Judgment No SC. 120/04
Appeal No. 188/02
MINING AND SMELTING COMPANY (PRIVATE)
COURT OF ZIMBABWE
CJ, SANDURA JA & ZIYAMBI JA
NOVEMBER 22, 2004 & JANUARY 14, 2005
Andersen SC, for the appellant
respondent in person
SANDURA JA: This is an appeal against a judgment of the Labour
Relations Tribunal (the Tribunal) (now the Labour Court)
ordered the appellant (Zimasco) to reinstate the respondent
(Banda) as Zimascos financial accountant, or pay
in lieu of reinstatement.
background facts in this matter may be tabulated conveniently as
1. In August 1985 Banda joined Zimasco as a cost accountant. Four
years later, in 1989, he was transferred to the post of financial
accountant. His immediate superior was Mr P Daya
(Daya), the chief accountant.
2. On 6 December 1990 Daya wrote to Banda as follows:
It is becoming of great concern to me that to date none of the
deadlines set for the timeous completion of work for the year-end
audit reporting purposes have been met. For your information I
detail below some of these deadlines
(a) Staff Debtors
Deadline to have a typed reconciliation in my office by 10.00 am
Monday 3rd December was not met. This, I remind
you, was extended after you failed to produce it with the October
reconciliation as detailed
in my memo to you dated 12th November,
All filing of creditor accounting records were (sic) to be
filed by the 23rd November, 1990. On my follow-up
you were unable to give me a reply and to which you stated you would
come back to me. This
you never did.
(c) Sampling of Invoice with Paid Stamp
The deadline for the completion of this exercise, which I kindly
remind you again are unstamped from July, was the 23rd November
(refer my memo dated 12th November, 1990). This was
have expected you to issue a memo to your bookkeeper and creditors
clerks instructing them to complete the above exercises.
produced a schedule as requested but informed me that the opening
balance details would be acquired from Deloittes. To date
not received any information nor any feedback on this.
(e) Creditors Reconciliation to Control Account Etc
Per the audit plan the deadline for this was 5th December
1990 by 10.00 am. Refer my audit plan memo dated 21st November
1990. I have specifically stated in this memo, that should the
deadline not be met, I was to be approached well before
timeous and corrective action. This information would then be
passed to the Deloitte auditors to assist in their planning.
to emphasise that we need not give Deloitte an opportunity to report
on our inability to produce the work to them as planned.
(f) Alloy Transfers and Adjustments (Section Eight)
The deadline for this was 4.12.90. To date I have not received
this, bearing in mind that I specifically stated in my audit plan
that the prepared by, checked by and approved by controls be adhered
to (to) avoid handing over incorrect schedules to the auditors.
What is also distressing is that you have not bothered to inform me
or to liaise with me on any of the above matters. Please can
ensure that the above state of affairs is corrected and all
3. On 31 May 1991 Banda was given a final written warning in
respect of the acts of misconduct of habitual and substantial neglect
of duty, and gross inefficiency. The warning was valid for twelve
months, and Banda was informed that if, during that period, he
committed an act of misconduct in terms of the Code of Conduct (the
Code) he would be in danger of being dismissed.
4. In November 1991 Banda was seconded to the costing section as a
5. On 30 January 1992 Deloitte & Touche, the external
auditors, reported on Banda as follows:
Our relationship with Mr Banda was strained over the last few
years. This might be as a result of personality clashes,
judging by the number of people who have problems communicating with
him it would appear that the problem lies with his attitude.
current audit, most staff tried to avoid him because they found him
arrogant and unco-operative. Our communication with
channelled through Mr N Mpofu.
that Mr Banda always has a reason/excuse for any errors or
omissions, and often these attempt to transfer blame onto
members of staff.
the stock reconciliations for (the) year end had been checked by him,
yet it was specifically stated in Mr Dayas memo
year end planning that they should be checked and signed before being
handed to us. From our work on these reconciliations
appear that Mr Banda had no input at all and did not help his
assistant when it was obvious that the latter struggled
we found that the checking function which was his responsibility,
both in the financial and cost department, was not performed
6. On 13 February 1992, Daya wrote to Banda as follows:
Continuous Ignoring of Instructions and Procedures
(a) In your secondment to the costing section it was made clear to
you in my memo dated 27.11.91 that you were under (an) obligation
inform me at all times should you foresee any problems in not meeting
deadlines. At no time did you comply with this instruction.
continually left it to me to chase you up and several commitments
were made by you to have various reports completed. These
commitments were never fulfilled, nor did you have the courtesy to
inform me accordingly.
