Developments In Employment Law Jurispudence In Zambia: Analysis

CONTRIBUTORS:

Edwin Mbewe| LLB
Advocate of the High Court for Zambia.

Mehluli Malisa Batakathi | Bsc. (HONS) | LLB | ACIArb
Advocate of the High Court for Zambia

1.0     Introduction

The Labour Law landscape has been undergoing a number of changes since the amendment of the Constitution[1] in 2016 and the enactment of the Employment Code[2] three years down the line. It is beyond rational contention that the stated legislative interventions, by design, serve to alter the state of employment relations that existed prior to the enactments. With the onset of the Corona Virus (COVID 19) pandemic and the economic tail-spin that has resulted from its impact, a good number of people in the country found themselves out of employment for one reason or the other. As the pandemic rages on, with no end predicted in the foreseeable future, the economic turmoil is set to continue and the casualties on the employment front are almost certain to increase exponentially.

With the unprecedented terminations of employment contracts over a short period of time, it is inevitable that the law governing labour relations will take centre stage, as the fallout from the job losses moves from the board rooms to the courtrooms. Once again, our courts will be called upon to adjudicate on labour related disputes and “interpret” the written law in order to assign rights and duties to competing interests. The discussion that follows proceeds from the standpoint that, while the legislature has the constitutional mandate to pass laws, it is the judiciary that “breathes life” into the law, and as such, judicial creation of a law-rule is necessary to decide a question not envisaged or provided for by legislation. Closely akin to this situation, but much more common is the duty thrust upon the courts by the volume of new legislation, to synthesise it within the body of pre-existing law.  Given this backdrop, we are critically looking at some relevant judicial pronouncements following legislative enactments and their impact on labour relations in the country.

1.0   The Significance of Judicial Pronouncements

Zambia is a Constitutional democracy and to a certain extent strives to observe the doctrine of separation of powers. From our Constitutional order, the proper function of the courts is to adjudicate, and not legislate; the legislature (parliament) is and must be the paramount source of law. However, it is widely observed that there are instances in which legislation may be made in piecemeal or sometimes inadvertently drafted; at times without full consideration of competing, overlapping or inconsistent enactments. In such instances, the courts must perform, and the legislature intends them to do so, the function of integrating the interpretation of the statute into the general body of the law or co-ordinate its principles with others that are applicable to the given scenario and also of limiting the statute or extending its application according to  the legislature’s intended purpose, where literal words often permit either broad or narrow applications, the circumference of the statute not being discernible from the words themselves.[3]

The adjudicative process in Zambia, inevitably requires that on some occasions the courts create or modify general rules in order to decide disputes pending before them. This function of the Courts is qualitatively important as their role is that of a complementary law making institution to rationalize isolated statutes in accordance with their intended purpose and to permit them to serve as reasoned principles within the intelligible framework of the general law. This article considers two recent decisions of the superior courts in Zambia, namely; Lubunda Ngala and Jason Chulu v Anti-Corruption Commission[4] (Constitutional Court) and Konkola Copper Mines Plc v Nyambe Martin Nyambe and Others[5] (Court of Appeal) and their implications on employment law jurisprudence in the country. This was necessitated by the seemingly divided public/legal opinion that has followed the two decisions.

The authors summarise each of the aforementioned cases and go on to highlight some controversies that have arisen and possible implications on labour law in Zambia.

2.0  Ngala and Chulu v The Anti- Corruption Commission- Constitutional Court

Ngala and Chulu v Anti-Corruption Commission[6] ("Ngala"), was a referral to the Constitutional Court by the High Court for interpretation of Articles 189(2) and 266 of the Constitution[7]. This referral was made pursuant to the provisions of Article 128 (2) of the Constitution, which mandates other courts to refer any questions relating to the Constitution to the Constitutional Court subject to Article 28 which gives the High Court exclusive Jurisdiction to hear matters relating to the Bill of Rights.

