You Are Fired: New Labour Bill ang The Details.

Written By  Oudney Patsika

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NO employer will be allowed to terminate an employee’s contract without their consent if a raft of proposed amendments to the Labour Act is passed into law. The amendments also set a minimum benchmark of at least one month’s salary for every year served for retrenchees. It is understood that during discussions, employers were pushing for two weeks’ salary for each year served.

The current labour laws are silent on severance packages, it emerged. The proposed amendments emerged from a consultative process between government, employers and employees.

If approved, the amendments will cushion employees from being fired willy-nilly without compensation. Parliament is expected to gazette the Labour Amendments Bill today, while legislators, currently on recess, are likely to be summoned to debate the proposals.

Amendments in a draft Bill indicate that employers’ interests are catered for as the Bill promotes productivity and competitiveness of local industries.

You Are Fired: New Labour Bill ang The Details.

Part of the proposed amendments state that: “No employer shall terminate a contract of employment on notice in terms of Subsection (4) unless; the termination is in terms of an employment code of conduct or the employer and employee mutually agree in writing to the termination of the contract or the employee has engaged for a period of fixed duration or for the performance of a specified task.

“Where an employee is given notice of termination of contract of section 4 (a) (of the Labour Act) and such employee is employed under the terms of a contract without the limit of time, the provisions of section 12C shall be applicable with regard to compensation for loss of employment.”

The Bill also provides that a minimum retrenchment package for loss of employment shall apply to all subsequent retrenchments and shall be set by a works council or the employment council in the absence of a works council or where a council has not set a minimum retrenchment package for the relevant sector or industry or a minimum salary or wage of at least a month for each year served or the retrenchment board, which shall recommend such package to the Minister (of Public Service, Labour and Social Welfare) where no works council or employment council is in existence.

In the event that there is no agreement between the employer and the employee, the employer will be expected to give a written submission to the relevant employment council that will determine the matters arising from the disagreement for special measures to avoid retrenchment.

The Employment Council will then have to submit to the employer, worker’s committee and the works council, its determination in writing within 30 days after receiving submissions from the employer.

The Bill further proposes that in the event that an organisation alleges financial incapacity and subsequent inability to meet the minimum set retrenchment package for its employees, it shall apply for exemption to the relevant employment council or retrenchment board in the absence of an employment council that will be expected to process and determine within 14 days applications for exemptions.

In determining the exemption request, the employment council or the retrenchment board would have to consider the ability of the organisation to pay, relocation and job security for the remaining employees. At least 18,000 employees have lost their jobs in the last four weeks following a Supreme Court ruling a fortnight ago that revealed that both employers and employees had the same legal status under the common law.

This position allows companies to lay off workers on three months’ notice without going through the expensive retrenchment process.

The Attorney General’s Office was yet to submit the Bill back to Parliament late yesterday.

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