DISPUTE RESOLUTION MECHANISMS, WITH SPECIAL EMPHASIS ON ARBITRATION AND APPEAL MECHANISMS

BY HON. JOHNLIFE.T. MAWIRE

(ARBITRATOR AND LABOUR LAW CONSULTANT)

Paper presented at the Institute of People Management Labour Briefing.

Rainbow Towers, Harare

18 November 2009

Bulawayo Rainbow

20 November 2009

Preface

This presentation is adapted from the paper I presented at an ILO Workshop for newly appointed arbitrators in November 2007.

The opinions expressed in this paper are entirely mine, except where otherwise indicated. It is my hope that the presentation will assist in opening up avenues for further debate on the evidently fast- developing arbitration jurisprudence in Zimbabwe.

I thank you all.

Johnlife Tungamirai Mawire

Harare 15 November 2009.

LABOUR ARBITRATION LAW IN ZIMBABWE[1]

INTRODUCTION

The concepts of conciliation and arbitration have been on our statute books for a long time now.[2] Their existence was however not supported by comprehensive substantive and procedural provisions until the 2002 amendments to the Labour Act.[3] As a result, officers ended up taking the easier route of making decisions as they deemed fit.

With the continued assistance of the ILO, the social partners finally established the current system of conciliation and arbitration in more concrete and elaborate form.[4] Parliament also acknowledged the comprehensive consultations by the Ministry of Public Service Labour and Social Welfare regarding the amendments. The Parliamentary Portfolio Committee on Public Service, Labour and Social Welfare also supported the new labour dispute resolution regime. In its Report on the Labour Relations Amendment Bill, No. 19 0f 2001 presented to the House in its Third Session of the Fifth Parliament, the Committee said that:

“Your Committee observed with great caution the attempt by the Ministry to guarantee some possible standards of job security, an impartial, prompt and progressive dispute resolution process. The initial dispute resolution processes, standards and regulations had massive flaws, which were skewed in favour of employers. The current inclusion of some improved dispute resolution procedures is a welcome gesture, which goes a long way in setting the foundation for effective future debates on the matter.” [5]

That they were meant to be cardinal forms of dispute resolution was entrenched in 2002 through amendments to sections 74 and 82 to the Labour Act. Section 74 was amended to include “procedures for dealing with disputes within an undertaking.” Once such procedures were agreed to and incorporated in the Collective Bargaining Agreement, it then followed that the procedure would have to be religiously applied. In terms of the amendment to section 82,

“ If a registered collective bargaining agreement provides a procedure for the resolution of any category of dispute that procedure is the exclusive procedure for the determination of disputes within that category.”

The emphasis on conciliation and arbitration is littered throughout the Act, but of note are the following provisions:

  1. Section 93 provides for conciliation and arbitration in detail
  2. Section 63 which empower Designated Agents to conciliate and arbitrate with similar powers as Labour Officers.
  3. Section 98 on compulsory arbitration confirms that the Arbitration Act [Chapter 7:15] is also partially applicable to compulsory arbitration.
  4. In terms of section 98, an Arbitral Award is meant to be final and binding on the parties to the dispute, with an appeal being possible only on points of law. Further, an award in registrable for enforcement purposes
  5. In terms of section 101 of the Act, where an employment council refuses to approve a works council code, the works council may refer the matter to a Labour Officer whose determination shall be final unless the parties agree to refer it to voluntary arbitration.
  6. In terms of section 104, no strike can be legal unless inter alia;

“ an attempt has been made to conciliate the dispute and a certificate of no settlement has been issued”[6]

Apart from Parliament and the Executive, the Judiciary has added its weight to the advocacy for incorporation of the ADRS as part of our Labour Law. Justice Sandura in the case of Catering Employers Association v The Zimbabwe Hotel and Catering Workers Union, SC 112/2001 quoted with approval a South African judge ‘s sentiments that;

“When the parties agree to refer a matter to arbitration, unless the submission provides otherwise, they implicitly, if not explicitly……….abandon the right to litigate in courts of law and accept that they will be finally bound by the decision of the arbitrator. There are many reasons for commending such a course, and especially so in the labour field where it is frequently advantageous to all the parties and in the interests of good labour relations to have a binding decision speedily and finally made. In my opinion the courts should in no way discourage parties from resorting to arbitration and should deprecate conduct by a party to an arbitration who does not do all in his power to implement the decision of the arbitrator promptly and in good faith.”

It can therefore safely be concluded that Zimbabwe as a country has accepted arbitration as a part of its Labour Law.

As the brief of this paper was to analyse both the Arbitration Act (AA) and the Labour Act (LA) I shall proceed to deal with the key provisions of the two Acts with respect to both voluntary and compulsory arbitration. The intention is to restate the law in simple terms and to provide similarities and differences. Where necessary, case law will be provided. Similarly where the law is not clear, recommendations on the possible progressive approach to be adopted by practitioners will be given.

