Dambolachepa v Royal Insurance Company (Record) (IRC 263 of 2005 ) (263 of 2005) [2005] MWIRC 63 (14 October 2005);

Share
Download: 




IN THE INDUSTRIAL RELATIONS COURT OF MALAWI


PRINCIPAL REGISTRY


MATTER NO. IRC 263 OF 2005


BETWEEN


DAMBOLACHEPA ……………..………………………………………. APPLICANT


-and-


ROYAL INSURANCE COMPANY……………. …………………… RESPONDENT



CORAM: R. ZIBELU BANDA (MS) – CHAIRPERSON
Hara; Of Counsel for the Respondent
Applicant; Present
Chinkudzu; Official Interpreter
RECORD

HARA: I would like to make a formal application for leave to amend the IRC Form 2 – it was already served on the applicant.


COURT: Leave granted.


AP: Takes oath and states: I am Precious Dambolachepa, Blantyre Post Office Box 888, Blantyre. I was employed on 1st March 2000. I was dismissed on 31st May 2005. I have the letter of termination.


COURT: AP 1


I was not told the reasons for termination. I was asked to resign but I refused because I was not given any reasons why I should resign.


Events – In July 2004 one of our clients Universal, brought a vehicle to our premises for inspection and authorized of repairs. The vehicle was brought by the brokers, I inspected it. I was told to contact the owner of the garage quoted on the quotation. I phoned him and agreed on reduced figures for repairs. I authorized repairs. I was working as Assistant Claims Manager – it was my responsibility to inspect and authorize repairs. The motor vehicle was repaired and the insured signed a satisfaction that they were satisfied with the repairs and they paid the excess of K10000.00. Royal settled the claim – On 6th January 2005, I received a note from the Managing Director to clarify on certain points relating to photographer of the damaged vehicle? Who accompanied me for inspection? who the broker was? and other quotation as stated on this document?


COURT: AP 2


I clarified the issues – in a document –


COURT: AP 3


On 26th January I was summoned to the Managing Director’s office. I found the General Manager. I was told by the Managing Director that he was warning me for not attaching photographs to the file. It was not mandatory. I explained that it was cumbersome to get pictures because one need to finish 35 spaces in a firm and the claim was approved by the same management without the photographs.


COURT: AP 4


Further, I was told to go on leave until the matter was thoroughly investigated for 26 working days. I was told to hand over all official files to my immediate boss. My staff agency was cancelled effective in February 2005. My own insurances were cancelled.


COURT: AP 5


I proceeded on leave. Nothing was communicated to me on the investigation until end of leave on 7th March 2005. I resumed duties on 8th March 2005. I went back to the office on 18th March 2005. I found a letter asking me to clarify certain issues to the Managing Director. I clarified the queries on one quotation only being provided; non existent garage; and that the accident did not take place. I responded to the question. I was told to report for duties on 23rd March 2005 at 10 a.m. I went to the office. I found a note asking me to proceed on leave till 29th April 2005.


COURT: AP 6


I came back on 29th April 2005, I was told to report for duties on 26th May 2005 at 2 p.m. I met the Managing Director and General Manager they told me that they had resolved that I should resign. I rejected this offer. I was then told that they would terminate my service on 27th May 2005 was when I received a letter of termination. I never discussed or agreed to the contents of the termination letter – I never discussed or agreed to anything.


COURT: AP 7


I have another document explaining issues by the Managing Director – regards quotation and accident.


COURT: AP 8 – was a response to AP 9


The Managing Director wrote me a letter a response to AP 7 – enclosing a cheque for my terminal benefits.


COURT: AP 10


He wrote me another letter on 29th June 2005 enclosing a cheque for my pension contribution. I had served for some years – therefore I was entitled to 50% of employers contribution. He responded by giving me another cheque for K69295.00, representing 50% of the employers contribution – This was not enough. I was entitled to K138587.87. Old Mutual asked me to write a letter to them enquiring about the balance. They respondent but I have not received the money. I am claiming K69293.47.


Severance allowance – I was entitled to K81706.00 the company deducted K69000.00 being company contribution according to them – I am claiming K69000.00 which was unlawfully deducted.


