EMMANUEL SALLAH V. ERISAAC PRESS

JUDGMENT

ASUMAN-ADU, J.

The Plaintiff caused writ of summons to be issued against the Defendant on 9th April, 2009 for the following reliefs:

a. A declaration by this Court that the declaration of Plaintiff as redundant by the Defendant company without a negotiated package is wrongful and illegal;

b. A declaration that for 13yrs that the Plaintiff worked with the Defendant’s company, the Plaintiff should be paid four (4) months of his gross salary for each year that he worked with the Defendant company;

c. General damages; and

d. Costs, including the professional fees of the Plaintiff’s lawyer.

On 15th April, 2009 the Defendant entered appearance and it went on to file its Statement of Defence on 4th May, 2009.

The case for the Plaintiff is that he was employed by the Defendant Company on 30th October, 1995 as Darkroom Technician. He, therefore, worked in the Defendant company for thirteen years. He went on to tender-in-evidence his appointment letter as Exhibit A. He claims that in August 2008, he was declared redundant by the Defendant. He tendered in evidence the letter declaring him redundant as Exhibit B. According to the Plaintiff in declaring him redundant, the Defendant company did not write nor discussed any issue regarding a redundancy package with him. He was, therefore, paid no redundancy award by the Defendant. He as a result instructed his counsel to write to the Defendant on the issue. The Defendant replied the letter and asked the Plaintiff to give it up to January 2009 and they would get in touch, but since then he has heard nothing from them, hence this action.

According to him the said redundancy has caused him a great deal of distress financially, considering the fact that he has a family and an ailing father to take care of. He, therefore, claims as per the endorsement on his writ of summons.

The Defendant’s case was presented by one Edward Sam, the Commercial Manager. He told the court in his testimony that in August 2008, the company was not getting contract from its client due to the economic recession. Management, therefore, invited the workers to a meeting and informed them of the problem the company was going through. They were, therefore, asked to go home on redundancy and that when things improved, they would call them back. According to the witness, the Defendant did that to avoid a situation where they would keep the workers and would not be able to pay them.

The witness claims that, after the Defendant had received a letter from the solicitors of the Plaintiff, they called him to the office and negotiated with him. He was assured that by the end of December that year they would recall him if things improved. He could not wait and took the matter to Court. Negotiations were, therefore, on going at the time the matter was sent to Court by the Plaintiff. According to him, all the workers who were asked to go home have all been recalled and they are working. The Plaintiff was also recalled but he reported for work on one day and he left. He is as a result not entitled to his claim.

In his application for directions filed on 27th May 2009, the Plaintiff identified the following issues:-

1. Whether or not the redundancy declared by the Defendant followed the laid down procedure;

2. Whether or not the Defendant’s declaration of redundancy was done in accordance with the law;

3. Whether or not the Plaintiff herein is entitled to his entitlements to wit: redundancy package;

4. Whether or not the declaration of redundancy of the Plaintiff is wrongful without a negotiated package.

The Defendant on the other hand identified the following issues as additional issues filed on 25th June 2009:-

1. Whether or not the Defendant promised Plaintiff any package in September 2008 but reneged on it;

2. Whether or not negotiations were still ongoing between Plaintiff and Defendant before he issued his writ of summons;

3. Whether or not Plaintiff was ever queried or reprimanded by Defendant;

4. Whether or not Plaintiff was handed a letter of redundancy dated 29th August 2008 out of the blue;

5. Whether or not the question of lack of contracts was discussed with all employees before they were temporarily laid off;

6. Whether or not Plaintiff was recalled in January, 2009 and he reported for work.

Most of the issues listed above are irrelevant as far as this case is concerned. The court will, therefore, confine itself to issues affecting the Plaintiff’s redundancy. From the evidence before the court the fact that the Plaintiff and other workers of the Defendant company were declared redundant is not in doubt. This is confirmed by Exhibit B. That is the letter declaring Plaintiff redundant. So the main issue for determination is whether or not in embarking on that exercise the Defendant followed laid down procedure in declaring redundancy in work places. It is normally the contract of employment that will determine the procedure that will have to be followed in declaring workers redundant. In the absence of a written contract of employment it is the Labour Act 2003 (Act 651) that provides the procedure to follow in declaring workers redundant. Section 1 of the Act confirms this. It provides as follows:-

“The Act applies to all workers and to all employers except the Armed Forces, the Police Service, the Prison Service and the Security and Intelligence Agencies specified under the Security and Intelligence Agencies Act 1996 (Act 526).”

In the current case the evidence before the court shows that there is no specific written contract between the Defendant and the Plaintiff in spite of the fact that Section 12 of the Act makes it clear that the employment of a worker by an employer for a period of six months or more or for a number of working days equivalent to six months or more within a year shall be secured by a written contract of employment. Everything concerning the contract of employment between them is stated in Exhibit A, the appointment letter which is not sufficient. There is, however, nothing on redundancy in the said letter. In view of that it is the provisions in the Labour Act dealing with redundancy that will have to be followed in embarking on redundancy exercise in the Defendant company.

