By Paidamoyo Muzulu
An estimated 20 000 workers who were fired after the Supreme Court ruled that employers could terminate contracts on notice may have something to smile about if Parliament passes the Labour Amendment Bill this week.
Tucked at the end of the draft Bill published in the Government Gazette on Friday is just two lines which state that all employees fired in the wake of the landmark Supreme Court of Appeal ruling on Zuva Petroleum managers, are entitled to a minimum compensation of two weeks wages for every year they served.
Clause 18 of the draft Bill reads, “Section 12 of this Act applies to every employee whose services were terminated on three months’ notice on or after the 17th of July, 2015.”
Section 12C (2) unambiguously states the minimum retrenchment package that should be paid out to employees upon retrenchment or termination of non-fixed employment contract:
“A package (herein after called a minimum retrenchment package) of not less than one months’ salary or wages for every two years of service as an employee (or the equivalent lesser proportion of one months’ salary or wages for a lesser period of service) shall be paid by the employer as compensation for loss of employment (whether the loss of employment is occasioned by retrenchment or by virtue of termination of employment pursuant to Section 12 (4) (a), (b), or (c), no later than the date when the notice of termination of employment takes effect.”
The two-week salary for every year served can translate into huge amounts of money for some employees who had worked for many years, some nearing retirement, but who had been forced to walk away from their workplaces with nothing except a promised three-month salary.
The clause may force companies to cough out millions of dollars to compensate thousands workers fired in the past four weeks without benefits.
Confederation of Zimbabwe Industries president Busisa Moyo said in an interview yesterday that the Bill would lead to mass closure of companies as most would not be able to pay the retrenchment packages.
“Instead of the mass dismissals, we will witness mass closures or filing for liquidation or application to go under judicial management as most companies cannot afford to pay these packages,” Moyo said.
He added: “Most companies are on their knees and struggling to settle even statutory obligations such as taxes to Zimra, pensions and NSSA dues and I think companies should be given a reprieve.”
Moyo suggested that the real solution lay in all the parties meeting and having a frank and robust discussion on the state of the economy.
“These things need to be done at a tripartite negotiation forum and we agree on the way forward as business, labour and government,” he said.
Zimbabwe Congress of Trade Union secretary-general Japhet Moyo welcomed the retrospective effect of the Bill that seeks to give compensation to workers that have already been dismissed in the last four weeks.
“This would be a positive development if Parliament passes the Bill with that retrospective clause because that has been the union’s plea, that the law should protect those who were illegally dismissed after the Supreme Court ruling,” Moyo said.
However, Moyo said unions were not satisfied with the proposed minimum retrenchment package.
“We do not think that the two weeks’ salary for every year served is enough compensation as we don’t have social safety nets like the South Africans where I believe they have copied the clause from,” he said.
He added: “As unions, we would have preferred the law not to prescribe the minimum, but would have allowed negotiations at enterprise level to make a decision because companies that can afford paying more now will simply pay the minimum.”
Parliament will this week fast- track the passage of the Bill, but there remains a danger that the law may be invalid if the public is not consulted as this is now a constitutional requirement.
“Parliament must facilitate public involvement in its legislative and other processes and in the process of its committees,” reads Section 141 (a) of the Constitution.
The draft comes after President Robert Mugabe has for the past few days been speaking against the massive job losses.