LABOUR LAW UPDATE: EMPLOYERS’ GUIDE ON HOW TO HANDLE THE CORONAVIRUS OUTBREAK AT THE WORKPLACE IN PERSPECTIVE WITH TANZANIA LABOUR LAWS
- Pandemics and outbreaks in the eye of labour law in Tanzania
- The notion of “lockdown” and work-from- home to employer-employee relations
- Preventive Policies, mandatory testing; and other underlying privacy rights
- Concept of unpaid leave in labour laws and how to navigate around it
- Financial implications arising out of the outbreak and methods to save companies and whether salary deductions are feasible under the law.
The world at large is struggling to cope with the Coronavirus (COVID-19) outbreak and world over, governments have initiated stern lockdown measures, among others, to try and combat the disease. The viral disease, which seems to have originated from China around December 2019, is now reported to have infected about 638,146 by 30th March 2020 according to the World Health Organization and still growing.
The growing rate of infections and resulting deaths have prompted the aforestated measures, which in return have prompted employers around the world to employ various measures to address the matter. Some of the biggest airlines in the world have retrenched over 50 percent of their workforce by 12th March 2020, while as of recently, Menzies Aviation, world’s renown ground handling company has announced on the 27th March 2020 that it is cutting 17,500 jobs due to the corona virus outbreak and the slowed movement of people around the globe.
In Tanzania, as of 30th March 2020 it has been announced that there are 19 cases of confirmed coronavirus infections. Despite the low number of infections (compared to other countries in Europe or South Africa) the drawdowns of the global economic slump have reached Tanzania as well. As of last Friday (27th March 2020), only Ethiopian Airline remained the international carrier that flies in and out of the Country, and even that, announced over the following day that it is stopping its flights due to that.
Breakthrough Attorneys is aware of the national stand as regards the preventive measures to combat the coronavirus, which do not officially include lockdown and working from home. Nonetheless, many employers, have initiated working from home protocols and/or total lockdown for employees who may not practically “work from home”. Amidst this move, there comes a worrying and stressing issue on how to deal with these labour issues in the circumstances. Further to this, as the government maintains its stand not to implement a countrywide lockdown, employers with active offices are more and more facing questions on how to handle their employees in such a volatile time.
Our experts in Tanzanian labour law in this update address the most stressing issues that have faced many of our clients and the labour market in general.
2.0 Tanzania Labour Laws and Pandemics: Whether contemplated.
Tanzania labour laws, mainly the Employment and Labour Relations Act (ELRA) and its underlying subsidiary laws, do not cover pandemics i.e. supervening events that may lead to delay or non-performance of contractual obligation under labour law, (commonly known as Force majeure clauses.) In Tanzanian jurisdiction, Force majeure is a clause commonly found in commercial agreements and not contemplated under Labour Laws. With this void in the labour laws, it means that employers are not prohibited to include them either.
The current pandemic has exposed the weakness of the labour law and labour practice in the sense that, both have not contemplated such a complex factor in general application. In our view, employers are advised to include such clauses for similar happenings, such as floods, civil wars, epidemics/pandemics etc.
3.0 Lockdown and working-from-home; legal implications
3.1 The provisions of Section 15 (1) (f) of the Employment and Labour Relations Act, 2004 (ELRA) requires employment Contracts to include place of work. Nonetheless, the law allows flexibility on the same on the account of employer’s guidance and directions, without offending an employee’s rights.
3.2 Employers thus have powers to discuss and agree with employees as regards station of work, especially where office site may be a risk area for COVID-19 infection and exposure.
3.3 As a measure to combat COVID-19 transmission, amidst growing needs, and subject to Clause 4.0 (preventive policies and measures at workplace) and Clause 7.0 below (financial implications), working from home can address both the employer’s service continuity and act as a preventive measure for COVID-19 infection.
3.4 Given the fact that contracts are specific on where the employee would be required to discharge his/her duties i.e. station of work, it is imperative that employers do designate “working from home” policy in a special “Operational Requirement” program; Collective Agreements with unionized employees; or if applicable, written addendums to individual employees.
3.5 Where working from home poses other issues for the employer, such as strenuous financial situation, and then other labour management approaches as per the law will need to apply as per Clause 7.0 herein.
4.0 Preventive Policies and other employer vs. employee rights
Employers should undertake to implement at workplace preventive measure for purposes of being compliant with workplace safety laws. Under section 96 of the Occupational Health and Safety Act (OSHA Act) an employer with four (4) or more employees is required by law to have a healthy and safety policy as well as guidelines on how such policy will be implemented.
