Lazarus Muchenje v Susan M Mutangadura and Others

The applicant was the Chief Executive Officer (CEO) of the 6th respondent, NetOne Cellular (Private) Limited, a public entity. On 20 February 2020, the 1st to 3rd respondents convened a special board meeting at which they suspended the applicant as CEO. The applicant obtained an interim order from the High Court under HC 1524/20 interdicting the respondents from pursuing disciplinary proceedings. By letter dated 8 July 2020, the 6th respondent withdrew the suspension and reinstated the applicant without loss of salary and benefits. However, on 9 July 2020, the 2nd respondent wrote a letter purportedly on behalf of the 6th respondent terminating the applicant's employment contract on three months' notice in terms of section 12(4) of the Labour Act. The applicant challenged this termination, arguing it was invalid as it did not comply with the procedures set out in the Public Entities Corporate Governance Act and its regulations, which require fault-based dismissal grounds and prior Presidential endorsement.

• Whether the Labour Act prevails over the Public Entities Corporate Governance Act in relation to termination of employment of CEOs of public entities
• Whether termination on notice under section 12(4) of the Labour Act differs from dismissal under section 16 of the Public Entities Corporate Governance Act
• Whether there is an inconsistency between the Labour Act and the Public Entities Corporate Governance Act within the meaning of section 2A(3) of the Labour Act
• Whether the common law right to terminate employment on notice applies to CEOs of public entities
• The proper interpretation of the Public Entities Corporate Governance Act and its regulations regarding removal of CEOs

1. The letter of 9 July 2020 drafted by the 2nd respondent on behalf of the 6th respondent addressed to the applicant is declared null and void. 2. The 1st to 4th and 6th respondents shall pay costs of the application, the one paying the others to be absolved.

The ratio decidendi is that the Public Entities Corporate Governance Act and its regulations provide the exclusive legal framework for the removal of CEOs of public entities in Zimbabwe. Section 16 of the Public Entities Corporate Governance Act, read with section 11 of the Public Entities Corporate Governance General Regulations (SI 168 of 2018), requires that CEOs be dismissed only on specified grounds, following prescribed procedures, and with prior Presidential endorsement. There is no inconsistency within the meaning of section 2A(3) of the Labour Act between the Labour Act and the Public Entities Corporate Governance Act because the two statutes regulate different categories of employees for different purposes. The term 'termination of employment' is not materially different from 'dismissal' - both result in the employment relationship coming to an end. Where specific legislation has been enacted to regulate a particular category of employees, that legislation applies rather than general employment law or common law principles. Any attempt to terminate the employment of a CEO of a public entity without complying with the procedures set out in the Public Entities Corporate Governance Act is null and void.

The court made several obiter observations. Firstly, regarding the institutions contemplated by section 3(1) of the Labour Act (which excludes employees whose conditions are provided for in the Constitution), the court observed that these are institutions like the Judiciary, the Prosecutor General's Office, and the Auditor General, which the Constitution directly creates and for which it incorporates provisions for removal from office. The court noted that CEOs of public entities do not fall into this category as the Constitution does not directly create their positions. The court also observed that sections 197, 198, and 316 of the Constitution demonstrate Parliament's intention to guarantee tenure of office for CEOs of state-controlled entities and to link their tenure to efficient performance of duties. The court commented on the purpose of requiring Presidential endorsement for removal of CEOs, suggesting this was to provide security of tenure through a transparent and predictable process. Finally, the court observed that the common law remedy of termination on notice does not render nugatory the specific statutory provisions enacted to regulate CEOs of public entities.

This case establishes important principles regarding the interpretation and application of specialized legislation governing public entities in Zimbabwe. It confirms that the Public Entities Corporate Governance Act creates a specific regime for the employment and removal of CEOs of public entities that operates independently of the general Labour Act provisions. The judgment emphasizes the importance of statutory interpretation based on legislative purpose and context, and clarifies that where Parliament has enacted specific legislation to regulate a particular category of employees, that legislation prevails over general employment law. The case reinforces security of tenure for CEOs of public entities by requiring compliance with prescribed procedures including Presidential endorsement before removal. It also establishes that there is no substantive difference between 'termination' and 'dismissal' for the purposes of determining which statutory regime applies.