Ng'ambi v Northern Technical College and Management (Appeal 6 of 2011) [2016] ZMSC 256 (24 March 2016)

IN THE SUPREME COURT OF ZAMBIA APPEAL NO. 6/2011 HOLDEN AT LUSAKA (Civil Jurisdiction) BETWEEN: CHAKA NG’AMBI APPELLANT AND NORTHERN TECHNICAL COLLEGE AND MANANGEMENT RESPONDENT Coram: Muyovwe, Kaoma JJS and Lengalenga Ag/JS On the 9th October, 2014 and 24th March, 2016 For the Appellant: Ms. M. Mwalusi, Messrs Chifumu Banda and Associates For the Respondent: Mr. C. Mukonka, Messrs Caristo Mukonka Legal Practitioners JUDGMENT MUYOVWE, JS, delivered the Judgment of the Court Cases referred to: 1. National Airport Corporation Limited vs. Reggie Ephraim Zimba and Saviour Konie (SCZ) Judgment No. 34 of 2000 2. Charles Chenda and Evaristo Kangwa vs. Zambia Postal Services Corporation COMP. 82 of 2000 3. Kitwe City Council vs. William Nguni (2005) Z. R. 57 4. Khalid Mohammed vs. Attorney General (1982) Z. R. 49 Jl When we heard this appeal, Hon. Madam Justice Lengalenga sat with us, she has since reverted to the High Court, therefore, this is a majority judgment. This appeal is against the judgment of the Industrial Relations Court which dismissed the appellant’s claim that the termination of his employment by the respondent was unlawful and wrongful. His claim for compensation for loss of employment was also dismissed. The appellant’s story was that he initially joined the respondent as an Assistant Accountant on a two year contract. According to the appellant, during his tenure of office he discovered numerous anomalies in the issuance of receipts to students at the college. These discoveries involved his fellow Assistant accountant a Ms. Angela Sinkala. The appellant worked diligently and discovered a lot of irregularities and he would from time to time refuse to pass certain payments which unfortunately brought him into conflict with some Board members and the Principal. The appellant even accused the Principal of dishonest conduct. The appellant, said on 21st July, 2009 he received a letter of confirmation as Internal Auditor and J2 he accepted the confirmation. However, the appellant on 19th August, 2009 withdrew his acceptance on the ground that the confirmation was not done in good faith. His services were terminated following his withdrawal of acceptance. The appellant’s reaction was that his termination was null and void but when he reported for work on 16th September, 2009 the doors were closed to him. He was paid his dues but not his gratuity to the end of his contract. The appellant conceded that he did not have the relevant qualification for the position of internal auditor. He also conceded that in his letter dated 22nd July, 2009, he demanded that his salary scale be adjusted upwards as a condition for him to accept the offer of the contract. The respondent’s witness, who was the Principal at the establishment explained that the appellant was offered the position of Internal Auditor after management failed to fill up the position after advertising. That the appellant was appointed and put on three months probation. Following an audit by the Auditor-General’s office, the respondent was put to task over the fact that the appellant was not qualified to hold the position of J3 Internal Auditor. It was explained to the Auditor General’s office that the respondent could not attract qualified staff due to the unattractive conditions of service offered by the respondent. The appellant was offered the contract which he accepted but later withdrew acceptance of the offer. It was decided to terminate his employment since he refused to accept the letter of confirmation and the respondent declined to accede to his demand that the confirmation should be on a higher scale of NTC 2 from NTC 3. This was the respondent’s case. In its judgment, the Industrial Relations Court dismissed the appellant’s claim for compensation for loss of employment due to the fact that he did not confirm or accept his appointment as Internal Auditor. The court found that the appellant withdrew his acceptance thereby leaving the respondent with no option but to terminate his employment. The lower court found that the respondent’s actions were justified. The court found that the appellant failed to prove his claim for underpayment of gratuity. The court took the view that as the appellant did not adduce any evidence to show that he was a unionized employee for him to qualify to be paid gratuity up to the end of the contract, this J4 claim was bound to fail. Relying on the case of National Airport Corporation Limited vs. Reggie Ephraim Zimba and Saviour Konie1 the lower court declined the appellant’s claim that he be paid gratuity till the end of the contract as this was tantamount to being extravagant and unconscionable. The court also found that the offer of appointment as Internal Auditor was at Grade NTC 3 and that it was the appellant who declined to be redeployed. The court held that he had failed to prove his case on a balance of probabilities and dismissed his case. Before us, the appellant advanced two grounds of appeal. In ground one, the appellant complained that the lower court was wrong to hold that the appellant failed to present evidence that he was a unionized employee who was entitled to gratuity up to the end of his contract of employment. In ground two, the appellant attacked the lower court for holding that the respondent was justified in terminating his employment following his withdrawal of his acceptance of the contract offer for the position of Internal Auditor. In support of ground one, the learned Counsel for the appellant began by referring us to Article 12(j) (IV) of the • J5 ' Northern Technical College Human Resources Policy Manual (hereinafter called “the Manual”) which provides that: “The terms and conditions of service for NORTEC staff are negotiated annually or as determined by the board jointly with the staff union. Once agreed upon they are valid for all staff (unionized and non-unionized).” Counsel for the