Muzanenhamo v Tobacco Processors Zimbabwe (HH 113 of 2004) [2004] ZWHHC 113 (18 May 2004)

HH 113/2004 HC 3211/03 GOODMAN MUZANENHAMO versus TOBACCO PROCESSORS ZIMBABWE IN THE HIGH COURT OF ZIMBABWE CHITAKUNYE J HARARE, 5 February 2004 and 19 May 2004 Opposed Application Mr Mafusire, for the applicant Advocate Fitches, for the respondent CHITAKUNYE J: The applicant was employed by the respondent. The respondent is a duly registered private company. The respondent is a subsidiary of British American Tobacco (B. A. T.) Company. At some point during his employment with the respondent, the applicant was sent on secondment to Kenya and Uganda. After the secondment he returned to Zimbabwe. Upon his return he did not receive what he expected to receive. He sought audience with the employer on his grievances. According to paragraph 5 of his founding affidavit the respondent refused or ignored his efforts at negotiating a solution. His legal practitioners wrote a number of letters to the respondent without getting any substantive response. It was in light of this that he approached this court seeking a declaratory order that: 1. The respondent shall pay to the applicant the shortfall on the local currency bonus due to the applicant for the year 2001 which shall be calculated in accordance with the formula used by the respondent to calculate the bonus due to the applicant and other employees at his level for the preceding years and the respondent shall furnish the applicant with details of the formula and calculations within ten days of the date of this order. 2. The respondent shall pay an offshore bonus in U. S. currency from the time the respondent introduced the scheme for employees at the applicant’s level and the respondent shall furnish the applicant with details of the formula and calculation HH 113/2004 HC 3211/03 within ten days of the date of this order. 3. The applicant shall be deemed to have maintained his grade 36 status on his return from assignment in March 2002 and the respondent shall pay the applicant all the salary and other benefits appropriate to that grade the details of which shall be furnished to the applicant within ten days of the date of this order. 4. For the use of his private and personal motor vehicle the respondent shall compensate the applicant for business and private use at the rates prescribed by the Automobile Association of Zimbabwe for a motor vehicle with the same engine capacity as that actually used by the respondents from time to time. 5. The respondent shall pay the costs of this application. When the matter was argued in court the issue of the motor vehicle mileage had been resolved and an order as per the draft order was to be granted. The respondent also indicated that the issue of offshore bonus had been resolved. The applicant however denied this contending that the respondent had offered a figure it had arbitrarily decided on which figure was for part of the period in question. The issues that remained for determination were thus three vis: 1. Local currency. 2. Offshore bonus 3. Job grade The applicant also raised the issue of the respondent’s opposing affidavit being deposed to by Mr Gona. He contended that it is hearsay as Mr Gona is not the one he dealt with. The respondent’s argument was to the effect that Mr Gona has the mandate to depose to the affidavit in his capacity as the respondents Human Resources Director. Mr Gona has clearly indicated that some of the facts are within his personal knowledge. For facts not with his personal knowledge he has verified them from records in his custody. I am of the view that the opposing affidavit be accepted in the light of that explanation. The main issues will be dealt with individually. 1. Local Currency Bonus The applicant’s claim is for the balance of the local currency bonus. It is common cause that the applicant was entitled to this bonus. The dispute was whether he was paid in full or not. The applicant contended contended that the local HH 113/2004 HC 3211/03 currency bonus was based on company and individual performance. The respondent did not dispute that. Paragraph 9 of the opposing affidavit shows that the respondent admitted this fact. Despite that admission the respondent in paragraph 14 of its opposing affidavit stated that on this occasion the bonus was paid across the board to all employees on the basis of three months salary. The respondent went on to say that the criteria used by the respondent to pay all its employees three months salary was objective and was based on the company’s collective economic well being, as opposed to an employee’s individual performance. By virtue of this the respondent was admitting to abandoning the policy of considering both the company’s performance and individual’s performance to now considering only the company’s economic well being. Annexure ‘L’ a letter dated 31 March 2000 from respondent to applicant confirms that the 1999 local currency bonus was based on the company and individual performance. The respondent’s decision to abandon the aspect of individual performance was apparently without explanation. It was certainly a material departure from its acknowledged policy. In the absence of any cogent explanation for such departure I am of the view that the applicant is entitled to the local currency bonus calculated on the basis of company and individual performance. It was not proper for the respondent to arbitrarily forego the acknowledged basis upon which bonus was paid. I did not hear it argued that the issue of local currency bonus was purely within the respondent’s discretion. The manner in which this bonus was dealt with made it a contractual term for which applicant was expected to be paid on the usual basis. 