New labour law to stem job losses

Published: 31 August 2017

A Labour Act Amendment Bill expected to be promulgated into law in the coming quarter could result in a slowdown in retrenchments, deputy minister for Public Service, Labour and Social Welfare, Tapiwa Matangaidze, has said.

Retrenchments had increased by 62 percent in the second quarter of 2017 at 1 304, from 816 people retrenched during the first quarter of 2017, according to official statistics.

Matangaidze said the Labour Act Amendment Bill was complete and would be tabled in Parliament in its next session.

"We are pleased with the final document and we are now in a position to table it most probably in the fourth quarter when Parliament resumes. The original document had a lot of grey areas but we have worked on them. We will start seeing the level of retrenchments coming down as there will be more engagements across the board," he said.

A significant number of workers lost their jobs after a Supreme Court judgement in 2015 that employers could sack workers on three months' notice.

Although government hurriedly amended the Labour Act to stem more dismissals, companies have continued to sack workers due to viability challenges. The current amendments have also made it cheaper and easier to retrench.

In 2016, 3,881 workers were retrenched as a result of the Supreme Court ruling. Of these, 763 were from the commercial sector, which started outsourcing labour to cut costs.

Matangaidze said his ministry was also working on creating a database of all affected employees. This information would be given to the National Social Security Authority (NSSA) to enable retrenches to access loans to start projects.

NSSA has put in place $5 million to assist people affected by retrenchment after the Supreme Court judgment.
- fingaz