MAKE INFORMED DECISIONS

The business and labour sectors got together yesterday to find solutions to some of the emerging challenges they face, not least the Employment Bill of 2021, which has some contentious clauses that are seen as having the opposite effect of its intentions.

The 10th Annual Labour Law Seminar 2023, hosted by Business Eswatini, whose deliberations were closed to the media, was also expected to discuss, among other things, the big debate around the proposed conversion of the Eswatini National Provident Fund (ENPF) and find answers to the question of who pays and who benefits. These are very critical issues that may have a huge impact on the business environment and must be approached with great care and attention to avoid making it harder to do business in Eswatini, while also ensuring not to disadvantage the worker.

Jobs

This country is at a critical juncture where it needs to create jobs, and only a highly competitive and conducive environment can achieve this. Right now, we have a golden opportunity to lure unsettled investors from troubled South Africa by offering incentives that make it worthwhile to invest here long-term. Such seminars, coupled with wide stakeholder engagement, should contribute to laying the appropriate foundation for businesses to thrive and open up job opportunities.

The ENPF has been a subject of discussion for some time now, so I will not venture into that debate for today but look into the new question that has arisen among employers on whether Section 130 of the Employment Bill of 2021 works for or against our national goal of job creation. It has been submitted to us that this section seeks to outlaw labour broking by precluding an employer from outsourcing or sub-contracting any part or the whole of the employer’s core business to third parties, and especially all work that requires continuous performance or is of a permanent nature.

This is being viewed by some employers as effectively banning contracting and placing at risk hundreds of Swati-owned businesses, thousands of employees, and millions in investments in specialist vehicles and equipment. “Many businesses will be forced to close, jobs will be lost, and banks will be forced to repossess all financed equipment,” Montigny Chief Executive Officer (CEO) Andrew LeRoux told our Business desk recently.

Unemployment

The subject of labour brokers is a pain to workers and is seen as taking advantage of the unemployment crisis to exploit desperate job seekers.
Emphasis has been placed on the need to distinguish between labour brokers and contractors since labour brokers generally only provide labour and the employees are usually casual or temporary. The main concerns arise from the experience that these employees are vulnerable to abuse and exploitation, as they are often retained as casual, temporary, or hourly-paid employees for many years without permanent employment or the full protection of the country’s employment legislation.

On the other hand, contractors are legitimate, usually Swati-owned, specialist businesses that offer their services or products to various companies, and Eswatini makes extensive use of contractors, especially in the security, construction, sugar and forestry industries. Employees of these businesses are generally permanent, full-time, unionised, and subject to all the terms and conditions of the sector in which they operate. LeRoux pointed out that some of these contractors have become big businesses with hundreds of employees, millions of Emalangeni in capital equipment, and extensive retained knowledge and expertise.

Contractors

He is worried, though, that Section 130 of the Employment Bill is placing contractors at risk of being dissolved, as it makes it very clear that an employer shall not outsource or subcontract any part or the whole of the employer’s core business to third parties, especially all work that requires continuous performance or is of a permanent nature.

“This effectively bans contracting and places at risk hundreds of emaSwati-owned businesses, thousands of employees and millions in investments in specialist vehicles and equipment. Many businesses will be forced to close, jobs will be lost and banks will be forced to repossess all financed equipment,” he observed. Also highlighted is the fact that the Bill deals with triangular forms of employment—another name for labour brokerage—separately.

The big worry put forward is the impact, which may see big businesses adapt because they have the resources, skills and finances to replace these contractors internally, but at the expense of small business owners. Will this, as LeRoux points out, see many employees become redundant, drive mechanisation faster, see banks lose significant amounts lent to these small businesses, resulting in small businesses finding it harder to raise funding in the future as they will have to prove that the services that they provide cannot be regarded as contracting, which would now be unlawful? That is a gloomy picture. I hope the labour law seminar will emerge with answers that replace the gloom with a boom in the business sector. Only well-informed decisions can achieve this.
 
 

Post your comment

Your name:

Your e-mail address:

Add your comments:

Please enter the code you see in the image:

Image:

Code: