IN THE INDUSTRIAL RELATIONS COURT OF MALAWI
MATTER NO. 154 OF 2001
MALAWI POSTS CORPORATION………………...…RESPONDENT
HON. M.C.C. MKANDAWIRE, CHAIRMAN
Mrs. Ching’oma, Employees’ Panelist
Mr. Nindi, Employers’ Panelist
Respondent, present (Represented by Counsel Khuze Kapeta)
Mr. Lora/Kalulu – Official Interpreter
J U D G M E N T
Matters in Issue: Unfair Retrenchment and victimization of the Applicant as a result of his involvement in Trade Union activities
This matter has been brought by Mr. Robert J.D. Mkwezalamba the Applicant against Malawi Posts Corporation (MPC) the Respondents.
In his statement of claim, the Applicant has disclosed an alleged trade dispute of unjustified retrenchment. The Applicant at first applied for the relief of compensation up to his normal retirement viz salary, pension, severance allowance and other monetary benefits contained in the Malawi Posts and Telecommunications Corporation (MPTC) Conditions of Service and collective agreements. At a later stage however the Applicant applied to amend the relief to be that of reinstatement; an application which the Respondents vehemently objected. We shall be commenting on that at a later stage in this judgment.
The Respondents filed in a defence to the claim put by the Applicant. In broad terms, the Respondents said that the services of the Applicant were not terminated as a result of his involvement in an illegal strike. The Respondents say that the Applicant’s services were terminated as a result of restructuring the Respondent’s activities whereby the Applicant’s services became redundant.
Before we go further, let us first settle the issue in relation to the change of relief by the Applicant from that of compensation to reinstatement. We have looked at the submissions made by learned Counsel for the Respondents. Counsel repeated in his submissions that the relief of reinstatement was sought by the Applicant after all the evidence relating to the Applicant case had been adduced and tendered. There was thus no basis for this relief Counsel observed. Counsel further urged this Court that the Applicant should not turn the Court into a "club". In addressing this issue, we have first looked at the spirit of the Labour Relations Act No. 16 of 1996 which Act governs the operations of this Court. We note that Section 71 provides as follows:-
"(1) The Chief Justice, on the advice of the Chairperson of the Industrial Relations Court, may make rules for the purpose of regulating the procedures of the Industrial Relations Court and such rules shall have regard to the need for informality, economy and dispatch in proceedings of the Industrial Relations Court.
(2) The Industrial Relations Court shall not be bound by evidence in civil proceedings."
From the foregoing, it is thus clear that rules of procedure in the Industrial Relations Court are somehow more flexible and easily accessible by the parties. Relevant to the issue at hand is Rule 25 (1) (f) of the Industrial Relations Court (Procedure Rules) 1999. This rule provides:-
"Without prejudice to the decision – making power of the Court under Section 67, the Court may on application or of its own motion at any time – allow any party any time to amend his application or his opposition."
This rule is very crystal clear and does not need further postmortem. The catchwords are at any time. Thus the Applicant having applied to amend the relief sought after he had already given the side of the story did not breach any rule.
We would like to appeal to our Court users especially the legal fraternity that it is high time they got acquainted with the Labour Relations Act, Employment Act and the rules governing the operations of the Industrial Relations Court. We have at times been lest astounded to see honourable learned friends from the bar completely out of tune with the current developments in Labour Law especially the operations of the Industrial Relations Court and the rules which are in use in this Court. These rules should be well understood just like the Rules of the Supreme Court (RSC) are. Our decision therefore to allow the Applicant amend the relief was well founded and the discretion we used was after having taken into account the objections raised by Counsel which we found to have had no merit at all. This issue having been put at rest, we shall now look at the evidence as it came from both sides.
The Applicant gave a solid background that led to this case. He told the Court that he was employed by the Malawi Posts and Telecommunications Corporation as accounts assistant in 1996. At their place of work, they established a trade union known as the Malawi Posts and Telecommunications Union and he was elected as its General Secretary. The Malawi Posts and Telecommunications Corporation (MPTC), was a statutory corporation and was governed by an Act of Parliament. In June 2000, MPTC was split into two entities. There was the Malawi Posts Corporation and the Malawi Telecommunications Limited (MTL). Employees were requested to join either of the two. The Applicant said that he opted to join MPC. Although MPTC was split into two, the trade union did not. It continued to exist as one. The trade union was thus serving the interest of employees both at MPC and MTL. The Applicant remained the General Secretary of this trade union.