In this case, the Applicants were employees of the Anti- Corruption Commission (“the Respondent”) on permanent and pensionable contracts of service who later resigned from employment after working for slightly less than a year each. Following their resignations from employment, the Applicants demanded that the Respondent, who had removed them from the payroll, pay them their terminal benefits which was not done, leading the applicants to institute legal proceedings in the High Court for Zambia claiming, inter alia accrued leave days, uniform and settling in allowances and also payment of their salaries, in arrears, for every month since their last day in the Respondent’s employment. They also sought a declaration that the Respondent’s failure to maintain them on its payroll pending final settlement of their terminal benefits was an infringement of their rights enshrined in the Constitution[8].

During proceedings in the High Court, the applicants applied that the matter be referred to the Constitutional Court for determination of the true meaning the following constitutional questions: 

1. “Whether, in light of the provision of Article 266, terminal benefits accrued in respect of person’s service fall within the ambit of the definition of a “pension benefit.”
2. “Whether, in light of the provisions of Article 189 (2) of the Constitution, a person who has not been paid his/her terminal benefits on that person’s last working day should be retained on the payroll, until payment of the terminal benefits based on the last salary received by that person while on the payroll.”
3. “Whether, in light of the provisions of Article 189 (2) of the Constitution, the failure or unwillingness to retain a person on the payroll having not paid the person his/her terminal benefits is an infringement on the rights of that person.”

The High Court granted the application, stayed the matter from further proceeding therein and duly referred it to the Constitutional Court.  The Applicants sought to have the Court apply the literal rule in interpreting Articles 189 and 266 of the Constitution by giving the words in the relevant articles their ordinary meaning and find that  terminal benefits of employees who had resigned but had not been paid at the time of leaving employment were covered and as such these employees were to  be kept on the payroll until such payments were made. They also vociferously argued that pension, gratuity and compensation referred to under Article 266 had similar characteristics in that they are accrued during the course of employment and become payable when employment is terminated by either resignation, retirement or effluxion of time. On the other hand, the Respondent argued that the literal rule of interpretation should be discarded in favour of the purposive rule, which primarily seeks to resolve the mischief which faced the legislature, as application of the literal rule to the articles in question would lead to absurdity. The thrust of the Respondent’s contention was that the intention of the legislature in enacting the two Articles was to cushion the hardships that were faced by pensioners due to delayed payment of their dues and not public officers who resigned from employment to seek other gainful employment.

The Constitutional Court held that:

1. What is anticipated with a pension is that it becomes effective on retirement, in some cases due to age or other circumstances and certainly not resignation. (emphasis given)
2. The accrued leave days, uniform and settling in allowances claimed by the Applicants did not qualify to be pension benefits that are covered by Articles 189 and 266 of the Constitution.
3. The term “similar allowance” used in Article 266 in defining what a terminal benefit is can only refer to allowances that are similar or akin to a pension benefit, gratuity or compensation and certainly not leave pay, uniform and settling in allowances. It is thus not every type of allowance or money that becomes due to an employee that can be a similar allowance to a pension, gratuity or compensation in terms of Article 266. (emphasis given)

The Court concluded that the type of terminal benefits claimed by the Applicants, namely, leave pay, settling in and uniform allowances, did not fall within the ambit of the definition of a pension benefit as defined in Article 266 and as such could not invoke the provisions of Article 189 to be maintained on the payroll.

2.1   The implications of the decision in Ngala

Although the Constitutional Court's decision as summarized above appears to be straight forward, opinion seems to be divided on its implications, with contrasting views as follows:

1. That Article 189(2) only applies to retirees or retrenchees

The first view is that the Constitutional Court's decision in Ngala only applies to retirees, retrenchees or those engaged in public service. This view seems to be founded on the Constitutional Court's recourse to the historical background to Article 189 of the Constitution. The Court remarked as follows:

"We can only repeat that the mischief which the Legislature intended to correct is clearly spelt out in the genesis, rationale and context of those Articles as stipulated in the Report of the Technical Committee on Drafting the Zambian Constitution. Of particular relevance is the draft Article 252 (1) which was proposed to guarantee the rights of public officers to a pension, gratuity or retrenchment benefits. We also refer to draft Article 256 (6) which was proposed to define what a “pension benefit” is. This is the precursor of the definition of a pension benefit in Article 266 of the Constitution. We find it prudent to quote the summary and the rationale of the proposed Articles 252 and 256 (6) which, respectively, state as follows:

“The Article provides for payment of pension, gratuity and retrenchment benefits to public officers.”