Application of AA and LA to Labour Disputes.

Both the AA and the LA apply to Labour disputes. The AA and the Model Law as modified by the AA apply to all disputes in Zimbabwe that the parties have agreed to submit to arbitration except those that are excluded expressly by the Act. Those excluded include an agreement that is contrary to public policy, a dispute which, in terms of any law, may not be determined by arbitration and a criminal case. [7]

Where an enactment provides for the determination of any matter by arbitration, the provisions of that enactment, to the extent that they are inconsistent with the AA, shall prevail.[8] With respect to the LA, it follows that where it provides for certain issues which contradict the AA, the provisions in the LA take precedence. The position is made clearer by Section 98 of the LA which provides that: -

“Subject to this section, the Arbitration Act [Chapter 7:15] shall apply to a dispute referred to compulsory arbitration”

For the avoidance of doubt, voluntary arbitration disputes are covered by the AA in toto.

Appointment of Arbitrators

In voluntary arbitration cases, the parties are free to agree on a procedure of appointing the arbitrator or arbitrators (of whatever nationality). If there is no agreement, then for a tripartite panel, each party shall appoint one arbitrator[9], and the two arbitrators thus appointed shall appoint the third arbitrator. If a party fails to appoint the arbitrator within 30 days of receipt of a request to do so from the other party, or if the two arbitrators fail to agree on the third arbitrator within 30 days of their appointment, the appointment shall be done, upon request of a party, by the High Court.[10]

The High Court is given powers to appoint a single arbitrator as well where there is failure by the parties to agree.[11] The same Court is given powers to determine any dispute regarding failure by any party to act according to agreed procedures on appointment and its decision shall be subject to no appeal.[12]

For compulsory arbitration under the LA, it is the Conciliator who, upon consulting any Labour Officer senior to him and to whom he is responsible in the area in which he attempted to settle the dispute refers the matter to an arbitrator[13] from the list appointed by the Minister[14], in consultation with the Senior President of the Labour Court and the appropriate Advisory Council if any appointed in terms of the LA.[15] The Conciliator, in terms of Section 93 (5) of the LA refers disputes to compulsory arbitration only:

(a)disputes of interest and the parties are engaged in an essential service or

(b)with the agreement of the parties or

(c)if the dispute is a dispute of right.

For the avoidance of doubt, the Conciliator cannot refer a dispute of interest in a non-essential service for compulsory arbitration without the agreement of the parties. If a Certificate of No Settlement is issued and the parties to such a dispute are not in agreement that the matter be referred to compulsory arbitration, then it may be resolved through collective job action. Further compulsory arbitration is not left for disputes of interest in the essential services only like is the norm under ILO jurisprudence.[16] In Zimbabwe, compulsory arbitration applies even to disputes of right as well and to disputes of interest in non-essential services which may be declared essential services by the Minister if a strike in the non-essential sector, service industry or enterprise persists to the point that lives, personal safety or health of the whole or part of the population is endangered![17]

The compulsory arbitrator may also be ceased with the matter through reference by the Labour Court.[18] The LA obliges the conciliator and the Labour Court to afford the parties a reasonable opportunity of making representations on the matter before referring the matter.[19] This is so that the parties are not taken unawares. In practice however, some parties have taken this opportunity to refuse to appear before fee-charging arbitrators. Arbitrators should deal with this issue as a preliminary point if their jurisdiction is challenged on the basis that the parties were not consulted by the conciliator prior to the referral of the matters to them.

Otherwise the only grounds for challenging the appointment of an arbitrator are the existence of circumstances likely to give rise to justifiable doubts as to his impartiality or independence, or if, in appropriate cases, he does not possess the qualifications agreed to by the parties. The arbitrator must mero motu disclose any such circumstances to the parties. Unless the challenged Arbitrator withdraws from his office or the other party agrees to the challenge, the arbitral tribunal shall decide on the challenge.[20] In the case of voluntary arbitration, the challenged arbitrator’s ruling is challengeable in the High Court, while under compulsory arbitration, the ruling is appeallable to the Labour Court on points of law.

The High Court’s decision will be final.[21] In both situations, pending the decision of the court or the arbitrator, as the case may be, the arbitrator may proceed to issue an award.[22]

If the arbitrator is incapacitated from proceeding by reason of a challenge, agreement of parties or becomes de facto or de jure unable to perform the functions of his office, fails to act without undue delay or withdraws from office, a substitute arbitrator may be appointed.[23] In that event, unless otherwise agreed by the parties:-

(a)where the sole or the presiding arbitrator is replaced, any hearings previously held shall be repeated.

