LABOUR LAW

SSU 07317
(For BD.HRM)
Series of Lecture notes
BY
ABEL JOSHUA
ACADEMIC YEAR 2022/2023

Module One (1): Explain nature and scope of employment contracts

1.1 Definition of Employment contract

CONTRACT

Any legally binding agreement voluntarily entered into by two or more parties
that places an obligation on each party to do or not do something for one or
more of the other parties and that gives each party the right to demand the
performance of whatever is promised to them by the other parties.

Every agreement enforceable by law is defined as a contract. An agreement

within a contract must be based upon a promise.

Every promise and every set of promises forming consideration for each other is
defined as agreement.” (Indian Contract Act, 1872).

An employee: Any person, excluding and independent contractor, who works for
another person or for the state and who receives, or is entitled to receive, any
remuneration; and

Any other person who in any manner assists in carrying on or conducting the
business of an employer.

An employer: is an organization, institution, government entity, agency,

company, professional services firm, nonprofit association, small business, store,
or individual who employs or puts to work, a person who is called an employee
or a staff member.

The definition of an employer is a person or a business that gives a paying job to
one or more people. (The company you work for is an example of your
employer.)

Promise:-A person’s declaration that she will or will not make something
happens in the future.

Promisor:-a person who is making the promise.

Promisee:-a person to whom the promise is made.

Offeror: a person who is proposing an agreement.

Offeree: a person to whom proposition (the offer) is made.

An employee: any person, excluding an independent contractor, who works for
another person or for the state and who receives, or is entitled to receive, any
remuneration; and

Any other person who in any manner assists in carrying on or conducting the
business of an employer

An employer: is a person, company, or an organization that employs people,
pays them for work.
1.2 Types of employment contracts
There are various types of employment contracts, however such types contracts
fall on the three criteria

Workers on indefinite term contracts

Workers on definite term employment contracts, with a duration of 12 – 36
months

Workers on definite term employment contracts with a duration of under 12
months

1.2.1 Permanent employment contract

Perhaps the most widely understood document, permanent employment
contracts are given to those who will be working regular hours for their
employer, including both full-time and part-time roles (think of a typical 9 – 5,
Monday to Friday job).

Permanent contracts cover those who are salaried or work for an hourly rate,
and they are ongoing until the employee leaves the business. This type of
contract entitles the employee to the full range of benefits and employment
rights, outlining their working hours, responsibilities, and terms of payment.

1.2.2 Part-Time Employment Contracts

Part-time employees have ongoing employment and typically work less than 38
hours a week. They usually work regular hours each week and are entitled to the
same minimum employment entitlements as full-time staff. However, the part-
time entitlements are on a ‘pro rata’ basis.

1.2.3 Fixed-term contract

A fixed-term contract is more popular amongst freelancers and contractors as
they set an end date for the employment. For example, a contract could last
three months, six month or a year. The contract can be extended but is put in
place to ensure that temporary or contract staff are given the same rights as
those in permanent employment.

The contract will outline the dates of employment as well as the salary and rights
that we’ve already mentioned above. Those who overstay their contract without
extending it are considered to then become permanent employees and must
hand in a notice if they want to leave the company, otherwise they’re free to
leave on the agreed end date.

1.2.4 Casual employment contract

Casual employment contracts are for those who want security. This includes the
employer wanting the individual to commit to the business and the employee
wanting to guarantee working hours. That said, these are not fixed hours like in
 a permanent contract. The two parties agree on the minimum number of hours
they’ll be guaranteed each week or month.

For example, the contract could outline that the worker will be given 16 hours a
week, but it doesn’t have to state when these hours will be, so shift patterns can
differ. The document entitles the employee to statutory sick pay and other
benefits, and means they’ll accrue holiday depending on how many hours they
work.

1.2.5 Independent Contractor

Independent contractors are typically self-employed workers who contract their
services out to other companies. Contractors negotiate their own fees and
working arrangements and they have the freedom to work for multiple
employers at once. It’s important for an employer to clearly define whether the
person they hire is a permanent employee or independent contractor as there
may be risks to the business if the contractor turns out to be an employee.

1.2.6 Zero-hour contract

There are currently 917,000 people on zero hours contracts in the UK, a number
that is slowly falling after a steady decades-long rise. A zero hours contract is
somewhat of an enemy in the world of workers’ rights, as it means that there is
no obligation for the employer to offer a set amount of hours. It works both
ways, though, and means that the employee can take or leave the hours they
want.