appellant contended that in terms of the above cited provision, the terms of the Collective Agreement applied to all NORTEC staff whether unionized or not. It was contended that the Collective Agreement entered into between the Northern Technical College Management Board (hereinafter called (the Board”) and the National Union of Technical Educational Lecturers and Allied Workers dated 27th May, 2007 are applicable to the appellant by virtue of Article 12(j)(IV) of the Manual whether he is unionized or not. Counsel referred us to some two cases from the United States of America where it was held that Manuals similar to the respondent’s Manual have been held to create implied terms in a contract of employment. According to Counsel, the authorities cited though not binding on this court contain persuasive provisions and that we should therefore, consider them. Counsel contended that the J6 Manual introduced implied terms into the appellant’s contract of employment which the respondent was bound to comply with and that this included the appellant’s entitlement to have his gratuity computed in accordance with the Collective Agreement. It was contended that the Manual was not a draft but it was fully operational going by the wording of the Manual at page 4 which states that: “It is my pleasure to launch the Human Resource Policy Manual for NORTEC.” Further, it was contended that there is nothing in the Manual which suggests that it was a draft which would become operational on a specified date. It was submitted that, therefore, the appellant was entitled to be paid his gratuity in accordance with Clause 15.1.4 of the Collective Agreement which states: “If a contract of an employee is terminated prematurely the employee shall be paid a gratuity at the rate of 30% of the gross salary based on the employment contract period. The last drawn salary is the basis for the calculation of gratuity.” Counsel further argued that the court below misdirected itself when it held that the appellant should have adduced evidence to show that he was a unionized member before the Collective Agreement could apply to him. Counsel argued that the lower court misdirected itself as the appellant produced the J7 Manual in his bundle of documents and that Clause 15.1.4 of the Collective Agreement should have been considered in computing his gratuity. In support of ground two, Counsel for the appellant referred us to the definition of an employee under the Employment Act Chapter 268 of the Laws of Zambia. . He submitted that going by the definition in the Act, a contract of employment is a contract of service and that like any other contract there must be an offer, acceptance and consideration, as well as the intention to create legal relations. Further, that in order to determine whether one is an employee or not, it is essential to determine whether there was an agreement between the parties and if so, whether the agreement amounts to a contract. Counsel brought to the fore submissions by Counsel for the respondent where they conceded that there was a contract between the parties and the appellant was placed in Grade NTC 3. According to Counsel, the contract of employment was not subject to confirmation and the request to confirm the appellant came later and it was never a term of the contract entered into between the parties on 1st March, 2008. It was submitted that J8 this was because there was already a contract of employment in place and that, therefore, it was open to the appellant to accept or object to the request for confirmation. It was submitted that the withdrawal by the appellant of the confirmation did not terminate the contract of employment as the request to confirm only came more than a year after he was working as an Internal Auditor. Counsel contended that as the appellant was already an employee he was entitled and justified to reject the subsequent conditions. We were referred to the case of Charles Chenda and Evaristo Kangwa vs. Zambia Postal Services Corporation2 where the Industrial Relations Court held that: “It is trite law that contracts of employment are governed by the terms and conditions agreed to by the parties hitherto and as such no extraneous matters might be read into the contract once the parties have appended their signature...” Counsel argued that a request to confirm was not a letter offer of employment but that it was an extraneous term intended to vary the terms on which the appellant and respondent was to relate as employee and employer. Counsel insisted that the respondent went against the law in terminating the appellant’s contract of employment on the ground that he did not confirm the acceptance of the offer by the respondent. That, therefore, J9 the court below erred in both law and in fact when it held that the respondent was justified in its actions to terminate the appellant’s employment when he withdrew his acceptance. Counsel urged this court to allow the appeal. In response to ground one, Counsel for the respondent Mr. Mukonka filed heads of arguments which he relied on. He submitted, inter alia, that the documentary evidence produced by the appellant in the lower court revealed that he was employed on a fixed term of contract for employees in management. Mr. Mukonka referred us to the letter of offer of employment dated 25th January, 2008 which reads under paragraph 4 as follows: “You will be reporting to the Principal. Your salary will be three Million One Hundred and Nine Thousand six Hundred Kwacha, K3,109,600.00) gross per month in pay grade NTC for contract staff.” The letter of confirmation of employment dated 20th May, 2009 addressed to the appellant under paragraph 3 stated as follows: “The terms and conditions under which you will serve are for management and the contract of employment ... you will serve on a three years contract effective 1st March, 2008.” J10 It was submitted that from the two letters, it was clearly stated that the appellant was on a fixed contract. Counsel argued