542/15 dated 31st January, 2019 which was in favour of the respondent, filed this application seeking to revise and to set aside the CMA's award on the following ground: "The Hon. Arbitrator grossly erred in law and fact by failing to award Food and Housing allowances to the applicants, despite evidence tendered, and Government Notice to the contrary." The application is supported by the affidavit affirmed by the applicant's advocate Raya Said Nassir. Challenging the application, Michael Peter Mahande the respondent's advocate filed counter affidavit. Briefly, this matter emanated from the respondent's act of challenging the wage order in GN.223/2007 which required the employer to pay a minimum salary of Tshs. 150,000/= per month, meal allowance Tshs 20,000/= and Housing allowance of 30,000/= per month. Upon the respondent's application to the Minister of Labour, Employment and Youth Development, the Minister exempted the respondent from payment of salary to a minimum of 150,000/= per month and allowed them to pay 80,000/=without allowances. TUICO challenged the same to the High Court on Application No.37/2008, where the exemption order was nullified the decision which was upheld by the Court of Appeal in Civil Appeal No.33/2009. While the matter was in court, the Government reviewed the minimum wages to suit the industry needs, hence issued GN.172/2010 which changed the minimum salary to Tsh.80,000/= and GN. 196/2013 which changed minimum salary to Tshs. 100,000/=.The applicants referred the matter to the CMA challenging the applicability of subsequent GN.172/2010 and GN.196/2013 and insisted that the same are not applicable to the respondent's employees. They maintained that GN,223/2007 is proper law in their claims for salary arrears. At CMA the arbitrator determined the matter partly on their favour. They thus filed the present application hence this judgment. By consent hearing was by way of written submission. Both partied compiled with the schedule. The applicant was represented by Advocates Raya Said Nassir, Ally Ismail and Richard Madibi at different times, while the respondent was represented by Advocates Michael Peter Mahende and Julius Mkirya. In support of the application the applicant's counsel argued that, the arbitrator erred in law and fact by failing to award the applicants housing and food allowance. According to the contract in relation to the house rent entered between the applicants and the respondent, it was agreed that the house rent will be paid on percentage basis basing on the salary of the employee. The applicants were deducted 4,000/= from their salaries as house rent. In 2007 through Government Notice NO.223/2007 the employer was obliged to pay the house allowances Tshs. 30,000/ = per month. The respondent never paid the applicants the said sum even after that law came into force. That the arbitrator's finding that the applicants who received cheaper accommodation should not be paid the house allowances has no basis. In regard to the food allowance it was submitted that, it was agreed in their agreement that the respondent will sell food in a lower price hence the applicant will be free to choose either to buy the food from the respondent or not as per clause 20;00 of the agreement (Mkataba wa Hali Bora), Therefore, the arbitrator erred in law and fact by stating that there was no need for the applicant to be paid the food allowance because they were given by the employer. The respondent never paid the applicants 3 20,000/= per month as required under Part B of GN.223/2007. Applicant counsel prayed for the grant of the application. In reply, the respondent's counsel submitted that the arbitrator was right in holding that employees given houses, transport and food allowance for free should not be subjected to gain twice over the same benefit as admitted by one of the applicants, citing the case of Ronald Ufoo Muro v AIM Steel Ltd, Rev. No.73/2018. The applicants received free meal and were living in the respondent's premises at a subsidized monthly rental fee of 4000/=. Neither of the applicants demanded to be paid the allowances in monetary form. Hence, they should not be entitled to receive food and house allowances for similar purposes. It was further submitted that the arbitrator erred to state that all employees should be paid by virtue of GN.223/2007.The same can only be applicable to those employees who were present at the time it was published and for the period before new wage orders,GN.172/2010 and GN 196/2013. Section 40(1) (c) of the Labour Institution Act provides that a wage order sh^l remain binding until they are amended or superseded by a new order. In rejoinder, the submissions in chief was reiterated. Further it was stated that the employees living in respondent's house does not justify double payment of rent. The same were not free but the rent was paid from the salaries of the applicant. After the existence of GN.223/2007 the applicant was to opt either to stop deducting the house rent from the salaries of the applicants or to issue the house allowance to the applicants. 4 K. Vll After careful consideration of the parties' submissions, records and relevant laws, I find the issue for determination is whether the applicants were entitled to be paid meal and housing allowances. It is on records that the issue of housing and meal allowances was statutorily introduced by GN.223/2007. And before the said order came into existence the applicants were deducted Tshs. 4000/= in their salaries by the respondent as a house rent and were provided with a free meal. Due to that circumstances, the arbitrator decided that the applicants were not entitled to house and meal allowances introduced by GN. 223/2007. The said GN.223/2007 was superseded by GN, 172/2010 and the later by GN.196/2013 as per Section 40(1) (b) of the Labour Institutions Act which provides: The provisions of a wage order shall remain binding until they are; a) Suspended or cancelled by minister in accordance with subsection (2) b) Amended or superseded by a new order, or c) Superseded by a Collective agreement." However GN. 172/2010 did not phase out the entitlements of the applicants which were supposed to be paid as provided under GN.223/2007 as per Section 10 of which provided that; ". . Where any employee to whom the provisions of this order apply is at the commencement of this order, entitled to receive wages at higher rate than those prescribed or provided by this order, that employee shall for so long as he/she is employed by the same employer continue to be entitled to receive such higher wages and favourable benefits. [Emphasis added] 5 Also taking note that the cause of action arose in 2008 when they were entitled to the allowances as per GN.223/2007. It is undeniable fact that the applicants were provided with houses at lower price of 4000/= deducted from their salaries as house rent and they were offered meal at a lower price. The same were issued at employer's discretion and compassion, hence it became a rigi’t to the applicants until when revoked by the respondent. This court is of the view that the entitlements provided under GN.223/2007 were statutory entitlements to all employees including the applicants despite the fact, that the employer issued them with the houses and meals prior to the law came into force. Therefore the applicants were entitled to be paid the allowances in terms of GN.223/2007. To make it clear, the employees who are entitled to the allowances are those who were employed prior the enactment of GN. 172/2010 as per Section 10 (supra). According to exhibit P2 (Mkataba wa hali bora) agreed by the parties in 2012, the agreement is silence on whether the houses and provision of meal at the lower prices will exempt the employer from paying the applicants their allowances as per the law. Therefore, the applicants are entitled to be paid their allowances from 2008 up to 2013, after the GN.196/2013 came into force.GN.196/2013 revoked GN.172/2010 and it had withdrawn the fringe benefits. 6 Basing on the above discussion, I fault the arbitrator's order in regard to the housing and meal allowances. I hereby quash and set aside the arbitrator's order in regard to the same. I thus allow the application. Z.G.Muruke JUDGE 16/10/2020 Judgment delivered in the presence of Raya Nasir for the applicant and Consensta Bonifasi and precsidor Mtani for the respondent. • J 11 Z.G.Muruke JUDGE 16/10/2020 7