“The rationale for the Article is that, there is need to provide for pension of public officers in the Constitution as a right that can be enforced in a court of law. The Committee observes that such pensions are part of social security schemes whose fundamental objective is to protect individuals from the hardships which will otherwise result from unemployment, retirement or death of a wage earner.”

In view of this clear background to Article 189, we do not appreciate or comprehend how accrued leave days, uniform and settling in allowances can be stretched and interpreted or held to be a pension benefit or similar allowance as defined in Article 266 of the Constitution. We do not also see how those terminal benefits can fit in the rationale or background to the Articles in question. It follows that it would be folly to ignore the preparatory works that formed the background to the enactment of Articles 189 and 266 when clearly, the Legislature did not at all envisage the inclusion of accrued leave pay, settling in and uniform allowances when the Articles in issue were enacted while the mischief behind the enactment of Article 189 is plain and the intention is clear, namely, to cushion pensioners and retrenchees from the hardships they were experiencing as a result of delayed payment of their pension money or gratuity.

The Applicants are neither pensioners nor are they retrenchees who would be entitled to a gratuity which would have entitled them to remain on the employer’s payroll until these benefits are paid."

In the Court’s words, the Applicants in Ngala were neither pensioners nor retrenchees and thus were not entitled to remain on the employer’s payroll. This fuels the view that the provision under Article 189(2) of the Constitution can only apply to employees under “pensionable” service as it is with those in the public service or only those who are retrenched from their work. It would therefore seem that employees who are not in the public service, although under pensionable employment; whether retirees or retrenchees do not qualify for the protection offered by Article 189(2) leaving only public service pensioners and retrenchees as the only ones covered.

2. That Article 189(2) is not only restricted to  retirees or retrenchees

The second view holds that Article 189 of the Constitution does not only apply to public service retirees or retrenched employees, but to any employee who is not given their terminal benefits as captured in the definition of pension benefit.

This view finds support from the fact that whereas the First Draft Constitution provided:

“252. (6) In this Article, “pension benefits” includes any pension, compensation and gratuity or similar allowance for persons in respect of their service as public officers, members of the Defence Force and national security agencies or for the widows, children, dependants or personal representatives of those persons in respect of the service,"

The Constitution as amended, in Article 266 simply defines “pension benefit" as:

“...includes a pension, compensation, gratuity or similar allowance in respect of a person’s service."

Further, whereas Article 252 of the First Draft Constitution states:

“252. (1) The right of a public officer to a pension, gratuity or retrenchment benefit is hereby guaranteed,"

the Final draft Constitution, which was subsequently enacted provides as follows:

“224. (1) An employee, including a public officer and Constitutional office holder, has a right to a pension benefit."

It should be noted that the language used in drafting, has clearly changed from "public officer" as appears in the first draft of the Constitution, to "an employee, including a public officer" in the Constitution as amended. This indicates that the framers intended to include any kind of “employee” as opposed to limiting it to a “public officer”. A similar trend emerges when considering Article 253 (2) of the First Draft Constitution which provided:

 “253. (2) Pension in respect of service in the public service is exempt from tax.”

In light of Article 225 (2) of the Final Draft Constitution which reads:

“225. (2) A pension benefit shall be exempt from tax.”

Again, it is clear that "public service" is dropped and the framer is adopting a less restrictive approach. On the rationale behind the final wording that the above provision took, it is indicated in the Final Report of the Technical Committee on drafting the Constitution that:

"Further, the Committee amended clause (2) by providing that all workers be exempt from paying tax on their pension. The Committee observed that workers should not be discriminated against based on their employer. The Committee also observed that the principle should be that workers, who had been paying tax throughout their working life, should not be burdened with payment of taxes on their pension."

The following provisions were also included in the First Draft Constitution:

“254. (1) The payment of pension or retrenchment benefits shall be paid on an employee’s last working day, and any instalments of pension benefits shall be paid regularly, and be easily accessible to pensioners.

(2) Where pension or retrenchment benefits due are not paid on an employee’s last working day, the employee shall stop work but the retiree’s or retrenchee’s name shall be retained on the payroll until payment of the pension or retrenchment benefits.

