UNION OF IND. COM. AND FINANCE VS AVIATION HANDLING SER (H1/37/22) [2023] GHACA 140 (26 July 2023)

IN THE SUPERIOR COURT OF JUDICATURE IN THE COURT OF APPEAL ACCRA, A.D. 2023 Suit No: H1/37/2022 Date: 26th July, 2023 CORAM: CECILIA SOWAH J.A. (PRESIDING) EMMANUEL ANKAMAH J.A. GIFTY AGYEI ADDO J.A. IN THE MATTER OF THE LABOUR ACT, 2003 (ACT 651) BETWEEN: UNION OF INDUSTRY, COMMERCE AND FINANCE COMPLAINANT (BERNARD INKOOM & BENJAMIN YAMOAH) /APPELLANT AVIATION HANDLING SERVICE (GHANA) LTD RESPONDENT /RESPONDENT JUDGMENT EMMANUEL ANKAMAH J.A. 1 INTRODUCTION This is an appeal against the ruling of the National Labour Commission dated 29th January 2020. For ease of reference, in this opinion, the Complainants/Appellants shall be referred to collectively as “the Appellants” and the Respondent/Respondent simply as “the Respondent”. BACKGROUND The Appellants were previously in the employment of the Respondent as security personnel. The Respondent is a company that provides aviation support services in Ghana. The 1st Appellant was employed on 1st August 2006. From the Record of Appeal, it is not provided when the 2nd Appellant was employed by the Respondent but according to its mother union UNICOF he was a senior officer just like the 1st Appellant. During the course of their employment, a complaint of verbal abuse was lodged against the Appellants by a colleague staff of the Respondent. A Disciplinary Committee was set up by the Respondent to investigate the complaint. At the hearing of the Disciplinary Committee, the Appellants objected to the presence of all witnesses at the hearing when the Complainant testified and before those witnesses testified. Nonetheless, the Disciplinary Committee overruled these objections. The Disciplinary Committee concluded its mandate and submitted its report to the Management of the Respondent. Management relied on the report and terminated the Appellants’ employment on 20th September 2013. The Appellants petitioned the Labour Commission on grounds of unfair termination due to the procedural flaw in the Disciplinary Committee’s hearings and prayed for an order 2 of reinstatement. The Labour Commission evaluated the case of the Appellants and the Respondents and made the following findings: 1. The Disciplinary Committee’s proceedings were flawed and not conducted in a fair manner because: a. The decision by the Disciplinary Committee to overrule the objection raised by the Appellants concerning the presence of the complainant’s witnesses was erroneous. b. The Appellants were summoned to answer a case of verbal abuse lodged by the complainant (the staff of the Respondent) however, the Appellants were found liable for different offences which were not levelled against them. c. The Respondent through its Managing Director on 16th May, 2013 wrote to Appellants and undertook to afford them an opportunity to be heard and state their case. This was not done by the Managing Director without any reason. 2. The procedure for termination was in breach of the rules of natural justice and was also in breach of the provisions of section 63(4) of the Labour Act, 2003 (Act 651). The Labour Commission, however, did not grant the relief prayed for by the Appellants and ruled: in accordance with its powers under section 64 (2)(c) of Act 651 orders the Respondent to pay seven (7) months’ basic salary to the Appellants as compensation to each of the Complainants [the Appellants] for unfair termination of their employment. 3 Aggrieved by the ruling of the Labour Commission (“the Commission”), the Appellants pursuant to Section 134 of the Lobour Act,2003 (Act 651) has appealed the ruling to the Court of Appeal on two grounds: a. The quantum of compensation ordered by the Commission is on the low side and unfair b. The Commission erred when it failed to order interest on the compensation ordered by the Commission The Appellants indicated in the Notice of Appeal that further grounds of appeal will be filed upon receipt of the Record of Appeal but none was done. It is obvious from the grounds of appeal that the Appellant does not dispute the decision by the Commission not to reinstate them. Indeed, their protests are against the quantum of compensation awarded in their favour and the lack of interest on the compensation. Therefore, this appeal raises two issues and they are: 1. Whether or not the compensation awarded by the Commission is low and unfair? 2. Whether the Appellants are entitled to be awarded interest on the compensation? The first issue shall be considered first followed by the second issue. Issue 1: Whether or not the compensation awarded by the Commission is low and unfair? It is provided under Section 63 (4) of Act 651 that: 63. Unfair termination of employment (4) A termination may be unfair if the employer fails to prove that, (a)the reason for the termination is fair; or(b)the termination was made in accordance with a fair procedure or this Act. 4 Thus, where the Commission upon a complaint or petition of unfair termination of employment filed by an aggrieved employee establishes for a fact that the termination was unfair, the law provides remedies that may be ordered by the Commission on a case- by-case basis. Accordingly, Section 64 of Act 651 provides: 64. Remedies for unfair termination (1) A worker who claims that the employment of the worker has been unfairly terminated by the worker’s employer may present a complaint to the Commission. (2) If upon investigation of the complaint the Commission finds that the termination of the employment is unfair, it may (a) order the employer to re-instate the worker from the date of the termination of employment; (b) order the employer to re-employ the worker, either in the work for which the worker was employed before the termination or in other reasonably suitable work on the same terms and conditions enjoyed by the worker before the termination; or (c) order the employer to pay compensation to the worker. The above provisions vest the Commission with the power to order the employer to either re-instate the worker, re-employ the worker where possible or compensate the worker. In the present case, the Commission found as fact that the Appellants' employment was unfairly terminated and exercised its powers under Section 64 (c) of Act 651 to award the Appellants compensation of seven (7) months of their basic salary without more. The principle of law applied by the Courts in Ghana on the award of compensation arising out of unfair termination is that the award must be made for payment based on a reasonable period after which the aggrieved former employee should have secured 5 employment and mitigate his loss but not for the entire duration of employment. It follows that if a person remains