Sunday, October 25, 2020

It’s OK to fire employees for no valid reason ÔÇô Court of Appeal

You would be well-advised to start a backyard garden or look for a new job if your contract of employment says that you can be terminated “for whatever reason.”

That may sound incredulous but is actually judicial truth from the Court of Appeal (CoA) which has just pronounced that employers can terminate employees with such contracts in bad faith, for no valid reason and that it is unnecessary to afford them the benefit of a disciplinary hearing.

This revelation comes courtesy of a court case between the Botswana National Youth Council (BNYC) and two of its former employees that it fired midway through their contracts.

Displeased with a High Court judgement in which Justice Dr. Zein Kebonang found in favour of the pair – Goitse Mpolokang and Tibapi Gucha – BNYC took the matter up with the CoA. After its deliberations, a three-judge panel at the appellate court unanimously upheld the appeal. This will come at considerable cost to both Mpolokang and Gucha who would have been looking forward to a huge pay day after Kebonang found that they were entitled to the balance of their contracts as damages. However, the CoA, the highest court in the land, has completely turned the tables on them because they not only lost but will also have to pay costs of the suit. 

The issue boils down to what piece of legislation regulates lawful termination of a contract for a fixed period in Botswana. In a judgement assented to by Justices Craig Howie and Jacobus Brand, Justice Isaac Lesetedi says that such termination is regulated not by the Employment Act but the common law.

“Under the common law, the relationship of the employer and the employee in the circumstances falls within the ambit of the law of contract and is governed by the agreement between the parties,” the judgement reads.

In this particular case, the agreement between BNYC and its two ex-employees stated that “a contract of employment may be terminated by either the organisation or employee for whatever reason provided that notice is given by either party or payment made in lieu of notice.” While Mpolokang and Gucha argued that BNYC was contractually required to provide a reason for the termination of their employment, the phrase “for whatever reason” sealed their fate. Lesetedi’s interpretation of the phrase is that it gives either party “the right to terminate the contract of employment even for a reason which is not valid.” Mpolokang and Gucha had also argued that providing a reason for their termination was necessary for purpose of determining whether they could invoke the right to be given a disciplinary hearing as provided for under BNYC’s disciplinary process. The judge disagreed.

“There is no substance in this submission. The phrase “for whatever reason” gives [either party] the right to terminate the contract of employment even for a reason which is not valid. No purpose could therefore have been served by going through a disciplinary enquiry (assuming the reason fell within that scope) when the outcome of such enquiry would have served no purpose as the validity or otherwise of the reason was of no consequence. It also follows that an invalid reason is no reason at all and is as good as giving no reason. The issue of valid grounds for termination or good faith did not therefore arise either at common law (the law of contract) nor was it a requirement stipulated under the contract. The parties dispensed with the requirement and there is no need to search for it,” Justice Lesetedi’s judgement says.

The appellate court’s ruling will definitely have earth-shattering implications for the job security of Botswana workers.

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