IN THE HIGH COURT OF TANZANIA LABOUR DIVISION AT DAR ES SALAAM LABOUR DISPUTE NO 15 OF 2010

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1 IN THE HIGH COURT OF TANZANIA LABOUR DIVISION AT DAR ES SALAAM LABOUR DISPUTE NO 15 OF 2010 TANZANIA PLANTATION AND AGRICUTURE WORKERS UNION... COMPLAINANT VERSUS M/S UNITRANS (T) LTD..... RESPONDENT 20/4/2011 & 6/6/2011 R.M. RWEYEMAMU, J: JUDGMENT At issue in this case is whether the respondent enterprise falls under the agriculture or transport sector for purpose of determining wages payable under the Labour Institutions (Regulations and of Wages and Terms of Employment) Order GN 112/2007 later revoked by GN 172/2010. The dispute was filed by the complainant - a workers trade union commonly known by its acronym TPAWU against the respondent/employer for failure to pay wages and provide for other terms of employment to its workers on terms allegedly applicable to them as workers under the transport and communication sector. The respondent opposed the claim on ground that its enterprise falls 1

2 under the agricultural sector therefore its workers are properly paid according to rates applicable to that sector. In the case, the complainant appeared through their legal officer while the respondent appeared though Ms. Kashonda & Dafta advocates. Hearing was by way of sworn evidence supported by parties submissions. The facts that are common cause (undisputed) according to the Non Settlement Order filed as per Rule 10(4) of the Labour Court Rules GN 106/2007 and from the evidence as well as submissions led by the parties are that:- 1. Employees of the respondent are being paid wages and provided with other terms of employment in accordance with terms applicable to the agricultural sector. 2. The complainant is an agricultural workers trade union recognized as the exclusive bargaining agent of employees at the respondent s work place in terms of section 67 of the Employment and Labour Relations Act, 6 of 2004 (the ELRA). 3. From its memorandum of association, the respondent is a transport company and its business license shows that it is doing business of transport agency. 2

3 4. The respondent is an independent company hired by Kilombero Sugar Company (KSCL) for transportation of cane from field to the mill an activity described in the agreement as in field loading of all volumes of Kilombero s sugarcane; transportation of sugarcane from the estates to the mills; land preparation of certain sugarcane fields; maintenance of certain Kilombero roads, irrigation drains and canals. 5. From 2001 to 2007, the parties had a protracted dispute which was ultimately mediated by the CMA where TPAWU was seeking access to the respondent premises for purpose of unionization of its employees and the respondent was refusing on grounds now contradicted. TPAWU s position then was that the respondent was subcontracted work by KSCL whose prime activities was sugar cane cultivation and related activities therefore the respondent fell under the agricultural sector as per demarcation made by the then Trade Union Federation. The respondent s position was that it fell under the transport sector as per their business license. Both have reversed their positions in this dispute. The evidence of TPAWU contained in the affidavit sworn by Mr. Godman Nyemba an employee and the Field Branch Secretary at the respondent premises and substantiated on in the submission was in summary that:- 3

4 a. The respondent belongs to the Transport sector as per her business license registration certificate and memorandum of association which have never been revoked or amended. b. The respondents sworn testimony admits that the respondents business license indicates that the respondent is a transport agency, and he is doing cane transportation from the fields to the mills among other activities The fact that the respondent is also doing other agricultural business does not amend their business license - at most it shows that she is conducting business for which she is not licensed. c. The respondent is well aware that she belongs to the transport sector and that is why she had all along in the past resisted TPAWU s efforts to unionize its workers but instead, preferred COTWU, a union operating in the transport sector. Their earlier stance that the respondent was a transport company was mere speculation and that was why they failed to prove their case! d. For purpose of the Minimum wage order, a sector is categorized according to the employer s business and not that of the union representing its employees. In opposition to the above, the respondent relied on sworn testimony of Mr. Gaspar Mwakatuma its principal officer and submissions to the effect that: 4

5 a. Admittedly, the respondent s license shows that she is doing business of transportation but the real situation is that she is doing business as an agricultural service provider- its principal obligation is to propel and support agricultural activities including cane fields preparation, maintenance of agricultural machinery; harvesting and transportation of agricultural produces at Kilombero as per agreement with KSCL dated 22/12/2000. b. The nature of the respondent s business is further evidenced by; a certificate of registration of incentives issued on 32rd April 2001 by the Tanzania Investment Centre (TIC) where the description of enterprise is given as To provide cottage services for agriculture sector ; its certificate of membership of the Association of Tanzania Employers (ATE) issued on 14 th November 2008 showing that the enterprise has been allocated to the Agricultural division ; and the certificate of registration of a workplace issued by the Occupational Health and Safety (OSHA) on 8 th February 2011 where its nature of work is described as Agricultural Service Provider (incidentally the certificate was issued after the dispute was filed in May 2010) c. KSCL is categorized as an agricultural sector company even though it does sugar processing and sales apart from sugar 5

