CIVIL APPEAL NO 121 OF 2022 WATER AID TANZANIA VS CLARE HAULE

IN THE COURT OF APPEAL OF TANZANIA AT PAR ES SALAAM ( CORAM: MWANDAMBO. J.A.. MWAMPASHI. 3.A. And FELESHI, 3.A1 CIVIL APPEAL NO. 121 OF 2022 WATER AID TANZANIA ........................................................................ ..APPELLANT VERSUS CLARE HAULE...................................................................... RESPONDENT (Appeal from the Judgment and Decree of the High Court of Tanzania (Labour Division) at Dares Salaam) fMwipppo. J.^ dated the 4th day of May, 2020 in Revision No. 13 of 2019 JUDGMENT OF THE COURT 18th February & 14th March, 2025 FELESHI. J.A.: The employment contract between Clare Haule, the respondent, and Water Aid Tanzania, an international Non-Governmental Organization (NGO), the appellant, ended on 31st March, 2017 when the latter terminated the employment of the former on operational requirement (retrenchment). That aggrieved the respondent who filed her complaint with the Commission for Mediation and Arbitration (CMA) which found that she was fairly terminated. On a revision preferred by the appellant that decision was overturned by the High Court, which granted her 12 months' compensation for unfair termination in the form of retrenchment. It is that High Court decision which prompted this appeal before us. The brief facts on the parties' employment relationship and from which the labour dispute ensued are that: in July 2014, the appellant employed the respondent as a Program Officer for Urban who later received multiple promotions, eventually rising to the position of Senior Program Manager, Policy and Advocacy, in June 2016. On 31st March, 2017, the respondent's employment was terminated due to financial constraints which caused the appellant to restructure her organogram. After receiving her retrenchment package, she filed a labour dispute number CMA/DSM/KIN/R.476/17 with the CMA claiming that she was retrenched by the appellant without a valid reason because the appellant's organogram restructuring process had never been officially communicated to her. Additionally, she stated that she was denied the right to be heard, including the opportunity to seek clarification or ask questions regarding her termination. The respondent's prayers thus were for 24 months1 salary equal to Tshs 108,965,568/= as compensation, Tshs. 36,321,856 as an additional salary which was given every year for leave, rent, and education support. She also prayed for Tshs. 50,000,000/= as general damages, instruction fee of 10% for all amounts claimed, certificate of service and any other reliefs as the CMA could deem it fit to award. The appellant denied the respondent's claims and asserted that, the respondent's employment was governed by the terms of their agreement (exhibit Rl) and that, before retrenching her, the organization had ventured into a restructuring process in its initiatives to address her financial constraints. That process, which ended up with freezing of several positions and reducing staff numbers, had engaged a comprehensive discussion of all employees since the third quarter of the financial year which ended on 31st March, 2017. As a result, several positions, including those of a driver, regional program support staff, senior program manager for policy and advocacy, and information technology manager, were affected. To support her claims, the appellant presented meeting registers (exhibit R3) and emails (exhibit R4) as evidence for meetings held every Monday morning and how communication was being shared. Having heard the parties and considered the evidence adduced before it, as aforesaid, the CMA found that the respondent was fairly terminated from her employment. It thus dismissed her complaint for lack of merit. Aggrieved, the respondent preferred a High Court Division Labour Revision No. 13 of 2019. As alluded to earlier, the High Court found that though the reason for termination was fair it was procedurally unfair because the retrenchment procedures were not complied with. However, as the High Court did not find merit in other claims/ basing on section 40 (1) (c) of the Employment and Labour Relations Act, Chapter 366 (the ELRA) it quashed and set aside the CMA's award and ordered the appellant to pay the respondent 12 months' salary as compensation for the established procedurally unfair termination. Dissatisfied by the decision, the appellant preferred this appeal on two grounds. But, when the appeal was due for hearing she dropped the second ground of appeal. We find convenient to paraphrase the first ground of appeal thus: that, the High Court erred in law