(b) In my
audit planning memo I made it clear that overtime will be allowed
after complying with the normal overtime procedures.
procedures were never complied with.
(c) In the
same memo I instructed that all schedules for the auditors be typed.
Further these schedules were never checked by you
and approved by
(you) meaning this goes against all efforts to improve the quality of
work from the section.
your appraisal dated 15.10.91 I pointed out the need for you to
improve your presentation quality. Your contribution to the
December Management Report leaves a lot to be desired and indicates a
total lack of respect for my office.
The above facts indicate a very careless attitude to your work which
does not augur well for current efforts to improve your overall
situation in the section.
7. On 19 February 1992 Daya again wrote to Banda complaining
about inaccurate reconciliations and, inter alia, said:
The quality of checking and supervision is very poor and is
highlighted by the above. You appear to be very content to accept
reconciling items without further investigation. As an accountant,
I would have expected you to identify the incorrect treatment,
especially as both reconciliations did not talk to each other.
8. Later that month, i.e. February 1992, Banda was charged with two
acts of misconduct in terms of the Code. The first was gross
inefficiency in the performance of his duties, and the second was
habitual and substantial neglect of duty.
9. In March 1992 a disciplinary hearing, presided over by Mr P Breese
(Breese), the administrative manager, was held.
main charges had been preferred against Banda, as set out above, the
disciplinary hearing proceeded on the basis that
the particulars of
those charges were individual charges. At the end of the hearing,
six of the charges were found to have been
proved, and Bandas
dismissal was recommended.
10. Banda then appealed against that decision in terms of the Code,
and the appeal was heard by Mr H J Briel (Briel),
the general manager, on 27 March 1992. Briel confirmed the
verdicts in respect of five of the six charges, and dismissed Banda
with effect from 10 April 1992.
11. About two years later, on 7 March 1994, Banda noted an
appeal to the Tribunal. There is nothing in the record before this
Court which indicates the circumstances in which the late noting of
that appeal was condoned. Nevertheless, the appeal was allowed
the Tribunal, and the order indicated at the beginning of this
judgment was given.
Aggrieved by that result, Zimasco appealed to this Court.
view, the Tribunal seriously misdirected itself when it allowed
Bandas appeal and ordered that he be reinstated or paid
lieu of reinstatement. I shall deal with the five charges, found
proved by Briel, in turn.
The allegation in this count was that Banda had distributed a
production labour analysis report for January 1992 in which the cost
of overtime was grossly overstated by $1 062 892.00, a very
large amount of money in those days. The report had been
by an analysis clerk, and Banda assured Daya, to whom he was
accountable, that the report reflected genuine overtime worked.
when Banda was called upon by Daya to substantiate the statement that
the report indicated genuine overtime, he discovered
that the report
was inaccurate and that the overtime had been overstated by
$1 062 892.00.
can be no doubt that Banda admitted the charge in this count. I say
so because when he was asked by Briel, at the hearing
of his appeal,
why he had not discovered the error made by the analysis clerk, he
said it was because he did not check properly.
In my view, he
did not check the report at all because, had he done so, he would
have discovered the error in the same way that
he discovered it after
Daya had called upon him to substantiate the assurance that the
overtime reflected was genuine.
view, when the Tribunal concluded that the charge in this count had
not been established, it seriously misdirected itself.
judgment it stated as follows:
An error of overstatement under the circumstances cannot be a sign
of incompetence. It also seems that the company did not in
reprimand Mr P Daya, (Bandas) senior, when he overstated
by a figure of $2 178 127.00 which was more
overstatement by (Banda). If the mistake amounted to a serious or
substantial neglect of duty, then Mr Daya too ought
to have been
charged and dismissed.
