Gadama and Another v Opportunity Bank of Malawi (IRC Matter No. 36 of 2013) [2018] MWIRC 9 (26 October 2018);

Primary tabs

Share

Flynote tags: 

IN THE INDUSTRIAL RELATIONS COURT OF MALAWI MZUZU REGISTRY

MATTER NUMBER I.R.C 36 OF 2013

 

BETWEEN

ISABEL GADAMA.........................·............................................1ST APPLICANT

PATRICIA CHIPANGULA.........................................................2ND APPLICANT

AND

OPPORTUNITY BANK OF MALAWI ............................................RESPONDENT

 

 

CORAM:  HIS HONOUR KINGSLEY DON MLUNGU, DEPUTY CHAIRPESON

CECILIA T. NYIRENDA, EMPLOYERS' PANELIST

ALEXANDER LUNGU, EMPLOYEES' PANELIST

WILLIAM CHIWAZA, COUNSEL FOR THE APPLICANTS

CHRISTON GHAMBI, COUNSEL FOR THE RESPONDENT

HEZRON MHONE, COURT CLERK

 

JUDGEMENT

INTRODUCTION

The two applicants were working for the respondent at its Mzuzu Service Centre and both were dismissed from employment with effect from 16th May, 2013 on allegations of flouting bank procedures and acting fraudulently by receiving funds from customers and not depositing the same in customer's accounts as loan payments.

The first applicant was working as a Recoveries Officer from 10th February, 2011 and the second one as a Loans officer from February 2009. The applicants commenced this action claiming that their dismissal was unfair in that it was based on unsubstantiated allegations and that their right to be heard was grossly violated in the process leading to their dismissal, interalia. They thus claim damages for unfair dismissal; terminal benefits in form of notice pay and for the 1st applicant, repatriation costs from Mzuzu to Lilongwe where she had been employed and transferred from.

THE EVIDENCE

The evidence of the applicants herein leading to their claim of unfair dismissal is that the 1st applicant received a phone call on 13th March, 2013 from the then resndent's Mzuzu Branch Manageress that she should inform her colleague, the 2nd applicant, that they were wanted at the Respondent's Headquarters in Lilongwe the next day, 14th of March, 2013. At that time the applicants then immediately arranged for their own transportation from Mzuzu to Lilongwe as the Branch Manageress had further communicated that it was too late to arrange for their transportation costs but that they will be refunded on return. The applicants said they were never told the agenda of the meeting at the respondent's headquarters and that they were given Notices of Disciplinary Hearing and the charges 10 minutes before they were called in the hearing. They said this 10 minutes was not enough for them to prepare for their defence. They also said that there was no valid reason for their dismissal as there was no any conduct on their part to be considered fraudulent. To that end they submitted that their dismissal was unfair warranting them to be awarded damages for unfair dismissal and also terminal benefits as claimed. They also prayed interest on the same.

After the applicants had closed their case, the respondent indicated that it was going to parade its own witness in defence and the matter was duly adjourned for this Opportunity /exercise. The respondents filed a witness statement deponed by Mr. Harry Munthali but on the set date, the intended witness was not paraded and the respondent later decided to close the matter without parading any witness.

ISSUES TO BE DETERMINED

  1. Whether the applicants were fairly dismissed or not.
  2. Whether the applicants are entitled to the claimed terminal benefits or not; and
  3. Whether interest can be awarded on the claimed benefits

THE APPLICABLE LAW

A. THE CONSTITUTION

Section 31 of the Republican Constitution states that: "Every person shall have the right to fair and safe labour practices and to fair remuneration."

Section 43 of the Constitution states that: "Every person shall have the right to -

  1. Lawful and procedurally fair administrative action, which is justifiable in relation to reasons given where his or her rights, freedoms, legitimate expectations or interests are affected or threatened; and
  2. Be furnished with reasons, in writing, for administrative action where his or her rights, freedoms, legitimate expectations or interests are affected.

