Nqobizwe Thebe
The Labour Court has dismissed an appeal by motor industry employers and upheld an arbitration award granting wage and allowance increases to automotive sector workers.
The ruling means employers must implement a 10% minimum wage increase and a 20% rise in transport and housing allowances, backdated to July 2024. The appeal was thrown out for lack of merit, with costs awarded against the Motor Industry Employers Association of Zimbabwe.
The case arose from a wage deadlock between employers and workers represented by the Automotive and Allied Workers Union of Zimbabwe and the Motor Trades Workers Union of Zimbabwe. Workers sought higher wages and allowances while employers argued for maintaining current pay levels and negotiating changes at individual plant level.
The dispute went to compulsory arbitration, where arbitrator Bianca Mercy Chipokosha ordered the 10% wage increment and 20% allowance increases. Employers then challenged her decision in the Labour Court.
In their appeal under section 98(10) of the Labour Act, employers argued that the arbitrator had exceeded her authority by “unilaterally” imposing increases and effectively creating new conditions of service. They claimed the arbitrator gave “lip service” to their financial incapacity and that the award was grossly unreasonable and contrary to public policy. They sought to have it set aside entirely.
Justice B.T. Chivizhe rejected these arguments, holding that the arbitrator acted within her mandate because both parties had agreed to refer the wage deadlock to compulsory arbitration with clear terms of reference under section 98(4) of the Labour Act. The judge said employers were “precluded, at this late stage, to seek to raise the issue as to whether or not the Arbitrator had the power to render an award as she did.”
The court distinguished the case from the National Railways of Zimbabwe Supreme Court decision that employers relied on, instead aligning it with the Star Africa Corporation Limited v Zimbabwe Refinery Workers Union judgment, which upheld an arbitrator’s wage award after a similar deadlock. Justice Chivizhe noted that unlike the NRZ case where new, unnegotiated allowances were imposed, this matter concerned existing conditions of service and a dispute over wage increments, making it “more akin” to Star Africa.
On the claim that the award violated public policy, the judge ruled this argument was misplaced in the Labour Court. Such challenges must be brought in the High Court under Article 34 of the Model Law in the Arbitration Act. The court also found the claim of gross unreasonableness unsubstantiated and concluded after examining the award that it was “far from being unreasonable.”
Justice Chivizhe endorsed the arbitrator’s approach, noting she had carefully balanced the employers’ economic evidence against workers’ need for a decent living wage. Quoting the arbitral award, the judgment highlighted the principle that “although the employees are entitled to a living wage there is need by the Tribunal to balance the employee’s interest against the employer’s capacity to pay the increased wages.” However, it also noted that “the mere fact that an employer is operating at a loss is no license for it to pay slave wages not worthy of human dignity.”
The court agreed with the arbitrator’s finding that workers faced a “crippling” cost of living, especially in transport and housing, with evidence showing an “unsustainable burden” on their earnings that justified wage adjustment.
Justice Chivizhe noted that employers have recourse to exemption mechanisms at the National Employment Council for entities “genuinely struggling to pay minimum wage in the short term,” undermining their claim that financial concerns were ignored.
The judge dismissed assertions that the arbitrator paid “lip service” to employers’ alleged inability to pay, saying this was “not supported by the record.” The onus under section 76 of the Labour Act lay on employers to prove their incapacity.
On backdating, the court held this formed part of the agreed terms of reference and that employers, having failed to address it before the arbitrator, could not raise it for the first time on appeal.
The Labour Court ruled that the appeal “be and is hereby dismissed with costs for lack of merit” and that “the arbitral award per Honourable Bianca Chipokosha dated 11th February, 2025 is upheld.”
The decision cements motor industry employers’ obligation to honor the staggered implementation of wage and allowance adjustments and reinforces arbitrators’ powers to resolve wage disputes from deadlocked negotiations.