(b)Where an arbitrator other than a sole or a presiding arbitrator is replaced, any hearings previously held may be repeated at the discretion of the arbitral tribunal.[24]

Further, unless otherwise agreed by the parties an order or ruling of the arbitral tribunal made prior to the replacement of an arbitrator under this article is not invalid solely because there has been a change in the composition of the tribunal.[25]

Determination of terms of reference

Unlike in voluntary arbitration where parties determine the terms of reference of the arbitration through an arbitration agreement,[26] under compulsory arbitration, the Labour Court or the Labour officer, as the case may be, shall determine the arbitrator’s terms of reference after consultation with the parties to the dispute.[27] As observed earlier, he should afford the parties a reasonable opportunity of making representations on the matter.[28] Where there is a dispute as to the terms of reference, the arbitrator must refer the matter back to the referring officer, unless the parties agree that the arbitrator makes a decision on the terms, since the LA is clear that it is the Conciliator who has the jurisdiction to determine the terms. It is advisable for the Conciliator to solicit written agreements from the parties on the terms of reference or separate proposals by the parties, from which he can make a decision. It would appear that a Conciliator or the Labour Court’s decision on the terms of reference is final.

Procedural Issues.

The AA is very detailed when it comes to procedural issues. The underlying principle is that the parties themselves must agree on these issues and in the absence of an agreement, the arbitrator shall decide. These include Place of Arbitration,[29] language to be used in the proceedings,[30] exchange of statement of claim and defence[31] and appointment of experts.[32]

The LA is silent on these issues. This means that the AA applies instead. Some of the issues that are relevant include the following: -

a)That the arbitrator may, unless otherwise agreed by the parties, order interim measures of protection, grant an interdict or other interim order[33] or order the parties to make a deposit in respect of fees and costs.[34]

b)That if, during arbitral proceedings, the parties settle the dispute, the arbitral tribunal shall terminate the proceedings and, if requested by the parties and not objected to by the arbitral tribunal, record the settlement in the form of an arbitral award on agreed terms.[35]

c)That the parties shall be treated with equality and each party shall be given a full opportunity of presenting his case.[36]

d)That unless the parties decide otherwise, the arbitrator may decide whether to hold oral hearings or to determine the matter on record.[37]

e)That all statements, documents or other information supplied to the arbitral tribunal by one party shall be communicated to the other party[38]

f)That the parties may appear or act in person or may be represented by any other person of their choice.[39]

g)That the arbitrator may issue a default judgment.[40]

Arbitrators powers

In terms of the LA, when hearing and determining labour disputes, the Arbitrator shall have the same powers as the Labour Court[41]. The Labour Court rules, which govern its operations, have to be analysed closely to confirm which provisions take precedence over the AA and also those provisions not applicable to arbitrators.

Determination of Costs.

For voluntary arbitration, the issue of costs and expenses of an arbitration, including the legal and other expenses of the parties, the fees and expenses of the arbitral tribunal, and other expenses related to the arbitration, shall, unless otherwise agreed by the parties, be as fixed and allocated by the arbitral tribunal.[42] These issues are normally covered in the arbitration agreement. Where the voluntary arbitrator does not cover these issues, in the absence of an agreement by the parties, each party shall be responsible for his own legal and other expenses and for an equal share of the fees and expenses of the arbitral tribunal and any other expenses related to the arbitration.[43] Under the LA however, in referring a dispute to compulsory arbitration by a person other than a Labour Officer or a Designated Agent for the employment council which is registered to represent the undertaking or industry to which the parties belong, the Labour Court or Labour Officer, as the case may be, should determine the share of costs of the arbitration to be borne by each party.[44] Further, where a party to a dispute referred to compulsory arbitration is made up of more than one employer, employee, employers’ organisation, or trade union, the costs of the arbitration shall be paid in the proportions agreed upon by the constituent members of the party or, failing agreement, in the proportions determined by the arbitrator or arbitrators.[45] Where there are disputes as to the determination of costs, the arbitrator must resolve the dispute as a preliminary issue or refer it to the referring authority if the issue was not canvassed and the parties are not agreed on apportionment of the costs. The issue of what costs and the factors to take into account is covered under Rule 32 of the Labour Court rules. These include that the costs may be awarded irrespective of the judgment in the cause, may be made costs in the cause, may be reserved to be dealt with at the conclusion of the action, may be denied or the authority may determine that each party bears its own costs. Even a party not represented by a legal practitioner may be awarded his or her disbursements in addition to necessary expenses. The disbursements and necessary expenses are not explained and it will be the discretion of the authority to determine the equitable costs in the circumstances.

Interest

In terms of the AA, unless agreed by the parties,

(a)an arbitral tribunal may award interest at such rate, on such sum and for such period as may be specified in the award.[46]

(b)Where the award does not specify otherwise, a sum directed to be paid by the award shall carry interest from the date of the award up to the date of payment at the same rate as a judgment date.[47]

The LA is silent on this issue. In practice, most arbitrators have not made any awards incorporating interest and should in future be guided by the AA.