In January 2001, the Union declared a trade dispute with Management of MPC. This dispute was in relation to salary and other benefits. By the 10th of January 2001, the dispute was successfully settled. It is the evidence of the Applicant that a week after the dispute had been successfully settled, the Director of Finance of MPC invited him. He warned him that Management was under pressure to fire him from work because of his involvement in union activities. After this warning the Applicant said that he was heavily scared. He then formally lodged a complaint with the Ministry of Labour through the Regional Labour Office (RLO) South. The RLO responded through a letter marked as App Ex 1. As General Secretary of MPTC Union, he was also heavily involved with Union activities at MTL. He said that this did not go down well with Management at MTL and some correspondence ensued between MPC and MTL. He tendered in evidence a letter App Ex 2.
On the 18th of May 2001, Management of MPC invited union members at MPC to discuss new Conditions of Service for MPC since at that time, they were still using Conditions of Service for MPTC. Whilst discussing these Conditions of Service, Management of MPC also introduced the subject of retrenchment which was pending in MPC. During the meeting, a disagreement arose as regards some clauses on Conditions of Service. This was mainly in relation to the issue of introducing one-month salary for each year of service instead of 3 months salary for each year of service as was the case in MPTC. Management of MPTC promised that they would consult the Board and the Applicant tendered Ex No. 3 as evidence of this meeting.
On June 19th 2001, MPC issued a circular on pending retrenchment which had been discussed in passing during the May meeting. The circular is App Ex No. 4. The union then called for another meeting in order for the two parties to discuss the contents of this circular. The union’s concern was that how could retrenchment be implemented in the absence of Conditions of Service in MPC? It was thereafter agreed that the matter be re-discussed at a different forum.
On the 27th of July 2001, MPC promoted the Applicant and transferred him to Mzuzu to operate a computer centre. In order to comply with this transfer instruction, the Applicant was given a week to go and look for a house and also see his new office. Thus between the 3rd and 8th of August 2001, the Applicant was in the City of Mzuzu looking for accommodation and also to set up an office there. The Applicant said whilst in Mzuzu, he discovered that a computer section did not exist there. When he asked for the office, he was told to go to the GPO Stores Mzuzu. He went to the place and found that there was none. The Applicant said that this frustrated him. He further told the Court that he could not find a house within the 7 days given to him. He thus requested the Human Resources Officer (N) to assist him find suitable accommodation and he returned to Blantyre. A week after his return from Mzuzu, the Applicant said that he booked an appointment with the Chief Executive of MPC who is the Postmaster General (PMG). He briefed the PMG about his findings in Mzuzu and the frustration he had.
The Applicant said that a day after he had met the PMG, he was invited by the Deputy Controller Human Resources. He was asked by this officer as to why he had not gone to Mzuzu since the PMG was enquiring from him. The Applicant said that he expressed a very big surprise because he had just met the PMG the previous day and had briefed him about his experience in Mzuzu. On the 29th of September 2001, the Deputy Controller Human Resources still insisted to know why he had not gone to Mzuzu. Later on the Applicant met the PMG to re-explain the position about Mzuzu. The Postmaster General then ordered that he should immediately report to the Controller Information Technology (CIT) at the head office. When he reported to the CIT, the Controller expressed a very big surprise about his promotion and assignment to Mzuzu. He told him that he had no immediate plan to have a computer department in Mzuzu. He also advised him that the business plan was not even there for Mzuzu and that the post for a computer operator in Mzuzu could only exist once the business plan was realized.
On the 1st of October 2001, whilst attending a workshop on trade unions, the Deputy Controller Human Resources called him. He handed him a letter and he discovered that it was a letter of retrenchment. In that letter the PMG referred to the Conditions of Service for MPC which Conditions were not yet in place. Immediately after the retrenchment letter, the Applicant said that he enquired from both the Director of Administration and Finance as to what had caused his retrenchment. But these two said that they had no knowledge. They both said that all they knew was that the PMG had received instructions to dismiss him hence this retrenchment.
