Old Mutual to argue it's entitled to fire Moyo
Old Mutual will argue that an employer is entitled to terminate an employment contract when it appeals a judgment interdicting it from firing former CEO Peter Moyo. But ahead of that appeal, which may only be heard in December, Moyo will be in court next month.
He will argue that Old Mutual is in contempt of court for refusing him entry to work after Judge Brian Mashile reinstated him in July.
He was fired for a second time in August, notes a Fin24 report by Ferial Haffajee. Old Mutual has been granted leave to appeal against Mashile’s ruling, with the Gauteng High Court sitting as a full Bench and likely to be led by Judge President Dunstan Mlambo.
The company will argue that Mashile erred in several areas of law, the most important being on a company’s right to terminate. ‘…the court failed to deal with, and effectively ignored, all the relevant authorities on the entitlement of an employer to terminate a contract of employment on notice, and that the termination is lawful for the reason that it is authorised by the clause permitting terminations on notice and does not constitute repudiation’.
In other words, Old Mutual will argue that Moyo signed his contract which provided for summary termination on notice pay – which is what happened.
Old Mutual will argue that this contract ‘…does not require the applicants to provide just cause or a fair reason for termination. There is, therefore, no contractual requirement to follow a fair process to provide just cause or a fair reason for termination’.
A clause like this is obviously counter-factual to the values underpinning SA’s labour laws, but the company argues that this is standard practice in how CEOs are employed – which is why they earn the big money, notes the Fin24 report.
Moyo earned an average of R3m a month at Old Mutual – before bonuses.
At issue is the fact that he also cashed in dividends from NMT Capital, the investment holding company he co-owns with well-known businessmen Sango Ntsaluba and Thabiso Tlelai. In the period in contention, the Old Mutual court papers reveal that Moyo also received R30.6m in dividends from NMT Capital and may also have received R20.9m allocated in July 2018.
These payments are at the centre of his axing, as the company says Moyo should have ensured that Old Mutual receive dividends first – before he was paid.
Old Mutual is a preferential shareholder in NMT. It’s a messy conflict and Old Mutual contends that Mashile glossed over it.
For his part, the judge, in interdicting Moyo’s termination of employment, said Old Mutual should have looked at how Transnet fired its acting CEO Siyabonga Gama, who was first subject to hearings and disciplinary procedures.
But Old Mutual says Gama’s contract stipulated that termination was subject to a pre-dismissal procedure while Moyo’s contract only required six months’ notice.
Fin24 notes that regardless of whether the case is settled out of court, Old Mutual wants the appeal hearing to go ahead as it judges the issues at hand to be materially important.
© Juta and Company (Pty) Ltd 2016
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