On 15th March 2005 my motor vehicle was comprehensively insured it was involved in a road accident but I did not claim because of the cancellation of my policy on 4th February 2005 – I insured it for on lesser cover because I was taken unawares by the cancellation. I am claiming K55000.00 representing repairs to the motor vehicle.


On 3rd April 2005 my cellphone was stolen which had been fully insured. I did not claim because of the cancellation. I am claiming K25000.00. (no police report). I am also claiming Loss of monthly income; medical aid; pensionable terms; and stress arising out of the loss of the job.


UNFAIR

It was unfair because there was no valid reason. I explained everything but I still got the termination.


Relief – compensation

My qualifications are: MSCE > Advanced Diploma Charted Institution for TPT.


XXN – I had two meetings with the General Manager and Managing Director but they were not meetings. They were just telling me their decisions.


Looks at document – dated 12th April 2003 the contents are not correct that I processed a claim without discussing with my supervisor.


“ID 1” – poor performance.


In 2004 – a document 31st January memo from Managing Director to Applicant – on poor performance –


“ID 2” –


Looks at document 30th January 2004 – not found.


Looks at 25th June 2004 document – Managing Director to Applicant –


“ID 3” –


Looks at document – 25th November 2004 – Managing Director to the Applicant – I don’t agree with the contents.


“ID 4”


Looks at 25th November 2004 document from Applicant to Managing Director – I am admitting that I did something without approval from Managing Director.


“ID 5”


Looks at 1st December 2004 document – memo from Managing Director to Applicant – I signed the letter, “ID 6” of liquidation –


Looks at 3rd December 2004 – memo from Managing Director to Applicant –


“ID 7” –


Looks at document – 9th December 2004 – General Manager to Applicant memo –


“ID 8”


Looks at memo/ file note by J. Unyolo 1st December 2004 – fraud.


“ID 9”


Mr Unyolo was an employee in my department – he was a Claims Assistant – he is referring to the Mwayang’ana claim. I know Mr Shawa, driver for Royal Insurance –


Looks at photos – damaged and non damaged photos –


“ID 10 (a)”

“ID 10 (b)”

“ID 10 (c )”

“ID 10 (d)”


Looks at a report by General Manager 9th December 2004.


“ID 11” – I don’t know anything about this report/memo.


Looks at document – 6th January 2005 – Managing Director to APP – AP 2 – I responded that the garage existed –


Looks at memo from Managing Director to Applicant.


AP 4 – I did not attach the photo because the process to get firm developed took long.


In the response in AP 3 I explained what happened – photographs missing.


Looks at document – memo from response on garage existence –


“ID 13” – Mr Shawa’s report – on garage – Universal Industries – this was the source of the warning in AP 4. I was never told reason for termination. I had two meetings with Managing Director and General Manager but only to be told decisions made by them.


The Managing Director and General Manager did not present to me the issues – I only explained the Universal issue. I was warned in relation to Universal issue – I authorized repairs in the claim of the vehicle was repaired – the garage existed. I don’t know whether Mr Phiri also went to look for the garage. I was responsible for processing claims it was also my responsibility to investigate claims and pay if there are no suspicious circumstances relating to claim. I did not do anything that raised doubt in the management to warrant dismissal.


The policies and insurance agency’s were employment benefits. These were contract between the insurer and myself. They had conditions that would entitle cancellation. Severance allowance and pension I was entitled to 50% of employer’s contribution but I got 25%. Old Mutual were fund managers – looks at document letter from Old Mutual to Royal 13th October 2005 – on withdrawal benefits.


“ID 14” –


Re examin: I don’t agree with the documents referred to in XXN. I don’t know about them. They were not brought to my attention.


“ID 15” – memo from Managing Director to Malimero copy to applicant – 5th February 2003 –query on Multi Country and the K30000.00 reserve –


RP: Takes oath and states: I am Damiano K. Phiri, I am General Manager – reason – misconduct – not following procedures – e.g. settling of claims and services, authorising of repairs to non reputable or non existent garage; more than often these things repeated themselves.


