Mass job losses loom

These new labour laws will force mass redundancies. Employers who have five workers will be forced to lay off three so that they can remain with two that they will be able to give housing, transport and allowances. It’s a good policy but the timing is bad because economic times are hard.

MASS retrenchments are looming in the country if Government does not rescind its decision to make payment of 25 percent gratuity, housing and transport allowances mandatory, Citizens Democratic Party president Robert Mwanza has warned.

Mr Mwanza said the policy was good but that the timing of implementation was not favourable because most companies were grappling with finances.

He said in an interview that economic conditions at the moment were bad and that most companies were in a financial crisis.

Mr Mwanza said increasing the wage bill for firms when the country was experiencing negative economic conditions was not feasible.

He said most companies would be forced to retrench some workers for them to meet gratuity, housing and transport allowances among others.

Mr Mwanza said most employers were already struggling to meet their monthly wage bill because of the present harsh economic conditions.

He explained that load-shedding had affected profitability for most companies and that they were struggling to stay in business.

Mr Mwanza said it was better for the economy to have many people in employment even if they were getting low wages than a few with a relatively high income.

“These new labour laws will force mass redundancies. Employers who have five workers will be forced to lay off three so that they can remain with two that they will be able to give housing, transport and allowances. It’s a good policy but the timing is bad because economic times are hard,” he said.

Earlier, Forum for Democracy and Development spokesperson Yotam Mtayachalo also warned that newly introduced labour laws would lead to mass job losses with the economy being in recession.

Mr Mtayachalo, who is former General Secretary of the National Energy Sector and Allied Workers Union said in as much as the labour reforms were good for employees, the timing was wrong.

He said load-shedding, fuel and electricity tariff increase were affecting businesses badly.