unemployed for a long period and the unemployment was occasioned by unfair termination any award of compensation due the affected employee must be assessed having regard to the likelihood of duration within which the person may secure another employment provided there are no such provisions dealing with compensation in an employment contract or statutory enactment. In the case of Ashun v Accra Brewery Ltd [2009] SCGRLR 81, the Supreme Court speaking through the venerable Date-Bah JSC (as he was then) on the Ghanaian common law position on the award of compensation for unfair termination cited with approval the decision of the Apex Court in Nartey Tokoli and Ors v Volta Aluminium Co. Ltd (No. 2) [1989-1990] 2GLR 341 and held: “A contract of employment is clearly terminable. Even if it is terminated wrongfully, that does not give the aggrieved party the right to be paid salary till his retirement age. The Supreme Court held in Nartey-Tokoli v. Volta Aluminium Company [1987-88] 2 GLR 532 that where an employer terminates an employee’s appointment in breach of a contract of employment, the employer is liable to pay damages to the employee and that the damages are not limited to salary in lieu of notice. Thus, for instance, in Hemans v. GNTC [1978] GLR 4 where an employee’s contract was wrongfully terminated, the Court of Appeal awarded him four months’ salary in damages, though the notice period under the contract was only one month. Nevertheless, the duty of mitigation of damages devolves on an employee. Accordingly, he or she has the duty to take steps to find alternative employment. In principle then, in the absence of any contrary statutory or contractual provision, the measure of damages in general damages for wrongful termination of employment in the common law of Ghana is compensation, based on the employee’s current salary and other conditions of service, 6 for a reasonable period within which the aggrieved party is expected to find alternative employment. Put in other words, the measure of damages is the quantum of what the aggrieved party would have earned from his employment during such reasonable period, determined by the court, after which he or she should have found alternative employment. This quantum is, of course, subject to the duty of mitigation of damages. These principles outlined above, however, hold true in relation to only contracts not affected by public law provisions.” In this present appeal, the Appellants are urging this Court to review the award of compensation as ordered by the Commission and to increase it from seven (7) months of their gross salary to three (3) years or 36 months of their gross salary. Interestingly, the Appellants did not disclose any mitigation they had undertaken relative to their securing new employment. One of the Appellants claimed that he helps his wife to run a small convenience shop see page 62 of the ROA. The Appellants were security personnel and this Court is of the opinion that seven (7) months is a reasonable period within which the Appellants could have secured a new employment if they were minded to do so. To hold otherwise and order the Respondent to pay the Appellants 36 months of their gross salary will be to “set our face against realities” as stated in the Nartey-Tokoli case supra. Accordingly, having considered the submissions of the parties and the decision of the Commission, this Court holds that the compensation awarded by the Commission was not low but fair and consistent with the peculiar facts of this case. We now consider the next issue which touches on whether the Appellants are entitled to be awarded interest on the compensation. The Appellants submitted that because the National Labour Commission has the characteristics of a court of competent jurisdiction, the Commission is vested with the power to order interest to be paid on compensation it awards. The Appellant relied on 7 James David Brown v National Labour Commission and anor [2020] 153 GMJ 125 SC and National Labour Commission v First Atlantic Bank [2020] 170 GMJ 676 SC. Counsel then proceeded to urge this Court to give consideration to the following cases as they touch on the computation of interest on judgment debt. The cases are Royal Dutch Airlines v Farmfex [1989-1990] 2 GLR 623 and Butt v Chapel Hill Properties 2003-2004 1 SCGLR 626. The Appellant’s case is simply that the facts of this case merit the award of interest on the compensation awarded by the Commission. The Respondent disputed the cases of the Appellants and posited that the facts of this case do not merit the award of interest. Counsel for the Respondent relying on the case of Ghana Commercial Bank v Odom [1975] 2 GLR 54 submitted that interest was recoverable as a debt in cases where either it was payable under a contract whether express or implied from the usage of trade; or where statute had fixed a rate at which it was payable. The Respondent contended that interest was imperative where a party had kept money belonging to a party and deprived that party of use for a period of time. This case was not one which fell into any of the established principles. It is the opinion of this Court having considered the submissions of the parties that the Appellants are not entitled to interest on the compensation awarded them by the Commission. The Appellants did not prove that they were entitled to interests as a result of their employment contract with the Respondent. They are rather claiming interest on the compensation awarded by the Commission which is without any legal basis. The Appellants did not demonstrate any instance where they were entitled to receive benefits from the contracts but were withheld without cause by the Respondents. In such a scenario, the Courts have held that interest ought to be awarded on the benefits which are due to the affected party because the innocent party had been deprived of his money 8 by the other party who had kept the money for his own use, see the case of IBM World Trade Corp v Hasnem Enterprise Ltd [2000-2001] SCGLR 393. In this appeal, the compensation of seven months salaries each awarded the appellants were not benefits accrued to them as of the time their employments were unlawfully terminated that therefore same should attract interest. In conclusion, we find no merit in the appeal and the decision of the Labour Commission dated 29th January, 2020 is hereby affirmed. Accordingly, the appeal is hereby dismissed. EMMANUEL ANKAMAH J.A. (Justice of the Court of Appeal) [SGD.] I agree CECILIA SOWAH J.A. (Justice of the Court of Appeal) [SGD.] I also agree GIFTY AGYEI ADDO J.A. (Justice of the Court of Appeal) 9 Counsel: Daad Akwesi with Shirley Otoo for Respondent/Respondent Charles Bawadua for Complainant/Appellant 10