clearly, the Tribunal seriously misdirected itself in at least two
it was a serious misdirection to say that the error of overstatement
could not be a sign of incompetence on the part of
main function was to check the accuracy of the reports prepared by
his subordinates. The overstatement of the
cost of overtime by
$1 062 892.00 was a very serious error which Banda did not
discover because he did not perform the
fundamental duty of checking
the report. In my view, the failure to check the report was a
complete dereliction of duty on his
part, which justified the
conclusion by Briel that Banda was guilty of substantial neglect of
duty and gross inefficiency. As an
accountant Banda must have
appreciated the importance of accurate figures in making business
the statement by the Tribunal that if the overstatement of the cost
of overtime was a serious or substantial neglect of
duty by Banda,
then Daya should also have been charged and dismissed, was completely
unjustified. The fact that Daya might have
committed a similar act
of misconduct and might not have been charged was irrelevant in the
determination of whether Banda had committed
the act of misconduct
with which he was charged. There is no logical connection between
the two. In any event, the full facts
of the alleged overstatement
by Daya were not before the Tribunal.
circumstances, and bearing in mind that the Code provides that the
penalty for substantial neglect of duty and gross inefficiency
dismissal, the Tribunal should not have set aside Bandas
basis alone the appeal must be allowed. Nevertheless, I shall deal
with the rest of the counts.
The allegation in this count was that Banda failed to follow the
correct procedure in reconciling reline spares and high value
at the end of 1991.
had three different classifications of stock reserved for its own
use. These were reline spares, high value stores and
spares were spare parts kept for the major refurbishment of furnaces
every twelve to fifteen years. High value stores consisted
parts and materials required by Zimasco for its daily operations, and
included things like oil, grease, bolts and protective
And insurance spares were spare parts purchased specifically for
major breakdowns of machinery which could occur within
five to twenty
allegations in respect of this count were set out by Daya in his
memorandum to Banda dated 19 February 1992. That memorandum,
in relevant part, reads as follows:
The effect of this journal was an attempt to disclose separately
Reline Spares. Reline Spares were however separately disclosed
under Insurance Spares for year end purposes.
correct treatment was to transfer the entire amount from Insurance
Spares to Reline Spares and add on the January receipts of
for both accounts were prepared for January and checked by yourself.
The Reline Spares reconciliation starts with
a balance per ledger
and ends with (a) 9.4 million figure (which supposedly
represented the total of stores ledger cards).
Surely, the basic
accountancy concept in this particular situation is to represent the
ledger balance as the total of the cards
the High Value reconciliation contains a reconciling item, which is
the total January receipt of Reline Spares. Surely,
this should be
transferred to the Reline Spares account so that the Ledger balance
would equal the value of cards on hand.
evidence confirming the above allegations was given by Breese, who
testified under oath before the Tribunal, and it was not
challenged. In addition, it is pertinent to note that Banda did not
testify under oath when he appeared before the Tribunal.
made a number of submissions, and therefore gave no evidence.
judgment the Tribunal said:
The appellant (i.e. Banda) cannot be charged for failing to follow
a procedure that he did not know existed. Especially
management had commended his reporting system as being more user
stating the above, the Tribunal seriously misdirected itself. This
is so because there was no evidence showing that Banda did
that the procedure in question existed or that management had
commended Bandas reporting system as being more user friendly.
Tribunals finding in respect of this count was, therefore, wholly
unjustified and cannot be allowed to stand.
The charge in this count was in two parts. The first part alleged
that Banda had failed to produce reconciliations on time, and
second alleged that he had not complied with the laid down procedure
which required that the reconciliations be checked and authorised
Daya before they were submitted to the auditors.
found Banda not guilty in respect of the first part, but guilty in
respect of the second part. In fact, Banda had not denied
allegation in the second part.
the Tribunal, Breese testified under oath and confirmed the
allegations in the second part of the charge. However, no evidence
was given by Banda. Notwithstanding that fact, the Tribunal in its
The appellants (i.e. Bandas) evidence was that Mr Dias
(sic) was not available, and waiting for his availability
would have meant that we (sic) would have failed to meet the
deadline. The appellant then made a decision to hand them in as his
supervisor was unavailable.
view, bearing in mind that Banda did not give any evidence before the
Tribunal, and that he did not deny the allegation that
he had not
complied with the laid down procedure, the Tribunal seriously
misdirected itself by referring to evidence given
by Banda, and
by finding that Banda was not guilty of failing to comply with the
laid down procedure. It follows that the Tribunals
cannot be allowed to stand.
