Kamanga v Stanbic Bank (IRC 302 o 20044 ) (NULL) [2006] MWIRC 101 (02 August 2006);

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IN THE INDUSTRIAL RELATIONS COURT OF MALAWI


PRINCIPAL REGISTRY


MATTER NO. IRC 302 OF 2004


BETWEEN:


KAMANGA…….………………...…………………………. …………...APPLICANT


-and-


STANBIC BANK…………….……………………..........................…...RESPONDENT



CORAM: R. Zibelu Banda (Ms); Chairperson

Chirwa; of Counsel for Applicant

Mulemba; of Counsel for Respondent

Chinkudzu; Offical Interpreter



JUDGMENT

Dismissal- -Summary dismissal- Reason for dismissal- Negligence-Procedure-Opportunity to be heard and defend oneself-Disciplinary hearing- Court interference with decision of employer-Only in allegation of unfair disciplinary hearing-Appeal-To cure defects in trial hearing.


Facts

The applicant was employed by the respondent. He was dismissed by letter of 16 January 2004. The reason for dismissal was negligence which led to loss of respondent’s money amounting to MK390 000-00 through a fraudulent transaction perpetrated against the bank. The applicant challenged the termination alleging that the termination was unfair because the reason was not valid and that the procedure leading to the termination was not fair. He stated that it was not his responsibility to verify the details of the account holder and or of the account to ensure that they were dealing with un authorized person. In terms of hearing, he told court that he did not have access to the investigation’s report nor to the company’s legal adviser at the hearing.


The respondent on the other hand informed court that the reason was valid and that the applicant had a role to play in the transaction. They stated that the applicant made some endorsements that misled the bank in paying out money to a fraudster. They averred that the applicant was responsible for verifying that the bank was dealing with an authorized person who was known in person or indeed that mechanisms were in place to indemnify the bank in case of loss. Regarding the hearing, the respondent contended that they had heard the applicant, the hearing was fair and that if at all the hearing was flawed, that anomaly was cured on appeal. They asserted that the termination was fair.

Issues

The Court was called upon to determine whether the dismissal was fair. The issues for the applicant were that the reason was not valid. He averred that he had not committed any wrong. He also stated that the hearing was not fair. The respondent on the other hand alleged that there was negligence on the part of the applicant in the conduct of his duties which negligence led to loss of the respondent’s funds.


The Law

The Employment Act provides in section 57 that before dismissal an employee must be given the reason for dismissal. If the dismissal is connected with the employee’s conduct or capacity that employee must be given an opportunity to be heard and explain his side before he can be dismissed. In Nkhwazi V Commercial Bank of Malawi (Civil Cause No. 233 of 1999 (unreported)) where although the cause of action arose before the Employment Act 2000, His Lordship Justice Mwaungulu, described the effect of section 57 of the Employment Act in the following terms on pages 9 and 10 of the transcript:


“Under Section 57 of the Employment Act, therefore, 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. The employment of an employee shall not be terminated for reasons connected with his capacity or conduct before the employee is provided an opportunity to defend himself against the allegations made, unless the employer cannot reasonably be expected to provide the opportunity.”


In the instant case the issue was whether the reason for dismissal was valid. The applicant knew the reason that led to a disciplinary hearing- loss of MK390 000.00 and how the applicant contributed to that loss. On assessing the evidence the court finds that the respondent had a valid reason to institute disciplinary proceedings.


In deciding whether a disciplinary hearing arrived at a proper decision or not, the Court should restrict itself to facts before it at the Court hearing and avoid substituting decision of the employer with its own decision. The Court should not state what it could have found if it were sitting at that disciplinary hearing, but rather should restrict itself to whether the disciplinary hearing was properly constituted and the proceedings were conducted with fairness.


In assessing the fairness of an employer’s decision to dismiss the question arises as to what extent a Court should be permitted to interfere with the employer’s bona fide decision to dismiss? The question was answered in the Labour Appeal Court of South Africa in County Fair Foods (Pty) Ltd V CCMA & others [1999]11BLLR 1117 (LAC), Kroon JA holding that :


“[Interference] with the employer’s sanction is only justified in the case of unfairness. However, the decision of the arbitrator as to the fairness or unfairness of the employer’s decision is not reached with reference to the evidential material that was before the employer at the time of its decision but on the basis of all evidential material before the arbitrator.”


There are a number of reasons for holding that a Court should not lightly interfere with decision of the employer. For instance, the employer had the advantage of hearing witnesses into the alleged misconduct at the time that it happened and the employer is better placed to know the rules and procedures and more especially its operational interests than any Court, see Kachingwe and others V Southern Bottlers Ltd [Matter Number IRC 162/2003 (unreported)].


In the instant case the applicant alleged that the disciplinary hearing was unfair because he did not have a copy of the investigation report and that legal adviser for the respondent did not attend the hearing. There is no merit in insisting that a legal adviser must attend an internal disciplinary hearing. These internal disciplinary hearings are supposed to be informal and with as little technicality as possible. The applicant did not state how the presence of a lawyer was going to change the decision.


Access to investigations report is a valid point and it is encouraged that where an investigation is instituted into an alleged misconduct, all concerned parties must have access to the report so that they can be well prepared for the hearing. The rationale is that an accused person should not be taken unawares at the hearing. In this respect the hearing was unfair.


Appeal

The applicant appealed against the decision to dismiss him. It is not known what exact grounds he put in his defence, all that is available is that he appealed against the decision. It is the respondent’s contention that the appeal cured any defects that may have occasioned at the first hearing. Indeed this is the position of the law. For example, in Byrne V BOC Ltd [1992]IRLR 505 EAT, the Employment Appeal Tribunal held that:


Where the first stage of the disciplinary hearing is seriously flawed, it is essential if the appellate process is to be properly treated as establishing fairness overall that it should be able to stand on its own merits as conferring upon the employee all the rights which should have been accorded at the initial stage, notably proper notice of the complaint, and a full opportunity of stating the employee’s case.


In Sartor V. P & O European Ferries (Felixstowe) Ltd [1992] 271 CA, the Court of Appeal held that;


A procedural defect which is sufficiently serious as to render the decision to dismiss unfair can be cured by an opportunity to appeal by way of rehearing.


In the instant case the court heard that the applicant had an opportunity to appeal. He did not challenge the appeal proceedings. It is therefore found that the defect that was occasioned at the first trial was cured by the appeal.


Finding

It is the finding of this court that there is no compelling reason why it should interfere with the decision of the respondent. The applicant’s action is therefore dismissed in its entirety.


Any party aggrieved by this decision is at liberty to appeal to the High Court within 30 days from the date of this judgment. Appeal lies on matters of law and jurisdiction, see section 65 (2) Labour Relations Act 1996.



Pronounced this 2nd day of August 2006 at BLANTYRE.




Rachel Zibelu Banda

CHAIRPERSON.