COVID-19: Its impact on employment contracts in Zimbabwe

COVID-19: Its impact on employment contracts in Zimbabwe – an analysis into Zimbabwean Labour Law and the relevant legal principles which could serve as a guide for employers and employees in reaching an equitable compromise in dealing with the pandemic.

Written by Eulitah Nyasha Paratema & Ropafadzo Sandra Shoko, for LexisNexis South Africa.

[Durban, 14 April 2020]

Introduction

On the 17^th of March 2020, President Mnangagwa launched the country’s Covid-19 National Preparedness and Response Plan in line with the World Health Organisation recommendations.[1] As part of measures to contain the spread of Covid-19, he declared the pandemic a State of National Disaster and announced several precautionary measures that would be implemented to contain the spread of the virus. These measures included the closure of schools, colleges and universities on Tuesday 24^th March 2020 until further notice; the postponement of all major social events including the Zimbabwe International Trade Fair (ZITF) and the 40th Independence Day celebrations that were scheduled for Bulawayo next month; and banning public gatherings of more than 100 people, including for religious purposes, for the next 60 days. The National Preparedness and Response Plan was then gazetted as law on 23^rd March 2020, under Statutory Instrument 77 of 2020. This instrument effectively gives the effect of law to all the recommendations the President pronounces on how to contain the spread of the covid-19 virus and outlines the penalties for failing to comply with them.

On the 27^th of March 2020, President Mnangagwa announced that the country would be on lock down for 21 days starting from Monday 30 March 2020. This essentially means that all our citizens are required to stay at home except, for when there is need to make essential movements such as to buy food or for health emergencies or for other vital movements.  Statutory Instrument 83 of 2020 has been enacted to give guidelines on how the lock down will be conducted and the penalties that may be faced by individuals who do not comply with the restrictions.

As it stands Zimbabwe has recorded eight confirmed cases of the pandemic, with 1 resulting in death, however it is anticipated that it’s a matter of time until more reports of the pandemic surface.[2] This unprecedented state of affairs has raised anxiety in the corporate world as businesses worry about the effect the pandemic will have on their contractual obligations.Covid-19 has been described in legal frameworks as a vis major, a casus fortuitous or simply an act of God. This occurs when performance of contractual obligations is rendered impossible after conclusion of the contract because of circumstances beyond human capabilities[3]. Below we shall look at what this means in the face of labour law issues in Zimbabwe.

Obligations under employment contracts

There are various scenarios that may arise in the face of this crisis regarding employment obligations. The governing law is codified in the Labour Act [Chapter 28:1]. In the wake of the quarantine restrictions that were imposed by the government of Zimbabwe there has been much anxiety about what the future holds for most employees. Plenty of questions are being raised about the implications the mandatory lockdown will have on the rights and obligations under their contracts.

An employee generally has the duty to give service to an employer. Such duty forms the employment contract. Absence from work has to be unreasonable, voluntary and over a long period of time,if it is to warrant dismissal or any punishment. Under common law, if the failure to provide service is as a result of a supervening impossibility or casus fortuitus or action caused by the employer rendering performance impossible then the employee is not liable. In Chaponda v Shamva Gold Mine, the court reversed the dismissal of employees who were members of the opposition and had failed to come to work because of harassment and violence by members of the ruling party and in which some members of management were complicit.[4]

As the government said in its initial statement concerning the lockdown, all companies, except for those offering essential services, are expected to be closed for the next 21 days, codified under section 1 of Statutory Instrument 83 of 2020. Now this poses a few questions of interest especially for those employees that will still be required to go to work and even more so for those who cannot report for work now that their workplaces have been forced to shut down.

Rights of essential services workers

The first instance is quite straightforward, for those employees still that are still reporting for work as per usual nothing changes for them. They are still entitled to their full pay. Under the common law an employer has a duty to ensure reasonable care for the safety of workers, including the provision of safe premises, machinery and systems of work, taking into account the actual working conditions of the worker.[5] However, unlike prior to 2002 where the provision of services overrode any right of the employee,[6] the Labour Act now requires employers to ensure that employees are working in safe environments.[7] The W.H.O has issued recommendations for employers to follow to ensure the safety of employees.[8] If an employer fails to do this and an employee contracts the virus while at work then this may attract a penalty for the company under the Labour Act.[9] A prominent lawyer, Mr Magaya mentioned that if an employer fails to take the necessary precautions and in the process exposes employees to the risk of contracting Covid-19, employees can report this matter to the Police or lodge a complaint with the National Employment Council.[10] Such circumstances would justify boycotting on the part of employees in order to avoid occupational hazards.[11]

If an employee is infected with the virus and requires some time off work, the employee will be entitled to sick leave, according to Section 14 of the Labour Act. Although section 12B explicitly provides for a special leave to an employee who has been in contact with an infectious disease, the option of taking the special leave days is open to an array of other reasons but a sick leave specifically addresses the situation of Covid-19. The provision in section 14 states that if the employee has been employed for at least a year they will be entitled to 90 days leave with full pay. If after those 90 days they have not yet recovered the period can be extended by another 90 days, but with half pay. If after the 180 days, the employee is still unwell then the employer may look at terminating the employee’s contract without notice.[12]

We also have those employees who even though they are supposed to go to work, decide that they don’t feel safe to do so because they fear they might get infected or that they may have a pre-existing condition that would make them more prone to contracting the virus. Unlike our neighbouring country Namibia which actually provides for a section that entitles an employee to be absent from work, when they feel it is dangerous[13], our own Labour Act provides for no such scenario. In such cases, where the company has under s6 of the Labour Act made it quite safe for the employee to work, the company can ask then ask them to work from home if they can. In the event that they cannot undertake their duties from home then employers may have two options open to them. The first would be to advise them to take their annual leave days and the second would be to advise them to take an unpaid leave.[14] Under no circumstances whatsoever can the employer force the employees to go on their annual leave. However, it should be noted that the common law imputes that ‘No work no pay’. Thus, if you do not go to work then you do not get paid because the employee has a duty to provide service.

