REPORTABLE (105)

Judgment No. SC. 106/04

Civil Appeal No. 308/03

ZIMBABWE ELECTRICITY SUPPLY AUTHORITY v ZIMBABWE ELECTRICITY SUPPLY AUTHORITY EMPLOYEES

SUPREME COURT OF ZIMBABWE

CHIDYAUSIKU CJ, ZIYAMBI JA & MALABA JA

HARARE JUNE 28, 2004 & FEBRUARY 14, 2005

F Nyakabawu, for the appellant

T Chitapi, for the respondent

CHIDYAUSIKU CJ: The appellant in this case is a parastatal which supplies electricity. It is engaged in providing an essential service in terms of the Labour Relations Act. Its employment relations disciplinary procedures are governed by a code of conduct registered in terms of the Labour Relations Act [Chapter 28:01] (“the Act”).

It is common cause that the respondents, who are employees of the appellant, engaged in an unlawful collective job action in the form of sit-ins, strike action and general withdrawal of their labour.

A show cause order was issued by the Labour Court terminating the job action by the respondents. On the return day of the show cause order, although the legal practitioners of both parties suggested to the court that they were agreed on the order to be issued by the court, differences emerged when they made submissions to the court. It became apparent that the parties were agreed only on certain aspects and disagreed on others. The parties were agreed that the collective job action was unlawful, and that it should be terminated with immediate effect. There was, however, some disagreement over the course of action the appellant could take in regard to conduct prior to the issuance of the show cause order.

The appellant was of the view that it could lawfully discipline the employees for their conduct prior to the show cause order. The respondents took the view that the appellant could not do so. The respondents contended that the show cause order barred the appellant from taking any disciplinary action for conduct committed prior to its issuance.

The disposal order, the meaning of which is in dispute, provides as follows:

“IT IS ORDERED THAT –

1. The illegal job action engaged on by the respondents as from 13 October 2003 be and is hereby terminated forthwith.

2.(a) The applicant be and is hereby ordered to lift, with effect from today’s date, the suspension it imposed on the striking employees.

(b) The applicant be and is hereby authorized to withhold payment of salaries and benefits to those employees who were on suspension in respect of the period that they were on strike and on suspension.

(c) The applicant be and is hereby authorized to withhold salaries in respect of the rest of the striking employees for the duration of the Collective Job Action.

3. Applicant be and is hereby authorized to take disciplinary action in terms of its Code of Conduct against any employee who defies the provisions of this order.

4. The dispute between the parties be and is hereby referred for conciliation in terms of the Labour Act Chapter 28:01.”

The appellant was dissatisfied with paras 2 and 4 of the disposal order. It appeals to this Court for an order striking out the two paragraphs. The main argument advanced by the appellant is that the Labour Court had no power to issue the directive contained in those two paragraphs. The Labour Court did not state in terms of which section of the Act it had issued its order. I have assumed that the Labour Court must have been acting in terms of s 107 of the Act which provides as follows:

“107 Disposal orders

(1) On the return day of a show cause order the Labour Court shall, at the time and place specified in the order, inquire into the matter and shall afford the parties concerned an opportunity of making representations in the matter.

(2) After conducting an inquiry in terms of subsection (1), the Labour Court may issue a disposal order directing that -

1. the unlawful collective action be terminated, postponed or suspended; or

2. the issue giving rise to the unlawful collective action concerned be referred to another authority to be dealt with in terms of Part XII and that, pending the determination of the issue in terms of that Part, the unlawful collective action concerned be terminated, postponed or suspended.

