BUSINESS has described the Labour Amendment Bill which passed through Parliament on Thursday as “retrogressive” and “a threat to economic growth”.
Xolisani Ncube
They argued that for a country whose economy was non-performing, the retrospective aspect of the Labour Bill was likely to result in the closure of companies. A lot of companies which fired workers are likely to be forced to pay large amounts as compensation.
Approximately 25 000 workers, including those employed by ailing parastatals like the National Railways of Zimbabwe and Air Zimbabwe, lost their jobs after the Supreme Court ruled that employers could fire workers on three months’ notice only.
Employers’ Confederation of Zimbabwe (Emcoz) president Jack Murehwa yesterday said the product (Bill) that Parliament ended up producing missed the objectives of creating a friendlier environment for business and potential investors.
He said the Bill was likely to cause the collapse of many businesses.
“It is retrogressive and counterproductive for laws and amendments to stop business entities from making appropriate business decisions,” Murehwa said.
“When a businessman or investor takes the option to separate with employees or close shop, it must be a clear sign that all is not well with that establishment.
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Sadly, the current debate seems focused on how a failing or closing business can be forced to keep employees in the failing establishment,” he said.
According to the proposed Bill, which has since been gazetted and now awaits Presidential assent for it to become law, all workers fired as from July 17 are entitled to two weeks’ salary for every year served on top of the three months notice award. Business said this was not achievable.
“We understand that government has decided to apply the provisions of the Bill in retrospect despite the fact that this aspect had been viewed as unconstitutional by several quarters. We are not sure of the circumstances that could have informed government to take that stance,” he said.
Murehwa said affected businesses would have to wait and formally be advised that “whilst the actions they took some time in the past were within the provisions of the law and therefore within their legal rights, those rights had been revoked in retrospect.”
National Chamber of Commerce president Davison Norupiri said there was nothing new on the Bill that was likely to stimulate economic growth. He said the Bill still needed further amendments.
“The Bill to us as business has done nothing which we can talk about other than to shorten the process of retrenching unwanted labour.
Norupiri said the clause suggesting retrospective payment of workers posed a serious economic challenge to most companies.
“It is a fact that most businesses have been struggling to stay afloat and when this window opened, they offloaded people whom they thought were unwanted.
But now, for government to instruct that they pay them in retrospect, most firms will close shop and the economy at large will be affected,” he said.
During debate on the Bill in Senate, Midlands senator Morgan Komichi said government had fasttracked the Bill and ignored MDC-T proposed amendments in order to please Chinese investors and the International Monetary Fund.
“Madam President, are we being controlled by IMF and China to the extent that when we are sick and tired of our workers, we lay them off ? We are known as a country that used to protect its workers, but now we are seated here talking about a Bill that is not protecting the labour force,” he said.
The International Monetary Fund has been lobbying government to cut its wage bill and reduce its staff so that the country’s economy could be revamped.