The Applicant told the Court that at the time he was retrenched, Management of MTL and the Union had entered a deadlock over pay. MTL employees had declared a strike and the strike had reached its eleventh day. He was thus surprised to hear from the Director of Administration who said that the Applicant was to blame because Management had tried all it could to shield him from the pressure. The Director even told him that he was actually supposed to be posted to Chitipa. He also told him that had he travelled to Mzuzu, he would not have met this fate.
The Union on the 3rd of October 2001 wrote MPC protesting about the retrenchment of the Applicant. On the 22nd of October 2001, a meeting was held between the two parties and the union wanted to know as to who had sanctioned the retrenchment of the Applicant since the Board for MPC was dissolved.
The second witness was Mr. Dick Semani who was at the time working with MTL. He was a member of the union to which the Applicant was the Secretary General. His evidence was that when the Respondents wrote a circular on retrenchment, the union requested for discussions with Management in order to agree on the modalities of retrenchment. But before that was done, Management retrenched the Applicant. When the union enquired during a meeting as to why they had retrenched the Applicant, Management said that they had just been pushed to retrench the Applicant. Management further complained that the Applicant was poking his nose in MTL affairs. The third and last witness for the Applicant side was Batwell Ulemero. His evidence is that he is the president of this Malawi Posts and Telecommunications Workers Union. He also told the Court how the Applicant was retrenched and as to how the Union had protested because no modalities were followed. His evidence was in general similar to that of the other witnesses.
All these three witnesses told the Court that out of the 600 employees that were supposed to be retrenched as per the circular letter from Management only the Applicant was retrenched. By the time this case came up for hearing on the 25th of March 2002, only the Applicant had been retrenched. This they said was also evidence on its own that he had been singled out due to union activities.
The Respondent called one witness. He is Mr. George Allan Kafukiza Khaki. He is the Senior Human Resources Officer at MPC. The witness told the Court that after MPTC was split into two, MPC formulated its own Conditions of Service. When the Applicant was retrenched in 2001, he was supposed to be paid partly on the old MPTC conditions and partly on the new Conditions of Service for MPC which were approved by the Board of MPC. He told the Court that from 1st of July 2001, MPC had its own Conditions of Service. The witness confirmed that the Applicant was transferred to Mzuzu on promotion. At that time, the World Bank was assisting MPC to put in place an office for computer. The witness said that whilst awaiting things to be in place in Mzuzu, the Applicant was attached to the IT office in Blantyre. It is the evidence of this witness that the Applicant was not at all retrenched due to his union activities. He said that MPC had given the Applicant a lot of support on union activities and even assisted him with credit facilities to attend a conference in Japan. The witness further said that the retrenchment the Applicant suffered was an ongoing exercise. It was not targeting him. Due to financial problems, MPC was doing it in phases and that he was one of those who got retrenched first.
What we have narrated here is the evidence which we thought was relevant to the case. There were lots of things said about which Conditions were applicable to the Applicant in relation to his retrenchment package. We found such evidence to have been extremely unfocussed. We say so because the matters in issue before us concern the alleged victimization of the Applicant by being put on retrenchment and not which Conditions of Service are applicable to the Applicant. If we dwelt on the latter, then it would appear as if we had already decided that this retrenchment was justified and fair.
This matter falls within the purview of the Malawi Constitution in particular Section 31 which deals with Labour issues. Section 31 (1) provides:-
"Every person shall have the right to fair and safe labour practices and to fair remuneration."
We shall be looking at this provision more in our analysis that follows hereunder.
We have also looked at the Labour Relations Act in particular Section 6 (1) (b) which provides:-
"(1) No person shall, in respect of any employee or any person seeking employment –
(b) dismiss or prejudice such person because of trade union membership or participation in the formation or the lawful activities of a trade union."
The Court has also addressed its mind towards Section 2 (2) of the Labour Relations Act which provides:-
"This Act shall be interpreted so as to give effect to the Constitution and the obligations of any international treaty, including any international Labour Conventions entered into or ratified by Malawi."
It is this Section that indeed enjoins us to widely consult Constitutional provisions which deal with labour matters hence the citation of Section 31. We are again obliged by virtue of Section 2 (2) to give effect to International Labour Standards of the ILO. There are indeed several ILO Conventions that Malawi has ratified which protect the rights of employees at the work place in as far as trade union activities are concerned. These Conventions are:
(1) Convention No. 98 on the Right to organise and Collective Bargaining (1949) ratified by Malawi on 22nd March 1965.
