Soko v Chibuku Products Ltd - Matter No. 13 of 2002 (13 of 2002) [2002] MWIRC 23 (01 October 2002);

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IN THE INDUSTRIAL RELATIONS COURT OF MALAWI

PRINCIPAL REGISTRY

MATTER NO. IRC 13 OF 2002

BETWEEN:

MR MANUEL SOKO …………………………………….. APPLICANT

-and-

CHIBUKU PRODUCTS LTD …………………………. RESPONDENT

CORAM: 

R. ZIBELU BANDA (Ms.) DEPUTY CHAIRPERSON

Manuel Soko, Applicant

Olex Dzimba for Respondent (Personnel Officer)

Ngalauka Court Clerk

J U D G E M E N T

Withholding wages for overtime work; normal working hours form part of contract of employment.

FACTS

The applicant commenced this action on 9th January, 2002 claiming One Hundred Fifty-Five Thousand Two Hundred, Ninety Eight Kwacha and thirty tambala (K155, 298.30) comprising money earned in excess hours worked for the respondents during a period from November 1998 to December 1999.  He informed court that he commenced employment with the respondents on 2nd February 1995 as Sales Representative. His services were terminated on 29th February 2000. At the time of termination of services he had risen through the ranks to position of Distribution Manager, earning a basic salary of K6, 593.00 from K1, 240 when he was first employed.  

Terms and conditions of contract of employment between applicant and the respondent were expressed in a document tendered by the applicant as exhibit “AP1” entitled:   “JUNIOR STAFF CONTRACT.” However, the respondents denied that this document formed the contract. They contended that the applicant had risen through the ranks to managerial position as per exhibit “RP5” being a letter of promotion from the respondents to the applicant entitled: “PROMOTION: DISTRIBUTION MANAGER.”                   

The applicant submitted that the promotion did not come with express terms and conditions for that job other than a revised salary to K5733.00 per month. He therefore, felt that he was guided by “AP1”. In that document the applicant singled out the section on “SALARY: normal hours of work”. It is on the basis of this section that he claims overtime.

ASSESSMENT OF FACTS

The first observation is that “AP1” was a contract of employment for a Sales Representative. At the time of termination of services the applicant was not a Sales Representative but a Distribution Manager. Therefore he could not have been governed by “AP1”.

The second observation is that the applicant on his own admission never claimed overtime since becoming Distribution Supervisor in Bantered in November 1998. He informed court that his immediate boss a Mr. Mvula had advised him that he could not claim overtime because he was not entitled. There was nothing to show that the applicant was dissatisfied with that advice. He continued work and never claimed any overtime until the termination of his services in February 2000. The applicant could not produce in court any form or official document from the company indicating or verifying his claims for either ordinary overtime, day off overtime or holiday overtime. He tried to show that he had this information in a personal diary, which, was missing, the court found this assertion rather far fetched.

In countering the applicant’s assertions on overtime entitlement, the respondents produced two memorandums under subject: “MAXIMUM SALARY FOR OVERTIME,” dated 10th September, 1998, marked as exhibit “RP1” and another headed: “MAXIMUM SALARY FOR CLAIMIMG OVERTIME,” dated 29th December, 1999 exhibited as “RP2”.

In the first memorandum the maximum salary for claiming overtime was K3231.25. The respondents explained that all employees were advised through Operation Managers that those who got a basic salary of K3231.25 and above were not entitled to overtime allowance. During this period the applicant’s salary stood at K4, 009.00 as per exhibit “RP3’. This exhibit was a salary increment advice from the Personnel Manager to the applicant, dated 1st October 1998. It should be remembered that the applicant’s claim for overtime is for period from November 1998 to December 1999. During this period as can be seen from “RP1” and “RP3”  (there was no evidence to the contrary) the applicant fell outside the overtime entitlement category.

In the second memorandum the maximum salary for one to claim over time was K5, 545.00 per month effective 1st January 2000. It was produced and exhibited in this court “RP5”, a document, showing that prior to this memorandum the applicant was holding the position of Distribution Manager and earning a salary of K5733.00 per month.

This court did not believe the applicant’s allegation that he never got or saw “RP1” and “RP2”. If the applicant believed that he was entitled to overtime he would have claimed it using the normal channels that everybody else used at the company. It is because he knew that he was not entitled that he never took any steps to claim overtime allowance when he was so employed.

THE LAW

The Employment Act 2000 states in section 36(1) that:

“An employee’s normal working hours shall be set out in the employment contract.” 

It is therefore the duty of parties to a contract of employment to set out clearly the express terms of a contract of employment including normal working hours. It was submitted that the only time, terms and conditions of service of the applicant were mentioned in documentary form was when he was Sales Representative. This prompted the applicant to think that he could select the terms and conditions that were to his advantage from this contract and use them against the respondents.  However, the legal position is that the employer is not under duty to set out each and every term of contract of employment in a document. The legal obligation is limited to issuing a written statement containing particulars of the main terms and conditions of employment. Employees do not have to sign this document. (See section 27(1) of the Employment Act 2000.)

The fact that there was written regulation on overtime formed an express term of contract regarding overtime pay. It was not necessary for the respondents to draw up a formal contract of employment with the applicant to express that particular term. It was enough that there were written statements in the form of memorandums from now and again advising employees on changes in overtime entitlements. It was up to the applicant to negotiate with management if he felt aggrieved with the condition regulating overtime.

It is said in the Law of Employment: Practice and Analysis (1998) that:

“Hours of work will be in accordance with the contract of employment. Usually this will provide for some normal or standard number of hours per week, beyond which hours constitute overtime. The rate at which overtime is paid, is, like ordinary pay, not governed by legislation. Rather it is a matter of contract. The test of whether overtime is contractual is whether the employer must provide it and the employee must work it.”

This view echoes the spirit of our law in section 36 of the Employment Act 2000 quoted above.

Evidence of whether the respondent provided overtime to the applicant would have been in the form of authorization. The respondent submitted in court the procedure for overtime at the respondent’s company. Authorization was crucial before one could claim overtime. Head of Department or Supervisor would issue authorization where necessary. The authorization had to be documented, for purposes of calculating off time hours or pay in lieu thereof. The applicant had at one time during his term of employment with the respondents been entitled to overtime and he followed a procedure as laid down by the respondents. This court cannot entertain his assertion, therefore, that he was in the dark.

FINDING

The conclusion of the court is that the applicant was aware of the position on overtime at his work place. The employer did all it could to inform employees including the applicant the position on overtime allowance as amended from time to time. This was enough notice to all. The burden was on the applicant to question that position when he had the time during his term of service. The court finds that the applicant was not entitled to overtime and hence his claim for K155, 298.30 must fail in its entirety.

Pronounced in open court this 1st day of October 2002 at LIMBE.

 R. Zibelu Banda (Ms.)

DEPUTY CHAIRPERSON