Of the different types of employment contracts the fixed term contract elicits the most interest. A fixed term contract specifies termination of the employment relationship on a specific date or upon completion of a specific task or occurrence of a specific event. The contract can last for a few hours, or weeks or years. The type of employment contract entered into between parties is dependent on organisational requirements, job demands and individual preferences.
YOUR RIGHTS WITH MIRIAM TOSE MAJOME
The growing concern for workers is the growing preference by employers to hire labour on fixed terms than on permanent basis. This is a worldwide trend against which the International Labour Organisation attempts to stem through various protocols and directives because the casualisation of labour has negative consequences on employees.
The big multinational capitalist corporations rely heavily on casual labour because of their fanatical desire to cut costs and maximise profits at whatever cost. Labour is the biggest casualty as technology is providing cheaper and more efficient economically sensible alternatives. Employing temporary and casual staff cuts labour costs as they are only cost obligation payment for the time worked.
Locally industries such as agriculture have always relied on casual workers and fixed term contracts. Workers are employed when seasonal demands dictate it such as planting, weeding or harvesting times. There is no obligation to employ redundant employees and so employees are free to find other work after termination of fixed term contracts.
To understand this issue and how it came to be now it is important to have some knowledge about the history of employment and jobs.
Labour trends — a short history
The last decades of the 20th century the ie from the 1970’s to the 90’s saw a radical change in traditional jobs and employment patterns which had been established in the 19th Century industrial revolution. The industrial revolution radicalised working culture in the western world which also affected the rest of the world. As industries and economies grew because of the revolution there was a massive demand for labour to work on the farms, mines and factories.
Employers competed aggressively for both skilled and unskilled labour. Employers desperately needed to retain employees to ensure continuous supply of labour to maximise production and meet the insatiable demands of the ever expanding consumerist markets. It was thus essential to keep employees working for them for as long as possible and so they ensured they paid them monthly wages, incentives and attractive benefits to keep them loyal.
It even became the norm for generations of families from grandparents to great-grandchildren to work for similar generations of the same employer. Skills were hand down the generations. A young man who in 1865 worked as a train driver would have his children, grandchildren and great grandchildren all working in the railway trade such that in 2018 that family would know no other life beyond the railway tracks.
As the 19th Century gave way to the information age rapid innovations in technology led to less dependency on human labour especially unskilled labour. Jobs became more and more scarce and tables turned as employers were no longer desperate for labour. They became increasingly able to choose from an inexhaustible supply of labour.
There was no longer any need to retain employees for life and incur the burden and costs of permanent employment like paying benefits and incentives. Rigid labour laws installed to protect employees from exploitation also made permanent employment less attractive to employers. Employers rather enjoyed the freedom of hiring and discharging employees at will as the need for labour peaked and waned.
The 21st Century ushered in even more rapid technological changes that have rendered many skills and jobs redundant.
The effects are all around for anyone to see. For instance commercial banks which once employed 30 permanent tellers now only employ about five tellers only and closed the majority of branches. This means 25 permanent employees were made redundant.
A few of them may sometimes be needed but only for very busy times of the month or the day and they would be employed on fixed term basis. The banks are not obliged to retain hordes of redundant employees on its payroll. However, much it may be protested and disliked it is an incontrovertible fact that the labour culture has irretrievably changed from what it was in the 19th Century. Being employed for life is a thing of the past.
The law can only change around the protection of employees on fixed term contracts to ensure they are better protected and not exploited. The Labour Act is not very clear as to be definitively protective of fixed term contract workers in terms of the rights they can enjoy such as maternity leave, vacation leave and sick leave, terminal benefits etc.
Abuse of fixed term contracts
Fixed term contracts are obviously very attractive to employers for a host of reasons chief among them being cutting labour costs. Some employers use them as a means of evading statutory obligations such as tax and payment of employee benefits such as leave days, maternity leave, pension and medical aid among others.
There is no clear provision for sick leave, while on a fixed term contract and usually sick employees must just soldier on working even in spite of illness because the contract will not be extended to make up for the days they were away. There is no job security at all and the fear of job loss is a permanent fear for fixed term contract workers.
If female staff have to take maternity leave they may as well just forget about the job altogether because they cannot come back to finish off the contract of it has expired. The employer on a fixed term contract will rely on the basis of not having an obligation to abide by regular employment laws. They are not bound to pay retrenchment packages at the termination of the contract or pension accruals or vacation leave.
While an employer in a permanent contract has to pay a retrenchment package equalling two weeks of pay for every year worked all the fixed term contract employer pays is just the salary for the last month of the contract.
When an employer renews or rolls over a fixed term contract continuously an expectation that it will be renewed again may be created especially if it happens over a long period of time. The expectation is deemed as legitimate and is protected in accordance with Section12B of the Labour Act.
If a legitimate expectation has arisen summary termination of the contract may be deemed as unfair dismissal. The principle of legitimate expectation has been tested many times even in the highest courts. One cannot help but observe that recent Supreme Court judgments have generally not been favourable to the cause of employees and can no longer be relied upon to provide the relief desired and expected by employees.
The pro-socialist labour friendly slant of the post-independence era seems to have very quietly given way to a pro-business and pro-employer orientation. Recent landmark judgments like Nyamande v Zuva Petroleum SC43/15, Simbi Steelmakers(Pvt) Ltd v Shamu and 43 Others SC71/2015 and Magodora vs Care International Zimbabwe SC24/2014 all ruled in favour of employers and pronounced judgements which have very serious consequences for the employment relationship in favour of employers.
The Magodora ruling was emphatic that there can be no issue of legitimate expectation arising when a contract is clear that it is for a fixed term and thus no other meaning can be implied from it.
Next week we will look closely at the pros and cons of fixed term contracts and the international and local perspectives of the casualisation of labour.