Specific incidents - Acting without authority – His reserve was under K10000.00 in year 2002 – the applicant was aware of the reserve –


Looks at ID 2 – performance of applicant – failure to produce reports; failure to follow up on claims seriously reducing a reserve without justification.


Looks at ID 3 – serious misconduct sum insured was K81000.00 but the applicant made a reserve of K100000.00 – when an insurance company has a claim it can pay up to the insured sum but not exceeding sum insured.


Looks at ID 4 misconduct – failure to sign on a reserve figure and on Universal the reserve of K100000.00 was supposed to be referred to the Executive Management but the applicant failed to do that.


Looks at ID 5 – misconduct – reserve on Old Mutual claim response of the applicant – the response was just protective because in his position he could not over look the issue of reserving and signing reserve figures.


ID 6 – misconduct – signing a repudiation letter – where a claim is not payable – the letter is supposed to be written by the Operations manager or Executive manager – the applicant explained the irregularity but not convincing – in his position he was supposed to know about these issues.


ID 7 – Repudiation of claims emphasizing that the applicant was not supposed to sign repudiation letter.


ID 8 – Misconduct – dishonesty accepting to process a claim for damage which did not occur – the applicant was confronted but explained that he did not know about the damage – when the motor vehicle was inspected there was no damage at all.



ID 9 confirms that the claim was fake –


ID 11 is my document – I carried out investigation on the motor vehicle because I knew – it – I found out that the motor vehicle was not damaged. I confronted the applicant but he said he did not process the claim – however he said he had received a call from Mr Mwayang’ana to inform him about accident.


The ID 12 and ID 9 – before the claim was concluded Mr Mwayang’ana was involved in real accident and in view of the second claim we cancelled his policy due to the fake claim.


The applicant was an Insurance Agent for client – Mwayang’ana. As an agent he was supposed to make sure that his client’s vehicle was involved in an accident.


Looks at ID 13 – note – note by Shawa – we asked Mr Shawa to locate the car connection garage – to verify its existence – he reported that the garage never existed – in my own accord I drove to Chilobwe to look for the garage but I never found it. Before I was transferred to Lilongwe I lived in Chilobwe – I did not know the Mr Gondwe mentioned in the memo –


Procedure – we had meetings with the applicant – we investigated cases of Mwayang’ana and Universal and considering his past misconduct as management we felt it would be easier for us to send him on leave to investigate properly.


The applicant was invited to a meeting where he was told that with the investigations carried out we verified that the applicant was involved in the fraudulent claims. We told him that we had lost trust in him and that we could not continue working with him. We asked him to resign. The applicant refused. The Managing Director and myself looked at the contract of employment and decided to terminate his service without notice. We also paid him his accrued leave days; pension benefits and severance allowance.


Pension – the applicant was not happy with his benefits – he thought we had paid him less – 50% we got clarification from Old Mutual that they had paid him 100% - ID 14 –


We paid the applicant 50% of employers contribution – that is what was paid – the applicant. Our concern were that as Assistant Claims Manager – the applicant held a position of noble trust – because claims department pays out money to client – if a senior officer failed to perform in this position in his department we could not continue with the employment relationship. Royal is reputable and none of us made any comments relating to the applicant’s termination – we never tarnished his reputation.


XXN: All mail to our company is seen by Managing Director, in his absence, the General Manager. Reserve comes from a recommendation from Claims Handler like yourself. It is calculated and recommended by Claims Handler. The reserve fluctuates upwards on downwards. The K30000.00 was – permanent reserve – the claim was being concluded, it was at conclusion level. The query on reserve was procedurally addressed to your boss – Operation Manager – the Claims Handler is supposed to work hand in hand with underwriter to verify sum assured. You could delegate to ID 3 – under normal contributions the K100000.00 could not be reserved beyond K100000.00. The issue was that the applicant had over reserved on sum assured.


The reserve was not put by the applicant but as Senior Officer you were supposed to regularize the mistake – You failed to do the correct initialing – there were no calculations. You were supposed to initial the reserve but you did not.


