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Nyasha Brighton Munyuru
Managing Partner & Head of Corporate Law, Muvingi Mugadza Legal Practitioners,
Harare munyuru@mmmlawfirm.co.zw

Introduction

The use of alternative dispute resolution in labour matters was a rarity in Zimbabwe until the country introduced a new statutory instrument under the Labour Act.[1] The new statutory provisions introduced a raft of measures into the law and brought about changes to the usual procedure. The new provisions introduced conciliation as a form of dispute resolution[2], which was to be spear headed by labour officers. It also introduced compulsory arbitration, which was to be conducted under the terms of the Zimbabwean Arbitration Act (Chapter 7:15).

In conciliation proceedings, parties to the dispute appear before the conciliator, in accordance with section 93(1) of the Labour Act, which deals with the conciliation of labour disputes and unfair labour practices referred by an employee to the conciliator. Under this provision, the conciliator attempts to resolve the dispute between the parties failing which he or she will issue a certificate of no settlement which would result in the parties going for compulsory arbitration in terms of section 93(5a)[3] or voluntary arbitration in terms of section 93(5b) of the Labour Act. The distinction with compulsory arbitration is that the parties do not choose an arbitrator as that is done by the labour officer appointed by the Ministry of Labour and with voluntary arbitration parties agree to direct the dispute to be dealt with by an arbitrator chosen by the parties.

The approach of the Constitutional Court: Isoquant Investments (Pvt) Ltd t/a Zimoco v Memory Darikwa

The Applicant in the matter terminated on notice the employment contracts of 17 of its employees. Aggrieved with that decision, the employees lodged a complaint to the National Employment Council for Motor Industry (NEC) that the Applicant had failed to pay their retrenchment packages.

The Respondent, a designated agent (DA), was requested to redress the issue through conciliation. At conciliation, the DA made an order that the Applicant pay its former employees their retrenchment packages in terms of section 12C (2) of the Act. The DA applied to the Labour Court for the confirmation of that order against the applicant.

The Applicant challenged the constitutionality of section 93 (5a) and 93 (5b) of the Labour Act and argued that the provisions violated its rights to equal protection of the law and to administrative justice, as contained in section 56 (1) and 68 (1) of the Constitution of Zimbabwe respectively. The Labour Court referred the constitutional questions to the Constitutional Court. The apex court held that there were no proceedings before the court a quo in terms of section 93 (5a) of the Act which warranted the court a quo to refer the matter to the Constitutional Court to determine the questions of the constitutionality of section 93 (5a) and 93 (5b).

The decision of the Constitutional Court of Zimbabwe in Zimoco v Darikwa[4] acknowledges the role played by alternative dispute resolution mechanisms in the resolution of labour matters. The court emphasised the faith of the legislature in conciliation as an effective process for consensus seeking and as an important first step prior to disputes becoming subject to arbitration or adjudication.[5] The Court stated that conciliation is a process that does not involve the use of power by a third party to  resolve a dispute between the parties, as compared to arbitration and adjudication.

In the cyclostyled judgement, the court distinguished between conciliation and arbitration wherein it held that conciliation as a mechanism gives the parties to the dispute the opportunity to resolve it by agreement through voluntary participation, whereas, under arbitration, there is  a third party involved who will make a binding decision on behalf of the parties. The court also held that, conciliation, unlike arbitration, enables the parties to be in control of the outcome of the dispute resolution process. Furthermore, the court eschewed the legislature from outlining a procedure that the conciliator ought to follow in dispute resolution, but indicated that the conciliator is to be conferred with more powers under section 93(1) of the Act which provides that a labour officer to whom a dispute or unfair labour practice has been referred, or to whose attention it has come, shall attempt to settle it through conciliation or, if agreed by the parties, by reference to arbitration. The court further held that section 93(1) is wide enough to be interpreted to mean that it clothes a labour officer with the powers necessary to enable him/her to discharge the duty imposed on him/her in the conducting of conciliation.

