Eunice Shaba and Ors v Copperbelt Energy Corporation PLC (Appeal 10 of 2002) [2003] ZMSC 161 (14 April 2003)

IN THE SUPREME COURT OF ZAMBIA APPEAL NO 10/2002 (HOLDEN AT NDOLA) (CIVIL JURISDICTION) BETWEEN: EUNICE SHABA AND OTHERS APPELLANT AND COPPERBELT ENERGY CORPORATION PLC RESPONDENT CORAM: LEWANTKA, DCJ. CHIBESAKUNDA, MAMBILIMA JJS On 5U1 June, 2002 and 14,h April, 2003 For the Appellant: M. G. MASENGU of M. G. Masengu & Co. For the Respondent: Mrs. J. CHAILA, Legal Counsel. JUDGMENT LEWANIKA DCJ., delivered the judgment of the court. This is an appeal against the decision of a Judge of the High Court dismissing the Appellant's claims for:- 1. 2. an order and declaration that the appellants be paid their terminal benefits in accordance with the ZCCM letter dated 31s1 July, 1997 and the collective agreement entered into between the Mine Workers Union of Zambia and Zambia Consolidated Copper Mines Limited, an order and declaration that the Respondent’s purported amendment of the terms and conditions of employment under which they were serving without the consent of the Appellants is illegal and null and void. 3. an order that the appellants be paid housing allowance due to them. The evidence on record is that the Appellants were employees of the Power Division of ZCCM prior to September, 1997 when the Power Division was taken over by the Respondent following the privatisation of ZCCM. On 2nd December, 1997 the Appellants were transferred from ZCCM to the Respondent. The letters of transfer stated in part that:- "as par! o f (his transfer Copperbelt Energy Corporation PLC hereby offer to employ yon in the same job and on the same terms and conditions you are currently employed by ZCCM and that your accrued benefits for the years served in ZCCM will be held in trust by CEC ..the same terms and conditions as provided for in your contract with ZCCM." The redundancy package under ZCCM was 28 months salary plus one month's salary for each completed year of service. There was a redundancy agreement dated 14th April, 1997 which ran from Is* April, 1997 to 31s* March, 1999. The Appellants were represented by the Mine Workers Union of Zambia and four of the Appellants were shop stewards and represented other members at collective bargaining meetings. The Appellants were covered by the collective Agreement dated 14th April, 1997. On 21^ September, 1999 the Respondent wrote to the Appellants laying them off from employment. On 16th December, 1999 the Respondent wrote letters to the Appellants declaring them redundant. In the said letters the Appellants were paid one month's salary each in lieu of notice. On I?11’ December, 1999 the Respondent signed a collective Agreement with the Mine Workers Union of Zambia whose effective date was Is1 April, 1999. It is common cause that the Appellants were paid the money held in trust in full for service rendered to ZCCM. The Appellants sought to be paid their redundancy package under the agreement dated 14th April, 1997 entered into between MUZ and ZCCM and not the agreement dated I?111 December, 1999 between MUZ and the Respondent on the ground that when that agreement was signed, they were no longer in the employ of the Respondent The learned trial Judge found that the Appellant's redundancy benefits were to be calculated in accordance with the collective agreement signed on 17th December, 1999, hence this appeal. At the hearing of the appeal counsel for the Appellants amended the Memorandum of Appeal and substituted the following grounds of appeal. 1. 2. 3. that the learned trial Judge erred in fact and law when he held that the Appellants had consented to the new conditions of service being applied to them through their union representatives even when a greater number of the Appellants were non-unionised, that the learned trial Judge erred in law when he allowed the redundancy agreement to be effective retrospectively before the redundancy agreement had been approved and gazetted by the Minister. The agreement was defective in law. That the court below grossly misdirected itself when the Development Agreement between the Government of the Republic of Zambia and the Respondent which protected the Respondent's employees from any adverse conditions of service without consent was refused to be part of evidence or not considered at all. In arguing the first ground of appeal counsel for the Appellants said that the non-unionised employees had their ZCCM conditions of service, i.e. the redundancy agreement of 14th April, 1997 and that for non unionized employees the new collective agreement had no effect at law. As for the second ground of appeal, counsel said that termination of employment by way of redundancy is provided for under Section 26B of the Employment Act as amended by Act No. 15 of 1997. He said that Section 26B(2)© provides for the proper officer to be notified not less than 60 days of the impending termination, number of categories of employees, the period within which the redundancies are to be effected and the nature of the redundancy package. He further said that a redundancy agreement is also a collective agreement by its definition under Section 3(1 )(b) of the Industrial and Labour Relations Act, Cap 269, That sections 70 and 71 of Cap 269 apply to this redundancy agreement that; (a) the agreement should be lodged with the commissioner