BERLINWASSER INTERNATIONAL AG MAURITIUS v BENYDIN L.R IN THE SUPREME COURT OF MAURITIUS. Berlinwasser International AG Mauritius

Transcription

1 BERLINWASSER INTERNATIONAL AG MAURITIUS v BENYDIN L.R 2017 SCJ 120 Record No IN THE SUPREME COURT OF MAURITIUS In the matter of:- Berlinwasser International AG Mauritius Appellant v L.R. Benydin Respondent JUDGMENT The respondent had sued the appellant before the Industrial Court claiming severance allowance for unjustified and unfair termination of his employment. The Court in its judgment ordered the appellant to pay to the respondent the total sum of 208,330 rupees, made up of 190,000 rupees as severance allowance and 18,330 rupees as end of year bonus together with interest on the severance allowance. The respondent s case in the Court below was that he had been in the continuous employment of the appellant for 38 months until the defendant terminated his employment without any reason. The appellant averred in its plea that the employment was terminated because it was not satisfied with the performance of the respondent. But by mutual agreement the reason for the termination was not stated in the dismissal letter in order not to jeopardise the respondent s chance of securing an alternative employment. The appellant further averred that respondent accepted as compensation a sum of 58,108 rupees which he was offered at the time of the termination of his employment. The respondent s version was that he was initially employed as driver/messenger before he was appointed as purchasing officer and was granted an increase in salary. He was also provided with a vehicle both for his professional and private use. On 11 October

2 2 2011, he was summoned to the office of the accountant, Mr Meea, where he also met the General Manager, Mr Otto, who asked him to take a month leave and informed him that he would be paid 3 months salary. He was then tendered a document which he was asked to sign as his letter of resignation. He refused to sign the document and wanted to know the reason for the termination of his employment. No reason was given to him. He was dropped at his place by another employee to whom he remitted the keys of the appellant s vehicle which he used to drive. On 21 October 2011, a sum of 58,108 rupees was credited in his bank account. He was never called before any disciplinary committee to answer any charge in relation to his conduct at work and was never given any reason for his dismissal. He had never been informed that there was any complaint of poor performance against him. Respondent denied that he agreed to terminate his employment by accepting a compensation of 58,108 rupees and denied that there had been 3 meetings with the management as averred by the appellant. He made a complaint to the labour office when he received the letter from the appellant which terminated his employment. The accountant, Mr Meea attended the labour office and offered a sum of 60,000 rupees in order to settle matter. He rejected the offer. Both the accountant and the General Manager of the appellant, witnesses Meea and Otto, gave evidence at the trial which purported to show that following 3 meetings with the respondent, there was a common decision to terminate the respondent s employment. As a result a sum of 58,108 rupees was credited in the respondent s bank account. This sum represented the amount which respondent had accepted as compensation for him to leave his employment. It was also agreed, still according to these witnesses, that no reason would be mentioned in the dismissal letter in order not to jeopardise the respondent s chance to obtain a new employment. Both witnesses also mentioned the problems which the respondent had been having whilst interacting with other members of the staff and in the performance of his duties as a driver. They also complained that respondent would buy wrong equipment and spare parts whilst purchasing goods on behalf of the appellant. Witness Rayapen, who gave evidence on behalf of the appellant, stated that he attended a meeting in the course of which Mr Otto and Mr Meea expressed to the respondent his unsatisfactory performance at work. The main reason that was invoked by them was his difficult relationship with other members of the staff. Mr Meea informed the respondent that he would have to leave his employment for which he would receive a

3 3 compensation of 58,000 rupees. Mr Otto produced a document to the respondent for his signature, on which witness Rayapen affixed his signature as witness. According to witness Rayapen, the respondent admitted the complaints that were being levelled against him. But the respondent refused to sign the document purporting to acknowledge that he was voluntarily accepting to terminate his employment in consideration for a compensation of 58,000 rupees. The learned Magistrate carried out an elaborate analysis of the evidence in the course of which he pointed out that the following facts were not in dispute. The respondent had been in the continuous employment of the appellant for a period of 38 months. The respondent s employment was terminated by a letter dated 17 October 2011 (Doc. B). No reason for the termination of the employment was mentioned in the letter of dismissal and there had been no disciplinary hearing to enquire into any charge against the respondent. We shall first consider Grounds 1(a) and (b) and (2) of the grounds of appeal which were argued together and which read as follows:- 1 (a) In deciding the dispute on the additional ground for an alleged breach of Section 38 (3),(4) of the ERA, the learned Magistrate acted ultra petita, and his decision to that effect is null and void, given that the complaint was based on unjustified and unfair ground, as allegedly no reason was given for dismissal, as borne out at paragraphs 6 and 7 of the Proecipe. (b) Because in relying on Section 38(3)(c) & 4 of the Act, the Learned Magistrate allowed himself to be unduly influenced by this extraneous consideration, thereby rendering the whole judgment fundamentally faulty. 2. Having decided the dispute outside the pleadings, the Learned Magistrate has deprived Appellant (Defendant) of his constitutional right to a fair hearing as guaranteed by Section10(8) of the Constitution, as the Appellant (Defendant) was deprived of the opportunity to rebut the basis on which the Learned Magistrate decided the case, thereby rendering the whole judgment null and void It was submitted that the learned Magistrate s judgment is defective inasmuch as he acted ultra petita by proceeding to determine the plaintiff s claim on the ground that there had been a breach of section 38(3)(c) and (4) of the Employment Rights Act ( ERA ).