2. Offshore Bonus Though the respondent said that this issue had been resolved that was clearly not so. The applicant contended that respondent arbitrarily offered him 6 000U. S. dollars which is only part of the total amount he is entitled to. The respondent’s rationale for not paying the applicant this bonus from the beginning was not easy to appreciate. It was the respondent’s argument that the applicant was not entitled to this incentive bonus because this bonus was meant as a skills retention scheme for those employees with special skills and based in Zimbabwe. In paragraph 15 of the opposing affidavit the respondent said that secondees were specifically excluded from this scheme. Unfortunately this assertion was not substantiated. The respondent argued that the applicant was excluded because as a secondee he HH 113/2004 HC 3211/03 already benefited in the form of international exposure and from receiving a US dollar denominated salary. This argument appeared ill founded. The applicant’s letter of assignment did not show that the applicant was to receive a US dollar denominated salary. The applicant denied this. He contended that his salary was paid into his Zimbabwe Bank Account in local currency. The allowances he received while on secondment were in the host country’s local currency. The respondent’s argument on the issue was clearly not well grounded. The respondent’s policy as noted in its International assignment handbook (Annexure H) appeared to be that those on secondment should not be prejudiced by such secondment, hence their salary reviews and bonus schemes were tied to those of their home country. On bonus the handbook states: “You will continue to receive any bonus or incentive payments which would normally have applied in your home country…” In the absence of an unequivocal statement disqualifying the applicant, he is surely entitled to this bonus. The letter of assignment has no such an equivocal disqualification. No other document was produced specifically excluding secondees from this offshore bonus scheme. The applicant is entitled to this bonus calculated on the basis set at the inception of the scheme. 3. Job Grade The applicant contended that just before being sent on secondment to Kenya he had been upgraded to Grade 35. Whilst in Kenya he was upgraded to Grade 36. He moved to Uganda in that grade. When he returned to Zimbabwe he was downgraded to grade 35. As far as he was concerned he had earned Grade 36 and so he should have been accorded that grade on return to Zimbabwe. The respondent admitted that prior to his secondment the applicant was in Grade 35. In Kenya the applicant was upgraded to Grade 36. According to the respondent the letter of assignment unequivocally stated that an employee upon return from assignment would revert to the grade he held prior to undertaking the international assignment. In paragraph 25 of the opposing affidavit the respondent states that the applicant’s letters of assignment HH 113/2004 HC 3211/03 to Kenya and Uganda specifically provided that he would revert to grade 35 upon return to Zimbabwe. A careful perusal of the two letters of assignment Annexures ‘N’ and ‘O’ does not support this. No such specification is contained therein. Annexure ‘N’ states inter alia, that: “You will take up the position of Head of Processing in Grade 35 located in Kenya.” The applicant was thus to be in Grade 35 whilst in Kenya. Annexure ‘O’ the letter of assignment in Uganda states that: “You will take up the position of Area Leaf Processing Manager in Grade 36 located in Uganda.” The remuneration package provided was for Grade 36. Page 2 of the letter shows the applicant’s home packages being for grade 36. The letter also states that at the end of the assignment the assignment letter will cease to have effect and applicant will revert to the terms and conditions of employment applicable in his home country. The letter further states that: “At the end of this assignment and upon return to Zimbabwe your cash remuneration will revert to your previous base salary.” Therefore whatever base salary applicant was getting as a result of the assignment was to cease and the previous base salary was to be effected. The question may thus be did “terms and conditions” include grade. The applicant argued that it did not whilst the respondent said it did. The applicant’s argument that he earned Grade 36 may seem to have some merit. Unfortunately the letters of assignment give the impression that the grades on assignment were for the duration of the assignments. It may also be noted that issues of remuneration were according to a given grade. If therefore the remuneration were to revert to those of the previous grade, surely even the grade was to be affected. It is thus clear that the terms and conditions included the grade. In that regard therefore it was within the respondent’s discretion to either bring back the applicant in the grade he had been assigned in or to his previous home country grade. Whilst indeed there may be some secondees who upon return either maintained their grades or were upgraded that did not oust the respondent’s discretion. HH 113/2004 HC 3211/03 In the premises the applicant cannot succeed on this issue. Accordingly it is declared that: 1. The respondent shall pay the applicant the shortfall on the local currency bonus due to the applicant for the year 2001 which shall be calculated in accordance with the formula used by the respondent to calculate the bonus due to the applicant and other employees at his level for the preceding years and the respondent shall furnish the applicant with details of the formula and calculations within ten days of the date of this order. 2. The respondent shall pay the applicant an offshore bonus in U. S. currency from the time the respondent introduced the scheme for employees at the applicant’s level and the respondent shall furnish the applicant with details of the formula and calculation within ten days of the date of this order. 3. 4. The applicant’s application to be deemed to have maintained his Grade 36 status on his return from assignment in March 2002 is dismissed. For the use of his private and personal motor vehicle the respondent shall compensate the applicant for business and private use at the rates prescribed by the Automobile Association of Zimbabwe for a motor vehicle with the same engine capacity as that actually used by the applicant from time to time i.e. for a vehicle whose engine capacity is 3.5 litres. 5. The respondent shall pay the costs of this application. Scanlen and Holderness, applicant’s legal practitioners Gill Godlonton and Gerans, respondent’s legal practitioners