CRDB Bank PLC vs Lenifrida Magawa (Civil Appeal No. 316 of 2023) [2025] TZCA 1193 (14 November 2025)

IN THE COURT OF APPEAL OF TANZANIA AT PAR ES SALAAM ( CORAM: MKUYE. J.A.. MAIGE, J.A. And KHAMIS. J.A.^ CIVIL APPEAL NO. 316 OF 2023T CRDB BANK PLC .................................................................... APPELLANT VERSUS LENIFRIDA MAGAWA .................................................... RESPONDENT (Appeal from the judgment and decree of the High Court of Tanzania Labour Division at Dar es Salaam) (Maqimbi. J.^ dated the 16th day of November, 2022 in Revision No. 205 of 2022 JUDGMENT OF THE COURT 10th& 14th November, 2025 MAIGE, J.A.: While in the services of the appellant as a senior bank officer, the respondent was accused of forgery, stealing by servant, occasioning loss to a specified authority and money laundering. She was, as a result, charged with the aforesaid offences and prosecuted at the Resident Magistrate Court of Dar Es Salaam at Kisutu in Economic Case No. 126 of 2019. Before the trial commenced, however, the respondent executed a plea bargaining agreement (exhibit D4) wherein she admitted an offence of stealing by servant and undertook to repay to the appellant the stolen amount of USD 3,518.52. Based on the said plea, the respondent was l convicted and sentenced to pay a fine of TZS 400,000.00 and in default, serve ten years' imprisonment. Subsequent to the conviction and sentence as aforestated, the respondent underwent a disciplinary action for gross misconduct whereupon she was convicted based solely on her conviction in exhibit D4. Her employment was, as a result, terminated. Aggrieved, the respondent preferred a referral to the Commission for Mediation and Arbitration (the CMA) complaining that her termination was unfair both in substance and procedure. The CMA found that the respondent's conviction as per exhibit D4 was a conclusive evidence of her guilty of the alleged gross misconduct and, therefore, constituted a fair reason for termination. Concerning fairness of the procedure, the CMA held, based on the principle in Mwita Magani and Another v. Mganga Mkuu Hospitali Teule Biharamulo, Labour Revision No. 9 of 2013 (unreported) that, the requirement for disciplinary hearing under rule 13 of the Employment and Labour Relation Act (Code of Good Practice) Rules, GN. No. 42 of 2007 ( GN 42 of 2007) was not necessary where the employer was convicted with an offence related to misconduct. In the alternative, the CMA opined that the respective requirement was complied with. It, therefore, dismissed the complaint. 2 Unhappy with the CMA award, the respondent applied for revision to the High Court, Labour Division (the High Court). The High Court found that the issue of fairness of the reason for termination was correctly dealt with by the CMA. It did not, however, agree with the CMA's position that under the circumstances of this case, compliance with the procedure under rule 13 of the G.N. No. 42 of 2007 was not a condition precedent for determination of the validity of termination of the respondent's employment. The basis of the decision in our careful reading, was the respondent's claim that she executed the plea bargaining agreement leading to her conviction because the offence she was charged with was not bailable. In particular, the High Court expressed as per page 330 of the record, as follows: "Further to the above, in this case, much as the applicant entered a plea-bargaining agreement, since she admitted to have done so to save herself from remand custody, the respondent was still obliged to conduct investigation in order to show how the applicant's conduct caused him loss as an employer. Since the employer alleged that the employee caused him loss, an investigation report, as the matter o f procedure, should have been availed to the employee to show how the alleged offence she entered into plea bargaining agreement caused loss to the employer. 3 Having said that, and, upon examining the evidence, the High Court concluded that the procedure under rule 13 of the G.N. 42 of 2007 was not adhered to in that; there was no evidence of the respondent being afforded adequate time to prepare her defence. Neither was there any evidence that she had been served with any investigation report. The High Court, therefore, reversed the award of the CMA to the extent of its determination of the issue of procedural fairness and substituted it with an order that the respondent's termination was procedurally unfair. It, as a result, awarded her 12 months salaries as compensation for unfair dismissal. Once again aggrieved, the appellant has preferred the current appeal on the following grounds: 1. The Labour Court Judge erred in law by saying that the appellant was required to conduct investigation and provide the same to the respondent contrary to rule 13(1) o f the Employment and Labour Relations (Code o f Good Practice) Rules G.N. 42 o f2007. 2. The Labour Court Judge erred in law by raising issues which were not in dispute at the disciplinary hearing, CMA and High Court and proceeded to determine the same without affording parties right to be heard. 3. The Labour Court Judge erred in law by saying that the purpose o f the respondent to plead guilty in criminal charges levelled against her was for the purpose o f saving her from remand prison contrary to rule 13(11) o f the Employment and 4 Labour Relations (Code o f Code o f Practice) Rules, G.N. No. 42 o f2007, Section 27 o f the Penal Code and section 228(1), (2) and 229 o f the CPA Cap. 20 RE. 2022. 