Brewing and Distilling Employers Association v Brewing and Distilling Workers Union and Others

The Brewing and Distilling Employers Association (applicant) and the Brewing and Distilling Workers Union (first respondent) deadlocked in negotiations over wage and allowance increases for employees in the brewing and distilling industry. The parties agreed to submit to voluntary arbitration before the second and third respondents (Moses Chinhengo and Munyaradzi Gwisai). The union claimed a 34.62% basic wage increase and increases in transport (75%), housing (150%), and subsistence allowances (30%), with certain allowances to be paid exclusively in USD. The employers opposed, arguing that economic conditions had improved with a firming exchange rate and declining inflation. On 25 September 2023, the arbitration tribunal rendered an award granting: a 20% basic wage increase to USD 312 (62.5% in USD, 37.5% in local currency); transport allowance of USD 45 (wholly in USD); housing allowance of USD 60 (wholly in USD); and subsistence allowance of USD 54 (62.5% in USD, 37.5% in local currency). The applicant sought to set aside the award under Article 34 of the UNCITRAL Model Law, claiming it was contrary to public policy. The first respondent filed a counter-application seeking registration and enforcement of the award.

• Whether the arbitral award was contrary to the public policy of Zimbabwe and should be set aside under Article 34 of the UNCITRAL Model Law (domesticated in the Arbitration Act [Chapter 7:15])
• Whether the tribunal erred in using an inflation rate of 30.9% instead of 15.3%
• Whether the tribunal failed to consider relevant economic fundamentals and submissions by the applicant
• Whether the tribunal failed to regard the currency mix of employers' revenue when ordering certain allowances to be paid wholly in USD
• Whether the tribunal granted relief not sought by the employees
• Whether a counter-application that was not stamped by the Registrar was properly before the court
• Whether an authenticated copy of the award must be attached to an application for registration and enforcement
• Whether the arbitral award should be registered and enforced as an order of court

The application to set aside the arbitral award was dismissed with costs. The counter-application was granted. The arbitral award dated 25 September 2023 was registered as an order of court for purposes of enforcement, granting: (a) basic minimum wage of USD 312 (62.5% in USD, 37.5% in ZWL at prevailing RBZ Auction Rate); (b) transport allowance of USD 45 wholly in USD; (c) housing allowance of USD 60 wholly in USD; (d) subsistence allowance of USD 54 (62.5% in USD, 37.5% in ZWL). The first respondent (union) was awarded costs on an ordinary scale.

An arbitral award will not be set aside as contrary to public policy merely because the reasoning or conclusions are wrong in fact or law. An award is only contrary to public policy where the reasoning or conclusion constitutes a palpable inequity that is so far-reaching and outrageous in its defiance of logic or accepted moral standards that a sensible and fair-minded person would consider that the conception of justice would be intolerably hurt by the award. In voluntary arbitration, parties consensually agree to accept the arbitral award even if it may be wrong, provided proper procedures are followed. Courts will not interfere with arbitral awards except on the grounds outlined in Article 34(2) of the UNCITRAL Model Law. A counter-application filed under Rule 58(8) of the High Court Rules 2021 is not a "first document" within the contemplation of Rule 78(4) and therefore need not be stamped or consecutively numbered by the Registrar, as it has no separate existence from the main application. An arbitral tribunal does not violate public policy by ordering certain allowances to be paid wholly in foreign currency where there are rational economic reasons for doing so (such as landlords refusing local currency). The search for truth in litigation is paramount, and technical defects such as failure to attach an authentication certificate due to inadvertence should not defeat substantive justice where no prejudice results.

The court observed that litigants should not play hide and seek with courts, and lawyers as officers of the court should not behave like hired guns, as litigation is not a game of wits but a serious and scientific process to resolve disputes. The court noted that awarding periodic, fair and reasonable wages is not contrary to public policy but essential for good industrial relations as it prevents industrial unrest characterized by collective job action. The court commented that the alternative of paying allowances in local currency and expecting employees to source USD at parallel market rates would severely prejudice employees. The court emphasized that in litigation, the search for truth is paramount, and parties concealing material information from the court are unworthy of its protection or assistance.

This case is significant for Zimbabwean arbitration law as it clarifies the limited grounds upon which courts may interfere with arbitral awards under the UNCITRAL Model Law as domesticated in the Arbitration Act. It reinforces the principle that voluntary arbitration is consensual adjudication where parties accept awards even if potentially wrong, provided proper procedures are followed. The judgment provides guidance on the public policy exception under Article 34, holding that mere errors of fact or law do not constitute violations of public policy—only palpable inequity that defies logic or accepted moral standards to an outrageous degree warrants setting aside an award. The case also clarifies procedural matters regarding counter-applications under the High Court Rules 2021, particularly that counter-applications filed under Rule 58(8) need not be separately stamped or numbered as they are not "first documents." It demonstrates judicial deference to arbitral tribunals' reasoning and factual determinations, particularly in specialized areas like labour relations and wage determination. The case also affirms the constitutional obligation under section 65 of the Constitution of Zimbabwe to ensure fair and reasonable wages, and recognizes that awarding periodic fair wages promotes good industrial relations and prevents industrial unrest.