(3) Without derogation from the generality of the powers conferred upon the Labour Court in terms of subsection (2) to make a disposal order, such order may provide for -

(a) in the case of an unlawful collective action other than a lock-out -

(i) discharge or suspension of an employer’s liability to pay all or part of the wages or benefits due to specified employees or categories of employees engaged in the unlawful collective action, in respect of the duration of such collective action or part thereof

(ii) the employer, in his discretion, to dismiss summarily, or lay off or suspend with or without pay, specified employees or categories of employees engaged in the unlawful collective action;

(iii) the lay off or suspension, with or without pay, of specified employees or categories of employees not engaged in the unlawful collective action for such period as may be specified where such lay off or suspension is necessitated by the collective action;

(iv) the dismissal of specified employees or categories of employees engaged in the unlawful collective action;

(v) the prohibition of the collection of union dues by any trade union concerned for such period as may be specified;

(vi) the suspension or rescission of the registration of the trade union involved in the collective job action;

(c) …”. (underlining is mine)

In regard to the challenge to paragraph 2 of the disposal order - section 107(3)(a)(i)of the Act empowers the Labour Court to provide for, in a disposal order, the discharge or suspension of an employer’s liability to pay wages of employees engaged in an unlawful job action. Paragraph 2(b) and (c) of the disposal order authorises the appellant to withhold salaries of the striking employees. The legal basis for such a directive exists in the Act.

However, para 2(a) of the disposal order directed the appellant to lift the suspension it had imposed on some employees. There is no provision in s 107 of the Act conferring power on the Labour Court to issue such a directive. Section 107(2)(b) empowers the Labour Court to suspend the collective job action pending the determination of the underlying cause of a job action. That section cannot be construed as empowering the Labour Court to order the lifting of a suspension imposed by the appellant on its employees. Accordingly the Labour Court had no power to issue the directive set out in paragraph 2(a) of the disposal order.

The Labour Court did not adjudicate on the underlying cause of the dispute between the parties. It, however, determined that the collective job action was unlawful and referred the determination of the underlying cause of the collective job action to another authority in terms of s 107(2)(b) of the Act.

While I am satisfied that the Labour Court has the discretion to refer an unresolved dispute to another authority as it did in terms of para 4 of the disposal order, the order itself reveals serious flaws. The Labour Court referred the unresolved issues for conciliation in terms of the Act. The Act enjoins the Labour Court to refer the matter to a specific authority and to spell out, in its order, the specific terms of reference. In this regard s 98 of the Act provides as follows:

“98 Effect of reference to compulsory arbitration under Parts XI and XIII

(1) In this section, ‘reference to compulsory arbitration’, in relation to a dispute, means a reference made in terms of paragraph (d) of subsection (1) of section eighty-nine or section ninety-three.

(2) Subject to this section, the Arbitration Act [Chapter 7:15] shall apply to a dispute referred to compulsory arbitration.

(3) Before referring a dispute to compulsory arbitration, the Labour Court or the labour officer, as the case may be, shall afford the parties a reasonable opportunity of making representations on the matter.

(4) In ordering a dispute to be referred to compulsory arbitration, the Labour Court or labour officer, as the case may be, shall determine the arbitrator’s terms of reference after consultation with the parties to the dispute.

(5) In referring a dispute to compulsory arbitration –

(a) the Labour Court; or

(b) the labour officer, after consulting any labour officer who is senior to him and to whom he is responsible in the area in which he attempted to conciliate the dispute;

as the case may be, shall appoint as an arbitrator a person whose name appears on a list referred to in subsection (6):

Provided that the labour officer who attempted to conciliate the dispute which is referred to arbitration shall not be appointed as the arbitrator in that dispute. …”.

It is clear that paragraph 4 of the disposal order falls short of the requirements of s 98 of the Act. In particular it does not identify the authority to which the matter is referred or set out the terms of reference as is required by the Act.

Section 98 of the Act spells out very clearly what should be done in the event of the matter being referred to compulsory arbitration. The parties have to be given an opportunity to be heard before such an order is made. The order should clearly set out the terms of reference and identify the authority to which it is referring the matter. In the light of the above paragraph 4 of the disposal order has to be struck out.

In the result the appeal succeeds to the extent that paragraphs 2(a) and 4 of the disposal order are deleted from the order issued and the matter is remitted to the Labour Court for the reformulation of para 4 of the order. Because of the partial success of the appeal the ordinary rule that costs follow the result does not apply. Each party will bear its own costs.

ZIYAMBI JA: I agree.

MALABA JA: I agree.

Gill Godlonton & Gerrans, appellant's legal practitioners

T H Chitapi & Associates, respondent's legal practitioners