B. THE EMPLOYMENT ACT

Section 57 of the Employment Act provides as follows:

  1. The employment of an employee shall not be terminated by an employer unless there is a valid reason for such a termination connected with the capacity or conduct of the employee or based on the operational requirements of the undertaking.
  2. 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.

Section 58 provides that "A dismissal is not fair if it is not in conformity with section 57 or is a constructive dismissal pursuant to section 60."

Section 59 states that:

  1. "An employer is entitled to dismiss summarily an employee on the following grounds:-
    1. Where an employee is guilty of serious misconduct in consistent with the fulfilment of the expressed or implied conditions of his contract of employment such that it would be unreasonable to require the employer to continue the employment relationship.
    2. Willful disobedience to lawful orders given by the employer.
  2. In subsection (1), "Summary dismissal" means termination of the contract of employment by the employer without notice or with less notice than that to which the employee is entitled by any statutory provision or contractual term. Section 61 states that:
  3. In any claim or complaint arising out of the dismissal of an employee, it shall be for the employer to provide the reason for dismissal and if the employer fails to do so, there shall be a conclusive presumption that the dismissal was unfair.
  4. In addition to providing that an employee was dismissed for reasons stated in section 57 (1), an employer shall be required to show that in all circumstances of the case he acted with justice and equity in dismissing the employee.

ANALYSIS OF THE LAW AND THE EVIDENCE

From the pieces of legislation cited above and also from case law as will be seen below, we wish to agree with the applicants that ample time of notice before hearing is a requirement of natural justice. It is very pertinent that a person defending herself before a tribunal needs sufficient time to prepare her case.

In the instant case, the applicants have told this court that they were given 10 minutes for them to prepare their case. The applicants were stationed in Mzuzu and the Disciplinary Hearing was heard in Lilongwe.

During cross- examination of the applicants as the date of 11th March, 2013, being the date when the letters were served on the applicants, the applicants stated that the referred date indicate the date when the Notices were prepared and not when it was served on them.

It will be noted that on these Notices, there is a separate section at the end where the recipient signs for the actual time and date the same is received. Herein, the applicants have said that they cannot recall whether they signed and left a copy at the Headquarters. Again the respondent has proffered that, it gave a four day notice. This being the case, it is imperative to restate the position of the law with regard to the evidential burden of proof and the same was stated in the case of KACHERE BAKERY -V- E.S.C.O.M Civil Cause No. 1499 of 2002 (H.C) (P.R) where it was held:

"The court is also mindful that the rule on evidential burden of proof is that it is the party that alleges the existence of certain facts that bears the burden of proof."

Thus, if the respondent insists on this date of service, they had an evidential burden to adduce evidence supporting that allegation. Seeing that the Notice was prepared by the respondent, obviously they knew better the purpose why they had included the section that required the applicants to sign the time and date of receipt. If all was in order, they could have insisted of the signatures and could have produced the same in this court to support its assertions. Since the applicants' claims that they were only informed on phone. to travel to Lilongwe on 13th March, 2013 and that they were given the Notice 10 minutes prior to the hearing were not disputed or controverted by any substantial evidence in any way, the applicants have on reasonable probability proved their case on this aspect. The conduct of the respondent in as far as the giving of notice of the disciplinary hearing was concerned amounted to miscarriage of procedural justice.

Connected to the above violation of the applicants' right to be heard was the fact that all the documents that were relied by the respondent were being produced there and then without prior disclosure to the applicants. This is according to the case of KANDA -v- GOVERNMENT MALAYA (1962) AC 322 where the court held that the accused person ought to know the case made against him and the evidence supporting the same and be given fair opportunity to correct or contradict them."

Coming to the submission by the applicants that their right to be heard and defend themselves was violated in that they were not given a fair opportunity to confront and cross- examine their accusers, we proceed as follows:

It has been held that it is a fundamental principle of natural justice that where a duty to act fairly demands an oral hearing, the right to cross- examine one's accuses also exists. See KHOSWE -V- NATIONAL BANK OF MALAWI Civil cause No. 718 of 2008.

