Issues of payment of retrenchment packages agreed between workers and employers in Zimbabwe dollars before the advent of the multiple currency system continue to be brought before the dispute resolution system. Some employers stand accused of deliberately delaying payment of the packages and now want to do so in the now defunct currency.
Disgruntled workers have even taken some of the contentious cases to the Supreme Court, but the Labour Court continues to be inundated with such cases. This week I will examine a case where an employer delayed paying agreed retrenchment packages, and now want to do so in Zimbabwe dollars.
Ballantyne Butchery (Private) Limited trading as Danmeats Colcom Foods initially agreed with its 95 workers on a retrenchment package in Zimdollars on January 23, 2009, which was then the legal tender.
Also agreed by the parties on the same day was another package that was never contested by the workers.
This was payment of US$90 worth of fuel coupons flat per every employee, US$200 worth of fuel coupons per every year served, and 20kg pork bones for every year served. The second package was to be paid in two installments, end of January 2009 and in February 2009, and there was no problem with this.
However, the workers disputed the first agreement for payment in Zimdollars. The workers argued that the employer did not immediately pay them in terms of the agreement and by the time they were paid, the Zimdollar had lost value.
The matter was reported as an unfair labour practice and eventually heard before an Arbitrator.
The workers submitted that though the monetary authorities pronounced on February 3, 2009 that there would be a multiple currency regime, the employer proceeded on February 10, 2009 to pay the Zimdollars as per the original agreement.
This was despite the fact that it was now zero value.
The workers alleged the employer had acted in bad faith when it paid on February 10, 2009 the Zimdollar, which had lost its value.
They further argued that had the employer paid the Zimdollar prior to February 3, 2009 when the multiple currency regime was introduced, it would have been well within its rights.
The employer challenged the relief which was being sought by the workers on the basis that the workers were asking the Arbitrator to make a new contract for the parties by asking him to come up with a revalued package. It was argued that under the Roman Dutch Law, a third party couldn't come up with contractual terms that bind the two parties.
Further, it was argued that the workers had not placed any evidence before the Arbitrator to enable him to make a specific award of damages. The employer also made submissions to justify or support why it was not able to pay the agreed Zimdollars much earlier than February 13, 2009.
It argued that the agreement of January 23, 2009 did not state when the packages were payable.
Therefore, any evidence brought by the workers to supplement the exclusive memorial of the transaction ought not to have been allowed.
Finally, the employer argued that the workers waived their rights to contest the employer's action when they took too long to bring this action. The workers had also accepted the Zimdollars in their accounts hence waived their rights. A delay of three and half months in enforcing their rights was also consistent with a person who has decided to waive their rights.
However, was there an inordinate delay in enforcing their rights and a waiver?
The Labour Court does not lightly assume that a party has abandoned or renounced his rights where reliance is placed on a tacit waiver. In this case, there was no proof shown by the employer that there was a definite surrender of their rights by the workers.
This is whether expressly or by conduct plainly consistent or irreconcilable with an intention to preserve their rights. All that was told was that a period of three and half months lapsed before the workers enforced their rights. Generally, a prescription period of two years is given in labour matters.
Acting within three and half months can therefore not be said to have been a delay so inordinate to prove that the workers, with knowledge that enforcing their rights within three and half months amounts to a waiver, persisted in that conduct.
It cannot reasonably be said to them that they waived their rights. The workers cannot be said to have accepted the payment in that these payments were made by Real Time Gross Settlement straight into their accounts. It is not persuading that the employer managed to show that the workers expressly or by conduct waived their rights. Was it relevant for evidence to have been led to supplement the written agreement vis-à-vis when the payment ought to have been due?
In hearing and determining disputes, an Arbitrator shall have the same powers as the Labour Court, according to Section 98 (8) of the Labour Act (Chapter 28:01). The Labour Court is not bound by strict rules of evidence and can ascertain any relevant fact by any means, which the presiding officer thinks, fit and which is not unfair or unjust to either party.
The hearing of evidence is thus not governed by common law since statute has specifically provided for such in Section 90 A of the Labour Act.
Since the contract was silent on the performance date, the Arbitrator could hear evidence on the issue from both parties and make a factual finding.
The factual finding may not be appealable to the Labour Court, which hears appeals on points of law from Arbitrators' decisions. So unless there were allegations of gross unreasonableness in the conclusion of facts made, the decision on issues of fact cannot be appealed against. In this case, no allegations of gross unreasonableness were made.
An Arbitrator in terms of Section 90 A of the Labour Act provided, no injustice was done to either of the parties, could thus hear evidence. The fact that no specific claim for damages had been made by the workers is irrelevant. This was not a claim for damages but an allegation of an unfair labour practice by the employer. The employer, having agreed to pay a retrenchment package in Zimdollars, delayed effecting the payment.
Would it be fair to just pay the workers in a currency that was now worthless? Had the employer paid prior to February 3, 2009 then it would have acted fairly.
The Supreme Court has also ordered the payment of damages suffered during the Zimdollar era in United States dollars converted at an agreed rate. (Central African Batteries versus John Mhangu SC79/10).
It is in this regard that Labour Court president Ms Lilian Hove ordered that the Zimdollars payable to the retrenched workers be converted and paid in United States dollars. The rate of conversion was to be agreed between the parties, either of which was free to approach the Labour Court for the determination of the applicable rate. Danmeats Colcom Foods was also ordered to pay the worker's costs.