Legal battle threatens social contract

via Legal battle threatens social contract – The Zimbabwe Independent October 9, 2015

On September 3 employers from all over the country packed a Harare hotel after taking up an invitation by the Employers Confederation of Zimbabwe (Emcoz) to meet government officials for discussions on the contentious amendments to the Labour Act.

Kudzai Kuwaza

There was no free seat in the auditorium as frustrated employers waited to meet ministry of Labour officials who had been delayed. They waited patiently for their arrival while chatting animatedly about the Act, which in their view was poisonous.

“The turnout shows that this is an issue of life and death,” an employer quipped.

The tension was so thick; you could slice through it with a knife. Such was the atmosphere that Emcoz president Jack Murehwa felt compelled to tell waiting employers to exercise restraint when discussing the amendments with government officials when they arrive.

After an hour, the officials arrived led by then acting labour permanent secretary Memory Mukondomi and legal advisor in the ministry, Precious Sibiya.

The meeting began with employers expressing serious reservations with various amendments especially the clause that mandated employers to compensate workers dismissed using the July 17 Supreme Court ruling. The ruling allowed employers to dismiss workers on three months’ notice without paying a retrenchment package.

This spurred government to amend the law outlawing the clause that formed the basis of the Supreme Court ruling in the process.

Sibiya stood her ground saying government could not just watch as thousands lose their jobs without compensation. Accusations were traded with Sibiya saying employers refused to attend crucial meetings over the issue prior to the amendments while Emcoz executive director John Mufukare said the short notice of the meetings made it impossible to consult before attending.

At the end of the meeting, employers were far from being satisfied setting the stage for a legal battle between government and employers.

The High Court application by employers last week in which Labour minister Prisca Mupfumira is the respondent means the gloves are well and truly off.

Even the wording of the court application reflects how angry and frustrated employers are over the amendments hurried through Parliament in August.

“This is an application for a declaration of the constitutional invalidity of certain provisions of the Labour Amendment Act No 5 of 2015,” Mufukare said in his founding affidavit.

“I am prepared to go further to aver that this limitation came about through an arbitrary process of legislating, a kneejerk reaction by the State to what it perceived as a social ill.

“That the process of legislating, the Amendment Act, was reactionary is evidenced in the lack of thinking, consultation and research required to guide government action and law making.”

He said there was no doubt the new Act would cause hardships to business in the country, by further stifling economic growth and causing massive unemployment, the very antithesis of what the State sought to achieve.”

Among the issues employers are contesting to add to the issue of retrospectivity, is the fixed retrenchment package, the issue of seasonal contracts becoming permanent after being renewed after a certain number of times, the right of dismissed workers to be compensated and the adjudicating powers given to labour officers.

Labour however is dead set against the employers’ appeal to the amendments.

Zimbabwe Congress of Trade Unions (ZCTU) secretary general Japhet Moyo said the union is seriously considering contesting any application to remove the two clauses by employers.

“The ZCTU is considering using the legal process to defend the status quo,” Moyo said.

“We are ready to join those who defend the status quo if there is a court case to nullify these amendments.”

Moyo said employers should compensate those who were dismissed using the July 17 ruling adding that most workers were dismissed using probability so should be entitled to compensation.

The stand-off begs the question: Whither the proposed social contract under the auspices of the Tripartite Negotiating Forum?

Economist and former Zimbabwe National Chamber of Commerce president Oswell Binha is under no illusions about the prospect of a social contract involving government, business and labour.

“The social contract is long dead; there is no social contract anymore,” Binha declares.

“The reason employers have gone to court is not to set a precedent of laws being applied in retrospect. If a precedent is set you never know what other laws will be applied in retrospect.”

The TNF, a social dialogue platform that brings together government, business and labour to negotiate key socio-economic matters, had been revived when Mupfumira was appointed Labour minister in a bid to bring the three parties to the table to tackle various bottlenecks affecting the economy.

However it remains to be seen how the three parties can have effective dialogue as they are at each other’s throats as evidenced by the court application by employers.

Economist John Robertson said the TNF, which is always at loggerheads, should come up with measures aimed at reducing costs.

“The negotiators in the TNF do not see each other very often and when they do they do not speak the same language,” Robertson said. “There is a serious need for action to reduce costs. This will help bring in investment.”

Whatever the outcome of the court appeal by employers, there is no doubt that this will have a landmark effect on labour relations in Zimbabwe.