Employers biggest winners in the Labour amendment Act

EMPLOYERS have been viewed as the biggest winners in the Labour Amendment Draft Act which has been signed into law by President Robert Mugabe.

The Act assert workers offloaded should get two weeks wage for every year served as compensation to all employees fired in the wake of the landmark Supreme Court ruling.

Stakeholders at a breakfast meeting held in Mutate last week to discuss on termination of employment on notice organised by local consultancy firm, Eve Employment Consultancy in conjunction with Golden Peacock Hotel agreed that employers were the greatest winners in the Act.

Independent arbitrator,  Kudakwashe Pisirai in his presentation on the Bill said employers were the biggest winners despite their outcry about having no money to pay the employees and fears of rapid company liquidations following the retrospective law.

"Retrenchment under the old laws was difficult and costly. The least case scenario was one month for every year worked, while the extreme case was the Daily News case back in 2003 of six months for every year worked. So the present ruling reparation with a minimum of two weeks wage for every year served is actually a score for employers and it will serve as a pull factor to foreign investors," said Pisirai.

He said the fact that employers could apply for an exemption not to pay the minimum retrenchment package immediately through the National Employment Council was another additional benefit in favour of progressiveness.

According to Clause 5 12C (2), Unless better terms are agreed between the employer and employees concerned or their representatives, a package (hereinafter called "minimum retrenchment package"), of not less than one month's salary or wage for every two years of service as an employee (or the equivalent lesser proportion. . .) . . .shall be paid. . ., no later than date when the notice of termination of employment takes effect.

Pisirai said the 14-day ultimatum for companies to respond and the opening for companies to prove their inability to pay was another windfall.

Clause 6 which touched on measures to avoid retrenchment and the powers of NEC and the retrenchment board to determine deadlocks was also applauded by people at the workshop who said resistance by unions to lower packages to reasonable amounts was dealt with cleverly.

Africa University corporate secretary and legal advisor, Christopher Munguma, who was part of the attendants at the workshop, concurred with  Pisirai but called on Government to speed up the alignment of all amendments to the Constitution.

"The Government Gazette on the part of the minimum retrenchment package was definitely in favour of employers with a visionary outlook to draw foreign direct investment and prop-up industry, but at the same time protecting the interests of employees.

"However, we have quite a number of laws that have not yet been aligned to the Constitution which leaves plenty of loopholes for abuse," said  Munguma.

In his presentation, a business consultant, Joseph Mashingaidze, said Government should address the dollarisation issue and assist industry on compensation prior to dollarisation in 2009.

"Industry is complaining that the current push to pay severance packages takes no consideration that companies migrated from the Zimbabwe dollar era to dollarisation in 2009 with virtually nothing, yet now they have to settle obligations rising from a period where all their investments were sunk. Government has to address how to assist industry in the case of retrenchment benefits before dollarisation," said Mr Mashingaidze.

On the other hand, negotiations by the TNF are expected to commence today (Friday) to incorporate input from trade unions and business.