7 NGOS APPLY TO RETRENCH

MBABANE – The Ministry of Labour and Social Security has revealed that about seven NGOs who were receiving USAID funding have applied for retrenchment.

The ministry’s Communications Officer, Nompilo Mncina confirmed that numerous non-governmental organisations (NGOs) have submitted requests for retrenchment and/or payouts to their personnel since the beginning of the year. She explained that the department is actively processing applications from these various entities, but cannot identify these NGOs because the requests are still undergoing a thorough review process.

These applications are being evaluated in accordance with Section 40(2)(a)-(f) of the Employment Act, No.5 of 1980. This legal framework mandates a detailed and often lengthy process, typically exceeding a month, before any decisions can be finalised. Section 40 of Eswatini’s Employment Act outlines the procedures that employers must follow when dealing with redundancies. It is important to note that these procedures do not apply to all types of employees.

Specifically, the provisions of this section do not extend to employees engaged in seasonal contracts, those on fixed contracts of six weeks or less without the possibility of renewal, or casual employees.  

Notice

When an employer is considering terminating the employment contracts of five or more employees due to redundancy, they are legally obligated to provide written notice. This notice must be given at least one month in advance to both the labour commissioner and any organisation with which the employer has a collective agreement. The purpose of this notice is to ensure that all relevant parties are informed and have time to prepare for the impending redundancies.  

The notice itself must contain specific information. Firstly, it must clearly state the number of employees who are likely to be affected by the redundancy. Secondly, it should detail the occupations and remuneration of these employees. The reasons for the redundancies must also be provided, giving clarity as to why these job losses are necessary. Furthermore, the notice must specify the date when the redundancies are expected to take effect.  

In addition to these requirements, the employer must also disclose the latest financial statements and audited accounts of the company.  This requirement aims to provide transparency into the financial health of the company and the necessity of the redundancies.  Finally, the employer must also detail what other options have been considered to avoid or minimise the redundancies.  This demonstrates that the employer has explored all possible alternatives before resorting to job terminations.  

In summary, Section 40 of Eswatini’s Employment Act sets out a clear procedure that employers must adhere to when contemplating redundancies.
This procedure focuses on providing adequate notice and comprehensive information to the relevant parties, ensuring transparency and protecting the interests of the employees affected. “The requests are filed in all our regional offices, hence it is still early to share statistics for now,” Mncina stated.

Contracts

She emphasised that not all requests are automatically granted. The process involves various stages, including advising parties to allow existing contracts to run their course and exploring alternative solutions to minimise redundancies. The department’s approach is not simply to approve retrenchments, but to seek viable alternatives that protect employment. This proactive stance reflects a commitment to balancing the needs of businesses with the welfare of the workforce.

While specific statistics regarding the identity of the organisations applying for retrenchments and the number granted permission are not yet available, Mncina indicated that the information will be compiled and released once the review process is complete. She advised that formal requests for the finalised data should be directed to the office of the principal secretary.

Furthermore, details regarding the sectors most affected and the common reasons advanced by the entities seeking retrenchments are also pending.
The department’s focus at this juncture is on the meticulous processing of each application, ensuring compliance with the Employment Act and exploring all possible avenues to mitigate job losses. In conclusion, while the precise impact of recent retrenchment requests on the labour force remains to be seen, the department is actively engaged in a comprehensive review process.

The final figures and detailed analysis will be made available upon completion of this process, providing a clearer picture of the current labour landscape. Economist Thembinkosi Dlamini stated that the impact of retrenchments would be massively felt, from the employee level to the national level. He suggested that those who lose their jobs would face significant hardship.

Difficulties

Dlamini particularly emphasised the difficulties faced by individuals specifically trained for their positions, as they would encounter more challenges in finding new employment compared to those in positions such as accounting. Dlamini asserted that these job losses would exacerbate the unemployment rate in the country, leaving many people without the means to support themselves or their dependents.

He further explained that retrenchment would lead to increased stress levels among those affected, as they would struggle to maintain their previous standard of living, potentially having to make changes such as moving children from private to public schools. The economist highlighted that employees would experience stress due to financial commitments made under the assumption of job security, such as school fees or loans.
He predicted that individuals would be indebted and the potential losses of assets like houses and cars.

Dlamini also indicated that the banking sector would be affected, as they would lose interest and loan repayments, and would be compelled to repossess people’s assets to recover debts. Service providers, including loan providers, would also suffer from a loss of clientele. At the national level, Dlamini cautioned that the country would lose essential services provided by employees of NGOs funded by USAID, services that the government was unable to provide.

As an example, he suggested that if a retrenched organisation had been providing free contraceptives, the country might experience overpopulation due to increased procreation.

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