Presenting the 2015 budget in December, Finance Minister Patrick Chinamasa said the country’s labour laws needed to be relaxed in order to attract foreign direct investment (FDI).

He said the current laws gave too much protection to workers and threatened the viability of companies which are struggling to maintain “unsustainable salary scales’.

“The cost structure of our companies is not sustainable, we cannot compete with other companies in the region…our labour costs are too high,” he told an audience of business leaders at the BUY Zimbabwe Awards in December.

Furthermore, at a Confederation of Zimbabwe Industries 2015 Economic Outlook Symposium in Harare last week, Chinamasa called for a total salary freeze across all sectors.

The government is proposing, amongst other measures, that salary negotiations be done at company level, as opposed to a sectoral level.

The cabinet has adopted the amendment principles, paving the way for the proposals to be put before parliament where they are expected to be approved.

But the president of the Zimbabwe Congress of Trade Unions (ZCTU), George Nkiwane, said Chinamasa’s proposals fly in the face of the principles agreed at Zimbabwe’s social dialogue platform, the Tripartite Negotiating Forum (TNF).

“The initially agreed principles were in line with the Constitution and that was carefully managed. This shift by government is a violation of workers’ rights and, indeed, a violation of the Constitution,” Nkiwane told Equal Times.

He said that labour, business and government representatives at the TNF had all agreed that amendments to the country’s labour laws would focus on harmonisation, conforming to international labour standards, the protection of workers from casualisation and the recognition of workers’ full rights to collective bargaining.

However, Nkiwane described Chinamasa’s proposals as quite the opposite to what was agreed. Furthermore, he charged the government of undermining the work of the National Employment Council (NEC) which negotiates minimum wages in Zimbabwe.
Both Chinamasa and the newly appointed labour minister, Prisca Mupfumira, were unavailable for comment when contacted by Equal Times.

But Nkiwane, has expressed hope that Mupfumira will be willing to enter a dialogue on the proposed amendments.

“The current Minister has some experience from industry and we believe through engagement we will be able to make some progress,” Nkiwane said..

A necessary evil?

Tau Tawengwa, a Harare-based industrial researcher told Equal Times that the labour market flexibility proposals as a “necessary evil” in the pursuit of efficient service delivery and good economic governance.

“Rigid labour laws do not allow for large-scale employment in sectors that are labour intensive,” he said.

However, as Joel Akhator Odigie, a human and trade union rights coordinator for the Africa office of the African Regional Organisation of the International Trade Union Confederation (ITUC Africa) explains, what is happening in Zimbabwe is symptomatic of something happening all over the continent, thanks to the “destructive” interventions of international financial institutions like the International Monetary Fund and World Bank.

“Flexibility is a strategy to use labour to incentivise FDI. But it is also a way of deregulating the labour market and freeing the state from the responsibility of protecting workers,” he told Equal Times.

He argues that a well-trained, competent and well-remunerated workforce is a much better way to attract investors, rather than offering short-sighted incentives and cheap wages.

“Labour flexibilisation is a race to the bottom,” said Odigie. “It further pauperises working people and continue to give FDIs benefits that cannot be retained within the local economy.”