The uneasy fate of non-essential workers – what happens to their salaries and leave days?

We turn now to the second instance, where the employees con no longer report for work because their companies have been shut down due to the mandatory shut down. In this case some companies may make provision for their workers to be able to work from home. If the employees who are ready and able to do so, then they continue as if they were still reporting at their normal places of business. In such options these employees will still receive their full salaries and benefits on the basis that they are meeting the requirements of their contracts and availing their services to the employer.[15]

Usually under common law the “no work, no pay” principle applies where an employee is absent from work other than on public holidays or lawful leave.[16] . However, arguments have been brought forward, in light of the social justice or fair labour practices, in both the Act and the Constitution,[17] that the law is not applied just literally but should reflect principles of justice and fairness.[18]Normally, where a worker is unable to provide work due to a reason caused by the employer or a casus fortuitus (unforeseen event like power cuts), then the worker is entitled to payment of his/her remuneration.[19] An interesting point has been raised that under common law, in that the “no work no pay” principle does not apply where a vis major exists because it is an act of God and therefore not working is not the employee’s fault.

Be that as it may, the Labour Act does not explicitly oust “the no work, no pay” principle.[20] In the current state of affairs, the application of such a principle would be arguable given the backdrop of Zimbabwe’s economy. Currently, companies rely mostly on the income generated by the business and it would be impractical to expect employers to pay employees at a time when the businesses have not been generating any income over the lockdown.

Under certain jurisdictions like the UK, in times of such disasters, business fall back on their business interruption insurance.[21] Currently, governments are playing an active role in balancing out this equation of employees getting paid, but the employer is not making money. State funds ordinarily are requested for by businesses finding it difficult to pay their employees, this was reiterated by Professor Lovemore Madhuku in an interview on ZBC news on Friday the 27^th of March.  Most engaged governments have been giving aid by reducing taxes businesses should pay and giving aid to those who have been tax compliant prior to this crisis.[22] The Zimbabwean government so far, along with some other African countries have stretched out help to families and individuals only.[23] One student was of the opinion that, for the African governments, their first aim is to contain the pandemic at the moment, then maybe later access the damage and try to intervene considering the limited resources these governments have.[24]

However, the question still remains as to what happens to the employees and their salaries during the month of inactivity when governments have not yet intervened, and businesses are not making profits? Even more anxiety lies with the employees who can’t work from home. There is no set precedent for situations such as these. The best course for each company would be to consider granting the employees a sort of special leave. The Act provides the conditions under which employees can get Special Leave. It stipulates that employees are entitled to 12 days leave with full pay,[25] but the conditions listed in that provision do not envisage situations such as pandemic outbreaks or quarantine restrictions. This could require both parties to negotiate and agree on the conditions of such a leave and the packages the employers can offer the employees. The aim in this case would be for the employer to mitigate the unfortunate position their employees have found themselves in due to the current situation. However, for employers who may find this quite expensive, they could lay-off their non-essential employees or offer them unpaid leave for the period.[26]

Specific regulation and law on infectious diseases?

Section 17 of the Labour Act gives the Minister power to enact any legislation that may be necessary to provide for the development, improvement, protection, regulation and control of employment and conditions of employment. Paragraph (n) specifically mentions the implementation of any national or international standards of employment, including those related to the rights and obligations of employers and employees as to safety, health and compensation for occupational disablement. This then justifies the use of literature from other jurisdictions. Hence, the Minister ought to direct a bill or regulation specifically towards the labour issue pertaining Covid-19.

Otherwise the Labour Act itself does not provide for provisions under an emergency, disaster or even war, which the ordinary employee or employer can impute in this current situation.

Conclusion

The current Zimbabwean legislative framework around the regulation of infectious diseases does not expressly provide for the conduct of employers. However, the legal principles discussed above should serve as a guidance and a balance must be reached that favours both the employer and the employee in these difficult times of the pandemic Covid19.

[15]Chiwara Covid-19: Impact on Businesses in Zimbabwe

[16] Zimbabwe Sun Hotels (Pvt) Ltd v Lawn 1988 (1) ZLR 143 (S).

[17]Section 2A of the Labour Act and s65 of the Constitution of Zimbabwe 2013(Amendment No 20)

[18]Zimnat v Chawanda 1990 (2) ZLR 143(S).

[19]Johannesburg Municipality v O’ Sullivan 1923 AD 201.

[20] Imputing the principles laid out by Hama v NRZ  1996(1) ZLR 664 later reiterated in Nyamande and Ors v Zuva Petroleum s-43-1, that common law has to be explicitly ousted for it not to exist.

[21]Eidee Bailly, COVID-19 and Business Interruption Insurance: What You Need to Know,March 22, 2020 | Article

[22]UK ‘s 330 billion https://uk.reuters.com/article/uk-health-coronavirus-britain-business-s/uk-to-unveil-business-rescue-package-as-coronavirus-hammers-economy-idUKKBN2140V2; USA’s 2Trillion bill;https://www.cnbc.com/2020/03/25/coronavirus-stimulus-bill-updates-whats-in-the-2-trillion-relief-plan.html; South Africa’s economic plan https://mg.co.za/article/2020-03-23-south-africas-economic-plan-for-covid-19/; Nigeria passes an COVID-19 Economic Stimulus Bill The Eagle Online.

[23] Press Statement on fiscal mitigatory measures to contain the impact of corona virus 2019 (Covid 2019) published 30 March 2020.