4 4 Counsel added that the respondent s case in the Court below was based only on the fact that the termination of his employment was unjustified and unfair because it had been terminated without any reason. It was argued by Mr S. Toorbuth, Counsel for the appellant, that since the respondent did not complain that he had been denied a fair hearing or that there had been a breach of any of the provisions of the ERA, the learned Magistrate acted ultra petita by relying on section 38(3)(c) and (4) of the ERA. It was thus submitted that by allowing himself to be unduly influenced by such an extraneous consideration, the judgment of the Magistrate is fundamentally faulty and cannot stand. Learned Counsel added that by proceeding to decide the dispute outside the pleadings, the learned Magistrate also deprived the appellant of its constitutional right to a fair hearing as guaranteed by section 10(8) of the Constitution. That submission is misconceived. It would not be correct to state that the Magistrate proceeded to decide the dispute outside the proceedings or by relying upon any extraneous consideration in view of the pleadings and the issues which were raised by the appellant itself. Firstly, the respondent s claim in his plaint was not based solely on the ground that the appellant had terminated his employment without stating any reason in his dismissal letter. He expressly averred, in paragraph 7 of his plaint, that the termination of his employment by Defendant is unjustified and unfair and therefore the Defendant is bound to pay to him severance allowance as per the laws of Mauritius. Furthermore, the appellant had specifically invoked the poor performance of the respondent in its plea by averring the following in paragraph 5(b): In fact Plaintiff was informed that his services were being dispensed with because management was not satisfied with his performance. The issue of poor performance was not only raised in the plea but was fully canvassed by the appellant in the course of the hearing. Witness Meea referred extensively for that purpose to the respondent s adverse and difficult interpersonal relationship with other employees which according to the appellant affected the performance at work of both the respondent and other employees. It was perfectly legitimate for the learned Magistrate, in the circumstances, to address his mind to the provisions of section 38(3) and (4) of the Employment Rights Act in order to determine the issue of poor performance which had been specifically invoked by the appellant as one of the reasons for the termination of the respondent s employment. Section 38(3) and (4) of the ERA read as follows:-

5 5 38. Protection against termination of agreement (1) (2) (3) No employer shall terminate a worker s agreement for reasons related to the worker s poor performance, unless (a) he cannot in good faith take any other course of action; (b) the worker has been afforded an opportunity to answer any charge made against him related to his alleged poor performance; (c) the worker has been given at least 5 days notice to answer any charge made against him; and (d) the termination is effected not later than 7 days after the worker has answered the charge made against him, or where the charge is subject of an oral hearing, after the completion of such hearing. (Emphasis added) (4) Where the opportunity afforded to a worker to answer any charge made against him under subsection (2) (a)(ii), (2)(b)(i) or (3)(b) is the subject of an oral hearing, he may have the assistance of (a) a representative of his trade union or his legal representative, or both; or (b) an officer, where he is not assisted as specified in paragraph (a). In view of the averments made by the respondent in his plaint and the issues which had been raised by the appellant in relation to the alleged poor performance of the respondent, both in its pleadings and in the course of the hearing, the learned Magistrate was bound to adjudicate on these issues by applying the relevant provisions of the law which would include section 38(3) and (4) of the ERA. As was rightly observed by the Magistrate in his judgment, the appellant as employer could not, in the light of the express provisions of section 38(3) and (4), terminate the employment of the respondent on the ground of poor performance unless (i) it had afforded the respondent a hearing to answer any charge relating to alleged poor performance in accordance with section 38(3)(b) and (c) and (4) of the ERA; (ii) the appellant was able to show that it could not in good faith take any other course of action than terminate the employment of the respondent in conformity with section 38(3)(a); and (iii) the employment was terminated within the prescribed time limit following the completion of the hearing as laid down in section 38(3)(d). It cannot be said therefore that the learned Magistrate acted ultra petita or decided the dispute outside the pleadings since it was incumbent upon him to apply the relevant provisions of section 38(3) and (4) of the ERA in order to determine the issue of poor

