Central Province Co-Operative Union v Mulambya (Appeal 3 of 2016) [2018] ZMSC 303 (7 September 2018)

' ' IN THE SUPREME COURT OF ZAMBIA HOLDEN AT NDOLA (Civil Jurisdiction) BETWEEN: • APPEAL NO. 003/2016 CENTRAL PROVINCE CO-OPE TIVE UNION APPELLANT AND • Rr=p•,~, ., - ._ u ·..,, ,r ,,....~ .,I\ , • I'-,;_ -• '-., ·....:!- \ 7 .. ,. ... ;.~ - c} ;J : . ..,.. .: • : :. r ~ r • . ... " ' • &.t.} . - . . ,.,, -....._ "' ! ' £ ,4 -4.,,#"~J"1 ,; ' . ~ -..i-. --..,~ . .. ~. · ~ ... - -7 t,.r-0 !'k -.,....>-w,.,...._, ALISALA AISON MULAMBYA surf't£ic;t;: ,~();;:,!~!~_; • ESPONDENT Coram: Mambilima, CJ, Malila and Musofida,c:tLJ on 4th and 7th September, 2018 , - - p o ~.., ~, i, :::.(i1S,. Ry · · u OX 5006 7 LUSAKA ' For the Appellant: Mr. 0 . Sinkamba of Messrs Sinkamba Legal Practitioners For the Respondent: Mr. Chanda Chilufya, appearin g on b ehalf of Mr. E. Chulu of Messrs Enias Chulu Legal Practitioners JUDGMENT MUSONDA, JS, delivered the Judgment of the Court. A. CASES REFERRED TO: 1. Barclays Bank Zambia PLC v. Zambia Union of Financial and Allied Workers (2007) Z. R. 106 2. Chilanga Cement PLC v. Kasote Singogo (2009) Z. R. 122 B. LEGISLATION REFERRED TO: The Employment Act, Cap. 268 of the Laws of Zambia • J2 1 .0 INTROD'UCTION .. 1 Th,e appellant has approached us t,o contest -h 1e lower co,urts determinatio,n ·to the effect that the re po,ndent had, as th 1e app,e·llant's former employee, been the subject of a redundancy exercise .and, co,nsequently, was entitled to, b·enefit from the statutory respite which the Empl,oyment Act, C,ap. 2 168 affords to .any (eligible) employ,ee who is caught up in such a predicrunent. ·2 .0 HISTORY. AN'D BAC. KGROUND :FACTS / CIRCUM:S TANCES1 2.1 The hist,ory and b 1.ackground fact.s. and ·circumstanc,es t,o which the present ap1peal is owed revo,lve aroun,d a narrow compas.s and can be recounted with. ease. 2 .. 2 The respondent had been employed .as a management emplo1y,ee of the app,ellant fr,om 10th December, 19'9'0 u :p to 31st March, 199,8 when,. as we shall dem,o,nstr,ate later on in this judgment, he left the appellant's emp,loy of his own accord . 2 .. 3, During the p·eriod of his. employment as aforesaid, th,e resp,ondent had b,een serving under the appellant.'·s conditions ·Of service for Man.ag,ement empl,oy,e,es .. • • J3 2.4 By a letter dated 6th June, 1997, the respondent sought to have the appellant's Board of Directors retire him early. 2.5 Concomitantly with his request to be retired early, the respondent also sought to have part of his early retirement benefits applied towards the purchase of the appellant's house which the respondent had been living in by virtue of and as an incident of his employment. 2.6 By a letter to the respondent dated 27th September, 1997, the respondent varied his earlier application as stated in 2.4 above to that of seeking to be voluntarily displaced or retrenched. In the same letter, the respondent indicated that the alteration of his application in the manner indicated above was: << ••• in line with the advice which [the appellant's General Manager allegedly] gave to all Head Office Senior Management staff at a special management meeting [held} on Tuesday, 16th September, 1997 .. . '' Additionally, the respondent reiterated his desire to have the appellant sell him the house which we referred to above. • ' J4 2.7 By letter dated 3 rd February, 1998 the appellant's General Manager reacted to the respondent's request as alluded to above. That letter was expressed in the following terms: ((Dear Mr. Mulambya, Re: APPLICATION FOR VOLUNTARY DISPLACEMENT AND PURCHASE OF A UNION HOUSE I am writing in response to your letters dated 6th June, 1997, 27th September, 1997, 17th November, 1997 and 22nd January, 1998 on the subject matter stated above. The Board of Directors considered your requests during the sittings of 4 th November, 1997 and 16th January, 1998. Subsequently, it was resolved that your request for voluntary displacement be accepted. Therefore, you are to serve for two (2) months as notice period commencing on 1st February, 1998 up to, 31st March, 1 998. Further, it was also resolved to sell you house number 58, Natuseko Site and Service, at the cost [sic.