It is Section 65 of the Act that deals with redundancy. Section 65(1) states as follows:-

“When an employer contemplates the introduction of major changes in production, programme, organization, structure or technology of an undertaking that are likely to entail terminations of employment of workers in the undertaking, the employer shall

(a) provide in writing to the Chief Labour Officer and the trade union concerned, not later than three months before the contemplated changes, all relevant information including the reasons for any termination, the number and categories of workers likely to be affected and the period within which any termination is to be carried out; and

(b) consult the trade union concerned on measures to be taken to avert or minimize the termination as well as measures to mitigate the adverse effects of any terminations on the workers concerned such as finding alternative employment.”

Section 65 (2) also states as follows:-

“Without prejudice to subsection (1), where an undertaking is closed down or undergoes an arrangement or amalgamation and the closed down, arrangement or amalgamation causes

(a) severance of the legal relationship of worker and employer as it existed immediately before the close down, arrangement or amalgamation; and

(b) as a result of and in addition to the severance that worker becomes unemployed or suffers any diminution in the terms and conditions of employment,

the worker is entitled to be paid by the undertaking at which that worker was immediately employed prior to the close down, arrangement or amalgamation, compensation, in this section referred to as redundancy pay”.

In the current case it is obvious from Exhibit A that workers in the Defendant company were not unionized. It states in paragraph 9 that as a private establishment, any form of trade unionism is prohibited and shall not be entertained. This shows that there was no trade union that the Defendant company would consult on the redundancy. It must be noted that the Labour Act applies to all organizations, be it a public or private institution. This shows that even though the Defendant company is a private institution, the Labour Act is applicable to it.

It is also clear from the evidence that the Chief Labour Officer was not informed of the intention of the Defendant company to embark on the redundancy exercise. This is very clear from the evidence of Edward Sam who testified on behalf of the Defendant company. He told the court during cross examination that the Defendant did not write to inform the Chief Labour Officer that it was declaring workers redundant because management felt it was not necessary in the sense that they had plans to recall the workers when things improved.

The Defendant, however, states that before embarking on the exercise they met the workers and informed them of the problems they were going through. They were, therefore, declaring them redundant with the intention that when the fortunes of the company improved they would be recalled to work so the redundancy was temporary and it was not contrary to law.

In the first place Exhibit B which declared the Plaintiff redundant never indicated that the redundancy was temporary. There is nothing in that letter indicating that when the fortunes improved the Plaintiff would be recalled. It clearly shows that the Defendant was completely severing relationship with the Plaintiff with no intention to be recalled. This explains why it states in paragraph 6 that:

“it is our fervent prayer that the Good Lord reward you abundantly and grant you success in all your future endeavours.”

The letter even did not make reference to the meeting management allegedly held with the workers on the redundancy.

The evidence before the court also shows that no negotiation took place between the Defendant and the Plaintiff. If anything at all there should have been some form of negotiation for the parties to agree on the terms of the exercise. If due to the problems the Defendant was allegedly going through it could not continue to retain the Plaintiff in its employment, there was nothing wrong about that. It was its right to decide on the workers it would want to work with. However, the proper procedure must be followed. It is to avoid such situations where employers decide at will when to declare a worker redundant that the Labour Act was promulgated. It is, therefore, expected that both employers and employees would respect the Act in order for there to be industrial harmony in the country.

According to the Defendant the Plaintiff was recalled in January 2009 to work but after selecting films for production to proceed he left. The Plaintiff, however, denies that he was recalled. He claims that they could not locate some films so he was just invited to help them to locate those films and not that he was recalled to work as alleged by the Defendant. So after selecting the films for them he left. Since the Defendant is alleging that it recalled the Plaintiff the onus is on it to prove that truly he was recalled. When he was declared redundant the Plaintiff was written to. It, therefore, follows that if it had become necessary for him to be recalled a letter to that effect would be written to him. Especially so, when at that time he had referred the matter to his lawyers. No such letter was tendered in evidence. The court, therefore, accepts the evidence of the Plaintiff that he was not recalled as alleged by the Defendant but rather he was invited to assist in locating some films which he did and left.

So from the evidence, the court considers the redundancy exercise undertaking by the Defendant as arbitrary and contrary to law since it did not follow the procedure provided by the Act. The court, therefore, agrees with the Plaintiff that the declaration of the Plaintiff redundant by the Defendant is wrongful. The Plaintiff is as a result entitled to be paid redundancy award by the Defendant. The question then is how much redundancy award should be paid to the Plaintiff?

