Analysis: OWEN KATONGO
MANY employees desire to work with some form of guaranteed job security so that they do not have to worry about being jobless again.
Now, as it happens, one’s employment can be terminated due to two major reasons which can be attributed to either (i) the employee or (ii) the employer.
At times, the employee can be performing and behaving very well but their employment is still terminated because the employer’s operational requirements have changed.
This is what sometime leads to massive job cuts as the employees’ services for which they were hired are no longer required by the employer.
Usually, employers undertake to cut jobs massively when projects finish, during restructuring exercises, when the company is closing, and such related circumstances.
While such business decision can be made, massive job cuts should not be used as a way for employers/management to protest the company shareholders’ decisions or Government’s decisions like increasing minimum wages and so on.
Massive job cuts should be used as a last resort where there is no other choice, as such terminations affect more than just employees.
1. Massive Terminations Affect Employees and Businesses:
When you massively lay off people, firstly, the employees and their families are the first ones to be adversely affected due to loss of income.
Soon, some parents/guardians cannot send their children/dependents to school. The children end up going back to selling in the markets and streets, fishing, charcoal burning, and cattle heading as well as being predisposed to prospects of child marriages.
Secondly, the business community is not spared when major employee layoffs are done at once.
Those who were providing transport to the workers lose out, the restaurants and bar owners where employees were eating and drinking from soon find that they have very few customers if any.
The shop owners where the employees were buying groceries and food stuffs are equally not spared. The owners of the houses and rooms for rent also find themselves with very few clients if any.
Thirdly, massive employment terminations also affect your own company production due to what Organisational Psychologists refer to as “Workplace Survivor Syndrome”.
The surviving employees may start to experience, fear, insecurity, frustrations, guilty, depression, and anxiety about when they too might be laid off. There is also loss of trust.
Additionally, stress soon ensues as surviving employees have to take up more work which for some time may adversely affect production levels and quality standards among other things.
As massive employment terminations affect not just the employees but also the businesses and the nation at large, they should be avoided unless where really necessary.
2. Follow the Due Termination Process:
While the law allows for termination of employment due to operation requirements of the undertaking as provided for under Section 5(b)(3) of the Employment (Amendment) Act, 2015, ensure that you follow the due process.
You cannot start mixing terminations due to operational requirements with terminations due to the employee’s capacity and or conduct as the two follow totally different processes.
Check the provisions of your contracts, conditions of service, and collective agreements (where applicable) or the legal requirements in the country for the specified categories of workers.
3. Fully Prepare the Employees for Terminations:
Employees come from all over the country and sometimes even outside the country, inform them of the impending terminations and provide counselling.
Preparing the leaving employees also mean providing them with some form of financial education on how they can better use their terminal benefits.
4. Give All That Is Due and Payable to The Employee:
Calculate and pay all salary arrears, outstanding leave days, gratuity (where applicable), and all payments that may be due and payable to the employee.
Section 48(4) of the Employment Act, CAP 268 of the laws of Zambia requires that you pay everything to the leaving employee on their last day of work.
In fact, the law now under Article 189(2) of the Constitution of Zambia (Amendment) Act No. 2 of 2016, provides that, “Where a pension benefit is not paid on a person’s last working day, that person shall stop work but the person’s name shall be retained on the payroll, until payment of the pension benefit based on the last salary received by that person while on the payroll.”
For avoidance of doubt, Article 266 of the Constitution of Zambia (Amendment) Act No. 2 of 2016, defines a pension benefit to include “a pension, compensation, gratuity or similar allowance in respect of a person’s service.”
Endeavour to pay leaving employees so that they can go and continue being productive wherever they go in society.
5. Separate Professionally:
Just because you are letting go of the employees, it does not mean that now you must be rude to them and other people.
Separate professionally, make sure that employees sign all required documentation and you also sign, and date stamp the documentation they may require.
Issue the leaving employees with a certificate of service as required under the provisions of Section 79(1) of the Employment Act, CAP 268 of the laws of Zambia.
In closing, it is important to remember that as you run your business, endeavour to balance the need for profit maximisation with the need for job creation, and patriotism to contribute positively to national development in your own way.
The author is a human resources and leadership advisor.
Analysis: OWEN KATONGO