6 6 performance which had been raised both in the pleadings and in the course of the hearing by the parties. Indeed he was bound to consider whether the provisions of section 38(3) and (4) of the ERA had been complied with in order to adjudicate upon the liability of the appellant as an employer who was invoking the poor performance of the respondent for the termination of his employment. The learned Magistrate found, following a correct assessment of the evidence, that there had been a breach of section 38(3) in that the appellant had failed to provide the respondent with any opportunity to answer the charge relating to his alleged poor performance. The importance of the right of an employee to be heard in relation to any charge prior to the termination of his employment has been forcefully emphasised in Bissonauth v The Sugar Insurance Fund Board [2007] UKPC 17. The appellant had failed to provide the respondent with the 5 days notice required under section 38(3)(c) in order to answer any charge of poor performance. The appellant had also failed to establish that it could not in good faith take any other course of action as laid down under section 38(3)(c) of the ERA. The learned Magistrate also referred to section 46(5)(b) and (c) of the ERA which entitled the respondent to severance allowance at the rate provided under section 46(5) of the ERA where there had been a termination of the workers employment in breach of section 38(3) of the ERA. Section 46(5) of the ERA provides as follows: 46. Payment of severance allowance (5) Where a worker has been in continuous employment for a period of not less than 12 months with an employer, the Court may, where it finds that (a) the termination of agreement of the worker was due to the reasons specified under section 36(3) and (4); (b) the termination of agreement of the worker was in contravention of section 38(2),(3), and (4); (c) the reasons related to the worker s alleged misconduct of poor performance under section 38(2) and (3) do not constitute valid reasons for the termination of employment of the worker; order that the worker be paid severance allowance. For all the above reasons, we consider that there is absolutely no substance in any of the arguments in support of Grounds 1(a), 1(b) and 2 which must accordingly fail. The remaining grounds of appeal, which are grounds 1(c) and (d) and 3(a) and (b) question the appreciation of the evidence by the learned Magistrate essentially in relation to (1) the reason for the termination of the respondent s employment (2) the termination of the

7 7 respondent s employment by mutual agreement in consideration for an agreed compensation of 58,108 rupees. Learned Counsel for the appellant submitted that the learned Magistrate failed to appreciate in the light of the evidence on record that the respondent had not been telling the truth in respect of the nature of his employment and job title, the use of the car, his remuneration, the calculation of overtime and the agreement with regard to the termination of respondent s employment. Counsel argued that the learned Magistrate should not have believed the respondent and drew the wrong inferences from the evidence on record since the evidence had established that the respondent was fully aware (i) of the reason for the termination of his employment; and (ii) had, following negotiations, agreed on the quantum of the compensation for the termination of his employment. Counsel referred in that connection to the 3 meetings which had allegedly taken place and the fact that the appellant could terminate the contract by giving one month notice. It is not in dispute that no reason was given by the appellant for the termination of the respondent s employment in the termination letter [Doc. B]. It was the appellant s case that it was agreed that the respondent for the termination of the employment was not stated in the letter in order not to jeopardise the respondent s choices by obtaining an alternative employment. We find no fault in the decision of the learned Magistrate to reject the contention of the appellant on that issue the more so, in view of the express provisions of section 37(2) of the ERA which create an obligation on the appellant to state the reason for the termination of the respondent s employment. 37. Notice of termination of agreement (1) (2) The employer shall, at the time of notifying a worker of the termination of his employment, state the reason of such termination. As regards the alleged acceptance by the respondent of a sum of 58,108 rupees as compensation, we have reviewed the evidence in the light of the submissions made by Counsel, we see no reason to interfere with the findings of the Magistrate, for any of the reasons invoked by Counsel for the appellant. As was observed by the Magistrate, it was clearly established that the respondent had emphatically denied to sign any agreement as to any compensation despite the fact that the document was presented to him for signature by the accountant and General Manager of the appellant, witnesses Meea and Otto. It was

8 8 confirmed by the appellant s own witness, witness Rayappen, that the respondent refused to sign the document which was presented to him. Had the respondent agreed with the proposal for such a compensation, there is no reason why he would have refused to sign the written agreement. On the contrary, his reaction was to make a formal complaint to the Quatre Bornes Labour Office to the effect that his dismissal by the appellant was unjustified and unfair. We have found no valid reason to disturb the conclusive findings of the learned Magistrate that the respondent had never agreed to terminate his employment in consideration for a compensation of about 58,108 rupees and that the respondent was not privy to any agreement that the reason for the termination of his employment should not be stated in the dismissal letter. It was perfectly legitimate for the Magistrate to reach such conclusions which are amply borne out by the evidence on record. All the grounds of appeal having failed, the appeal should be dismissed with costs. However, as regards the calculation of the severance allowance, we note that the learned Magistrate has overlooked the fact that the respondent has acknowledged having received a sum of 58,108 rupees from the appellant which had been credited in his bank account and which should therefore have been deducted from the total sum of 190,000 rupees awarded as severance allowance by the Magistrate. We accordingly amend the judgment by ordering the appellant to pay to the respondent the total sum of 150,222 rupees made up of 131,892 rupees as severance allowance and 18,330 rupees as end of year bonus together with interest on the severance allowance. The appeal is otherwise dismissed with costs. A. Caunhye Judge O.B. Madhub Judge

9 9 31 March 2017 Judgment delivered by Hon. A. Caunhye For Appellant : Mr Attorney S. Baichoo Mr S. Toorbuth, of Counsel For Respondent : Mr B. Sewraj, SA Mr M. Gujadhur, of Counsel