The ghost of Mike Musonda Kabwe v BP Zambia and unilateral variations of contract in Zambia

• Jurisdiction: South Africa
• Citation: (2019) 6(1) Journal of Comparative Law in Africa 131
• Published date: 16 August 2019
• Pages: 131-148
• Date: 16 August 2019

131

THE GHOST OF MIKE MUSONDA KABWE V

BP ZAMBIA AND UNILATERAL VARIATIONS OF

CONTRACT IN ZAMBIA

Chanda Chungu*

Abstract

The case of Mike Musonda Kabwe v BP Zambia was the first case to consider

the issue of variations to the contract of employment in Zambia. The case provided

that where a unilateral variation of the contract occurs, the employee is entitled to

a redundancy or early retirement package. This position has been unquestioned for

several years and been applied in a phlethora of subsequent cases – including being

reaffirmed several times by the Supreme Court. Until now, the case has not been

critically analysed adequately to deduce the various shortcomings of the approach

it took. This paper seeks to dissect the various shortcomings of the case to deduce

what the correct approach to unilateral variations of the contract of employment

should be.

Key words: contract of employment, unilateral variation, acquiescence,

breach of contract, repudiation

Résumé

L’affaire Mike Musonda Kabwe c. BP Zambia a été le premier cas à examiner

la question des variations du contrat de travail en Zambie. L’affaire prévoyait

qu’en cas de modification unilatérale du contrat, l’employé avait droit à un plan

de licenciement ou à un plan de retraite anticipée. Cette position est incontestée

depuis plusieurs années et a été appliquée à de nombreuses affaires subséquentes,

et a été notamment réaffirmée à plusieurs reprises par la Cour Suprême. Jusqu’à

présent, l’affaire n’avait pas fait l’objet d’une analyse critique suffisante pour en

déduire les diverses lacunes de la démarche qu’elle avait adoptée. Cet article c herche

à disséquer les diverses lacunes de l’affaire pour déduire à quoi devrait ressembler la

bonne approche face aux variations unilatérales du contrat de travail.

Mots-clés: contract de travail, modification unilatérale, consentement,

ruptune de coutrat, répudiation

Introduction

During the course of the employment relationship, it may be necessary

for variations to be made to the contract regulating the relationship. This

is necessary given that various changes are bound to occur during the

term of employment and it would be necessary to effect these changes in

* LLB (Cape Town); LLM (Cape Town); MSc Candidate (Oxen) Legal Practitioner, Mulenga

Mundashi Kasonde Legal Practioners, Lusaka, Zambia.

(2019) 6(1) Journal of Comparative Law in Africa 131

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132 JOURNAL OF COMPARATIVE LAW IN AFRICA VOL 6, NO 1, 2019

the contract. Such changes include but are not limited to reflecting any

promotion or demotion, salar y increases, changes in working times or

responsibilities to mention but a few.

An employment contract is subject to the general law of contract but is

regulated by legislation in Zambia as a background. Changes to the terms

and conditions of service in the employment contract must be lawful and

consented to by the employer and employee. The position of the law is

that a contract of employment, like any ordinary contract, is the outcome

of the consent of both parties, cannot be changed without the agreement

of the both parties. Thus, no variation can be made to the contract of

employment without the consent of the other party.1

The leading case on unilateral variations of contracts of employment

is embodied in the case of Mike Musonda Kabwe v BP Zambia Limited.2 As

this paper will demonstrate, the case has several shortcomings and gaps,

many of which this article will seek to clarify. In the event of an employer

varying the contract of employment to the disadvantage or detriment

of the employee, without their consent, the Mike Musonda Kabwe case

provided that the employee is deemed to have been declared redundant

on the date of such variation and must get a redundancy payment.3 Rather

than treating the unilateral variation as a breach of contract, the Zambian

courts have provided that the compensation shall be a redundancy or

retirement package.

It is this position that this paper will seek to challenge. A unilateral

variation of a contract of employment by an employer should be treated

as a breach and repudiation of the contract by the employee.4 Therefore, a

unilateral alteration of the conditions of service, which negatively impacts

on the employee, amounts to breach of contract of employment and

wrongful termination which may warrant damages for the employee in

appropriate cases.5

Breach of contract or entitlement to redundancy and early

retirement payment

The first case to consider the question of unilateral variation of

employment was the Supreme Court decision ofMike Musonda Kabwe v

1 Kenny Sililo v Mend-a-Bath and Another (Appeal 168/2014) (2017) ZMSC 54.

2 SCZ Appeal 115 of 1996.

3 Peter Ng’andwe and Others v Zambia Oxygen (ZAMOX) Limited and Zambia Privatisation Agency

SCZ Judgment 13 of 1999.

4 Zambia Oxygen Limited and Zambia Pr ivatisation Agency v Paul Chisakula and 4 Others SCZ

Judgment 4 of 2000.

5 National Milling Company Limited v Grace Simataa and Others (2000) ZR 91 (SC).The Supreme

Court emphasised that when variation of the terms of employment occurs, the employee is deemed

to have been declared redundant or early retired as may be appropriate as at the date of the var iation

and the benefits are to be calculated on the salary applicable.

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