that the Collective Agreement on which the appellant was trying to seek solace states in its preamble that “the Union is committed to negotiate for better salaries and conditions for their members” which clearly excluded the appellant who was not a member of the Union. Counsel also submitted that there were two payslips which were produced during trial; one was for a unionized employee of the respondent which showed a deduction of the union subscription and the other one for the appellant which showed no such deduction. It was submitted that the Manual was a draft and it was never implemented even though it had inscription that it was being launched. Counsel pointed out that the Manual was not even signed. He submitted that the argument that the appellant was a unionized employee and that he should be paid gratuity up to the end of the contract was unfounded and that that was not the position of the law. We were referred to our decision in Kitwe City Council vs. William q Nguni where it was held that: JU “It is unlawful to award a salary or pension benefits, for a period not worked for because such an award has not been earned and might be properly termed as unjust enrichment.” Counsel also relied on the case of National Airport Corporation Limited vs. Reggie Ephraim Zimba and Saviour Konie1 in which we frowned upon the awarding of extravagant and unconscionable amounts and refused to allow damages for wrongful termination to be computed as if the contract had run the full term. In response to ground two, it was submitted that through the letter dated 25th January, 2008 the appellant was offered employment by the respondent as Internal Auditor at a salary of K3,109,600.00 and the appointment was effective 1st March, 2008 on contract and Grade NTC 3. . It was specified in the said letter of appointment, that the appellant was to be on probation for a period of three (3) months and his confirmation was subject to satisfactory job performance. According to Mr. Mukonka, the appellant’s subsequent withdrawal of the acceptance of the offer to work as Internal Auditor terminated the contract especially that it was on the ground that the respondent had not adjusted his salary scale from NTC 3 to NTC 2. That the appellant J12 demanded an adjustment of his salary in order for him to accept the offer. Counsel submitted that the net effect of the appellant’s rejection of the salary grade of NTC 3 offered to him by the respondent is that, there, was no consensus of the vital element of consideration in a contract as the respondent offered payment in salary grade of NTC 3 whereas the appellant wanted to be paid in a higher salary grade of NTC 2. Counsel pointed out that the position as taken by the Board was that there was no contractual link between the appellant and the respondent since he had rejected the confirmation. That, therefore, the decision which the respondent made to separate with the appellant was appropriate. Counsel argued that the trial court was on firm ground when it held that the respondent was justified to terminate the employment contract following the appellant’s withdrawal of his acceptance. He further submitted that the trial court rightly noted, that the reason for withdrawing the acceptance of confirmation by the appellant was because the appellant wanted to be placed in grade NTC 2 and, therefore, the termination of the appellant’s employment could not be said to have been unfair or wrongful to warrant compensation for loss of employment. J13 Counsel submitted that the argument by the appellant that the withdrawal of his acceptance did not affect his employment status as he was already in employment is unacceptable more so that the appellant was insisting that if he was to continue working for the respondent he would only do so if he was placed in salary scale of NTC 2. Counsel argued that the case of Charles Chenda and Evaristo Kangwa vs. Zambia Postal Services Corporation2 cited by the appellant cannot be of any assistance to him as there was no term that was varied by the letter written by the respondent asking the appellant to accept his confirmation in employment. That in fact, it was the appellant who was attempting to vary the terms of the employment by introducing a new grade of NTC 2. Mr. Mukonka submitted that the trial court made a finding of fact that the appellant was correctly paid his terminal benefits. He pointed out that it is trite law that the appellate court will not reverse the findings of fact made by a trial judge unless it is satisfied that the findings in question were either perverse or made in the absence of any relevant evidence or upon a misapprehension of the facts or that they were findings which on J14 a proper view of the evidence no trial court acting correctly can reasonably make. Counsel submitted that there is no evidence that has been adduced to justify the variation of the finding of the trial court and that, therefore, this appeal has no merit and should be dismissed. We have considered the arguments advanced by Counsel for the parties. The issue for determination in ground one is whether the appellant was a unionized employee which would entitle him to be paid under the Collective Agreement. A perusal of the letters written to the appellant clearly indicate that he was serving under a contract of employment. The initial letter written on behalf of the respondent by the Finance and Administration Manager dated 25th January, 2008 reads in part: Dear Mr Ngambi Re: STAFF APPOINTMENT - INTERNAL AUDITOR Following the Internal control weaknesses and lapses that have been discovered in Accounts Department, I am pleased to inform you that Management has decided, on behalf of the Board, to appoint you to the position of Internal Auditor. J15 The above appointment is effective from 1st March, 2008 You will be paid gratuity for the period served. JOB PURPOSE To undertake assignments on the risk management, internal control and corporate governance arrangement of the Northern