ENFORCEMENT OF CERTIFICATE OF SETTLEMENT IN LABOR DISPUTES

Simbarashe Gobvu

More often than not, employees get stuck with certificates of settlement that are never honored by employers. Most employers have developed a tendency of agreeing to settle for the purpose of doing away with a dispute so that they avoid the next stage of ruling or arbitration. As a result, complainants will agree to settle in good faith while employers take it as a delaying tactic or as a way of coercing the complainant to agree on a payment plan different from that on the certificate of settlement. Employers would pretend to agree in good faith but later renege to pay as directed on the certificate of settlement. Unlike in other countries like Botswana where a certificate of settlement is enforceable, in Zimbabwe, it is a mere agreement that parties are expected to honor but not registrable. The biggest setback with a certificate of settlement is that it is not registrable like an arbitration award.

Litigants have found themselves disadvantaged and at times they end up giving up while they hold a certificate of settlement in their hands. In most cases, the complainant would go back to the labuor officer who issued a certificate of settlement. However, the labour officer may be helpless as the certificate of settlement would have blocked the next stage of ruling or arbitration. What the labuor officer usually does is to call the employer reminding him of her to pay. Some employers would respond and make effort to settle the agreement but other employers would profess ignorance while others try to evade payment by making continuous empty promises which are never fulfilled.

Some complainants would attempt to report the matter on a different platform or different labuor officer with the intention that they will not fall in the same trap of certificate of settlement. Their intention would be to disagree at conciliation so that the matter would proceed to the stage of ruling or arbitration. However such attempts usually hit a brick wall because it will face preliminary issues of res judicata. Some would attempt to take it to the labuor officer while it was already dealt with by NEC and issues of jurisdiction and parallel proceedings would block the matter. 

What is the recourse when employers renege to pay?

From my experience as a labor practitioner, I have realized that there are other avenues that can be tried to rescue the employee who becomes stuck with an unsettled certificate of settlement. Prosecution and filing a fresh complaint of unfair labor practice by the employer may assist the complainant to get recourse. The two approaches are the subject of interest in this article. Prosecution

According to the oxford dictionary, the prosecution is the act of officially accusing someone of committing an illegal act by bringing a case against that person in a court of law. A complainant who misses payment as agreed on the certificate of settlement would approach a labor officer who issued the certificate. The labor officer would write and send a prosecution letter to the police. Upon receipt of the letter, the police would arrest the employer party and take the matter to court. Usually, indigenous employers would comply once they are arrested but big companies would let the process go through the courts because no one is directly affected by the arrest since a company is a legal persona. The court would hear the matter and issue a court order which the employer can not renege to pay.

In terms of section 13(2) of the Labor Act, any employer who without the Minister’s permission withholds or unreasonably delays the payment of any wages or benefits owed in terms of subsection (1) shall be guilty of an offense and liable to a fine not exceeding level seven or to imprisonment for a period not exceeding two years or to both such fine and such imprisonment.

The provision of the Labour Act is very clear that failure to own outstanding wages or benefits can be considered as a criminal offense that warrants arrest of the offender and subsequent imprisonment and or payment of a fine. Employers must be aware that reneging to pay wages and benefits as agreed on the certificate of settlement can land them in criminal courts

Section 13 (3) of the Act provides that the court convicting an employer of the offense in terms of subsection (2) may order him to pay—

(a) to the employee concerned; or

(b) to any person specified by it for the benefit of the employee concerned; in addition to any other penalty which it may impose, an amount which, in its opinion, will adequately compensate the employee concerned for any prejudice or loss he has suffered as a result of the contravention concerned, within such period and in installments as may be fixed by such court.

It is noted that the court may impose a penalty which may end up compensating the employee for the loss and prejudices suffered for delaying payment as agreed by the parties at conciliation. Employers should be aware that they may end up paying more than what they would have paid had they paid as agreed.

Section 8(5) of the labor Act also provides that Sections 348 and 349 of the Criminal Procedure and Evidence Act [Chapter 9:07] shall apply, mutatis mutandis, in relation to the amount specified in an order made in terms of subsection (3) as if such amount were a fine referred to in those sections. The procedure followed when dealing with offenders who renege to pay fines prescribed by the courts also applies to those who fail to honour certificates of settlement.

Section 348 (1) of the Criminal Procedure and Evidence Act [Chapter 9:07] provides that when an offender is sentenced to pay a fine, the court passing the sentence may in its discretion issue a warrant addressed to the Sheriff or messenger of the court authorizing him to levy the amount by attachment and sale of any movable property belonging to the offender. The amount levied in terms of the above provision shall be sufficient to cover the fine and the costs

Subsection (2) further clarified that the amount which may be levied in terms of subsection (1) shall be sufficient to cover, in addition to the fine, the costs and expenses of the warrant and of the attachment and sale. The warrant shall be issued by the high court or magistrate court depending on the amount to be recovered. The recovery shall cause the attachment of movable property and where proceeds of movable property are insufficient to recover the amount due the immovable property shall be attached. In terms of section 349 of the aforementioned Act, the Court may enforce payment of fine from moneys on accused or salary or wages of accused whether as to the whole or part thereof.

New case on failure to comply with or implement a decision made in terms of the Act

Section 8(e) of the Act provides that an employer or any other person commits an unfair labor practice if, by act or omission, he fails to comply with or implement —

(iii) a decision or finding made under Part XII; or

(iv) any determination or direction which is binding upon him in terms of this Act;

Part XII deals with the resolution of disputes and unfair labour practices by the employer. Section 93 empowers labor officers to redress issues brought before them. It becomes an unfair labour practice when the employer party fails to honor an agreement reached in terms of party XII. An aggrieved employee will have to approach a labor officer and file a case of unfair labor practice with reference to section 8(e) (iii). It must be noted that the matter becomes new in the sense that the employer party refuses to comply with a decision made under part XII. The labuor officer would call parties and hear the matter and take it through the process of conciliation and where parties disagree the labour officer would proceed to make a ruling or refer the matter to arbitration in terms of section 93 of the Labour Act. The challenge however comes if the parties agree at the conciliation stage and another certificate of settlement is issued. It is however unlikely for the parties to agree at the conciliation stage because the complainant would be seeking recourse for reneging to pay.

It is also an unfair labor practice when an employer fails to comply with any determination or direction which is binding in terms of this act. Labour officers are entitled to make determinations where the disciplinary process is not completed within 30 days. An aggrieved party may approach a labour officer and file a case of unfair labour practice with reference to sections 8(e) (iv). Section 101(6) provides that if a matter is not determined within thirty days of the date of the notification of disciplinary hearing proceedings, the employee or employer concerned may refer such matter to a labour officer, who may then determine or otherwise dispose of the matter in accordance with section ninety-three. The section mentioned above empowers labour officers to make determinations on pending disciplinary cases and the labour officer’s determination shall be final. If the employer fails to comply with the determination it shall be considered as an unfair labour practice and the employee concerned may seek recourse in terms of section 8(e) (iv) of the Act.

Employees must not be stuck with certificates of settlement or determinations but must make effort to go back to the labour officers or designated agents so that they can be assisted to get what is due to them. https://masvingomirror.com

Opinions expressed herein are solely those of the author and must not be taken as legal advice. Simbarashe Gobvu is an experienced La­bour Practitioner and an Independent Arbitrator who writes in his own capac­ity. He can be contact­ed at [email protected]/ Phone 0773215904 or 0713008767

Leave a Reply

Your email address will not be published.