6 cultivation, and had it not contracted its services mentioned to the respondent, that would not make it a transport company. d. Further, companies doing similar work contracted for cane haulage namely NASSO and CASPIAN at Mtibwa and Kagera Sugar Companies respectively fall under the agricultural sector not transport. e. The term agriculture is defined by the Labour Institutions (Regulations and of Wages and Terms of Employment) Order GN 223 of 2007 now repealed by GN 172/2010 as including transportation in agricultural undertaking.the respondent was engaged in transportation in agricultural undertaking and therefore fall falls under that sector. The term transport sector refers to movement of people and goods from one location to another but despite its licence the respondent is carrying on transportation in an agriculture undertaking and does not transport any luggage or people on the highway. Before evaluating parties evidence and giving my decision. I should point out the following:- First, wage orders are made under Part V of the Labour Institutions Act, 7/2004 and my understanding of sections 35 to 39 of that Act is that the term sector is not defined directly but the term 6

7 agricultural sector is defined to include transportation in agricultural undertaking; and from its usage, a sector wage order is categorized according to the employer s business and covers all employees in a given sector unless the order specifically differentiates between employees of different undertakings within the same sector. Second, GN 223 was revoked by the Labour Institutions (Regulations and of Wages and Terms of Employment) Order GN 172/2010 which became operational on 1/5/2010. The meaning of agricultural undertaking in the latter order is similar to that of the revoked order, but the transport and communication sector has been subdivided into 4 segments with different rates being; aviation services, Clearing and forwarding, telecommunications and inland transport. Under GN 172/2010 order, the minimum wage for employees in agricultural undertaking is shillings 70,000/= while that of transport workers is 150,000/=. Third, under Part V of the ELRA which deal with organizational rights, any registered trade union can establish a field branch at any workplace provided 10 or more of its members are employed in that enterprise (section 60), and to be recognized as an exclusive bargaining agent, a union must represent a majority of employees at that unit (section 67). My understanding of the above provisions is that the Tanzania law does not mandate industry unions, that is, a union can operate in an undertaking belonging to any sector. The 7

8 implication of the above is that the presence of TPAWU, which is an agricultural workers union at the respondents premises, does not necessarily mean that the said premises falls under the sector of the union. The position would be different if the constitution of TPAWU prevented it from unionizing in a non agricultural sector- but that was neither pleaded nor testified to. Bearing in mind the all the above and facts that are common cause, my evaluation of the contending evidence is that: In deciding the nature of the respondent s business, I believe its license and memorandum of association are of significance. It is undisputed that the core function of the respondent is transport and there is no rational or any explanation why the company was licensed as a transport one, if it was only carrying on agricultural support services. Further, the fact that the respondent is doing business at KSCL in accordance with the tendered agreement does not mean the respondent is only engaged in agricultural support activities described in the agreement tendered, and provides no other forms of service or transport to KSCL under a different agreement. In short, evidence of providing support activities to KSCL does not in itself qualify the respondent to be an agricultural company. The reason, apart from its admitted nature of business, is obvious: The fact that the respondent has an agreement with KSCL does not mean that it does not carry on any other business permitted under its certificate of registration and 8

9 license. That is particularly so when the respondent is admittedly an independent company- it is not a subsidiary of KSCL. I have considered but not given weight to the description of the respondent on the TIC certificate, the meaning of the clause To provide cottage services for agriculture sector is not clear to me. What are cottage services? For argument s sake, would transporting sugar on a highway from Kilombero to Dar es Salaam or upcountry or cross border qualify or not qualify as cottage service? The term is vague and in absence of explanation it would be unsafe to speculate. As to description of the respondent business by ATE, I do not believe the fact that ATE allotted the respondent to the Agricultural division of its members necessarily proves the respondents nature of business when its licence indicates the opposite. The same goes for the OSHA certificate- issued after the issue of nature of the respondent business was in court. The similarity drawn between the respondent and NASSO & CASPIAN, the two companies carrying on business for companies allegedly similar to KSCL does not advance the respondent s case further because there were no sufficient facts given to enable a proper comparison to be made; especially undisclosed is whether the two companies are also registered and licensed as transport companies. 9

10 Curiously, no evidence was given by the parties to show in what kind of undertaking/activities the employees of the respondent were engaged in. In the absence of that, the logical conclusion I make is that the employees were hired and works for a transport company and are consequently entitled to be paid wages prescribed for the transport sector. In the result, I find for the complainant-tpawu and order the respondent to pay its employees according to the terms provided under GN 223/2007 for the relevant period and after 1/5/2010 according to terms provided under GN 172/2010. R.M. Rweyemamu JUDGE 30/5/