Technical College and make recommendations for improving these arrangements. You will be reporting to the Principal. Your starting salary will be three million one hundred and nine thousand six hundred kwacha. K3,109,600.00) gross per month in pay grade NTC 3 for contract staff, (emphasis ours) You will be on probation for a period of three (3) months. Your confirmation in employment will be subject to satisfactory job performance, (emphasis ours) On 20th May, 2009 the respondent wrote to him to inform him that they had decided to confirm him to the position with effect from 1st March, 2008. The letter stated that the contract would be renewed by mutual agreement. We take the view that the terms of the contract were plain to understand. Clearly, the argument by Counsel for the appellant that the Manual introduced implied terms cannot be sustained as the letter of appointment is explicit as to the terms of the contract of employment. It is not a question of Counsel for the J16 appellant merely plucking provisions from the Manual which appear to be favourable to the appellant while ignoring the blatant evidence that the appellant was on contract. As rightly argued by Mr. Mukonka the appellant’s payslip produced in the court below revealed that there was no deduction to the union. More importantly, the letter of offer of employment clearly stated that he was employed on contract. The cases that Counsel for the appellant relied on cannot assist him as it is trite that parties are bound by their contracts. The argument by Counsel for the appellant that the Manual was operational is unsustainable. Simply relying on a line on Page 4 of the draft Manual which states that “it is my pleasure to launch the Human Resource Policy Manual for NORTEC” is not sufficient proof that it was operational. In any event, there is no doubt that the appellant was employed on contract. For the appellant whose letters of employment clearly show that he was on contract to insist that he was also covered by the Collective Agreement applicable to unionized employees boggles the mind. The court below was on firm ground in holding that he did not prove that he was a unionized member. It appears to us J17 that the appellant was bent on having his own taylor-made conditions of service. Having examined the evidence, we find that the lower court was on firm ground when it held that the appellant failed to prove that he was a unionized member who could claim gratuity under the Collective Agreement. Ground one fails. Turning to ground two, the argument by Counsel for the appellant is that confirmation was never included in the terms of the contract of employment and the appellant had the option to accept or to object and that his withdrawal of the acceptance should not have ended up in termination of his employment. Counsel for the respondent, however, argued that the lower court was on terra firma to uphold the respondent’s decision to terminate on the ground that the appellant was not willing to take up the job and so he withdrew his acceptance. We have considered the arguments advanced by learned Counsel for the parties in this ground. First of all, Counsel for the appellant’s argument that the appellant’s contract of employment was not subject to confirmation is absurd especially when one looks at the letter of appointment dated 25th January, J18 ( 2008 which speaks for itself. We have referred to the said letter earlier in this judgment. The uncontroverted evidence in the court below was that on 20th May, 2009 the appellant was offered a three year contract as an Internal Auditor. In his letter dated 22nd July, 2009 in which he responded to the offer, the appellant requested for an adjustment to his salary scale as a condition for him to accept the offer. On 19th August, 2009 he, in no uncertain terms, withdrew his acceptance of confirmation as Internal Auditor on the ground that it was offered to him in bad faith. Interestingly, in all his correspondence he addressed himself as Internal Auditor in spite of the qualms he had about the position. The argument by Counsel for the appellant that confirmation was not part of the agreement cannot be sustained. We take the view that whether the confirmation came later is irrelevant, what is important is that, the appellant who was not even qualified for the post was being given an opportunity to work in that office. In fact, it is on record that the management considered him for the position as he was studying ACCA and this was one of the reasons that they gave to the Auditor­ J19 General’s query as to why the appellant was occupying the position. Unfortunately, he refused to accept the offer of confirmation as Internal Auditor and the respondent had no option but to terminate his employment. This was the same person who had earlier on refused to be re-deployed. All circumstances considered, the indicators are that the appellant left the respondent with no choice but to terminate his contract. The appellant wanted to take up the position of Internal Auditor on his own terms and conditions and he cannot now turn around and cry that the respondent was unjustified in its actions. The appellant has only himself to blame for the position he finds himself in. The appellant was paid all his dues and the lower court found that the termination was in accordance with the terms of the contract. The lower court cannot be faulted in its findings of fact. The case of Khalid Mohammed vs. Attorney General4 is instructive on this issue. Ground two also fails. In conclusion, Section 97 of the Industrial and Labour Relations Act, Cap 269 of the Laws of Zambia states that an appeal against any decision of the Industrial Relations Court must be on a point of law or any point of mixed law and fact. J20 » 1 r This appeal mainly attacked findings of fact by the lower court. The whole appeal, therefore, fails for lack of merit. Each party to bear their own costs. SUPREME COURT JUDGE --------R. M. C. KAOMA SUPREME COURT JUDGE J21