Car Connection Garage never existed at time of Universal Claim – I don’t remember when Universal Claim was paid. Procedures are that photograph must appear in claims – you did not do this. You authorized payment of claims without photograph to a garage that did not exist. We were tied to pay because you committed us to pay (we could not back down).


Investigation – on Mwayang’ana – during one of the meetings we had with you we told you results of investigation on Mwayang’ana case. Blantyre Police was involved in the investigations. I don’t know who they investigated. We received verbal abstract on the investigations –


We terminated your services following your previous misconduct. I don’t have document showing that you were entitled to K10000.00 reserve only.


Severance allowance – K82000.00 was paid – the termination was on 31st May 2005 –


Re examin: None


Question by Court: I was the agent in the Mwayang’ana issue. I was agent up to 15th February 2005 – the agency was terminated but I was not told the reason. The agency was cancelled with Mwayang’ana alongside all other clients – this was because of the Universal issue. I did not know that Mwayang’ana agency was cancelled. I never got any information. My client did not tell me about the cancellation of the policy.


Question to Mr Phiri – we did not outline all the incidents that hard happened before to the applicant as a reason for termination. We did not dwell in details on why we terminated the contract we just looked at the contract and we assumed that he knew about the previous incidents.


Hara: Written submissions within 7 days – judgment within 21 days.


R. Zibelu Banda

CHAIRPERSON

14/10/05



CORAM: R Zibelu Banda; Chairperson
Hara of Counsel for the Respondent
Applicant – Present
Gowa – Official Interpreter


HEARING ON ASSESSMENT


AP: Takes oath and states: I am P. Dambolachepa, Box 888, Blantyre. I lost salary – K43000.00 per month, loss of medical aid – 90% of the contribution – K5160 per month; I am demanding balance of K69000.00 on the severance allowance the employer deducted some money which they paid to me as company contribution-I did not lodge my complaint to the District Labour Office as I had lodged the matter with the court.


Court > To dismiss the claim – section 35 (8)


I was entitled to 20 days leave per year. I am claiming 26 leave days for 2003 and 2004 – which I did not get paid for –

Pension scheme – I was paid less K69294.00 –


Annual increment for 2005 – I am claiming 13% of my salary – about K5590.00 which I was supposed to get at the beginning of January 2005.


Overtime for 438.25 hours for working on week ends and public holidays. I was not paid all my dues for these overtime. I claim the balance of K114301.01 – for the period 2000 – 2003 – I queried the employer while I was there but it did not work.


I did not make this claim in the statement of claim that I lodged with the court. I would like to amend the statement of claim to include this claim.


Court: Amendment allowed – to be served on the respondent in the usual manner but to appear in a form closely resembling IRC Form 3.


Damage – of reputation –I claim damages for damaging my reputation.


Court : In unfair labour practices claims damages for reputation are not awardable.


  • I lost a cell phone – it was for K25000.00. I do not have a police report that it was lost-

  • I lost K114000.00 – the basis for the claim is that the company cancelled my policies – without any explanation.

  • I am claiming K50000.00 for use of my vehicle by the company. The basis of this claim is that the company General Manager took advantage of his position to use my car for his private errands.


The total claim > K391301.01.


XXN: I was contributing 10% to medical scheme – K200.00 per person total – contribution – K600.00.


Pension – I was paid K234828.80 balance is K69294.00. I was supposed to be paid K304122.80 leave pay – 6 days accrued in 2003; 20 days accrued in 2004 – I was asked to go on leave in January 2005 – I went on leave for the 26 days – I was getting my salary during this time – I was asked to go on leave – by December 2004 – the 26 days had accrued – the company paid me everything up to date of termination..


Overtime – Accrued between 2000 – 2003 I don’t have any proof that I claimed at the company. I did not raise this issue in the statement of claim – I was underpaid in overtime – I did not work overtime in 2004. Salary increment > I was entitled to an increment in January 2005 – this was the practice – I had been getting this increment every year – this is also in the conditions of service –


Court: Practice > > basis > >


Insurance Policy > These were contracts between myself and Royal Insurance.