(3) A retiree or retrenchee who does not receive the retiree’s pension or retrenchee’s benefits on the last working day shall be entitled to -

(a) any increment in salary given to public officers in the salary scale that the retiree or retrenchee was on at the date of retirement or retrenchment; and

(b) a pension or retrenchment benefit based on the last salary received by the retiree or retrenchee while on the payroll by virtue of this Article.”

In the Final Draft Constitution, the above provision takes the following marked departure:

“226. (1) A pension benefit shall be paid promptly and regularly.

(2) Where a pension benefit is not paid on a person’s last working day, that person shall stop work but the person’s name shall be retained on the payroll, until payment of the pension benefit based on the last salary received by that person while on the payroll.”

The language has clearly changed once again. The framer is no longer just concerned about "the retiree or retrenchee" but "a person". By that latter expression, the framers dug a pit wide enough to capture any employee.

While it is true that the rationale for the above cited Articles as they stood in the First Draft Constitution was that public servants suffered hardships due to delays in the payment of terminal benefits and needed to be cushioned from these by continuing to receive their salaries until the Government settled their terminal benefits, and that this payment shall not be deducted from the terminal benefits, the framers later extended the Articles to apply to any other employee who was entitled to a pension benefit as defined by the Constitution.

Given the different viewpoints that have arisen, does it then imply that Ngala is bad law? The authors are of the opinion that Ngala was correctly decided on its own peculiar facts and remains good law on such facts. This is so because the type of 'terminal benefits' (accrued leave days, uniform and settling in allowances) upon which the Applicants sought to be retained on the payroll, were adjudged not to be terminal benefits as defined by the Constitution or at all. Thus, the failure of the application, strictly speaking, was not because the Applicants were not in public service, retirees or retrenchees.

It can thus be argued that, employees on fixed term contracts whose employment is terminated but not paid severance pay at the time of separation would be required to be kept on the payroll until such payment is made. Equally, a redundant employee not paid a redundancy package would generally be covered by the provisions of Article 189 of the Constitution as well as the Employment Code Act[9] (Section 55 (3)(b)). This position finds support in the judgment of the Constitutional Court in the case of Mcqueen Zenzo Zaza v Zesco Limited[10] where it remarked as follows:

“Based on the facts of this case, it is apparent that the Petitioner has sufficiently shown that the compensation due to him upon the termination of his employment, which was termed as a redundancy package, qualified for consideration under the provisions of Article 189 of the Constitution. This payment was asking to compensation or similar allowance listed in the definition of pension benefit.

Premised on the foregoing, one would also argue that an employee medically discharged but not paid medical discharge would be covered by the provisions under Article 189 and be entitled to remain on the payroll until compensation for such discharge is fully paid. This is so because all the terminal benefits stated above are captured by the definition of pension benefits as defined by the Constitution; unlike accrued leave days, uniform and settling in allowances sought by the Applicants in Ngala.

The preceding paragraphs highlight the divided opinion with regards the interpretation of Articles 189 and 266 of the Constitution and their application to employees whose employment has been terminated in varying circumstances and whether the construction should be restricted to only retirees, retrenchees and public servants. Indeed, most recently, in the case of  Mayapi and Others v Attorney-General[11], delivered on May 20^th 2020, the Constitutional Court further guided on the subject as follows:

"We wish to quickly state that although the rationale makes specific reference to public servants, Article 189 is of general application to all employees in both the public and private sectors."

The foregoing notwithstanding, opinion in the legal and labour relations circles is divided, as it remains unclear as to whether or not terminal benefits, other than those arising from retirement or retrenchment such as gratuity at termination of a long term contract or medical discharge are protected by Article 189 of the Constitution. Although "gratuity" is expressly included in the definition of pension benefit under Article 266 of the Constitution, the High Court has recently ruled that gratuity payable at the end of a long term contract is not protected by Article 189 if such contract terminates by resignation. This is in the case of Frank Kapeluka Lungu v University of Zambia[12] delivered on 14^th May 2020, the Court quoted from Ngala as follows:

"While a pension benefit can loosely be considered to be a terminal benefit, it is not every terminal benefit that has the qualities and characteristics of a pension benefit. Firstly, because ordinarily and strictly speaking, Pension benefits relate to those who reach retirement age or are retired early for some reason while resignation is a termination that occurs before retirement age. Therefore, our firm view is that it would be wrong to say that all terminal benefits simply because they arise from the termination or the coming to an end of the employment contract, should be considered or interpreted to be the same as a pension benefit."