(2) Convention No. 87 on Freedom of Association and Protection of the Right to Organize Convention, 1948 ratified by Malawi on the 19th of November 2000.
The Labour Relations Act further provides for remedies in Section 8 in the event of any infringements of the rights provided for under Section 6 of the Act. This Section provides:-
"(1) Any complaint of infringement of the rights or protection contained in this part may be presented to the Industrial Relations Court.
(2) Subject to Subsection (3), the Industrial Relations Court shall make such order as it deems necessary to secure compliance with this part, including an order for reinstatement of an employee, the restoration to him or her of any benefit or advantage, and an order for the payment of compensation.
(3) Where an employee is dismissed contrary to Section 6, reinstatement will be ordered if so requested by the employee, along with any other remedy that the Industrial Relations Court deems appropriate, unless reinstatement is clearly not practicable."
As we have already noted, the Applicant’s statement of claim has dwelt on the issue of unjustified retrenchment due to his trade union activities. He is thus applying to this Court to hold in his favour that the retrenchment meted on him is unfair and unjustified.
The Court will also refer to the Employment Act in particular the provisions of Section 57 which says:-
"The employment of an employee shall not be terminated by an employer unless there is a valid reason for such termination connected with the capacity or conduct of the employee or based on the operational requirements of the undertaking."
This Court also places a lot of emphasis on the use of international labour standards of the ILO which add international flavour to its decisions where domestic law has already adopted the principles of such convention. One such Convention very relevant to the provisions of Section 57 of the Employment Act is Convention number 158 concerning Termination of Employment at the Initiative of the Employer. This Convention was ratified by Malawi on the first of October 1986. This Convention provides in Article 4 that:-
"The employment of a worker shall not be terminated unless there is a valid reason for such termination connected with the capacity or conduct of the worker or based on operational requirements of the undertaking, establishment or service."
Article 13 further provides for the procedure that has to be followed by the Employer once retrenchment is contemplated. For the benefit of our jurisprudence, this Article says:-
"(1) When the employer contemplates terminations for reasons of an economic, technological, structural or similar nature, the employer shall:
(a) Provide the workers’ representatives concerned in good time with relevant information including the reasons for the terminations contemplated, the number and categories of workers likely to be affected and the period over which the terminations are intended to be carried out;
(b) Give, in accordance with National Law and Practice, the workers representatives concerned, an opportunity for consultation on measures to be taken to avert or to minimize the terminations and measures to mitigate the adverse effects of any terminations on the workers concerned such as finding alternative employment.
The Applicant tendered in Court such evidence which he said was a sign that the Respondents prejudiced him as a result of his participation in trade union activities. The Court has looked at the evidence. In analysing the evidence on record, the Court has taken into account that victimization as a trade union activist by the employer may be done in several ways. The employer may directly take such an action which would manifestly be seen to be victimization. In other instances, the Court would look at circumstantial evidence which leads to only one conclusion that such action would be termed as victimization.
In the instant case, the Applicant cited the experience he had with Mr. Mpaya the Director of Finance who openly warned him that Management was under pressure to fire him because of his trade union activities. In order to buttress this point, the Applicant said that he officially lodged a complaint with the Ministry of Labour and there is documentary evidence to that effect. There was also evidence from the other witnesses that when the Union met Management of MPC on the retrenchment of the Applicant, Management told them that they were also pushed to retrench the Applicant. Management further told them that the Applicant was poking his nose in the affairs of MTL.
The Court found that this evidence was overwhelming against the Respondents. What however struck the Court is the fact that the Respondents did not controvert this piece of testimony. The Applicant even mentioned some officials by names and if what he was saying about them was not true, one would have expected those people to come in the open and contradict this evidence. Thus the evidence on the Applicant’s side went unchallenged. The Respondents of course invited Mr. Khaki the Senior Human Resource Officer. It was however very clear when Mr. Khaki was cross-examined that he was ignorant of most of the issues when it came to matters in issue here. We found that Mr. Khaki was more comfortable when it came to explaining the Conditions of Service. Unfortunately, the bone of contention was not the Conditions of Service; it was on the alleged victimization of the Applicant by the Respondents due to trade union activities.