While the ELRA is largely silent on safety policies, the same is vocal and requires for employers with unionized employees to agree under “collective agreements” on safety and health measures at the workplace (See Section 62 (1) (4) (b) of the ELRA and underscored by Regulations 55 (2) (b) and 56 (5) (b) (ii) of the Employment and Labour Relations (Code of Good Practice) Rules GN. No. 42 of 2007.) It is a safe presumption, that an employer with non-unionized employees may be required by the Labour Commissioner to implement similar policies especially in reference to the OSHA Act above.
The following can be applicable measures as far as COVID-19 is concerned;
4.1 Prepare policies and guidelines for preventing transmission of and exposure to COVID-19 at the workplace as per the ELRA and OSHA Act.
4.2 Conduct trainings, prepare informative manuals and or brochures for purposes of giving health information tips to employees and ensure strict compliance to the policy and safety measures as per the policy and preventive actions as per 4.3 below.
4.3 Provision of health and safety materials like sanitizers, water, soap, gloves and mask. (Section 55 and 56 of the OSHA Act covers for sanitary convenience and washing facilities at the workplace. These sections are echoed under the Occupational Safety and Healthy (First Aid and Welfare Facilities) Rules, GN. No. 147 of 2015 (See Rule 7 and 14)
4.4 In our experience with other clients and global associates, employers may also consider to designate different working groups (work stations) at the workplace. These different teams/groups may work separately from one another from different stations and/or hours. This is to avoid unnecessary contact that can lead to spread of virus throughout an organization, which may lead to a complete halt of an organization’s operations.
4.5 Some employers may wish to undergo a mandatory testing of COVID-19 virus at the workplace. The ELRA is silent about this aspect but clearly abhors discriminative practice at the workplace. Any testing employed will need to be general to all employees. OSHA Act under S. 3 and 109 contemplates “medical surveillance” which is the power of OSHA mandated health officers to conduct biological monitoring and/or medical tests to employees. Our labour law experts at Breakthrough Attorneys advise that where employers desire to carry such testing, they may wish to involve OSHA Officials for maximum compliance and minimum liability to the employees.
4.6 Any such testing may result into positive results for some employees. This outcome raises another issue based on employer-employee rights. Discrimination and privacy. An employer is required to ensure that an employee who tests positive for COVID-19 or any other contagious/infectious diseases for that matter, is protected from discrimination arising out of their medical status. (See Section 7 of ELRA read together with Rules 28, 29 and 30 of the Code of Good Practice)
5.0 Unpaid leave; is it part of the laws? Does the current outbreak apply?
Generally, the ELRA requires employers to give paid leave to their employees. All types of leave under the Act, including Annual leave, Maternity Leave, Sick Leave, Paternity leave and bereavement leave must be paid leave. Under extraneous circumstances, the employer may grant unpaid leave after specified leave period has expired and the employee needs extension of the same or in a few instances where an employee will not be entitled to paid leave. These include:
5.1 Where an employee has worked for less than six months (Section 29(1) of the ELRA) and
5.2 In case of sick leave where an employee fails to produce a medical certificate or is entitled to paid sick leave under any law, fund or collective agreement (Section 32(3) of the ELRA).
5.3 In case of paternity leave and the employee needs more than the statutory period, then the extra days will be approved as unpaid leave (Section 34 (2) (b)).
Although there are different circumstances where an employee can be subjected to unpaid leave, the ELRA does not provide for unpaid leave in a situation where there are pandemics or similar force majeure events as mentioned in 2.0 above.
Following the aforesaid, employers should avoid unilateral decisions to send any of its employees on unpaid leave unless the same has been taken as a measure taken under consideration of Clause 7.0 below to mitigate financial situation, which is usually undertaken with employees or employees’ trade union consultation under the ELRA.
6.0 Salary Reductions/Deductions; Yes or No?
6.1 Of the many queries our Labour Law Department has received from clients, the question of “whether the employer can resolve to initiate a salary reduction to a class of employees or all employees during the COVID-19 outbreak and economic slump” takes the top spot alongside the one on unpaid leave discussed in 5.0 above.
6.2 The answer to this question is both YES and NO, depending on foundation of the employer’s reason and procedure the employer may use. Let’s start with the NO.
6.3 As a general rule, remuneration of an employee is a standard and mandatory contract term under the ELRA (See section 15 (1) (h)) of which the employer first cannot change without consulting and agreeing with the employee (Section 15 (4)). Section 28 of the ELRA, which specifically prohibits deductions of an employee’s salary, except in certain prescribed circumstances, solidifies this position. Pandemics and force majeure events are not provided.
