ABOUT 69 former Bhadella Wholesalers workers in Mutare have lost their bid to challenge termination of their employment contracts after an arbitrator ruled that the termination of their contracts was legal following the closure of the company.
CHARLES LAITON SENIOR COURT REPORTER
After realising that the Mutare business was no longer viable, Bhadella decided to close the branch, but employees refused to accept the offered exit packages, challenging termination of their contracts on a three months’ notice.
According to the court papers, sometime in April this year, Bhadella decided to close the Mutare branch citing viability problems after which the proprietor held a meeting with the affected employees to discuss the impending closure as well as the packages to be paid to the employees upon termination of their contracts.
However, an agreement was not reached and on April 30, Bhadella officially closed the branch and terminated the employees’ contracts on three months’ notice that was to be paid in cash.
The move by Bhadella to shut down the business and terminate the employees’ contracts on notice was challenged by the workers who felt that instead their employer ought to have retrenched them.
The matter was then referred to the Ministry of Labour for conciliation and after failing to reach a consensus, an arbitrator cited as G M Chibaya was called in to resolve the dispute.
After listening to both parties, Chibaya said in his judgment: “I have, therefore, found that respondent’s decision to terminate the contracts in terms of section 12(4) (of the Labour Act) was a contractual right, whose exercise was not subject to retrenchment procedures laid down in Section 12C.”
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The arbitrator further said, having found that the termination of the contracts on notice was lawful, it became unnecessary for him to address the issue of whether or not the employees were entitled to be paid wages from May 2014 onwards.
“The termination of claimants’ permanent contracts on three months’ notice on April 30 2014, and is hereby found lawful,” Chibaya awarded.
Bhadella was represented by Everson Samukange.