Thus, in LAMECK MOYO -V- NATIONAL BANK OF MALAWI, Matter No. IRC 257 of

2007, the court stated this principle as follows:

"Moreover, it is trite law that an employee need to be given a chance to confront whoever is accusing him of any misconduct. In the present case the applicants were not given this chance, the respondents heard the accuser in the absence of the applicants."

The applicants testified through their witness statements that the respondent had failed to give the applicants tangible details regarding the investigations which were conducted and that the auditors reached the conclusions in their own and that the respondent failed to give chance to the applicants to cross - examine their accusers

 

ANALYSIS OF THE LAW AND THE EVIDENCE

From the pieces of legislation cited above and also from case law as will be seen below, we wish to agree with the applicants that ample time of notice before hearing is a requirement of natural justice. It is very pertinent that a person defending herself before a tribunal needs sufficient time to prepare her case.

In the instant case, the applicants have told this court that they were given 10 minutes for them to prepare their case. The applicants were stationed in Mzuzu and the Disciplinary Hearing was heard in Lilongwe.

During cross- examination of the applicants as the date of 11th March, 2013, being the date when the letters were served on the applicants, the applicants stated that the referred date indicate the date when the Notices were prepared and not when it was served on them.

It will be noted that on these Notices, there is a separate section at the end where the recipient signs for the actual time and date the same is received. Herein, the applicants have said that they cannot recall whether they signed and left a copy at the Headquarters. Again the respondent has proffered that, it gave a four day notice. This being the case, it is imperative to restate the position of the law with regard to the evidential burden of proof and the same was stated in the case of KACHERE BAKERY -v- E.S.C.O.M Civil Cause No. 1499 of 2002 (H.C) (P.R) where it was held:

"The court is also mindful that the rule on evidential burden of proof is that it is the party that alleges the e_xistence of certain facts that bears the burden of proof." Thus, if the respondent insists on this date of service, they had an evidential burden to adduce evidence supporting that allegation. Seeing that the Notice was prepared by the respondent, obviously they knew better the purpose why they had included the section that required the applicants to sign the time and date of receipt. If all was in order, they could have insisted of the signatures and could have produced the same in this court to support its assertions. Since the applicants' claims that they were only informed on phone. to travel to Lilongwe on 13th March, 2013 and that they were given the Notice 10 minutes prior to the hearing were not disputed or controverted by any substantial evidence in any way, the applicants have on reasonable probability proved their case on this aspect. The conduct of the respondent in as far as the giving of notice of the disciplinary hearing was concerned amounted to miscarriage of procedural justice.

Connected to the above violation of the applicants' right to be heard was the fact that all the documents that were relied by the respondent were being produced there and then without prior disclosure to the applicants. This is according to the case of KANDA-V- GOVERNMENT MALAYA (1962) AC 322 where the court held that the accused person ought to know the case made against him and the evidence supporting the same and be given fair opportunity to correct or contradict them."

Coming to the submission by the applicants that their right to be heard and defend themselves was violated in that they were not given a fair opportunity to confront and cross- examine their accusers, we proceed as follows:

It has been held that it is a fundamental principle of natural justice that where a duty to act fairly demands an oral hearing, the right to cross- examine one's accuses also exists. See KHOSWE -V- NATIONAL BANK OF MALAWI Civil cause No. 718 of 2008.

Thus, in LAMECK MOYO -V- NATIONAL BANK OF MALAWI, Matter No. IRC 257 of 2007, the court stated this principle as follows:

"Moreover, it is trite law that an employee need to be given a chance to confront

whoever is accusing him of, any misconduct. In the present case the applicants were not

given this chance, the respondents heard the accuser in the absence of the applicants."

The applicants testified through their witness statements that the respondent had failed to give the applicants tangible details regarding the investigations which were conducted and that the auditors reached the conclusions in their own and that the respondent failed to give chance to the applicants to cross - examine their accusers when they asked for that chance. Thus they argue that it was necessary for the applicants to confront the auditor who made the findings.

We agree with this submission in its entirety.

Coming to the issue which deals with substantive justice, namely whether the

respondent provided a valid reason for dismissing the applicants, we proceed thus:

The applicants have submitted that their dismissal was based on unfounded allegations, whereas the respondent states that it had valid reasons which is stipulated in section 59

  1. of the Employment Act, to wit, "misconduct inconsistent with the fulfilment of the expressed or implied conditions of his contract of employment..."

In the case of SHOPRITE TRADING LIMITED -V- JOKINGS CEMENT & OTHERS Civil Appeal No. 20 of 2012 (H.C) (P.R) it was held that when section 61 of the Act above is read with Section 57, we may safely conclude that the Parliamentarian was deliberately protecting the employee who is in a weaker bargaining position and that the employer no longer enjoys the liberty to dismiss an employee at his pleasure without consequences. The courts are implored to search for a reason and for that matter a valid reason for dismissal...."

Again in the case of SINGINI -V- B.C.A. BESTOBELL MALAWI Matter number

I.R.C. 274 of 2002, the court heal that:

"Where there is an allegation of dismissal, the burden is on the employer to show that there was a valid reason for the dismissal and that the employer acted with justice and fairness before dismissal; The employer must substantiate the reason in court. In the absence of such proof there is conclusive presumption that the dismissal was unfair... (Section 61 of the Employment Act.)"

In their dismissal letter, the respondent claimed that the applicants flouted the banks procedure by collecting funds as loan repayments from customers contrary to section 15.4 of the Credit Policy and Acting fraudulently by receiving funds from customers and not deposit in customer accounts as loan repayments. The applicants stated that they had indeed collected the money in the course of their duties from various groups who were in default of payment and in this case a sum of K19,891.00 and returned late on that Friday.

The applicants had instructed the groups to come to the bank with their respective bank details for depositing of the money that had been collected by them. And that at the time that the applicants were being suspended and invited to attend the hearing, they had managed to trace some of the group's bank accounts and had already deposited the same. The remaining sum of MKS, 000.00 was delivered to the supervisor.

Now the question we are grappling with here is whether the failure to deposit the money herein when collected in a banking system was an act of dishonesty and amounting to 'willful disobedience to lawful orders given by the employer' or insubordination, as argued by the respondent regard being to the whole circumstances of the case herein.

On Dishonesty, it is written as follows by an eminent labour law author, " ....it is...not a requirement that an employer should prove theft or fraud or any act of dishonesty beyond reasonable doubt before dismissing an employee. It is enough for the employer to entertain a reasonable suspicion as long as that suspicion is backed by circumstantial evidence through an investigation and the employee is given an opportunity to vindicate himself or herself.

On insubordination she writes: "This act of misconduct may take different forms, including refusal to obey lawful superior orders. This may include refusal to go on transfer.... In subordination may also arise out of carrying out duties that are not authorized.... It has also been held that undermining superior authority constitutes insubordination. See: R.S. SIKWESE, LABOUR LAW IN MALAWI, Page 80-81.

On investigation, it was held in the case of POLKEY-V- AE DAYTON SERVICES LTD (1987) 3 ALLER 974 that:

"In the case where an employee is dismissed because the employer suspects or believes that he or she has committed an act of misconduct, in determining whether the employer who discharged the employee_ on the ground of the misconduct in question entertained a reasonable suspicion amounting to a belief in the guilt of the employee of that misconduct at that time. This involves three elements: First, there must be established by the employer the fact of that belief; that the employer did believe it. Second, it must be shown that the employer had in his mind reasonable grounds upon which to sustain that belief. And thirdly, the employer at the at the stage at which he informed that belief on those grounds, must have carried out as much investigation into the matter as was reasonable in all the circumstances of the case."

