Africa-Press – Namibia. AFTER waiting over three years for the payout of their severance packages following the liquidation of the national airline, Air Namibia, the ex-employees of the former state-owned enterprise will finally breathe a sigh of relief after the High Court ordered liquidators to pay out their severance packages.
This ruling was made by High Court Judge Collins Parker, who explained that the liquidation of Air Namibia operated as a formal notice of dismissal to the employees, making it necessary for the liquidators, David John Bruni and Ian Robert McLaren, to make payment of severance pay to the dismissed employees in terms of Section 35 of the Labour Act 11 of 2007. He added, however, that a dispute arose regarding the calculation of the severance pay.
“The liquidators contended that Air Namibia’s contributions towards the employees’ pension, social security, and medical aid were not remuneration in terms of the Labour Act. The dismissed employees (the applicants) contended contrariwise that those contributions formed part of their remuneration. The court observed that while the employer’s contributions to pension, medical aid, social security, and the like are essential for funding pension plans, social security, and medical expenses of the employee, they are not considered part of the employee’s remuneration by the ILO Convention on Equal Remuneration and, indeed, under the Labour Act. The court’s decision was based on the interpretation of the word ‘remuneration’ in Section 1 of the Labour Act, having applied the triadic approach to the interpretation of statutes and other legal instruments, namely, the text, context, and purpose,” Judge Parker said.
He added that in terms of the Labour Act, ‘remuneration’ refers to payments in money or in kind made by an employer as an obligation to his or her employee in virtue of the fact that the payee is his or her employee.
“It is a fundamental principle in construing statutes that it may be presumed that words are not used in a statute without meaning and are not tautologous or superfluous, and effect must be given, if possible, to all the words used, for the Legislature is deemed not to waste words or to say anything in vain. It is declared that the applicants’ remuneration, for purposes of calculating the severance pay owed to them by the third and fourth respondents by virtue of the termination of their employment with Air Namibia (Pty) Ltd (in liquidation), includes the following amounts: basic salary, housing allowance, transport allowance, employer’s contribution towards medical aid, employer’s contribution towards pension, and employer’s contribution towards Social Security, which amounts are collectively referred to by the parties as ‘total cost to company,’” Parker said.
He added that what an employment contract cannot lawfully do is to give an employee a benefit, allowance, or advantage that is less in any respect than that granted by the Labour Act. “Therefore, I find and hold that by agreeing that remuneration included basic salary, housing allowance, transport allowance, pension: employer contribution, medical aid: employer contribution, and annual bonus, Air Namibia and the applicants concerned did not act in fraudem legis,” Judge Parker said.
He thus ordered the liquidators to amend their first liquidation and distribution account to reflect the total amounts in respect of each applicant employee of Air Namibia (Pty) Ltd (in liquidation) and to pay, within 14 days of confirmation, the amended first liquidation and distribution account.
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