a short analysis of the ‘Swaziland Conference of Churches v Prudence Kunene’ and ‘MA Dlamini Consulting Engineers (Pty) Ltd V Bonginkhosi  Zweli Mathunjwa’ judgments

 

Date published: 08-07-2024

 

In the past fourteen (14) months the Industrial Court of Appeal has issued two conflicting judgments relating to the question whether the Industrial Court (and by extension the statutorily established Conciliation Mediation and Arbitration Commission) has the requisite jurisdiction to grant the relief of contractual damages .i.e. the outstanding balance of the contract.   

Chronologically, the first judgment issued was that of Prudence Kunene which held that by the introduction of the Industrial Relations Act, 2000 introduced the concept of compensation for unfair dismissal, the legislature made inroads to the common law by now limiting and or prescribing compensation payable to a maximum of twelve (12) months. The Court held that the relief of “claiming the balance of the contract” was no longer available but that every category of employees was now limited to the prescribed twelve (12) months.[1]

A year later the decision M A Dlamini, emanating from the very same court, held otherwise. The Court held that it was within the competency and jurisdiction of the Industrial Court to grant contractual damages in the form of the balance of the remainder of the contract. This latter judgment does not make reference to the first judgment nor does it critique its findings or furnish the rationale for the departure.[2]

Effectively, there are now two conflicting judgments issued by the same Court. The normal rules of stare decisis dictate that the more recent judgment is the applicable pronounciation, however this rule is not absolute and may be departed from especially where the  latter decision is per incuriam. This is where the conflict lies; there is suggestion that the second judgment might be incuriam and therefore not binding as it does not make reference to the Prudence judgment and why it has departed from it.

The ratio of both judgments.

The ratio behind the Prudence matter is that by the introduction of the Industrial Relations Act, the legislature intended to regulate the termination of contracts at the workplace, specifically in accordance with section 16 of the Industrial Relations Act. Additionally there is the school of thought that it could never have been the intention of the legislature to differentiate between fixed term contracts [where the concept of damages being the balance of the contract arises] and permanent contracts which were regulated by section 16.

On the other hand, the M A Dlamini judgment ratio is that the Industrial Relation Act particularly section 8 recognises the Industrial Courts power to hear any matter which may arise at common law. More specifically, that the claim for damages for the balance of contract is one of such issues which emanates from the common law. That parties are free to enter into any kind of contract of employment so long as it does not confer any lesser rights than those imposed by the Employment Act.  Further, that there is no legislation that in clear and unambiguous language seeks to curtail the right of parties to enter into a fixed term common law contracts and enforcements of the right to remedial action availed by such contracts.

A fixed term contract derives its authority from the common law and any action undertaken in terms of the common law can only be dealt with or corrected by applying the acceptable remedial action under common law. Therefore it was open for persons to enforce common law remedial actions such as outstanding contract and that it was competent for the Industrial Court to adjudicate upon such disputes.

Consideration of the judgments and how other jurisdictions dealt with similar issues.

Both judgments are in agreement that an employee whose contract has been unlawfully terminated has the right to approach the Industrial Court for redress. The divergence is the relief that may be obtained. The first judgment limits compensation to the prescribed twelve (12) months and the latter judgment widens the parameters to the outstanding balance of the contract.

In the neighbouring country of the Republic of South Africa (to which we share the same Roman Dutch Common Law), the South African  Supreme Court of Appeal in the case of  Fedlife Assurance Ltd v Wolfaardt [2001] 12 BLLR 1301 (SCA), dealing with a similar question whether the introduction of the Labour Relations Act made inroads such that the common law remedies were abrogated held to the contrary  placing reliance on the presumption of statutory interpretation that “the legislature did not intend to interfere with existing law and a fortiori, not to deprive parties of existing remedies for wrong done to them.   A statute will be construed as doing so only if that appears expressly or by necessary implication.”

The ratio in the South African judgment is the same as the ratio in the M A Dlamini judgment i.e. that the legislature did not expressly abrogate the common law rights and therefore in the absence of such express mention it would wrong to interpret it as such.

On the other hand, the judgment in the Prudence matter does not address this aspect. The ratio is that the introduction of compensation in terms of section 16 was to regulate the area of termination of contracts and that there is no rational basis for the differentiation therefore the proper interpretation is that the legislature never intended for such differentiation.

The Court does not deal with the question of freedom to contract nor does it deal with the aspect that permanent employees are entitled to other statutory payments such as notice and severance to which the fixed term employee is not ordinarily entitled to.

Conclusion

Both decisions of the Industrial Court of Appeal with the greatest of respect have their deficiencies. However, when juxtaposed, the second judgment is to be preferred. Although it does not mention the first nor state the reasons for departure, it carefully interprets the statute and interrogates the question on whether the introduction of the Industrial Relations Act abrogated the remedial rights under common law. The first judgment does not concisely deal with this issue yet it is pivotal. There is a need for transpicuous reasoning why these common law rights have been abrogated.

Currently pending at the Industrial Court of Appeal and awaiting judgment are the cases of Arhast Investment (Pty) Ltd T/A Metropolitan International and College (Swaziland Campus) v. Hedwing Sigwadhi and Three Others wherein the same question has been raised yet again. Both judgments have been put before Court for consideration and we hope the Court will give direction in this ongoing legal conundrum.

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[1] https://eswatinilii.org/akn/sz/judgment/szica/2023/7/eng@2023-03-24

[2] https://eswatinilii.org/akn/sz/judgment/szica/2024/14/eng@2024-06-05