Counts Four and Five
I shall deal with these counts together because that is what the
Tribunal did in its judgment.
allegation in respect of Count Four was that there were numerous old
reconciling items on the Creditors Statement reconciliations
had not been resolved by Banda, and that that was evidence of Bandas
habitual and substantial neglect of duty and gross
disciplinary hearing, in finding Banda guilty on this count, stated
The Creditor Section for which Mr J Banda was
responsible up until the end of November 1991 has been the subject of
serious and grave concern by both External and Internal Auditors as
borne out in various reports on this section. His failure to
rectify the situation necessitated the seconding of the Group
Internal Audit Department to the Creditors Department. In a hands
on Fix It Role they instituted investigations to clear the
queries within the section. This lack of substantial action by
Mr J Banda constituted his habitual and substantial neglect
of duty and gross inefficiency in the performance of his duty.
allegation against Banda in respect of Count Five was that he had
failed to clear long outstanding balances on the Debtors
and that that was evidence of Bandas habitual and substantial
neglect of duty and gross inefficiency.
disciplinary hearing found that the allegations in this count had
been proved, and that Banda had failed to follow standard
procedures for the collection of outstanding debts.
appeal, Briel confirmed the disciplinary hearings verdicts on
Counts Four and Five, and noted that although Banda had started
attending to the problems affecting both the Creditors and Debtors
Accounts, he did not sustain the effort to complete the exercise
respect of each account.
findings were subsequently confirmed by Breese when he appeared
before the Tribunal and testified under oath. As already
evidence was given by Banda, nor did he call any witnesses.
in its judgment the Tribunal ignored the evidence given by Breese in
respect of Counts Four and Five, without commenting
on it, and stated
The remaining two charges (i.e. Counts Four and Five) related to
the failure by Mr Banda to clear items on the creditors
statement that had been long outstanding, and sundry debtors as well.
evidence showed that (Banda) had made several attempts to clear the
long outstanding items. For example, the twenty-six items
Sundry Debtors account had been reduced to nine items only. In some
incidences it was (Bandas) supervisors who had to
decisions to write off some of the debts that could no longer be
recovered. A request to write off the debts had been
(Banda) was frustrated by false promises to pay by the debtors.
Under the circumstances it was not due to the negligence
that these two accounts continued to have long outstanding items.
can be no doubt that the Tribunal seriously misdirected itself. It
completely ignored the evidence given by Breese and did
comment upon it. That evidence clearly established that the charges
in both counts had been proved. In addition, the
on the basis that Banda had given evidence, when in fact he had
simply made submissions, which could not be described
circumstances, the Tribunals decisions on both counts cannot be
allowed to stand.
I would like to comment on Bandas submission that in view of the
provisions of clause 4.1.1 of the Code the charges
against him were null and void. That clause reads as follows:
When an offence is alleged to have been committed, the Supervisor
will arrange an investigation by the Personnel Manager/Officer
Workers Representatives, and either dismiss the case or give a verbal
warning or lay a formal disciplinary complaint in writing.
complaint must be made within forty-eight hours of discovery of the
alleged offence. Complaints lodged outside this period
null and void except in situations where parties are operating away
from their base. These are expected to lodge a complaint
forty-eight hours of their return to their base.
submitted by Banda that as the complaints against him had been made
outside the forty-eight hour limit the charges preferred
were null and void.
the wording of the clause seems to indicate that its provisions apply
to all acts of misconduct, it seems to me that the
clause was not
intended to apply to those acts of misconduct, such as habitual and
substantial neglect of duty, which could only
be committed after the
same act had been committed a number of times, or after a series of
similar acts had been committed. I say
so because if that were not
the case, it would be difficult to tell at what point, for example,
the act of misconduct of habitual
and substantial neglect of duty was
committed or discovered. In any event, it would be undesirable to
determine labour disputes
on the basis of technicalities, such as the
one relied upon by Banda.
circumstances, the following order is made
1. The appeal is allowed with costs.
2. The order granted by the Labour Relations Tribunal is set aside,
and the following is substituted
The appeal is dismissed with costs.
CJ: I agree.
JA: I agree.
Welsh & Guest, appellant's legal practitioners