6.4 In essence, simply citing “COVID-19 outbreak” and its resulting impact will not be a sufficient reason for an employer to reduce employees’ salaries. Equally, even if the same was sufficient, how an employer reaches that decision and action will determine whether or not such employer can undergo a salary reduction exercise.
6.5 These two factors (sufficiency of reason and procedure) therefore, may in a fitting scenario turn our answer from NO to YES. The YES part is covered in 7.0 below as an alternative where other job retention rescue measures have failed. But not where the company is solvent and readily, liquid and the employer’s reason is merely prevalence of a disease outbreak. In summary, such prevalence needs to be supplemented with a rising organizational financial turmoil for it to count as a reason to consider pay cuts.
7.0 Financial crisis and how employers may handle employee base or wage turnover to save operations of the Companies.
7.1 It goes without saying that outbreak of COVID-19 has affected many businesses hence financial constraints to employers. Where a business faces financial crisis, Tanzanian Labour Laws allows retrenchment. Retrenchment refers to termination for operational requirements. Section 4 of the ELRA defines operational requirement to mean requirements based on the economic, technological, structural or similar needs of the employer.
7.2 Economic needs that relate to financial management of the business suffice as a legitimate basis for termination on operational requirements. This is provided under Rule 23(2) (a) of the Code of Good Practice Rules. That is to say, should an employer prove financial crisis resulting from the COVID-19 outbreak, the same fits in the operational requirements as pre-requisite for retrenchment hence legalization of the process. Bear with us as we break down how reduced pay can be under the auspices of retrenchment for an employer facing financial constraints in the current situation.
7.3 By law, when an employer is faced with financial issues and wishes to “manage the situation including contemplating reducing employees” they are required to follow retrenchment process. Section 38 of the ELRA provides for the procedures of terminating employees based on operational requirements. The process would entail discussions with the employees on what is the gist of the problem, as well as discuss ways the same can be avoided. In essence, solutions such as pay cuts, reduced work base for some etc. can and must be discussed before decision making. Under the law the employee has to be given options.
7.4 In essence therefore, pay cuts can be a means to navigate the troubling COVID-19 time but must be a result of an employer proving that there are financial hardships caused by the outbreak and that amongst other ways of mitigating employments of the employees, pay cuts may achieve survival of the organization as well as the earning of the employees. It is key to note that employees have to agree and sign on such a proposal otherwise termination by retrenchment will need to ensue.
7.5 Employers are advised to seek out their legal counsels for advice and guidance befitting their organization’s facts and circumstances before applying the review under this update.
Breakthrough Attorneys’ labour law team is of the considered view that our Labour Laws in Tanzania have not covered much on pandemics and force majeure. Nevertheless, our laws allow some measures to be taken as addressed. Employers are urged to be compliant with the law and act upon government directives for purposes of overcoming the situation.
As a general summary from the above update, our labour experts underline that:-
8.1 There is no provision in labour law covering force majeure or pandemic events.
8.2 Employers need to consult employees on any decisions involving COVID-19 prevention, management and impact at the workplace
8.3 Employers need to put COVID-19 preventive policies in place as well as guidelines on how to implement such policies.
8.4 Employees must be made aware of the said policies and guidelines and enabled to follow and observe them.
8.5 Employers have a duty to set preventive facilities such as washing units and other sanitary materials
8.6 Testing can be done under the auspices of occupational health laws but employers must observe privacy and non-discriminatory related rights of employees
8.7 “Working from home” policy is not restricted under the law but needs consultation and agreement with the employees.
8.8 Most of the issues may be easily discussed for unionized employees than for non-unionized ones. Unionized ones have capacity into entering collective agreements under the law.
8.9 There is no provision in Tanzanian law regarding unpaid leave. Clause 8.8 applies.
8.10 Salary reduction is generally abhorred and prohibited under the law.
8.11 Salary reduction can only be allowed if raised as a measure to avoid loss of employment during a retrenchment process necessitated by a looming financial crisis.
8.12 Employee consultation is key.
8.13 Follow set procedures set under the law for each action you undertake.
8.14 Consult your legal advisors to validate your intended action.
This publication has been prepared for information purposes only, and it does not constitute professional advice. You should not act upon the information contained in this publication without obtaining specific professional advice. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this publication, and, to the extent permitted by law, Breakthrough Attorneys, its members, employees and agents do not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this publication or for any decision based on it.