and fact in holding that the respondent's retrenchment was procedurally unfair for want o f prior consultation. At the hearing of the appeal, the appellant was represented by Mr. Reginald Shi rima, learned advocate while Mr. Mohamed Muya, learned advocate, represented the respondent. Submitting in support of the sole ground of appeal, Mr. Shirima contended that, before terminating the respondent on retrenchment, consultation was made through the morning meetings to all employees held each monday every week per the attendance registers (exhibit R3). There was also communication through emails (exhibit R4) to share the appellant's affairs including, the one used to summon back the respondent from Singida and managed to meet with the Managing Director on 31st March, 2017 in a meeting where the two discussed about the organogram restructuring and her retrenchment. The respondent's questions were answered, and clarifications were given. It was Mr, Shirima's further submission that, after that meeting, the respondent was given her termination letter erroneously dated 30th March, 2017 the date which was prior planned for their meeting before it was rescheduled to 31st March, 2017. The learned counsel also referred us to page 276 of the record of appeal and submitted that, in her testimony, the respondent deposed to have consented payment of her contract termination entitlements, meaning that, her termination on retrenchment was procedurally fair in terms of section 38 (1) (c) of the ELRA. Mr. Shirima thus urged the Court to allow the appeal and quash the High Court judgment and set aside its order. In reply, Mr. Muya resisted the appeal. He argued that there was no evidence that the appellant had discussed with the respondent on the intended employment termination on retrenchment. He argued further that, the evidence on record is to the effect that it was the appellant alone who decided to terminate the respondent's employment. As to Mr. Shirima's argument that there were communication and meetings that discussed the appellant's financial constraints, organogram restructuring and staff retrenchment, he argued, those were general to all employees and were not specific on the respondent's retrenchment and no minutes were tendered in evidence to that effect. Mr. Muya referred us to page 196 of the record of appeal (the respondent's termination letter- exhibit P2) and argued that, the evidence on record proved that the appellant did not consult the respondent before deciding to retrench her that is why she wrote a termination letter on 30th March, 2017 but served it to the respondent on 31st March, 2017, the day the two had briefly met for the first time the employer related to her about the appellant's organogram restructuring and her decision to retrench the respondent. He thus emphatically resisted Mr. Shirima's submission that dating the respondent termination letter 30th March, 2017 was a mere typos error but, was rather a true reflection of what the appellant had already decided on the respondents employment contract before 31st March, 2017. As regards the payment of contract terminal benefits, Mr. Muya vehemently opposed Mr. Shirima's contention that the payment signified that the respondent acceded to her termination. To him, that did not mean anything more than that the respondent, as she deposed at page 276 of the record of appeal, could not reverse the appellant's decision following her failure to provide answers to her questions. Finally, Mr. Muya beseeched the Court to uphold the High Court award and dismiss the appeal. In rejoinder, Mr. Shirima mainly insisted that the relevant procedures were followed in terminating the respondent's contract and he urged the Court to allow the appeal. We have considered both parties' arguments. At this juncture, we are faced with one issue of whether the High Court was proper when it decided that the respondent's termination was procedurally unfair for lack of consultation as a key procedure in termination of employment on operational requirement (retrenchment). The relevant part of the High Court decision is on pages 515, 516, 517 and 518 of the record of appeal stating that: "According to section 38 (1) (d) (/) (ii) and (iii) o f the ELRA, 2004 the employer is required to consult with any trade union or the respective trade union in the workplace or employees. As the employer did not consult with any trade union then it was mandatory for the employer to consult with individual employees the thing which according to the evidence in record was not done." [p.515 tines 17-19 and p.516 line 1-3] "Moreover, the evidence in record according to DW1 and termination letter show that the termination letter - exhibit P3 was written on 30/03/2017, but the consultation meeting was conducted on 31/03/2017 after it was adjourned on 30/03/2017. This means that the consultation meeting was just a meeting for the purpose of showing that the retrenchment procedure was adhered and was not called for the purpose o f a joint problem-solving exercise to reach an agreement as provided by GN No. 42 o f 2007in Rule 23 (4)."