LABOUR LAW FOR MSMES IN CONSTRUCTION

1 LABOUR LAW FOR MSMES IN CONSTRUCTION |PB 1| LABOUR LAW FOR MSMES IN CONSTRUCTION2 3 ACKNOWLEDGEMENTP roduced with the technical support of theInternational LABOUR Organization and the financialsupport of the Norwegian Agency for Development Cooperation (NORAD)Prepared by the LABOUR Institute of Zambia(Chapter 11) LABOUR LAW FOR MSMES IN CONSTRUCTION |2 3- FOREWORD -Globally, Micro, Small, Medium Enterprises ( MSMES ) have become engines for economic growth, job creation and poverty reduction. In Zambia, the building and CONSTRUCTION sector is one with high potential for the creation of employment through msme activity. This sector, which currently makes up of the economy, has experienced rapid growth in recent years, and is expected to expand further due to public sector funded infrastructure development projects and strong demand in the residential housing and office retail market. As the CONSTRUCTION sector continues to deliver as one of the main enablers of national economic growth, it is of criticalimportance that it equally contributes to the generation of decent jobs for Zambiansin order to fully achieve its potential to deliver broad based this end, a culture of the respect for the rule of LABOUR laws by both employers and workers must be firmly ingrained in the sector.

2 Compliance with LABOUR laws not only enhances working conditions for workers but also contributes to productivity and ultimately the competitiveness of the enterprise. Facilitating good working conditions through LABOUR law compliance, therefore, is an investment in a more productive work-force that will directly impact the performance of the business. To give a few examples of this, formalised employment relationships can provide the clarity, predictability and security that CONSTRUCTION workers need to commit them-selves fully to the job. Further, the creation of a safe working environment for workers helps to prevent the devastating effect of fatalities, injury and disease not only on af-fected workers and their families, but also on the business and economy in an industry where industrial accidents and risk of injury are inherent in the nature of work. Subscribing to social security schemes further mitigates risk for worker and employer alike against the cost of injury, as well as assuring a minimum level of wellbeing.

3 On all of these aspects and many others that contribute to improved businessperformance for MSMES , LABOUR laws provide an enabling regulatory Ministry of LABOUR and Social Security commends the work of the International LABOUR Organization, supported by the Norwegian Agency for DevelopmentCooperation through Law-Growth Nexus project in promoting the uptake of LABOUR laws by CONSTRUCTION msme through creating awareness of the business case forcomplying with LABOUR laws to MSMES . This complements the work of the Ministryin enforcing LABOUR laws. This booklet adopts an innovative approach to guiding businesses on how to comply with LABOUR laws by collapsing all relevant LABOUR regulations related to key aspects of the employment relationship. Summarising LABOUR laws by topic therefore makes it easy for msme owners to find a comprehensive statement of the LABOUR law onspecific issues. It is our hope that this guide to LABOUR laws for MSMES in CONSTRUCTION will go a long way in providing clarity on how to comply with LABOUR laws,thereby assisting the sector to generate more and better Fackson U.

4 Shamenda, MPMinister of LABOUR and Social Security| LABOUR LAW FOR MSMES IN CONSTRUCTION4 5 ABBREVIATIONS AND ACRONYMSADRMs Alternative Dispute Resolutions MechanismsCSO Central Statistical Office DWCP Decent Work Country Programme ILO International LABOUR Organization ILSs International LABOUR StandardsILRA Industrial and LABOUR Relations Act IRC Industrial Relations CourtLASF Local Authority Superannuation Fund LIZ LABOUR Institute of ZambiaLFS LABOUR Force SurveyMLSS Ministry of LABOUR and Social Security MSMES Micro, Medium and Small Scale EnterprisesMWCE Minimum Wages and Conditions of Employment NAPSA National Pension Scheme Authority NCC National Council for ConstructionOHS Occupational Health and SafetyPSPF Public Service pension FundSI Statutory Instrument TCLC Tripartite Consultative LABOUR CouncilZCTU Zambia Congress of Trade UnionsZFE Zambia Federation of EmployersZIHR Zambia Institute of Human ResourceZNPF Zambia National Provident Fund ZRA Zambia Revenue AuthorityWCFCB Workers Compensation Fund Control BoardLABOUR LAW FOR MSMES IN CONSTRUCTION |4 51.

5 INTRODUCTION Pg. 9 Purpose of the booklet Disclaimer2. WHICH LAWS GOVERN THE ZAMBIAN LABOUR MARKET? Pg. 11 Categories of the LABOUR statutes LABOUR market governance institutions3. WHAT IS THE MINIMUM AGE FOR EMPLOYMENT? Minimum age for employment Permissible employment of young persons Certain circumstances when the young person is not in school Performance of light work Employment of Apprentices Absolute prohibition of employment of young persons Employment in an industrial undertaking Hazardous work Absolute prohibition of worst forms of child LABOUR Protection of young persons from other forms of exploitation4. WHAT ARE THE DIFFERENT WAYS TO FORMALLY HIRE A WORKER? Employment contracts generally Who is an employee? Types of employment contracts Oral contracts of employment Record of oral contract Presumption as to new contract Contracts of employment which are required to be in writing Employee s consent Medical examination Attestation of contracts Contents of a written contract Rights of female employees Categories of employees Protected worker Contract worker Unionised worker Management staff Essential Worker Model Contract of Employment5.

