Wesene Medical Service PLC -v.- Kibrewesen A.-Termination of Employment- Causing Damage to the goodwill and profit of the employer-Cassation File No. 77134 V 14

 Wesene Medical Service PLC -v.- Kibrewesen A.

Federal Supreme Court Cassation File No. 77134 (October 18, 2012)

Holding of the Court:

When an employee endangers the goodwill, profit and survival of the employer, the measure that should be taken must be examined in light of the specific demands and features of the profession of the employee and the spirit and objectives of the Labour Law.

Article 27(1)(f) and (h) of Labour Proclamation No. 377/2003

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Cassation File No. 77134 Tikimt 8, 2005 E.C. (October 18, 2012)

Federal Supreme Court Cassation Division

Justices: Tegene Getaneh, Teshager G/Selassie, Almaw Wolie,

Ali Mohammed, Adane Negussie

Petitioner: Wesen Medical Services PLC

Respondent: K.A.

Judgment

The respondent, Dr. K. A., was the plaintiff at the Federal First Instance Court and claimed that his contract of employment was unlawfully terminated by the petitioner and he sought compensation. The petitioner, on the other hand, argued that the contract was terminated on lawful grounds as the respondent was repeatedly tardy and constantly in disagreement with patients. The Federal First Instance Court heard both parties and witnesses who testified that the respondent has divulged confidential information of patients to third parties. The witnesses also stated that he is not in good terms with patients and that patients usually ask for a refund because he comes in late. The respondent did not rebut these testimonies. So, the court decided that the termination was lawful.

The respondent, then, appealed to the Federal High Court. The court heard both sides and decided that the decision of the lower court based on the interpretation of sub-Articles (a) and (b) of Article 27(1) of the Labour Proclamation No. 377/2003 that deal with damages caused due to an employee’s tardiness was wrong. Furthermore, it reversed the decision of the lower court stating that the termination of the contract of employment was unlawful because violation of discipline in the medical profession is not a ground for terminating that contract under the proclamation.

This petition submitted to the Cassation Division of the Federal Supreme Court on February 9, 2012 states that the respondent has caused damage to the goodwill and profit of the organization. The respondent has the responsibility to abide by professional ethics. However, even though it was proven that he was violating these ethical rules, it was decided by the lower courts that the termination of the contract of employment was unlawful. Thus, the petitioner argued that there is a fundamental error of law in this decision.

The respondent in his response submitted on 27 June 2012 argued that the grounds raised by the petitioner are not sufficient for termination of the contract of employment without notice.

This court has examined whether the decision rendered by the Federal High Court has a fundamental error of law. This court has found that it has been proven in the lower courts that the respondent has gone against the ethics of the medical profession by revealing confidential information of patients to third parties. Moreover, there were testimonies that the respondent has verbally abused patients and had conflicts with them.

A colleague of the respondent testified that he divulged confidential information of patients to unauthorized third parties. She added that around the time of the termination of his contract of employment, she heard him telling third parties that a certain lady was living with HIV/AIDS and he was even calling her name. Patients of the respondent, while he was an employee of the petitioner, also testified that he mistreated and insulted them. They also added that they stopped going to the petitioner’s medical services. The credibility and weight of these testimonies were examined by the lower court.

In spite of such testimony, the appellate court found the decision of the lower court to be wrong, stating that the lower court’s finding about the damage caused by the respondent on the goodwill and profit of the petitioner was based on insufficient evidence. The appellate court did not question the credibility and weight of these testimonies. However, it overruled the decision of the lower court stating that these testimonies were not sufficient to show that the termination of the contract of employment was lawful.

The fact that the respondent has not contested the credibility and weight of the testimonies given against his misconduct, and whether these faults are sufficient grounds to terminate the contract of employment must be evaluated in light of the type of services the petitioner provides and its responsibilities along with the damages caused by the respondent.

According to Article 13(1) and (2) of the Proclamation No 377/2003, every worker has the obligation to perform in person the work specified in the contract of employment and to follow instructions given by the employer based on the terms of the contract and work rules. It can also be understood from Article 11(1) of Regulation No. 174/1986 E.C. of the Council of Ministers that the respondent should perform his duties in accordance with rules of professional ethics, respecting patients and keeping confidential information. If he does not do so and if he continues to work for the petitioner, the petitioner’s license may be suspended or revoked. In addition to these, it can be gathered from Articles 399 and 400 of the Criminal Code that the respondent’s act of disclosing patients’ confidential information to third parties results in criminal liability.

It can be understood from the above mentioned Regulation No. 174/1986 E.C. that the acts of the respondent which are proven have negatively affected the goodwill of the petitioner, made it less competitive in the market and it could have resulted in the suspension or cancellation of its license. Therefore, according to Article 27 (1)(f) of the Labour Proclamation, the respondent is responsible for causing quarrels with his patients at the work place, violating the medical profession’s ethical code and jeopardizing the goodwill, profit and survival of the petitioner’s medical services.

Article 27 (1)(h) of Proclamation No 377/2003, the respondent’s disregard of his professional ethical responsibilities, the utmost ethical expectations and unique features of the medical profession and the damages caused or that could have been caused on the petitioner must be carefully examined. The case must be examined in light of the objective of the Labour Law, its contents and all other legislation enacted to regulate licensing of medical services.

This court has found that the respondent’s violations fall under Article 27(1)(f)&(h) of Proclamation No 377/2003 and the contract of employment can be terminated without notice. In spite of this, however, the Federal High Court decided that the respondent’s violations are not sufficient to cause the termination of the contract based on this provision. This court has thus found that the decision of the Federal High Court has a fundamental error of law.

Decree

1.The decision of the Federal High Court is reversed.

2.The decision of the Federal First Instance Court is affirmed.

3.The court has decided that the petitioner’s termination of the contract of employment of the respondent is lawful.

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Signatures of five justices _______________________

Source: Federal Supreme Court Cassation Division Decisions

Volume: 14, pp 5-7.

Abridged translation: Selam Abraham