4. The Labour Court Judge erred in law by failing to determine proper relief contrary to rule 32(5) (b) o f the Labour Institution (Mediation and Arbitration Guidelines) G.N. No. 67 o f2007. At the hearing of the appeal, the appellant was represented by Mr. Innocent Felix Mushi, learned advocate, whereas the respondent was represented by Mr. Laurent Ntanga, also learned advocate. Each of the counsel had, in addressing the issues raised in the appeal, fully relied on his written submissions. We have, in composing this judgment, duly considered the contending views arising from these submissions. We shall start our deliberation with the second ground of appeal wherein the High Court was criticized by raising the issue of the connection between the criminal conviction and the misconduct leading to the termination of the respondent's employment. Mr. Mushi submitted that, as the claim was neither raised during disciplinary hearing nor during arbitration, it was wrong for the High Court to raise and determine it at its own motion without affording the appellant a right to be heard. Mr. Ntanga refuted the contention and submitted further or in the alternative that, it being a point of law, it could be raised at any time. 5 In testing the correctness or otherwise of the contention, we examined the record and satisfied ourselves that, the opinion under discussion was essentially based on the claim by the respondent right from the disciplinary proceeding that, she signed the plea-bargaining agreement and ultimately entered a plea of guilty with a view to protecting her liberty as the offence she was charged with was non-bailable. It was on that basis that, the High Court found that investigation into the allegation and conducting a formal disciplinary hearing was necessary. In that context, therefore, the High Court cannot be blamed to have raised the issue at the level of revision as the said complaint was the basis of the respondent's defense right from the outset. Without much ado, therefore, we find the complaint in the second ground of appeal baseless and, it is hereby dismissed. We now turn to the first ground of appeal which raises an issue of whether it was a legal requirement for the appellant to conduct investigation and disciplinary hearing to connect the respondent with the alleged misconduct. Mr. Mushi submits that it was not because, it is against the principle of law enunciated in Mwita Magani and Another v. Mganga Mkuu Hospital Teule Biharamlo (supra) that, such a requirement does not arise where the employee has been convicted of the offence constituting the relevant misconduct. It was further submitted 6 that as the offence the respondent was convicted of is connected and related to the employer's business, the appellant was right as per rule 13 of the G.N. No. 42 of 2007, to dismiss the respondent without there being conducted a formal disciplinary hearing. In the alternative, he submitted, the appellant acted more than fair by initiating disciplinary proceedings and following all the procedure as if the rule and the authority just referred were not in existence. Parties, it would seem, are not in dispute that gross misconduct does by itself suffice as a fair reason for termination of service. Equally not in dispute is the fact that stealing by servant, the offence which the respondent was convicted of as per exhibit D4, constitutes a gross misconduct. The dispute here is whether compliance of fair procedure and more so, conducting a disciplinary hearing as per rule 13 of the G.N. 42 of 2007, was necessary. This is a pure point of law. To address the issue, our starting point must be section 37(2) of the Employment and Labour Relations Act which sets out the essential elements of a valid termination of services. It is plain under the said provisions that for a termination of service to be valid, it must be premised on fair reasons and arrived at in compliance with fair procedure. Be it noted, in terms of subsection (5) of section 37, an employor cannot initiate displinary action in form of penalty, termination or dismissal against an 7 employee who has been charged with a criminal offence which is substantially the same, unless the criminal proceedings are finally determined. It is also the law as per section 43A of the Evidence Act that the relevance of a criminal judgment in civil proceedings is only to the extent of guilty or inncocence of the accused. That being the case and indeed it is, the High Court judge was, therefore, quite right in holding that the respondent's conviction was relevant to the extent of establishing fairness of the reason for termination and not fairness of the procedure. We understand, however that, in accordance with rule 9(1) of the GN. 42 of 2007, the extent to which the fair procedure under rule 13 has to be observed, may be determined by the reasons of termination at issue. To that extent, we may agree with the position in Mwita Magani and Another v. Mganga Mkuu Hospital Teule Biharamlo (supra) that, where the employee has been convicted with a criminal offence, investigation to establish if the employee committed the offence may not always be