The Namibian Employers' Federation says strict labour laws are contributing to the high unemployment rate in the country. Tim Parkhouse, Secretary General of the NEF told The Economist that it has been proven worldwide that strict legislation leads to high unemployment.
He said:"One of the problems in Namibia is that our labour legislation is very strict and internationally it's proven that if you have strict labour legislation you will have high unemployment."
Parkhouse said since the cost of labour was critical in the success of any business, it was important that labour laws should be flexible to allow companies to balance the cost of labour with their production.
"The flexibility of labour is something which is becoming far more important in business development anywhere in the world not just here in Namibia. This was raised in 2005 when the Trade Hub in Gaborone did what was called the investor survey and the investor roadmap for Namibia. They said that a barrier to firing, is a barrier to hiring. In other words if you are going to struggle to get rid of a worker, you will think twice about employing any more than is totally necessary."
Parkhouse said the problem with the Amended Labour Act was that it has taken away from the employer the capacity of being flexible with his labour costs.
"Labour hire, which is utilised anywhere in the world, is a way of providing temporary labour when it is needed. Supermarkets at month end or during the Christmas period, need more people on the floor than they do during the main part of the month. Labour hire was utilised to help fill that period.
"If you take a country like Spain, I know various figures but it is in the region of 26% to 40% of their workforce is all done through labour hire and nobody suffers because you constantly move around.
"One of the biggest labour hire companies told us that 80% of their people are employed 80% of the time, in different operations, where they are needed. These are the positive aspects of labour hire."
The NEF General Manager said, some of the labour hire companies were their own worst enemies as they were abusing the system by not paying workers decent salaries or providing them with any fringe benefits, keeping them on perpetual temporary contracts.
He added: "It's totally unfair to give someone a time bound contract for one year, one year, one year without giving them all the benefits that they are entitled to as permanent staff.
"There were no pension schemes, no one registered for social security and so on. The good labour hire companies are suffering because of the bad ones. The good employers are suffering because of the bad ones."
The employers federation said it is suggesting an open ended contract,which states that no work, no pay. "You want to come and work in my supermarket, but I will only be able to offer you work for a week or maybe ten days. So you will be employed by me, you will get the benefits of medical aid, social security registrations and so on but you will only physically be paid for the hours that you worked. There is no reason why that should not happen."