The Court has also looked at the events after the Applicant’s promotion. The Applicant was promoted and immediately posted to Mzuzu. We find nothing wrong in promoting an employee. After all, each and every employee expects promotion. But it’s the circumstances that surround this promotion which have made this Court to raise eyebrows. When the Applicant went to Mzuzu, there was no office, no equipment and there was completely nothing. When he came back to Blantyre, the officer in charge of the Computer Department who is the Director of Information Technology told him that he had no plans to open a computer department in Mzuzu and that the business plan was not even realized about Mzuzu. This was a very serious allegation against the Respondent. If the Applicant was manufacturing evidence, certainly the Director of Information Technology could have come to controvert the evidence. This was not done at all. Mr. Khaki did admit during cross-examination that up to now, there were no computers in Mzuzu. He only indicated that the World Bank had now procured some computers. We therefore found that the action taken by the Respondents to promote an employee and send that employee to a duty station where there is no structure for his position, where there is no office and no equipment for his trade was a deliberate act to punish the employee. This is also an act of unfair labour practice.
The Respondents tried to rely on the contents of the letter App Ex No.2 which was response to the letter written by MTL to MPC on the alleged interference of MPC employees in MTL activities. They said that in that letter, they had categorically denied that MPC employees were interfering with the activities of MTL only that some MPC employees were still executive members of MPC union and that when they went to MTL, they went there in their capacity as union members. The Respondents therefore argued that if they wanted to victimize the Applicant because of trade union activities, there is no way they could have defended the union members from MPC in that letter. Much as the Respondents wanted to blow the trumpet using this letter; we found that the contents of this letter should not be blown out of proportion. The letter speaks of the factual situation that was on the ground. The MPC employees who were executive members of MPT workers union were indeed going to MTL in their capacity as union members. Thus the Respondent cannot say that they defended the employees of MPC who were union members. This is just how things were and the Respondents were just narrating the situation on the ground. Even if we were to accept the Respondents’ point of view here, the evidence on record is so overwhelming against the Respondents that it outweighs the contents of this letter. Moreover this same letter is further testimony that there was talk at top Management level on the activities of union members.
Putting that aside, the Court has also looked at the way this retrenchment was effected. The Respondents had indicated in their circular that they would retrench 600 employees. The circular further said that the modalities for undertaking the retrenchment exercise were being worked out and will be discussed with the MPT workers union. There was uncontroverted evidence from the Applicant plus his witnesses that there were no further discussions on the modalities of the retrenchments which would affect 600 people. The Respondents’ witness Mr. Khaki did not say anything meaningful on this. As we have already pointed out earlier, the law requires fairness in matters of this nature. This Court has on times without numbers stressed that it is not sufficient for an employee to allege a need to retrench. This Court will need the actual reason for the decision in order to establish whether it is a legitimate exercise of management prerogative. In this particular case, there is already unchallenged evidence that top Management officers were not in the know how as to what led to his retrenchment apart from the fact that there was pressure from above due to the Applicant’s involvement in union activities.
More controversy in retrenchment has however surrounded the requirement of procedural fairness in the event of retrenchment. The procedural fairness is very crucial when the employer is deciding to implement retrenchment. The law, as well as international labour standards of the ILO, expects that the employer will consult the employee or the employee’s representative (trade union). Thus implementation involves the establishment of criteria for the selection of employees to be retrenched. Where no such criteria are contained in a recognition agreement the employer is enjoined to apply fair criteria, the principal requirement being that the selection process should not be arbitrary or at the employer’s whim. The need to consult is also necessary because before implementing retrenchment, there is need for suggestions on alternatives. Failure to consult by the employer will amount to unfair labour practice.
The facts in this case speak for themselves. There was no such consultation. Thus the criteria for selecting the Applicant out of the alleged 600 employees can have no any other explanation but that he was targeted as a result of trade union activities. Mr. Khaki told this Court that the Applicant was indeed retrenched alone out of 600 employees on the cards because of financial reasons. He said that the Respondents had to retrench in phases. We however found Mr. Khaki’s reason rather comical and unconvincing. The Applicant was retrenched on 1st October 2001. By the 25th of March 2002 when the matter herein was heard, he was the only one who had been retrenched. There was of course some talk that some other people had now received letters dated the 23rd of March 2002. We found that the Respondents had really targeted the Applicant. Why were they very interested to find money only for one person out of the 600 people, yet this was an employee whom they had just promoted. If indeed there were letters recently issued to other employees, we sincerely believe that those letters were triggered by the events in this case. The Respondents went on a panicking stampede after having realized that they were in a mess.
