As government meets Trade Unions and ECAM

This week (on 7th December 2011) representative of government, the employers and the employees will meet to discuss work related issues. The tripartite meeting involves the said parties as employees work for an employer, yet this relationship is not in a vacuum. The work relations happen in an environment where the government of the day makes regulating laws.

So in brief, trade unions speak on behalf of workers,Employers Consultative Association of Malawi (ECAM) for employers and government provides a platform for a working environment. Their connection and contacts makes it possible to bargain and reach a compromising working environment.

It is in the interest of the government that workers (as its citizens) are well taken care of. Their individual wellbeing translates to a country’s development. The government also ensures that businesses are well protected, and that owners realise maximum profits, so as to woo other investors.

The government makes laws that are binding to both employers and employees. For example, the Pension Act, which attracted more debate, was also made by the government as a third and main act in industrial relations setting the minimum wages for employees.

It is on that factor that government or precisely the Ministry of Labour has to be in contact and familiar with reality on the ground.

On the other hand, businesses exist to make profits. As much as they have a social responsibility, their interest is to make the maximum profit out of the minimum inputs. That is raw materials that are relatively low and employees that are lowly paid.

In fact, salaries are offered as either incentives or a thankful although the later can be contested against. If it was a ‘thank you for a well job done’ then both the payer and the paid would be satisfied with it.

The chain is incomplete without a mention of employees- that is human capital. They are ones that make businesses successful. Although some say they work of the love of working, generally we look for and work for wages.

Just as there is no free lunch, labour is priced. At least, an employee needs what can sustain him, say in a month, week or day, although the salary might not be enough.

It is then upon that basis, that the individual assessment of employees and employers on what the employees input has to be rewarded has to be compromised. That is to say it is rare for an employer to pay enough what exactly the employee needs.

The same has been a bone of contention when the issue of industrial actions (strikes) are concerned. Although strikes may erupted as a protest of bad working conditions among others, salaries has been the main.

Of importance in our nation today is on the rising cost of living, coupled with the economic problems that have negatively affected many businesses.

The meeting therefore, comes at a time when both the employees and employers have pertaining issues to be solved as soon as possible.

Trade unions are bargaining for an increase in the pay of their members to match the cost of living.  They argue the pay is out-dated.

The employers on the other hand fear the result of hiking basic salaries of their employees. In this time of economic hardship where companies are not making the needed profits, pay hike is unlikely.

Today, businesses affected by current economic situation fail to adequately import raw materials for their production because they cannot access the forex at the banks, the frequent power outages and insufficient fuel add to the pain.

In general, the output reduces and consequently loosing on sales.

Productions units are suspended making some workers an excess to the company. In both cases, the hiking of salary is unimaginable. ECAM recently commented that a push in the hike would force other small businesses out of the business.

Both employers and employees have valid arguments. An underpaid employee is demotivated and does not efficiently contribute to the general output of the company. On the other hand businesses want to have a maximum production from the least material possible.

Today as ever before government through the ministry of labour has before it a task. It is not only the ministry that is choked but rather the whole machinery that makes policies. Some of the problems that workers are complaining have sources in government policies that overlooked some pertinent issues.

High taxes in pay as you earn (PAYE), on goods and services we buy makes the life expensive and unbearable.

If fuel was readily available, forex was accessible and the environment in general was conducive some of these business would be operational and perhaps be willing to share their profits to the members of staff.

So as an employee cries for an increment, an employee knows how impossible that can be, consequently the business collapses, the employee becomes jobless. This in turn creates more social problem than intended.

In practice, the government shall have failed in the fight of reducing unemployment.

As much as companies would be willing to motivate their workers by increasing salaries, they cannot as they do not realise the projected profits. The recent case of Kris Offset and Sons Screen Printers refers.

Again, general price of goods rise on the market due to rise in the cost of raw materials and production, consumers substitute or abandon other products they once demanded. The impact of this behaviour on employees cannot be overemphasised.

My view is that as soon as the meeting is over, government should sit down and review the complaints raised by both the workers and employers. More than that, government should soul search as to how the current economic problems have affected the industrial relations.

Turning a blind eye to this would end us to a disastrous situation, where job terminations due to closures businesses of their production units will be recurrent. The same would scare away more investors. The current economic situation has been dealt with.


*Author is Chifuniro E. Banda- Management Trainee in Human Resource, writing in personal capacity

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