[p.5 17lines 1-8] "'In the present case the taw provides in section 38 (1) (c) that the consultation must be made prior to 8 retrenchment As the letter was written on 30/03/2017 before the consultation was made it is obvious that the consultation was not meant for a joint problem-solving exercise to reach an agreement, but rather making sure that the procedure was followed or in another word it was applied in a checklist fashion." [p.5 17 lines 18-19 and p. 518 tines 1-4] [emphasis added] Mr. Shirima firmly contended before us that the High Court observation above is fraught with error, the submission which, however, was vehemently resisted by Mr. Muya. Nevertheless, we cherish both learned counsel's concession on the laws applicable on termination of employment on operational requirement in this country, to wit, section 38 (1) of the ELRA and rule 23 (4) of the Code of Good Practice. Section 38 (1) of the ELRA speaks for itself thus: 38.-(l) In any termination for operational requirements (retrenchment), the employer shall comply with the following principles, that is to say, he shall- (a) give notice o f any intention to retrench as soon as it is contemplated; (b) disclose all relevant information on the intended retrenchment for the purpose o fproper consultation; (c) consult prior to retrenchment or redundancy on - 9 (i) the reasons for the intended retrenchment; (ii) any measures to avoid or minimize the intended retrenchment; (Hi) the method o f selection o f the employees to be retrenched (iv)the timing o f the retrenchments; (v) and severance pay in respect o f the retrenchments,; (d) give the notice, make the disclosure and consult, in terms o f this subsection, with- (i) any trade union recognized in terms o f section 67; (ii) any registered trade union which members in the workplace not represented by a recognised trade union; (iii) any employees not represented by a recognized or registered trade union. On the other hand, rule 23 (4) of the Code of Good Practice provides: "(4) The obligations placed on an employer are both procedural and substantive. The purpose of the consultation required by Section 38 o f the Act is to permit the parties, in the form o f a joint problem-solving exercise, to reach agreement on- (a) the reasons for the intended retrenchment (i.e. the need to retrench); (b) any measures to avoid or minimize the intended retrenchment such as transfer to other jobs, early retirement, voluntary retrenchment packages, fay o ff etc.; (c) criteria for selecting the employees for termination, such as last-in-first-out (LIFO), subject to the need to retain key jobs, experience or special skills, affirmative action and qualifications; (d) the timing o f the retrenchments; (e) severance pay and other conditions on which terminations take place; and (f) steps to avoid the adverse effects o f the terminations such as time o ff to seek work. While adjudging a similar labour dispute in Haider Mwinyimvua & Others v. Deposit Insurance Board & Another, [2022 TZCA 97 (7 March, 2022)] TANZLII, this Court stated that: "In our view it is clear that subsection (1) (a), (b) and (c) above creates three preconditions for retrenchment, one, that it imposes on the employer the onus to give notice o f any intention to retrench as soon as it is ii contemplated. Secondly, it requires the employer to disclose all relevant Information on the intended retrenchment for the purpose of proper consultation. Thirdly it enjoins the employer to consult prior to retrenchment or redundancy on the matter..." [Emphasis supplied] In the instant case, the evidence by Henry Raphael Horombe (DW1) at pages 265 to 270 of the record of appeal is plainly clear that, prior to 31st March, 2017 the appellant had not complied with the principles along with the procedural and substantive obligations placed to retrenching employers by section 38 (1), (a), (b), (c) and (d) (iii) of the ELRA and rule 23 (4) (a) to (f) of the Code of Good Practice respectively, above. The emails to all employees and the attendance registers, exhibits R3 and R4 Mr. Shirima relied on in his submission, we find, did not address the prerequisites of the law