The High Court then proceeded to hold that:

"From the above cited case, it is apparent that gratuity in the context of this matter does not amount to a pension benefit. The simple reason is that the Complainant has not retired by virtue of reaching the prescribed age of retirement or opted for early retirement. His is termination by way of resignation."

 It would appear that, the High Court’s foregoing decision suggests that a "gratuity" although expressly included in the definition of pension benefit under Article 266 of the Constitution, only qualifies for consideration under Article 189 if the termination coincides with retirement and cannot be considered if an employee resigns. The decision of the High Court in this matter presents difficulties in reconciling this interpretation with the principles set out in Ngala. This is so because, in the manner the High Court construed the article on gratuity, it can be said to have departed from the literal rule of construction without demonstrating any ambiguity or absurdity arising from maintaining the said literal rule of interpretation which is that a gratuity is expressly included in the definition of a “pension benefit” under Article 266 of the Constitution and consequently should be covered under Article 189 regardless of whether or not retirement age was attained or early retirement invoked.

This is further compounded by the fact that "gratuity" is by law payable to employees on long-term contracts while "pension" is payable to employees in permanent employment who have attained retirement age or invoked early retirement. It would be correct to posit that, it is only actual pension payments which should be restricted to retirement age or early retirement since the definition of “pension benefit” includes pension and not to extend the restriction already covered in "pension" to a "gratuity" as well. It would appear the Court’s decision was heavily influenced by the circumstances surrounding the termination of employment rather than the nature of the payment due to the employee, that is, at whose instance such a termination occurred. In this case, the reasoning of the High Court tends to suggest that a person who resigns is not entitled to the protection afforded by Article 189 in as far as being maintained on the payroll while awaiting payment of their gratuity. Thus although the High Court cited Ngala which considered a gratuity at the termination of employment as a pension benefit, it proceeded to reach a different conclusion, which is per incuriam Ngala.  

Although it is not every benefit, simply because it  arises from the termination or the coming to an end of the employment contract, which should be construed or interpreted to be the same as a pension benefit, it would leads to an absurdity to disqualify a gratuity from the protection afforded by Article 189 as it is expressly included under the definition of a pension benefit in Article 266. It can be argued that such as gratuity or indeed any such terminal benefit which is clearly accorded to a terminated employee to cushion them from the hardship that results from loss of employment unless by the time of termination they have since secured new employment. Arguably, the High Court’s decision has prospectively raised a question for further debate and a thread whose interpretation remains uncertain in various fora across sectors.

3.0  Konkola Copper Mines Plc v Nyambe Martin Nyambe and Others- Court of Appeal

Konkola Copper Mines v Nyambe and Others[13] was an appeal against a decision of the High Court delivered on 13^th October, 2017, in which it was found that a group of employees who had been employed before the amendment of the National Pension Scheme Act[14] in 2016, were prematurely retired at fifty-five years and that their retirement was unlawful, null and void for being contrary to the existing law which had placed normal retirement age at sixty years. In that regard, the Court deemed them as having been retired at the age of sixty years and ordered the payment of retirement benefits they would have received at the age of sixty years. They were also awarded damages for breach of retirement laws equivalent to six months’ salary including all allowances and perquisites, with interest and costs.

In the case before the Court of Appeal, the former employer (Appellant), raised five grounds of appeal being dissatisfied with the High Court’s decision. The gravamen of the Appeal was that the court had erred in law and in fact by holding that the appellant had prematurely retired the Respondents at the age of fifty-five years. The pith of the Appellant’s case was that the amendment to the National Pension Scheme Act in 2015 which changed the retirement age from fifty-five could not be applied retrospectively to cover the Respondents who had entered into contracts of employment years before the said change to the law. As a result, the Appellant argued, that the court had misdirected itself by awarding pension benefits for a period that the Respondents had not worked as that amounted to unjust enrichment.

