Appeal court turns down compensation to former TCC employee

DAR ES SALAAM: THE Court of Appeal has quashed the 904m/- compensation given to former Legal Affairs Manager with Tanzania Cigarette Company Limited (TCC), Lucy Mandara, whose employment services was terminated for alleged gross negligence and insubordination.

Justices Jacobs Mwambegele, Issa Maige and Gerson Mdemu reached into such a decision after partly allowing an appeal lodged by the TCC, the appellant, against the judgment of the High Court, which had ruled in favour of Mandara, the respondent.

“We, thus quash and set aside the judgement and decree of the High Court forthwith. In the circumstances we award 12 months’ salary compensation being the minimum provided for under section 40 (1) (c) of the Employment Labour Relations Act (ELRA),” they declared.

The justices pointed out in their judgment dated February 23, 2024 that in terms of section 40 (2) of the ELRA, such compensation is in addition to the terminal benefits awarded to the respondent in the termination letter.

During hearing of the appeal, the counsel for the appellant, Mr Paschal Kamala, had faulted the High Court award basing on the voluntary agreement because the agreement is only applicable to retired employees.

He also faulted it for being colossal and did not take into account promotion of economic development envisaged under section 3 (a) of the ELRA. In his argument, compensating the respondent that much will halt the company’s businesses.

Furthermore, the counsel submitted that what was awarded went far beyond the prescripts of section 40 of the ELRA.

He added, therefore, that the respondent was duly compensated as per the termination letter, thus what the High Court Judge awarded has no legal basis and is only applicable to retired employees, which is not the case here.

The counsel for the respondent, Ms. Oliva Mkanzabi, in response conceded that, reliefs following unfair termination are awardable in terms of section 40 of the ELRA.

Where this to her remain the correct legal position, the provisions of section 71(5) of the ELRA on collective bargaining agreement should also be taken into account, thus the import of the voluntary agreement by the Judge in compensating the respondent for unfair termination.

In their judgment, the justices of the appeals court noted that the High Court Judge intended the respondent be reinstated in her employment, a remedy awardable under section 40 (1) (a) of the ELRA.

She, however, refrained from so doing because the respondent never prayed for such remedy and, as per the application before the Commission for Mediation and Arbitration (CMA) she prayed for retirement benefits.

“This, in our view was wrongly underscored. We are saying so because, besides reinstatement, the remedy of reengagement and compensation awardable under section 40 (1) (b) and (c) of the ELRA were still open to the High Court Judge for consideration,” they said.

The justices pointed out that assuming that it was right for the High Court Judge to do so, yet there was no justification for just granting such compensation simply it was prayed without any analysis to justify that prayer.

They said it was also not correct, unlike what was observed by the High Court Judge, the Appellant through his witness, one Derick Stanley never objected the claims of retirement benefits.

The justices noted what such witness testified was that, had this been a retirement issue, then the claims were correct but he hesitated to say so because the matter is a disciplinary one.

What they gathered from the High Court decision is that, the Judge made her award as if the respondent was a retiree, the reason why in her judgement she made an order to deduct the amount paid to the respondent in the termination letter.