} of K7 million which shall be part-payment by the Union towards your terminal benefits. The balance, less your indebtedness, shall be paid to you within a period of not more than nine (09) months starting from 1st April, 1998. By copy of this letter, the Finance and Administrative Manager is hereby requested to calculate your total package and advise you accordingly. '' 2.8 Following the respondent's request to have the appellant confirm as to what he could expect b y way of his net terminal JS benefits, the latter advised him (by letter dated 19th October , 1998) that his net benefits , inclusive of pension • contributions , amounted to Kl,562,028.66. 2.9 On 27th November, 1998, the respondent's advocates wrote a letter to the appellant demanding payment of the respondent's 'confirmed ... terminal benefits .. . ) in the sum of Kl,562,028.66. This letter was followed by two subsequent reminders dated 18th December, 1998 and 6th January, 1999 in which the respondent's advocates were demanding the recovery of their client's Kl ,562,028.66 'outstanding terminal benefits.) 2.10 On 21 st January, 1999 the respondent, acting by his advocates, varied the nature and quantum of his demand against his former employer by seeking to recover an additional sum of KS,297,004.00 representing what was expressed as his unpaid monthly wages for the period April to December, 1998. This additional sum aro·se as a result of the respondent's decision to invoke the provisions which are now contained in Section 26 B (3) of the Employment Act, Cap. 268 of the Laws of Zambia which enacts as follows: • J6 ''An employee whose contract of service has been terminated by reason of redundancy shall- (a) be entitled to such redundancy pa.yment as agreed by the parties O·r as determined by the Minister, whichever is the greater; and (b) be paid the redundancy benefits not later than the last day of duty of the employee provided that where an employer is unable to pay the redundancy benefits on the last day of duty of the employee, the employer shall continue to pay the employee full wages until the redundancy benefits are paid.'' 2.11 For completeness, the respondent's advocates indicated in their demand letter of 21st January, 1999 that the appellant had been unable to settle the respondent's ((.. . full retrenchment benefits for . . . nine months'' and that, in consequence, the respondent had become entitled to the relief which the statutory provision cited above affords. 2.12 By a letter dated 25th January, 1999, the appellant contested the respondent's demand founded on Section 26B of the Employment Act, Cap. 268 of the Laws of Zambia thereby leaving the respondent with the last option of proceeding to court. ,, J7 3.0 THE COURT ACTION 3 .1 Following the parties ' failure to resolve the matter ex-curia, the respondent mounted an action in the court below se,ekin.g , in the main, the recovery of the Kl,562 ,028.66, earlier mentione,d by way of (outstanding terminal ben,efits) togethe r with full wages and all allowances from the date of his exit from the appellant up to the date of payment of his full benefits,. 3,.2 Fo,r its part, the appellant pleaded in its defence that a ·value to, th,e tune of Kl2,500,000.00 in the form of a house had been extended to the respondent by the app,ellant ,o,n the basis ,o,f a m staken belief that the former was entitled o Kl2,389, 154.2,5, on account of retrenchment benefits when, in fact, he had not been so entitled The appella.nt's contention in the court below was that the res,pondent was never retrenched nor declare,d redundant but had voluntarily retired. The appellant accordingly counter-cl,aimed the said ,sum of Kl2,5 1010,000 .i0 10 by way of seeking to have the respondent yie.ld vacant possession of the house, being No,. 6,06 A, N,ehru Cr,escent, Kab,we, together, with all ren.t for the ' ' J8 period that the respond·ent had remained in oc 1cupati,on of the house in qu,esti,on. 4 .0 ·T RIAL AND JUDGMENT OF T HE COU R T BELOW 4.1 Foll,owing the gran.ting: ·Of the respondent's .application t,o, h ,ave the mat.ter tri.ed without p,1,eadings on the bas.is tha·t sumtn.ary judgme·nt had .s.inc,e been ,entered by the District Regi.s.trar on accou ·t of the Kl,562,028 .. 6 16 undis.puted am 1ount, trial subsequently ensued b,efore the cour·t below in respe,ct of the moneys which the appellant was contesting, .namely,. those which had been fo·unded on the provisions of Section 2 168 of the Employm.,ent A,ct as 1earlier explained. 