In agreement with the Appellant, the Court of Appeal held as follows:

1. The High Court misdirected itself in finding that the respondents were retired prematurely at the age of fifty-five years because this is what the parties agreed upon at the time they were employed. The parties were bound by the terms and conditions that they set for themselves.
2. It could not have been the intention of the framers of the law to invalidate agreements that were perfectly legal at the time they were executed. The respondents’ contracts of employment, which provided that they would retire at fifty-five years are binding and cannot be varied on the basis of the amendment to the National Pension Scheme Act of 2015. A law that comes into effect after parties have contracted cannot apply to relations that were consummated previously. The respondents could not rely on the retirement age in the amended National Pension Scheme Act as it did not apply to them. The respondents accrued rights based on the conditions of their contracts of employment which they could not alter subsequently.
3. The Court below failed to appreciate that the retirement age of fifty-five years became an entrenched condition of the contract of service which cannot be altered by the recent amendments to the law. The said amendments only affect those who never made irrevocable options to retire at the age of fifty-five years before the amendment and those who joined the appellant after the amendments.
4.  The trial Court fell into error when it deemed the respondents to have been retired at the age of sixty years and that they be paid pension benefits they would have received had they worked up to the age of sixty years. The respondents were awarded pension benefits for periods that they did not work for and this amounted to unjust enrichment.
5. The respondents did not establish that their respective contracts of employment were breached by the appellant and were therefore not entitled to an award of damages.

3.1   Implications of Konkola Copper Mines Plc v Nyambe Martin Nyambe and Others

The authors hold the view that the Court of Appeal could have possibly resolved this case by pronouncing itself on whether or not the 2015 Amendments to the National Pension Scheme Act could apply retrospectively to anything duly done before their enactment.

It can be on one end argued that the Court answered that question correctly by applying a long standing principle on retrospective effects of legislation by holding that a law that comes into effect after parties have contracted cannot apply to relations that were consummated previously. It is also quite interesting, that the Court of Appeal then went on to hold that;  

"The said amendments only affect those who never made irrevocable options to retire at the age of fifty-five years before the amendment and those who joined the appellant after the amendments."

It is the first half of that obiter dictum that has been the cause of the controversy as it suggests that the 2015 retirement age amendments have retrospective effect to those, who in their contracts, did not include an express provision on the age of retirement. This position creates challenges of its own on two limbs as follows:

1. Even if a pre- July 2015 contract did not contain a clause specifying the retirement age, the same was implied by the law as it stood at that time. Thus, it follows that, before the amendments to the National Pension Scheme Act in 2015, it was not only those who had express provisions on the retirement age in their contracts who could retire at the age of fifty-five. Even those whose contracts did not contain an express retirement age were bound to retire at that age for the simple reason that it was the law at the material time. Therefore, it can be argued that, the 2015 Amendments to the NAPSA Act touching on the retirement age could not apply retrospectively not only to those who had express provisions in their contracts, but equally, even to those who had agreed to the retirement age by implication of the law on the retirement age as it existed at the time of contracting. Simply put, it is the prevailing law which prescribes the retirement age and not really the contract of employment.

2. The effect of a later law on anything duly done before its enactment is as follows;

Section 14 (3) (b) of the Interpretation and General Provisions Act, Chapter 2 of the Laws of Zambia is very instructive on this point. It provides as follows:

"14. (3) Where a written law repeals in whole or in part any other written law, the repeal shall not-

(b) affect the previous operation of any written law so repealed or anything duly done or suffered under any written law so repealed."

The general presumption against retrospective legislation holds true here. There is nothing in any of the 2015 Amendments to the NAPSA Act touching on retirement age to the effect that they can be applied retrospectively. In light of the foregoing, it follows then, that the 2015 Amendments on the retirement age cannot affect the implied terms as to retirement age so implied by the law in pre-July 2015 contracts and that the application of the 2015 Amendments on the retirement age is only forward-looking and has no retrospective effect whatsoever even for those who did not have express retirement age provisions in their employment contracts pre- July 2015.