and (b) the Minister must approve under Section 71(3) the agreement shall come into force on the day of the Minister's approval or a later date indicated in the agreement. He said that Section 73 of Cap 269 provides for the extension of any collective agreement but does not provide for retrospective application. As to the third ground of appeal, counsel said that the Development Agreement was applicable to the employees especially the non-unionised. That this agreement was entered into between the Government and the Respondent for the benefit of the Appellants and that the doctrine of privity of contract does not apply. In reply counsel for the Respondent submitted that with regard to the first ground of appeal, the amended memorandum of appeal has introduced issues which were not raised in the court below. She referred us to the statement of claim and the amended statement of claim. She further said that the supplementary record contains documents which were not produced in the court below and referred us to documents Nos. 22, 23, 25, 31 and 38 and said that no evidence was adduced on these documents in the court below. She said that the appeal is raising matters which were not before the court below and that the remedies being sought now are at variance with the reliefs pleaded in the statement of claim. She said that the issue of senior staff and non-unionised employees were not raised in the court below and that the issue was on the effective date of the collective agreement which came into effect on Is1 April, 1999 and whether it applied to the Appellants. On the second ground of appeal, counsel for the Respondent said that this issue was not raised in the court below. On the third ground of appeal, counsel said that the development agreement was not in the agreed bundle of documents in the court below and no evidence was adduced on it and that in fact the agreement was excluded by the court below. Counsel for the Respondent further said that the collective agreement was voluntarily entered into by the parties and referred us to the evidence of PW 1 on page 70 of the record. She said that the Appellants were represented by the Mine Workers Union of Zambia who had authority to represent them. She said that the agreement was effective from 1st April, 1999 although it was signed on 17th December, 1999. She said that there were some shop stewards among the Appellants who continued to attend meetings when the negotiations were going on. That the evidence on record shows that the members of the Mine Workers Union of Zambia agreed to the changes made in the agreement, and that there was no evidence on record to show that the agreement was detrimental to the Appellants. She urged us to dismiss the appeal. We have considered the submissions of counsel for the Appellants and for the Respondent as well as the evidence on record. We agree with counsel for the Respondent that the issues being canvassed by counsel for the Appellants were not raised in the court below. The only issue that rose to be decided was whether or not the Appellants were covered by the collective agreement which was entered into on 17th December, 1999 having been declared redundant on 16th December, 1999. It is common cause that the Appellants who were previously employed by ZCCM had their services transferred to the Respondent upon the privatisation of ZCCM It is also common cause that while in the employ of ZCCM their conditions of service were covered by a collective agreement entered into between ZCCM and the Mine Workers Union of Zambia. This is evident from the evidence of the lsl Appellant who said under cross-examination on page 70 of the case record;- "We are 106 in all. The conditions were common to all of us. Ife H ere transferred to C. E. C. on same conditions which applied to ZCCM. We were represented by M. U. Z. We were still under M. IJ. Z. even at C. E. C. We used to give instructions to M. U. Z. for them to go and sign for any changes in conditions of service." At the time that the Appellants were transferred to the Respondent their conditions of service were governed by the collective agreement dated 14th August, 1997 which was effective from Is' April, 1997 to 31March 1999. So that at the time when the Appellants were being declared redundant on 16lh December, 1999 that collective agreement had expired and was not in force as there is no evidence on record that its validity had been extended. That collective agreement was replaced by the one dated 17th December, 1999 but effective from I51 April, 1999. This was the agreement in force at the time that the Appellants were retrenched although it had not been signed. There is evidence on record that the Appellants were aware of the new agreement as some of them were shop stewards and took part in the negotiations. The Appellants cannot claim benefits under a collective agreement whose validity has expired and the learned trial Judge was on firm ground when he found that the appellants' redundancy benefits were to be calculated in accordance with the collective agreement dated 17lh December, 1999. In the circumstances we find no merit in the appeal which we dismiss but will make no order as to costs having regard to the circumstances of the Appellants. DEPUTY CHIEF JUSTICE L. P. Chibesakunda SUPREME COURT JUDGE I. M. C. Mambilima SUPREME COURT JUDGE 7