Paidamoyo Chipunza Health Reporter
Premier Service Medical Aid Society was yesterday ordered to pay ousted former group chief executive Dr Cuthbert Dube more than $3 million in salary arrears which accrued since his dismissal in January last year. The troubled medical aid society was also ordered to reinstate Dr Dube. This was after Dr Dube took his case to an arbitrator, Mr Dumisani Nyoni, challenging his dismissal, claiming that he was still employed as the chief executive of PSMAS and its subsidiary Premier Service Medical Investments (Pvt) Ltd.
He filed two claims demanding his monthly salary of $138 000 from PSMAS and another for $92 000 per month from PSMI.
Dr Dube was earning a combined $230 000 a month from PSMAS and PSMI when he was forced to resign in January 2014.
The matter was referred for conciliation, but the parties could not reach a settlement.
The dispute was subsequently referred for arbitration.
In a judgment delivered on Thursday last week, Mr Nyoni ruled in favour of Dr Dube, saying his contract was unlawfully terminated and ordered his reinstatement.
But PSMAS and PSMI, through their lawyer, Mr James Chikobvu Muzangaza, yesterday filed an appeal to suspend the arbitrator’s decision pending the determination of the dispute at the Labour Court.
In the case against PSMAS, Mr Muzangaza argued that the arbitrator erred in ordering that Dr Dube be paid his salary arrears at the rate of $138 000 a month, when there was no basis for such.
He argued that the arbitrator erred in finding that Dr Dube’s contract of employment subsisted as at the time of the arbitration proceedings, when all facts and circumstances as presented to him and as had been acknowledged by the parties at conciliation stage, showed without a doubt that the said contract had been terminated.
“Arbitrator erred in making an award that is tantamount to making a contract for the parties which neither he as arbitrator nor any court or tribunal can do,” argues Mr Muzangaza.
“The sum of $92 000 applied in respect of the expired contract, and not in respect of the one that came into operation on 1st January 2014 and which was terminated in February 2014.”
In the case of PSMI, Mr Muzangaza argued that the arbitrator erred in making an order that is equivalent to the reinstatement of Dr Dube without making a provision for damages as an alternative in compliance with certain provisions of the Labour Act.
He argued that the matter for determination was supposed to be on the legality of Dr Dube’s termination of contract.
He attacked the arbitrator’s ruling accusing him of reformatting the issues to suit his purposes, when he was not legally entitled to do so.
PSMAS made headlines towards the end of 2013 after it got involved in a salary scandal which saw Dr Dube and his top executive earning what were described as “obscene salaries” and perks at the expense of service delivery.
This resulted in the ouster of the society’s board chairperson Mrs Mercy Namasasu and Dr Dube, who was forced to retire.
Government then appointed an interim management chaired by Dr Mhlanga. The interim management was mandated to look into the society’s remuneration structure, critically review its financial position, its constitution and facilitate a forensic audit, among other matters.
To date, management has slashed salaries by about 90 percent, instituted a forensic audit and restructured the society.