21 March 2014

Zimbabwe: Labour Act Review a Game Changer


Government's proposal to review the Labour Act to rationalise, among other things, costs of production that at times constitute up to 70 percent of the total cost of conducting business should be given a chance.

For long, companies - mainly public institutions such as parastatals and local authorities -- had abdicated their roles and forgot they were the main cogs in turning around the economy.

These institutions had become cash cows for chief executives and their fellow top managers who wanted to make a quick buck at the expense of service delivery.

What disturbs most is that these fat cats had surrounded themselves with under-performing cronies who were drawing huge packages without bringing any value to the State-linked entities.

The sad thing is that when the top executives leave, their cronies remain at these companies and firing or retrenching them has proved costly, resulting in deadwood being kept but without adding any value to the institutions.

Cabinet must thus be lauded for proposing the review of labour regulations so that those that do not deserve to remain in the employment of Government for whatever reason -- especially under-performing and looting -- can be jettisoned without spending too much money on terminating their contracts.

At times, labour laws overprotect unproductive workers to the extent that employers find it difficult to get rid of people who are a drain on the company as they hold onto contracts of employment as their defence.

In as much as people work to earn a living, it is our humble suggestion that working for State companies and parastatals should be a calling to serve and not to be served.

These institutions are the powerhouses of national development and they should never be used by anyone as sources of unjust enrichment.

It has been established that many public sector debts relate to outstanding salaries and huge sums of money are being borrowed to sustain these packages at the expense of service delivery.

The majority of the 90 state entities are now setting aside 70 percent of their total revenue for salaries and the remainder for service delivery, instead of it being vice versa.

As such, and as noted by Finance Minister Patrick Chinamasa, the country now operates on typically high cost and low production.

We implore all relevant authorities not to resist the review of labour laws to eliminate obstacles constraining the viability of both public and private companies.

Labour laws must ensure that retrenchments, terminal benefits, downsizing, working hours and the arbitration awards system must be handled in a manner that does not throttle the viability of the firms or force the firms into voluntary sequestration.

After this has been said and done, Government should be mindful that not only companies need protection, but the workers too.

There must be mechanisms to ensure workers are not abused by companies that want to maximise profits by unfairly treating employees or sending them home empty-handed and on the flimsiest of excuses.

If Government over-protects companies, this will create an opportunity for failed labour-backed opposition parties like the MDC-T to resurrect, riding on alleged abuse of workers' rights.

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