4 .. :2 After ,considering the evidence and submi.ssions which the parties had res.pectively pl.a,ce,d before him, t e learne 1d trial j'udge found,. as. fact, that the respondent h .ad, pursuant to his ,own request, be,en d ,ecl.ared redundant and th.at the ap1pellan·t had pro,ce·eded to ,c,ompute a redundancy package for the respond.ent on the basis of Clause 1 7 .3 ,of the Conditions of Service un,der which the respondent had be·en serving and which provide,d as follo,ws: ' ' J9 '' 1 7. 3 An e mployee who shall be affected by Section 1 7.1 will receive the redundancy / retre nchment package as follows: (b) An employee who has worked for more than five (5) years s ervice shall rece ive five (5) months salary for each year completed or part thereof'' 4 .3 Having regard to h is fin dings as set ou t above, the learned trial judge accordingly concluded th at Section 26B (3) of the Employ ment Act, Cap. 268 applied to the respondent to the extent th at the appellant had not disputed the fact that the respondent was not paid his redun dan cy benefits on his last day of duty, namely, 31 st March, 1998. The judge accordingly entered judgment in favour of the respondent whereby the appellant was directed to pay the respondent his fu ll wages until his fu ll benefits were paid to h im. 5.0 THE APPEAL AND THE GROUNDS THEREOF 5 . 1 Th e appella n t was not pleased with th e judgment of t he court below and h as now sought our intervention on the basis of the fo llowing grounds : '' 1. The learned High Court Judge misdirected himself both in law and in fact by holding that the Respondent was • • J1 0 declared redundant against the weight of evidence on record. 2. The learned High Court Judge misdirected himself in both law and fact when he overlooked the amended defence and specific defences raised by the appellant in the court below. 3. The learned High Court Judge erred in both law and fact when he overlooked the fact that the plaintiff was paid all his Kl ,562,028.00 which was not disputed. 4. Any further grounds as may appear appropriate after perusal of record.'' 5 .2 At the hearing of the appeal, counsel for either party confirmed having filed their respective Heads of Argument to support the positions which they had respectively taken with respect to the issues at play in the appeal. 5.3 An issue which we feel inclined to immediately displace from further consideration is the projection, in the appellant's memorandum of appeal , of the fictitious ground numbered 4 above. As we have repeatedly said, this purported 'ground' is not, in the eyes of the Rules of this court, a valid ground of appeal at all. Accordingly, we are treating this appeal as having been founded on three grounds. Jll 16· .. 0 ARGU'MENTS ON APPEAL 6.1. Co n :sel for , he appellant 1canva sed .a va:riety of arguments around th,e t.hree grounds which we have identified above. Le·ar.ned counsel st.arted off by indicating: to us th,at, for the purpose of his arguments, groun,ds ,one and two had been consolidate:d into ground one while the third g,round w.as to be ar·gued as the se,c,ond gro1und. 6.2 Fo,r c 1ompl,eteness, Counsel for the ap·p,ellant also filed Heads 1of Argument in response to the appellant's Heads o,f Argument. 6.3 As not,ed ab,ove, counsel for the appellant canvassed .a vari,ety o-:f argumen.ts in suppo,rt of the grounds of appe.al, which ranged from the assertion ·that the respondent never retir,ed and was n ,ever d ,eclared redundant by the app,·ellant, to the assertion that he vo,luntarily exite·d from the employ of the appellant on terms w·h .1·ch wer,e o:utside his tern1s and conditions of employment. The fate of this appeal, however, has to turn on the view we take in relati·on to the narrow issue as t,o whether or not, in the lig,ht of the un 1dispu ted fact that the resp1ond,ent had been employ1ed und·er a writt:en contract J12 of empl·oyrnent. and had been serving under wTitten terms and conditio,ns of employm 1ent, the whole basis of the judgn1ent now under attack,, namely S,ectio1n 26B of the Emp·loyinent Act, Cap . 268 is le.gally tenable. 6.4· Lea1·11e,d counsel fo,r the appellant, for his p.art, contende,d in his h ,eads. 1of argum,ent that Section 26B of the Employinent Act,. Cap. 268 of the Laws of Zambi.a could not b·e properly inv,oke·d by an emplo1yee, such as th·e respondent, wh,o h .ad b 1·een serving pursuant to written c,onditi,ons of s,ervice which also covered re,dundancy. 