News / National
30 companies seek to dodge retrenchment payouts
19 Aug 2016 at 01:22hrs | Views
THE Zimbabwe Congress of Trade Unions (ZCTU) has referred to the Retrenchment Board more than 30 companies seeking exemption from paying retrenchment packages to dismissed workers.
Following the July 17, 2015 Supreme Court ruling, which granted employers powers to dismiss employees on three months' notice without paying a retrenchment package, a number of companies countrywide took the opportunity to lay off the workers.
In August last year, President Robert Mugabe signed into law the Labour Amendment Bill to repeal common law provisions that had been used by employers to fire workers on three months' notice.
However, employers have made a High Court application against some amendments to the Labour Act.
"It's true that some companies who fired the workers on three months' notice haven't paid the workers their retrenchment packages in terms of the Act.
"This is because the employer doesn't want to adhere to the law; the companies have confided with the Employers Confederation of Zimbabwe (Emcoz) to apply for exemption.
"About 33 companies who wanted a blanket exemption from paying retrenchment packages have approached ZCTU and we've turned down their cases and referred them to the Retrenchment Board," said the ZCTU secretary-general Mr Japhet Moyo in an interview.
It has been reported in some sections of the media that employers who are part of a High Court application challenging amendments to labour laws, have refused to approach the Retrenchment Board for an exemption saying this would imply that they retrenched the workers.
This week, about 11 former workers at Bulawayo-based Western Transport who were affected by the July 17 Supreme Court ruling told Business Chronicle that they were yet to get paid their retrenchment packages based on two weeks' salary for every year served.
Their former employer, they said has argued that it can only pay them one week salary for every year served. The ex-workers said they have refused one week salary for every year served their former employer has proposed.
"Following the exemption sub-committee meeting held on the 10th of June 2016, the exemption sub-committee recommended the following:
"The parties were given time to engage each other and reach an agreement, but failed. The employer is advised to pay the minimum retrenchment package of one month salary/wages for every two years of service as per Labour Amendment Number 5 of 2015. Affected employees to be paid on or before 31st July 2016," reads part of a letter from the National Employment Council (NEC) for the transport industry, dated June 13, 2016 addressed to Western Transport management.
In an interview, Western Transport human resources advisor Mrs Gladys Mpempa (pictured) confirmed the disagreement between the firm and its ex-workers.
She said while other companies were seeking exemption from paying the dismissed workers retrenchment packages through representation by Emcoz, Western Transport was not part of that arrangement.
"We've held meetings with the employees in relation to their retrenchment packages and have stood their ground that they want two weeks salary for every year served. We're facing cash flow challenges due to the prevailing business environment," she said.
According to a document, which Mrs Mpempa availed to Business Chronicle that Western Transport wrote to the NEC for the transport industry applying for exemption of payment of retrenchment packages, her organisation stated that it can only pay the affected workers a week's pay for each year worked.
"We address you in terms of Section 12 C (3) (a) of Amendment Act Number 5 of 2015. We initially submitted an application for total exemption and we received your decision dated 13th June 2016 that the company should pay the minimum retrenchment package of one month salary for every two years of service.
"As a company we've reconsidered our position and can now offer a week's pay for each year worked. We still emphasise on financial incapacity and attach hereto the financials of the company to justify our re-application," reads part of the document dated July 28, 2016.
The NEC for the transport industry has since requested Western Transport to submit the list of workers affected, amount owed in terms of the minimum package by employee and the amount owed in terms of the company's proposal.
Western Transport has also been asked to submit a payment plan for its proposed package and the current bank statement for the past three months.
Following the July 17, 2015 Supreme Court ruling, which granted employers powers to dismiss employees on three months' notice without paying a retrenchment package, a number of companies countrywide took the opportunity to lay off the workers.
In August last year, President Robert Mugabe signed into law the Labour Amendment Bill to repeal common law provisions that had been used by employers to fire workers on three months' notice.
However, employers have made a High Court application against some amendments to the Labour Act.
"It's true that some companies who fired the workers on three months' notice haven't paid the workers their retrenchment packages in terms of the Act.
"This is because the employer doesn't want to adhere to the law; the companies have confided with the Employers Confederation of Zimbabwe (Emcoz) to apply for exemption.
"About 33 companies who wanted a blanket exemption from paying retrenchment packages have approached ZCTU and we've turned down their cases and referred them to the Retrenchment Board," said the ZCTU secretary-general Mr Japhet Moyo in an interview.
It has been reported in some sections of the media that employers who are part of a High Court application challenging amendments to labour laws, have refused to approach the Retrenchment Board for an exemption saying this would imply that they retrenched the workers.
This week, about 11 former workers at Bulawayo-based Western Transport who were affected by the July 17 Supreme Court ruling told Business Chronicle that they were yet to get paid their retrenchment packages based on two weeks' salary for every year served.
Their former employer, they said has argued that it can only pay them one week salary for every year served. The ex-workers said they have refused one week salary for every year served their former employer has proposed.
"Following the exemption sub-committee meeting held on the 10th of June 2016, the exemption sub-committee recommended the following:
"The parties were given time to engage each other and reach an agreement, but failed. The employer is advised to pay the minimum retrenchment package of one month salary/wages for every two years of service as per Labour Amendment Number 5 of 2015. Affected employees to be paid on or before 31st July 2016," reads part of a letter from the National Employment Council (NEC) for the transport industry, dated June 13, 2016 addressed to Western Transport management.
In an interview, Western Transport human resources advisor Mrs Gladys Mpempa (pictured) confirmed the disagreement between the firm and its ex-workers.
She said while other companies were seeking exemption from paying the dismissed workers retrenchment packages through representation by Emcoz, Western Transport was not part of that arrangement.
"We've held meetings with the employees in relation to their retrenchment packages and have stood their ground that they want two weeks salary for every year served. We're facing cash flow challenges due to the prevailing business environment," she said.
According to a document, which Mrs Mpempa availed to Business Chronicle that Western Transport wrote to the NEC for the transport industry applying for exemption of payment of retrenchment packages, her organisation stated that it can only pay the affected workers a week's pay for each year worked.
"We address you in terms of Section 12 C (3) (a) of Amendment Act Number 5 of 2015. We initially submitted an application for total exemption and we received your decision dated 13th June 2016 that the company should pay the minimum retrenchment package of one month salary for every two years of service.
"As a company we've reconsidered our position and can now offer a week's pay for each year worked. We still emphasise on financial incapacity and attach hereto the financials of the company to justify our re-application," reads part of the document dated July 28, 2016.
The NEC for the transport industry has since requested Western Transport to submit the list of workers affected, amount owed in terms of the minimum package by employee and the amount owed in terms of the company's proposal.
Western Transport has also been asked to submit a payment plan for its proposed package and the current bank statement for the past three months.
Source - chronicle