This Court has looked at the submissions made by Counsel for the Respondents. With due respect to Counsel, we found that these submissions are rather irrelevant to the matter in issue. Counsel dwelt at length on the issue of the Applicant not being employed for life. Counsel also dwelt much on the Conditions of Service that were applicable to the Applicant such as severance pay. But there is nowhere in these submissions where Counsel had even come close to look at the relevant Law that is applicable in a labour dispute of this species. The relevant law is that which we have cited from the Labour Relations Act as well as citation of the ILO Convention. Counsel of course referred to High Court decisions in the cases of MALAWI SAVINGS BANK LTD. –VS-BONNY KALOMBOLA Civil Cause No. 1394 of 1997 (Unreported) and M.M. KAMBUWA –VS- MALAWI INSTITUTE OF MANAGEMENT Civil Cause No. 1240 of 1996 (Unreported) where Hon. Justice Ndovi as he then was quoted with approval Justice Kalaile (JA) in the case of P.T.K. Nyasulu case (MSCA Civil Appeal No. 23 of 1998). We developed very keen interest in these cases. But a postmortem of these cases will clearly show that the matters in issue were totally different. In all these cases, there was no dispute on victimization of an employee because of trade union activities. In all these cases, the Court were not invited to look at the Labour Relations Act. This dispute before us does emanate from the Legal foundation in this Act. We have therefore excellently distinguished these cases from the case at hand and in as far as this matter is concerned, this Court cannot be bound by these decisions, then there is no need for the existence of the Labour Relations Act, the Employment Act and the ILO Conventions if we are to borrow the reasoning in these cases cited by Counsel. The approach in some of the cases cited was purely common law approach.
After having given this case the best of its scrutiny, we found that there was indeed overwhelming evidence both direct as well as circumstantial that the Applicant’s retrenchment was accelerated as a result of his active participation in trade union activities which is a fragrant violation of Section 6 of the Labour Relations Act. This also does contravene Convention Number 98 on the right to Organise and Collective Bargaining in particular Article 1 (1) (2) which provides:-
"Workers shall enjoy adequate protection against acts of anti-union discrimination in respect of their employment. Such protection shall apply more particularly in respect of acts calculated to-
(a) Make the employment of workers subject to the condition that he shall not join a union or shall relinquish trade union membership;
(b) Cause the dismissal of or otherwise prejudice a worker by reason of Union Membership or because of participation in union activities outside working hours or; with the consent of the employer, within working hours."
The above Convention is very fundamental when it comes to anti-union discrimination. This Convention was also cited by this Court in the case of KEN WILLIAMS MHANGO –VS- MOUNT SOCHE HOTEL(Tourism Development Company) Ltd. IRC Matter No. 2 of 1999 (Unreported) decided on the 8th of December 1999 at Limbe. We find that the Applicant here had his employment terminated through retrenchment as a result of anti-union discrimination by the Respondents.
We further found that this retrenchment, even if it would have been declared normal, was done in a very unprocedural way. Employers should know that although they have the prerogative to retrench, but fair labour practice requires that proper procedures have to be followed before retrenchments are implemented.
The Applicant had applied for a relief of reinstatement. We found that the most suitable remedy in this case is indeed reinstatement, which this Court has the power to order under Section 8 of the Labour Relations Act. We therefore order that the Applicant should be reinstated to his position before retrenchment and that any benefits that were withheld such as salary etc. should be paid to him The Registrar of the Industrial Relations Court to ascertain these benefits.
We further order that since the Applicant had been promoted and posted to Mzuzu where there was no structure in place, the Respondents should attach him to an office which deals with computers. Preferably at the office of the Director of Information Technology in Blantyre where he was before he met this unjustified retrenchment.
DELIVERED this --------- day of May 2002 at Blantyre/Limbe.
M.C.C. Mkandawire, Chairman
Mrs. Ching’oma (Member Panelist)
Mr. Nindi (Member Panelist)