6.5· To· drive his point home, the a.ppellant's counsel ,cited ,o,ur decision 1n Barcl.ays Bank :Zantbia :P·Lc. v. Zantbia Uni,on of Financial. an·d Allied Workers 1 in which w·e mad·e the point that Se,ctio:n :2 16B of the Employment A,ct, ,cap. 2·68 c,ould not b ,e properly invok,ed in relation t 10 an employee who had be,en employed purs.u ,ari·t ·t·o a written 1Contract. 6. ,6 Reacting, to the above contention, counsel for the resp,ondent ar·gued in his heads of argument that Secti,on 26B (.2) (a), (b) and (c), ·Of the Employm 1ent Act, Cap. 268, of the Laws o,f Zambia did not ap·ply t.o the r,es.pon,dent by reas.on of the fa,ct ' J1 3 tha , as a non-un.io·ni 1ed emp1loy·e , he could n 1ot have been affected by the said provision to the extent ·that tha provisi 1on env1sag,ed the involvement ,o,f o,r co,n .sultation with an affecte,d employ,e,e's un·on representative befor,e such employee's r,edundancy can be effe,cted. :However, the r 1espondent's coun · el ,acknowledged ·that S,e,ction 26B (1) (,a) .an,d (b) did apply to the r·es,pon,dent. 16. 7 At th,e hearing O·f the app 1eal, Mr. S.inkamb,a, the learned c,oun.s,el for the .app,ellant, reiterated th.at the r 1e·sp 1ond,ent had b ,een serving un.der a writ.t 1en c,ontract while the terms and conditions under which he was serving w,ere also written ... 6,.8 Learned ,co,unsel also, confirme:d the fact that th,e respondent was paid all the mo·ney which he had been ,entitled to in the way of his. benefit:s save for the unpaid wag 1es or s,,al.ari,es whi,ch h ,e h .a ,d b,een claiming on the faith ,of Secti 1on 26B, of the Empl,oyment A ,ct, C,ap. 268. 7 .. 0 CONS IDERATION OF THE APPEAL AND, DE·CISION 7.1 We have examined the judgment of th,e co,urt below, the e·v1dence which the two parties placed befor,e the trial ,court and the argum 1ents. which w,ere canvasse·d in thi· court o,n J14 b half o,f the p,arti ·s in r ,eg,ard · o th n , rr w ·ss.u ,e with whi,ch we are primarily concerned and expr,es,s our g,r·atitu,de to counsel involved for their respective an,d useful exertions. 7.2 ,Given the documentary evi,dence which w .as deployed before the court below, it is, b,,ey,ond dispute that the: respon,dent was serving under a w·ritten c,ontract and ·written t.erms ,and conditi,o,ns, of ,empl,oyment. In point 1of fact, sizeable p,o,rtions of the .ap,pellant's Conditions. of Service for Manag,ement staff rec,ord r,elat1ng to ·the proce,edings in the court bel,ow. 7.3 Accordin,g to thos,e c,onditio,ns of service, redun,dancy was ,cap,ture,d in Cl,aus.e 1 7. , n fact, and as we no,ted early on in this judgm,ent, th,e trial judge did interrogate the redun,d.an,cy Cl,ause in qu,estion in his judgment whi,ch is now being as,sail,ed in this court. 7.4 In Barcl.ays Bank Zatnbi.a, PLC v. Za111bia. Union ofFin,ancial Institutions and ,Alli,ed Workers and Others 1 we made the point that,, Section 26B of the Employment Act, C.ap. 268, (which c,ont,ains detailed • prOVlS1lOilS • emplo.yment terminati,on through redundancy) only app 1lied to employees J15 who had b en 1en,gaged ,on oral ontr,acts .. Two years l.at 1er,, we r ,einforced the same obseivation in our decision in Chilanga Ce,m ,ent PLC v. Kasote Singogo2 • 7.5, It should no,t b1e d1oub1t,ed, in1dee,d, that what we sai 1d in B,arclays Bank Zambia PLC 1 with resp,ect to th 1e non appli,cability ,of Sectio1n 26B of the Employm,e,nt A,ct, Cap. 268 to, employees who a,re employed o,n writt,en 1employITient contr,acts h ,as, b,een repeate,d or restated in numerous other cas,es. ,ever since w,e m ,ad,e that S 1e:minal pr,onouncement in that case. 7. 6 For the avoidan,c,e of doub,t, the applicability or otherwise of Secti 1on 26B of the Emplo,yinent Act, in the manner we pronounce,d in the :Bar,clays Bank PLC 1 case, rema,ins immutable whether or not an employee is unionised o,r non unionis1ed., 7.7 Needle,ss to say, the invoc,a .tio,n of Section 26B of th,e Employrrient Act in favour O·f the respondent b,y t,he trial judge in the court below cons,tituted a blatant misdire,ction. J16 7 .. 8 In the res·ult,. we· allow this ,appeal .and set asid,e the judgrrient of the court below. The arising co,sts will :follow the event and should be taxed if not agreed. ' •••••••••••••••••••••••••••••••••••••• I. C .. MAM. BILIMA CHIEF ,JU. STICE •••••••••••••••••••••••••••••••••••••• .. __--- M. MALILA SUPREME ,COURT JUDGE •••••••••••••••••••••••••••••••••••• M. MUSONDA, SC SUPREME COURT JUDGE