Interestingly, the said obiter was actually directly lifted from an almost identical obiter in the Supreme Court decision in Jacob Nyoni v Attorney-General[15] in which the Court stated that:

"The new retiring age affects those who never made irrevocable option to retire at the age of 60 years and those who joined the service after the amendment."

While the Court’s position has been stated, there is, in practice, a general lack of clarity on what is the material date to pick between the date of the contract and the date of termination of employment in as far as application of the law is concerned. Opinion is divided on whether the law to apply is as it existed at the time of contracting or as it exists at the time of termination of employment. Based on the pronouncements of the Courts, it would appear that for retirement age, the same is ordinarily governed by the law and the law to apply is that which is in force at the time of retirement (termination). If however, the parties had agreed on a retirement age, the law in force at the time of such agreement will apply unless the later law at the time of termination (retirement) expressly does away with what the parties agreed on at the time of the contract.

An analogy may be drawn from the issue of termination of employment by the employer being required to be done on the basis of giving a lawful reason. That law did not exist prior to 2015. Thus one would assume that all pre-2015 employment contracts could be terminated without a reason even if terminated post-2015 as that is what the parties had agreed. There is authority however that the law at the time of termination applies and not the law that existed at the date of the contract. This was the case in Spectra Oil Zambia Limited v Oliver Chinyama (2018), where the respondent was employed in 2012. His employment was terminated in 2016 without a reason. The 2015 Amendment on giving a reason to terminate was applied by the Court of Appeal notwithstanding that at the time he was employed in 2012, the law allowed employers to terminate contracts of employment without giving any reason. In the Spectra Oil case, it is clear that the Court applied the law which was in force on the date of termination as compared to applying the law which was in effect at the time of contracting as was the case in the Konkola Copper Mines case.

Furthermore, in Mwenya v CFB Medical Centre Limited (2017) the Supreme Court observed that:

"However, as the said amendment only came into force on 3rd December, 2015, the issue does not fall for consideration in this appeal, since the amendment cannot retrospectively apply to the appellant, whose contract of employment was terminated two years earlier, on 31st May, 2013."

It would seem that the Supreme Court was prepared to invoke the 2015 Amendment on terminating with a reason to a contract which had been entered into prior to the legislative changes had the termination occurred after the amendment.

The approach by the courts on retirement age and the analogy on terminating employment contracts with a reason may at first sight seem irreconcilable, but they can actually be reconciled. It would appear that the Courts have taken a view that the law on retirement age upholds any agreement between the parties which was lawful at the time of contracting but contrary to the law at the time of retirement, whereas on the other hand the law on the requirement to give a reason when terminating a contract does not recognise any contrary agreement  between the parties which was lawful at the time of contracting. Thus, the latter maybe seen to be truly retrospective while the former has no retrospective effect per se but simply automatically applies in default of a contrary agreement.

It should be noted that the Court of Appeal’s decision is pending further appeal to the Supreme Court.

4.0   Conclusion

The State exists in order to advance and protect the interests and rights of its citizens and at the same time assign duties and obligations. It follows then, that if every member of the State knew perfectly well what their rights and duties are and the rights of everyone else, there would be no need for judicial organs within the State. However, reality suggests that such universal knowledge does not exist and as such the State needs judicial organs to determine what the rights and duties of the State and that of its citizens are. In carrying out their duties, the Courts settle what facts exist, and also lay down rules according to which they deduce legal consequences from established facts. These rules are the law.

The preceding article examined the pronouncements of the Zambian Courts in labour related disputes following amendments in the legislative framework with regards to retirement age and computation of terminal benefits. The law, as stated by the Courts is that the 2015 amendments to the NAPSA Act concerning the retirement age of employees do not have retrospective effect, that is to say, the said amendments do not affect the implied term as to retirement age so implied by the law in pre-2015 contracts. In essence, the application of the 2015 amendments on retirement age is only forward-looking and has no retrospective effect whatsoever. It would however appear that the latest retirement law automatically applies in default of a contrary agreement between the parties.

With regards terminal benefits and the Constitutional requirement to maintain employees on the payroll until pension benefits are paid, the debate rages on as the law still remains unclear on the subject. Until such a time the Courts pronounce with clarity what the law is, opinion will continue to be divided.