necessary. We shall however, not agree with the said decision that disciplinary hearing with its essential components of the employee's right to have adequate notice of hearing and sufficient time for preparation of his or her defence, will not be necessary. The reason being that, according to the law, the employer has a duty to prove both the two aspects of fairness for the termination to be upheld by the arbitrator or the High Court. That being a mandatory legal requirement and, in the absence of any express provisions in the employment laws dispensing with such a requirement, it cannot be correct to say that the employer can prove fairness of termination without adhering to the mandatory fair procedure. We may add that in the case like the current one where the employee alleged, right from the beginning that, she was induced to execute the plea-bargaining agreement because of the charged offence being non-bailable, it was incumbent upon the employer to conduct a reasonable investigation to ascertain the correctness or otherwise of the assertion. In that vein, it has to be noted that, just as an acquittal in criminal proceedings does not automatically render an employee immune from facing displinary prosecution, conviction thereof cannot discharge the employer's obligation to adhere to rules of procedural fairness. It, is, therefore, not the law to say that simply because an employee is convicted of a criminal offence, he or she can be dismissed summarily without the employer conducting a disciplinary hearing in accordance with the procedure set out in rule 13 of the G.N. No. 42 of 2007. The foregoing discussions suffice to dispose of the first ground of appeal. Equally so, for the complaint in the third ground of appeal to the 9 extent that the criminal conviction was capable of entirely establishing fairness of termination. However, the relevance of the conviction to establish existence of fair reasons, is not an issue before us because the High Court Judge has confirmed such proposition, correctly in our view. Her discussion on the respondent's claim that she signed the plea bargaining agreement for the purpose of saving her from remand custody, had a relevance, as we said herein, in determining whether carrying out an independent reasonable investigation was necessary. That said, the first and third grounds of appeal are hereby dismissed. We now wind up with the complaint in the last ground as to the alleged failure of the High Court to determine proper relief contrary to rule 32(5)(b) of G.N.67 of 2007. Mr. Mushi's submission in that respect was that, as the respondent termination was invalid just to the extent of fairness of the procedure, she should have been awarded an amount which is lesser than twelve months salaries. He did not, however, cite any specific authority to support his claim. Rule 35 (5) (b) of the Labour Institution (Mediation and Arbitration Guidelines) G.N. No. 67 of 2007 on which the complaint is based, provides as follows: "Subject to sub-rule (2), an Arbitrator may make an award o f appropriate compensation based on extent to which the termination was unfair." 10 The above provision, in our reading, is absolutely mute as to what should be the appropriate quantum of compensation. The extent to which termination was unfair, is mentioned as one of the factors to be considered in determining appropriateness of compensation. The labour regime, however, is not silent on the quantum of compensation. In that regard, section 40(1) (c) of the Employment and Labour Relations Act on which the High Court based in determining the quantum of compensation is relevant. It provides in effect that; where an arbitrator or Labour Court finds termination unfair, the arbitrator or the Labour Court may order the employer "to pay compensation to the employee not less than twelve months remuneration". The expression "not less than twelve months remuneration" entails, in our view that, twelve months remuneration is the minimum amount where termination is proved to be unfair. It does not matter if the fairness was merely procedural. The requirement for specific justification in which the extent of unfairness may be relevant, arises where the arbitrator or Labour Court awards an amount of compensation above the minimum. It does not apply in the case like this where the Labour Court awarded the minimum. Therefore, in Veneranda Maro and Another v. Arusha International Conference, Civil Appeal No. 322 of 2020, we stated: li "Currently, athough the law prescribes the minimum amount which is not less than twelve months' salary, it is settled law that the arbitrator or Labour Court has discretion to decide on appropriate award compensation which could be over and above the minimum. However, the discretion must be exercised judiciously taking into account all factors and circumstances..." In conclusion, therefore, the appeal is devoid of any merit and it is hereby dismissed. DATED at DAR ES SALAAM this 13thday of November, 2025. R. K. MKUYE JUSTICE OF APPEAL I. J. MAIGE JUSTICE OF APPEAL A. S. KHAMIS JUSTICE OF APPEAL ment delivered this 14th day of November, 2025 in the r. Godfrey Ngassa, learned counsel for the Appellant and aBsence for the Respondent, Mr. Ladislaus Msuba, Court Clerk; is hereby certified as a true copy of the original. A. S. CH JGULU DEPUTY REGISTRAR COURT OF APPEAL 12