REPOPRTABLE ZLR (15)

Judgment No. S.C. 14/02

Civil Appeal No. 217/2000

(1) AGNES NKOMO (2) J      SHANA (3) T      MAUTO (4) J      MUNANGA (5) K      MUJABUKI (6) T      CHIMBANI (7) C      PENYAI (8) S      BHAJILLA (9) K      CHIMANIKIRE

v

(1) RUBBER AND ALLIED PRODUCTS (PRIVATE) LIMITED

(2) THE CHAIRMAN OF THE RETRENCHMENT COMMITTEE N.O.

SUPREME COURT OF ZIMBABWE

SANDURA  JA, ZIYAMBI JA & MALABA JA

HARARE, JANUARY 21 & MAY 14, 2002

T Biti, for the appellants

E K Mushore, for the respondents

SANDURA  JA: This is an appeal against a judgment of the High Court which dismissed with costs the appellants’ application for an order directing the first respondent to pay to them the salaries and benefits due to them with effect from 1 September 1999.

The background facts are as follows. The appellants were employed by the first respondent, a wholly owned subsidiary of Dunlop South Africa. In 1999 Dunlop decided to sell the business and assets of the first respondent to Dunlop Zimbabwe Limited (“Dunlop Zimbabwe”). As the appellants could not be absorbed by Dunlop Zimbabwe, the first respondent decided to retrench them.

Accordingly, on 28 June 1999 the first respondent gave written notice of the proposed retrenchment to the works council in terms of s 3(1)(a)(i) of the Labour Relations (Retrenchment) Regulations, 1990, published in Statutory Instrument 404 of 1990 (“the Regulations”). The notice was copied to the chairman of the retrenchment committee in the Ministry of the Public Service, Labour and Social Welfare as required by s 3(1)(c) of the Regulations.

The first respondent’s business and assets were sold and transferred to Dunlop Zimbabwe on 1 July 1999, i.e. three days after the notice of the proposed retrenchment was sent to the works council.

The appellants objected to the proposed retrenchment and, after two meetings of the works council, the workers’ representatives on the council refused to participate in the retrenchment negotiations, alleging that the provisions of the Regulations had not been complied with.

Thereafter, on 30 July 1999 the first respondent wrote to the principal labour relations officer alleging that by refusing to participate in the retrenchment negotiations the appellants and their representatives on the council were acting in bad faith and were indulging in an unfair labour practice.

Subsequently, on 25 August 1999 a hearing was conducted by a labour relations officer, who issued a determination directing the parties to continue with the retrenchment negotiations. The determination further provided that in the meantime the appellants could go on paid leave.

When the appellants’ attitude to the retrenchment negotiations did not change, the first respondent wrote to each appellant in August 1999 informing him that he was to go on paid leave for the duration of his accumulated leave, and that thereafter he would go on unpaid leave until the proposed retrenchment was finalised.

About two weeks later, on 7 September 1999, the works council referred the dispute to the retrenchment committee. In the result, the Minister of the Public Service, Labour and Social Welfare (“the Minister”), acting on the advice of the retrenchment committee, refused to approve the proposed retrenchment.

However, the Minister’s decision was taken after the appellants had filed the court application in the court a quo seeking the relief already referred to. Neither party knew of the Minister’s decision when the application was heard. The application was prompted by the first respondent’s decision to place the appellants on unpaid leave.

The learned judge who heard the matter in the court a quo was of the view that the appellants should have complied with the labour relations officer’s determination issued on 25 August 1999, directing the parties to continue with the retrenchment negotiations or let the retrenchment committee determine the matter. He, therefore, dismissed the appellants’ application with costs. Aggrieved by that decision, the appellants appealed to this Court.

What happened in this case shows that both the first respondent and the appellants overlooked the provisions of s 16(1) of the Labour Relations Act [Chapter 28:01]. That section reads as follows:

“16 (1) Subject to this section, whenever any undertaking in which any persons are employed is alienated or transferred in any way whatsoever, the employment of such persons shall, unless otherwise lawfully terminated, be deemed to be transferred to the transferee of the undertaking on terms and conditions which are not less favourable than those which applied immediately before the transfer, and the continuity of employment of such employees shall be deemed not to have been interrupted.”

When the provisions of this section are applied to the facts of the present case, the legal position is as follows. When the first respondent’s assets and business were transferred to Dunlop Zimbabwe on 1 July 1999 the appellants became employees of Dunlop Zimbabwe with effect from that date, and with conditions of service not less favourable than those which applied to them before the transfer of the undertaking.

This also means that with effect from 1 July 1999 the appellants ceased to be employees of the first respondent and, consequently, the written notice of the intention to retrench them which was given by the first respondent to the works council on 28 June 1999 fell away. If the new employer, Dunlop Zimbabwe, wanted to retrench the appellants, it was obliged to give written notice of its intention to do so to its works council in terms of s 3(1)(a)(i) of the Regulations.

In the circumstances, the appellants’ application in the court a quo was misconceived. As already stated, in that application the appellants sought an order directing the first respondent to pay to them the salaries and benefits due to them with effect from 1 September 1999. However, payment of those salaries and benefits was no longer the first respondent’s obligation because it was no longer the appellants’ employer. It was in fact the obligation of Dunlop Zimbabwe, the new employer, to pay the appellants’ salaries and benefits with effect from 1 July 1999. The application should, therefore, have been brought against Dunlop Zimbabwe.

In my view, the appeal cannot succeed. However, as far as the costs of the appeal are concerned, I shall make no order because all the parties laboured under a misapprehension as to who the appellants’ employer was. By persisting with the retrenchment exercise after 1 July 1999 the first respondent must have led the appellants to believe that it was still their employer.

In the circumstances, the appeal is dismissed with no order as to costs.

ZIYAMBI JA: I agree.

MALABA  JA: I agree.

Honey & Blanckenberg, appellants' legal practitioners

Coghlan, Welsh & Guest, respondents' legal practitioners