By Section 65(4) of the Act the amount of redundancy pay and the terms and conditions of payment are matters which are subject to negotiation between the employer or a representative of the employer on the one hand and the worker or the trade union concerned on the other. The said negotiation should have been done before the exercise. In the current case the exercise had already been done. More so there is no existing term and conditions of service which could be used as basis for determining the amount to be paid. The Plaintiff states in his claim that he must be paid four months of his gross salary for each year served. He did not provide any basis for that. Also he did not tell the court his monthly salary at the time he was exiting. This court cannot, therefore, give a specific amount at the moment that should be paid to the Plaintiff as redundancy award. However, since there is no doubt that the Plaintiff is entitled to be paid redundancy award and there is no reason why the amount he has requested should be varied, it is ordered that he should be paid redundancy award as endorsed on his writ of summons.

On the issue of general damages I refer to the case of Yungdong Industries Ltd v. Roro Services (2005-2006) SCGLR 816 at 839 in which it was held that:-

“Generally, damages in tort are awarded by way of monetary compensation for a loss or losses which a Plaintiff has actually sustained, and the measure of damages awarded on this basis may vary infinitely according to the individual circumstances of any particular case. It is for a Plaintiff to prove what loss, if any, it has suffered by reason of a tort, and when, ...the effect of the tort is potentially adverse interference with the course of its business operations, it is for it to establish by evidence that there was, in fact, such adverse interference and that it suffered a properly quantifiable loss by reason of it.”

It was also held in the case ofDelmas Agency Ghana Ltd v. Food Distributors International Ltd (2007-2008) SCGLR 748 that where the Plaintiff has suffered a properly quantifiable loss, he must plead specifically his loss and prove it strictly. If he does not he is not entitled to anything. Damages must, therefore, be specially pleaded and proved by evidence at the trial. See also the case of Standard Chartered Bank (Ghana) Ltd. v. Nelson [1998-99] SCGLR 810.

In the current case even though the Plaintiff pleaded general damages on the writ of summons and went ahead to state in his statement of claim that the exercise has caused him a great deal of distress financially, he did not give evidence to prove the nature and the extent of damages suffered by him. It must be noted that damages must be endorsed and proved. Since in the current case, the Plaintiff has not been able to prove the damages, the court has no reasonable cause why it should order that damages be paid to him. The Plaintiff is, therefore, not entitled to be awarded general damages. That relief is as a result dismissed. It is, however, observed that redundancy award payable to the Plaintiff was due in August 2008 when he was declared redundant. From that time up to this time the real value of the said amount has fallen and it will be a miscarriage of justice to say that because the Plaintiff did not request that he should be paid interest on the amount it should be ordered that he is paid only the principal sum without interest. See the case ofButt v. Chapel Hill Properties Ltd [2003-2004] 1 SCGLR 636 at 652 in which it is held as follows:-

“Once the Court holds that there was, in effect, an implied loan transaction between the Plaintiff and the first Defendant or the Defendants, the court is obliged to exercise its statutory power to award interest on the loan implied in order to preserve the value of the capital originally borrowed. Justice requires that on the facts of this case interest be awarded to the Plaintiff, even if not expressly claimed....”

See also the case ofNTHC Ltd v. Antwi [2009] SCGLR 117 at 132 which is as follows:-

“Although Order 63, r 6 of the repealed High Court (Civil Procedure) Rules, 1954 (LN 140A), appears not to have been re-enacted in the new High Court (Civil Procedure) Rules, 2004 (CI 47), we believe that the High Court has an inherent jurisdiction to make such consequential orders as are necessary for doing justice, even if the beneficiary of such order, such as the Defendant in the instant case, has not expressly requested it.”

So in the current case even though the Plaintiff did not ask for interest on the redundancy award since the value has fallen, it follows that in order to maintain the original value of the amount interest on the amount should be awarded. It is as a result ordered that the Defendant pays interest on the redundancy award at commercial rate with effect from August 2008 to the date of payment.

With regards to costs it is observed that the Plaintiff filed the suit on 9th April 2009. So for more than one year now he has been pursuing this case. He has also engaged a lawyer who must be paid. As a successful party he is entitled to be paid costs by the Defendant.

In conclusion the court enters judgment for the Plaintiff against the Defendant as follows:-

a. It is declared that the declaration of Plaintiff as redundant by the Defendant company without a negotiated package is wrongful and illegal.

b. It is ordered that for the 13 years that the Plaintiff worked with the Defendant company, he should be paid four (4) months of his gross salary for each year that he worked with the Defendant company as redundancy award.

c. It is ordered that the Defendant pays to the Plaintiff commercial rate of interest on the redundancy award with effect from August 2008 to date of payment.

d. It is ordered that the Defendant should pay to the Plaintiff costs of GH¢3,000.00.

COUNSEL

MR. KINGSLEY KWASITSU FOR THE PLAINTIFF

COL. G. Y. TSAHEY (RTD.) FOR THE DEFENDANT