1 September 2013

Tanzania: BP Saved From Paying Sh2 Billion in Damages

THE Court of Appeal has saved BP Tanzania Limited from paying a British expatriate, Mr Riakdit Barnabas, more than two trillion shillings in damages and other terminal benefits for allegedly bringing to an end his employment with the company unfairly.

"We are of the settled view that the respondent (Barnabas) was not unfairly terminated. The retrenchment exercise was in accordance with the law and laid down procedures," Justices Mbarouk Mbarouk, Steven Bwana and Katherine Oriyo ruled.

They noted that what was in dispute was terminal benefits for which the British national was entitled and in her judgment dated March 16, 2012, Judge Regina Rweyemamu of the High Court's Labour Division had said, among others, that the respondent's basic salary also included car and housing allowances.

"Given the clear provisions of Section 4 of the (Labour Relations) Act we are of the considered view that basic salary is not inclusive of allowances when it comes to calculations of retrenchment package," the justices said.

Regarding whether the respondent retrenchment package was correctly calculated, the justices noted that the judgment of the trial court abdicated such judicial duty and, therefore, decided to refer back the matter of calculation of the quantum to the trial court for determination.

They further noted that the trial judge had not clearly entered her conclusion over the issues before her and they, therefore, directed the same to be done.

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