In the judgement, the court also distinguished between a conciliator and an arbitrator, holding that the parties need to understand that the role of the conciliator is to help them to reach a mutually acceptable agreement and that for the conciliation process to be successful, the parties need to trust the labour officer to raise issues or to make concessions.[6] The other distinction is that with arbitration, the arbitrator will hear both sides of the dispute and make an award which the parties undertake to accept as final and binding.

The court also held that only disputes of interest, that is disputes in which the claimant party seeks a benefit or advantage and not a right, are to be referred to arbitration, after a certificate of no settlement has been issued under the terms of section 93(3) of the Act. This particular section provides that, where the parties in a dispute of interest are engaged in an essential service, the labour officer must refer the dispute to compulsory arbitration, and where the parties in a dispute of interest are not engaged in an essential service, the labour officer may refer the dispute to voluntary arbitration with the agreement of the parties. It must be noted that the judgement is a step in the right direction, in that it reinforces the role of alternative choices to litigation in the handling of legal matters. The judgement also places emphasis on the need to fully ventilate the legal issues at the conciliation stage and in so doing, ensuring that matters are resolved amicably and also narrowing down the number of issues that will be resolved through arbitration.

Zimbabwean Arbitration Act (Chapter 7:15)

The model law on Arbitration proceedings in Zimbabwe is the Arbitration Act, (Chapter 7:15) [herein after referred to as the Act] promulgated on 13 September 1996. Its preamble states that the Act  is promulgated to give effect to domestic and international arbitration agreements; to apply, with modifications, the Model Law on International Commercial Arbitration adopted by the United Nations Commission on International Trade Law on the 21^st June, 1985, thereby giving effect to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards adopted in New York on the 10^th June, 1958. The Act further repeals the Arbitration Act [Chapter 7:02] and amends the High Court Act [Chapter 7:06].

A reading of the statute shows that Zimbabwe recognises arbitration as a form of dispute settlement. Despite there being not a lot of recognised arbitrable matters in the Act, it does acknowledge the existence of domestic and international arbitration agreements. The Act also regulates which law is applicable when it comes to domestic and international arbitration agreements, which is normally an issue that arises during arbitration.[7] The Act also recognises international arbitration agreements, and it incorporates a regulation that is applicable in the event of the place of an arbitration not being Zimbabwe.[8] The Act also provides which matters can be arbitrated, as provided for in the arbitration agreement[9] and which matters cannot be arbitrated on, listed as follows:

1. an agreement that is contrary to public policy; or
2. a dispute which, in terms of any law, may not be determined by arbitration; or
3. a criminal case; or
4. a matrimonial cause or a matter relating to status, unless the High Court gives leave for it to be determined by arbitration; or
5. a matter affecting the interests of a minor or an individual under a legal disability, unless the High Court gives leave for it to be determined by arbitration; or
6. a matter concerning a consumer contract as defined in the Consumer Contracts Act [Chapter 8:03], unless the consumer has by separate agreement agreed to that.

Furthermore, the Act considers any pieces of legislation with provisions for arbitration) providing for arbitration as an arbitration agreement in terms of section 4(1) of the Act. This also applies mutatis mutandis to the provisions of section 93 of the Labour Act of Zimbabwe discussed under the Zimoco judgement.

Concluding remarks

The Zimbabwean Constitutional Court has reaffirmed the role of alternative dispute resolution mechanisms in the handling of labour matters, which is a positive change from the litigation experiences of the past. The apex court also clarified the issue of conciliation which had previously been a grey area, especially given the lack of clarity on how the proceedings were to take place. Even though some questions have remained unanswered, the attempt in fostering conciliation and arbitration in labour matters must be commended, as they have always been recognised as forms of dispute resolution in other jurisdictions in this area of law. Nevertheless, we must also highlight that the current Zimbabwean Arbitration Act[10] needs to be reviewed, especially in light of the modern developmental trends in arbitration and considering that the Act has a lot of shortcomings to match international trends.

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