In the instant case, we are not told as to how much investigation into the matter was done by the respondent which investigation was reasonable in the circumstances of the case.

It has been stated above that under section 61 of the Employment Act, the burden of proving that the reason for the dismissal was a valid one lied on the employer and in this case the respondent.

See: The case of SINGINI -V- B.C.A BESTOBELL MALAWI (Supra) which also held that

"The employer must substantiate the reason in court."

It is not enough to simply allege that the employer had a valid reason for dismissal. The employer must establish that the reason was justified. The court examines the reason

given for termination of employment and the act of misconduct and tries to find if the termination is justified. If the reason is not supported by evidence, the court may conclude that there was no justification for the dismissal.

See: R.S. SIKWESE, LABOUR LAW IN MALAWI P79 and MAHOWE -v- MALAWI HOUSING CORPORATION Civil Cause No. 3687 of 2000 (Unreported) (H.C)

"In the case where an employee is dismissed because the employer suspects or believes that he or she has committed an act of misconduct, in determining whether the employer who discharged the employee_ on the ground of the misconduct in question entertained a reasonable suspicion amounting to a belief in the guilt of the employee of that misconduct at that time. This involves three elements: First, there must be established by the employer the fact of that belief; that the employer did believe it. Second, it must be shown that the employer had in his mind reasonable grounds upon which to sustain that belief. And thirdly, the employer at the at the stage at which he informed that belief on those grounds, must have carried out as much investigation into the matter as was reasonable in all the circumstances of the case."

In the instant case, we are not told as to how much investigation into the matter was done by the respondent which investigation was reasonable in the circumstances of the case.

It has been stated above that under section 61 of the Employment Act, the burden of proving that the reason for the dismissal was a valid one lied on the employer and in this case the respondent.

See: The case of SINGINI -V- B.C.A BESTOBELL MALAWI (Supra) which also held that

"The employer must substantiate the reason in court."

It is not enough to simply allege that the employer had a valid reason for dismissal. The employer must establish that the reason was justified. The court examines the reason given for termination of employment and the act of misconduct and tries to find if the termination is justified. If the reason is not supported by evidence, the court may conclude that there was no justification for the dismissal.

See: R.S. SIKWESE, LABOUR LAW IN MALAWI P79 and MAHOWE -V- MALAWI HOUSING CORPORATION Civil Cause No. 3687 of 2000 (Unreported) (H.C).

The applicants submit that there was no any conduct on their part which could have been considered as fraudulent as all what they did was sanctioned by their superior. They state that since they had given an explanation as to why they failed to deposit the money immediately after being collected, no reasonable tribunal could have found that they acted dishonestly and consequently summarily dismissed them. Thus, they submit that the respondent failed to prove in this court that their dismissal was fair in that there was a valid reason and that the respondent acted with fairness before the dismissal. No any witness was called on the part of the respondent to justify the validity of the reasons for the dismissal. To that end, the applicants urges this court to bear in mind the sentiments that were made in the case of MAONGA & OTHERS - V- BLANTYRE PRINT AND PUBLISHING COMPANY LTD (1991) lA MLR 240 where the court cited the case of LEYLAND MOTORS CORPORAION MALAWI LTD-V- MOHAMED Civil Cause No. 240 of 1983 (Unreported) where Banda, J. as he then was held:

 
"Failure to call a witness to testify on a material point may damage the case of the party who fails to do so as that failure may be construed that the story is fictitious"

Thus, in view of the above, this court finds that the applicants' dismissal was unfair and they are entitled to be awarded damages for unfair dismissal.

Right of appeal explained as per section 65 of the Labour Relations Act.

 

MADE This...................Day of October, 2018 .

 

K.D MLUNGU 

DEPUTY CHAIRPERSON

 

CECILIA T. NYIRENDA

EMPLOYERS' PANELIST

 

ALEXANDER LUNGU

EMPLOYEES' PANELIST