6 STATUS OF TRADE UNIONS AND EMPLOYERS Pg. 27 ASSOCIATIONS Freedom of association Rights of employees Rights of employers Duty to enter into recognition agreement Essentials of a recognition agreement Collective agreements 6. EMPLOYERS STATUTORY OBLIGATIONS Pg. 33 Minimum wage Allowances Working hours Pay as You Earn (PAYE) PAYE tax bands What income and allowances are taxable| LABOUR LAW FOR MSMES IN CONSTRUCTION6 7 under PAYE? What income and allowances are exempted from tax under PAYE system? Social Security Systems What is Social Security? The Legal framework and Social security systems in Zambia National Pension Scheme Authority (NAPSA) 1. Employer s responsibilities 2. NAPSA is mandated to prosecute defaulting employers 3. Which employers are eligible for NAPSA registration?

7 4. When should an employer register? 5. Which category of employees should be registered with NAPSA? 6. Which categories of employees are exempted from NAPSA membership? 7. What benefits does NAPSA pay? 8. Eligibility for normal retirement pension 9. Eligibility for early retirement pension 10. Eligibility for invalidity pension 11. Who are the beneficiaries to a survivors pension? 12. Eligibility for funeral grant 13. What about the money contributed to the Zambia National Provident Fund (ZNPF)? Workers Compensation Fund Control Board (WCFCB) 1. Who should register with WCFCB? 2. Assessments 3. Assessments rates 4. Who is an employer under WCFCB? 5. Employers obligations 6. Who is a worker? 7. When to claim compensation benefits 8. Reporting of accidents?

8 9. Calculation of compensation benefits 10. What benefits are claimable for injury and disease? 11. Guaranteed benefits under WCFCB (A) Cash benefits (B) Non-Cash benefits 1. How do employers benefit by complying with WCFCB? 2. How much should the employer contribute? 3. Who is an employer under the NAPSA Act? 4. Which categories of employees should be registered with NAPSA? (b) Workers Compensation Fund Control Board (WCFCB) 1. Who should register with WCFCB 2. Assessments 3. Assessments rates 4. Who id an employer under WCFCB? 5. Employers obligations 6. Who is a worker? 7. When to claim compensation benefits 8. Calculation of compensation benefits 9. What benefits are claimable for injury and disease 10. Guaranteed benefits under WCFCB: (A) Cash benefits (B) Non-Cash benefits 11. How do employers benefit by complying with WCFCB?7. WHAT ARE THE REGULATIONS REGARDING THE Pg.

9 47 WORK ENVIRONMENT? THE OCCUPATIONAL HEALTH AND SAFETY ACT LABOUR LAW FOR MSMES IN CONSTRUCTION |6 7 Duty of Employer to Establish Health and Safety Committees Functions of the Health and Safety Committees Duties of Employers to Employees Duties of Employees at Workplaces Duties of Employers and Self Employed Persons to PersonsCOther Than Employees Duties of Person in Control of Workplace or Plant Prohibition of Dismissal or Victimization of Employee Designation of Occupation Health and Safety Service CONSTRUCTION (Health and Safety) Regulations FACTORIES ACT Health Safety Welfare General 8. WHAT LEAVE ENTITLEMENTS CAN A WORKER GET? Pg. 57 Paid annual leave Holiday allowance Paid sick leave Medical attention Compassionate leave Maternity leave 9 ON WHAT GROUNDS CAN A CONTRACT OF Pg. 61 EMPLOYMENT BE TERMINATED? By Notice or payment in lieu of notice By Dismissal based on conduct or performance By Summary dismissal By Death By Redundancy By Retirement (Normal retirement) By Discharge on medical grounds Procedure for medical discharge On expiry of the contract 10.

10 WHAT BENEFITS SHOULD I GIVE TO A WORKER Pg. 65 ON TERMINATION OF CONTRACT? Wages and allowances Leave pay Redundancy benefits Severance pay for unlawful dismissal Medical discharge Retirement benefits Repatriation benefit or allowance 11. DISPUTES Pg. 69 What is a dispute? Individual disputes Collective disputes Failure to reach settlement by conciliation Alternative dispute resolution mechanisms (ADRMs) Conciliation Mediation Arbitration Objects of arbitration Principle differences between Mediation and Arbitration Benefits of ADRMs INDUSTRIAL ACTION What is a strike? | LABOUR LAW FOR MSMES IN CONSTRUCTION8 9 LABOUR LAW FOR MSMES IN CONSTRUCTION |8 9 CHAPTER 1 Purpose of the bookletThe purpose of this booklet is to promote LABOUR law awareness among Micro-, Small- and Medium Enterprises ( MSMES ) in the CONSTRUCTION sector.