The recent changes in employment law are significant. They have consolidated all the labour laws into one piece of legislation and codified some of the common law and International Labour Organization principles. The new law also increased the statutory leave days, adding 3 days of family responsibility leave union leave and paternity leave. Maternity leave has also been increased from 12 to 14 weeks, with confinement increased from 6 to 8 weeks. An adoption leave has also been introduced. All these must be provisioned for financially. They will have strain on business expenditure.
Moreover, fixed term contracts are now limited in Botswana. There is a presumption of indefinite employment which requires employers to do meet three requirements for a fixed term contract:
- The fixed-term should not be more than 12 months;
- There must be a justifiable reason for having a fixed term contract of more than 12 months and these reasons are limited to the reasons stated in the Act; and
- The reason must be stated in the contract.
The law now requires employers to provide pro rata benefits to part time employees and employees on a fixed term basis.
This demonstrates a trend towards a worker-centric economy. From a business perspective, this is effectively a rise in wages, which concomitantly means a reduction in profits. This approach may have the undesirable result of dissuading multinationals from doing business in Botswana and unwittingly increase the rate of unemployment and retrenchment.
To fix this, it requires balancing the business-centric approach with the worker-centric approach by incentivising businesses such as tax breaks and other expansionary fiscal policy approach.
OLEBILE MUZILA
PARTNER | DRD
E: olebile@bookbinderlaw.co.bw