above. Conversely, the respondent's evidence in-chief and under cross-examination respectively as shown at pages 272 to 276 of the record of appeal, did not redress the deficiencies obtained in DWl's evidence but, rather, in our respectful view, justified the High Court findings above. For instance, the respondent deposed at pages 274 and 275 of the record of appeal that, she knew about her retrenchment the day she met the employer on 31st March, 2017 shortly before she was later served with 12 her retrenchment letter in the evening. Her further evidence at page 276, the page which incidentally was referred to us by each counsel, was that: "Qn: MD kusema mkataba unasitishwa wewe ulijibu nini? ~NHipewa nafasi ya kuuliza maswaii na (i) Kwa nini kitengo changu nimechaguliwa mimi n i oidest na kuwaacha waiioko katika probation nao wakajibu kwa vitu vingine haviwezi kufanyiwa kazi na wao wameeiekezwa wanipe taarifa. (ii) Lini ukomo wa mimi kufanya kazi? -31/3/2017 na wakaniuliza nina lolote? Basi nikawajibu nitishafanya (sic) maamuzi maana waiisema barua watanipa baadaye... Qn: Je nikisema ulikubaliana na suaia !a kuachishwa kazi ni sawa? - Ndiyo, ukizingatia pia waiishindwa kunipa majibu ya maswaii yangu nHiyouliza..." [Emphasis supplied] The respondent's retrenchment letter dated 30th March, 2017 (exhibit P2) referred in her testimony above, was indeed, served to her on 31st March, 2017 evening. Paragraphs 3 and 4 of that letter read; "As you are already aware> WaterAid Tanzania has had series o f discussions on this matter with ail employees since third quarter o f the current financial year...however, at this point, the Organization is forced to reduce number o f staff...as the last and final option. Because o f the operational requirements, the position o f Senior Manager....no longer fits within the new structure: regrettably, the Organization is left with no other option except terminating your contract of employment effective from 31st March, 2017..." [emphasis supplied] With the above evidence, it is very clear to us that, before 31st March, 2017, the appellant and the respondent had not met to negotiate the respondent's retrenchment. Besides, as we were unable to find evidence that the appellant worked with any trade union per section 38 (1) (d) (i) and (ii) of the ELRA, we are of the settled view that, considering the respondent's situation that she was not represented by a recognized or registered trade union per section 38 (1) (d) (iii) the ELRA, the appellant ought to have had accorded an extra weight on her mandatory obligation to hold the face to face consultation with the respondent before authoring the termination letter on 30th March, 2017 and serving it to her on 31st March, 2017. Doing so, in our view, would have taken onboard her employment contractual rights since no one else was there to represent and defend her interest in the intended retrenchment. In view of the evidence on record, we cannot therefore disagree with Mr. Muya that no notice was issued, and no actual pre­ retrenchment consultative meetings were conducted as rightly, in our view, found by the learned High Court Judge. That also disproved the appellant's assertion in paragraph 3 of exbibit P2 quoted above, since the so called "series o f discussions/ did not result into any recorded retrenchment agreement between her and the respondent. As a result, we equally find that, the meeting held on 31st March, 2017 was merely meant to justify the appellant's staged retrenchment checklist on the decision which she had already made on 30th March, 2017. By doing so, it did not only deny the respondent a right to participate in the retrenchment negotiation but, it also offended the principles of natural justice. See- STANBIC Bank T. Limited v. Iddi Halfani (Civil Appeal No.139 of 2021) [2023] T7CA 17496 (11 August 2023), TANZLII. In view of the discussion above, we find the issue we raised, that is, whether the High Court was proper when it decided that the respondent's termination was procedurally unfair for lack of consultation, is hereby resolved in the affirmative. As a result, we find the appeal lacking in merits and we dismiss it with no order as to costs. DATED at DAR ES SALAAM this 5th day of March, 2025. L. J. S. MWANDAMBO JUSTICE OF APPEAL A. M. MWAMPASHI JUSTICE OF APPEAL E. M. FELESHI JUSTICE OF APPEAL The Judgment delivered this 14th day of March, 2025 in the presence of Mr. Mohamed Muya, learned counsel for Respondent who took brief for Mr. Bernard Shirima, learned counsel for the Appellant, is hereby certified as a true copy of the original. A. L. KALEGEYA DEPUTY REGISTRAR COURT OF APPEAL