These contracts entitle workers to some statutory rights, though these are often
less than those of the previous documents we’ve discussed. It’s also worth
noting that this type of contract means the worker is not exclusive to one
company, they can also work for other people. Retailers and fast-food chains
tend to give out the most zero-hours contracts. They can be difficult for the
workers on them, as they often mean a lack of stable, consistent income. One
week you might work 40 hours, and the next week you might only work 5.

Types of contracts in Tanzania

In the case of Tanzania; the Employment and Labour Relations Act, 2004
together with the Law of Contract Act govern employment contracts.

If you are employed or about to be employed in Tanzania you need to sign
a Contract of Employment - including employment contract law, job
security, probation period, contract rights

According to the Employment and Labour Relations Act, 2004, there are
mainly three types of contracts under which you can be employed and
these are:
 i. A contract for an unspecified period of time: As the name explains, for this
type of contract the duration of employment is unspecified, meaning not
provided for. Some call it a permanent contract.
ii. Contract for specified period of time: This is a type of contract in which the
duration is specified. Under this contract if the specified duration has
expired then the contract automatically comes to an end. A contract for a
specified period of time could be of duration of one month, three months,
one year, two years etc.
iii. Contract for a specific task: This is a kind of contract in which a person is
employed to perform a specific task. Once the task is completed then that
contract comes to an end. For example, it could be that a person is
employed to offload crates of soda from a truck and once that task has
been completed then the contract ends.

1.3 Key aspects of industrial conflicts

1) Primary Strike: The strikes that are directly projected against the employer are
known as Primary Strikes. Below are types of Primary strikes which workers
adapt to push the employer to get them on terms agreed to workers.

Gherao is adopted by the factory workers to push the management to agree to
their demand by restricting access to office or factory premises where nobody
could move in or out.

Picketing is the process of highlighting their issues on playcard or banners to
show their demand to the public at large and media. In this union members are
being talked to resolve the issue peacefully.

Boycott is a process where no worker is allowed to carry out any work and
union members push other workers not to do work and participate in their strike.

Pen down strike where workmen come to work on a regular basis but do not
do any work and sit idle for whole office hours.

Go Slow Strike is also a very harmful way of strike where workmen
intentionally work very slow to slow down operation. This harms the employer
where order has strict timelines to deliver.

Hunger Strike is the most common and oldest method used by workmen where
they go for indefinite fasting and sit around factory or employer residence to
project their demand.

2) Secondary Strikes: The other name for the secondary strike is the sympathy
strike. In this, the force is applied against the third person having sound trade
relations with the organization to indirectly incur a loss to the employer and the
business. The third person does not have any other role to play in such a strike.
Module Two (2): Employment dispute settlement between employer and
employees
2.0 Employment dispute defined

Employment/Labour dispute means any controversy arising between a worker
and an employer or trade union and employers in respect of the application of
law, collective agreement, work rules, employment contract or customary rules
and also any disagreement arising during collective bargaining or in connection
with a collective agreement [Ethiopia, Labour Proclamation No. 42/1993, Section
136(3)]

Sect. 42. In this Part, dispute means any dispute or difference between an
employer or employers' organization and employees or a trade union, as to the
employment or nonemployment, or the terms of employment, or the conditions
of labour or the work done or to be done, of any person, or generally regarding
the social or economic interests of employees.

For the purpose of this part the term labour dispute means a dispute between a
trade union or group of employees and an employer or employers' organization
which relates to -the interpretation or application of a contract of employment, a
collective agreement or an arbitration award; a change of the existing terms and
conditions of employment or work; any other matter that may be subject to
collective bargaining.

Industrial dispute is a dispute or difference takes part:

i. Between employers and employees
ii. Between employers and workmen
iii. Between workmen and workmen
Dispute within industry are connected with:
i. Employment
ii. Nonemployment
iii. Terms of employment
iv. Condition of labour of any person

2.1Nature of employment disputes

i. Interest Disputes:

These conflicts are also called ‘conflicts of interest’ or ‘economic disputes’. Such
disputes relate to the establishment of new terms and conditions of employment
for the general body workers i.e., that affect the masses. Generally, such type of
disputes originate from trade union demands or proposals for increase in wages
 or other emoluments, fringe benefits, job security or other terms of employment.
These demands are put forth by the trade unions with a view to negotiate
through collective bargaining and disputes when the parties fail in their
negotiations to reach an agreement.

The terms ‘conflicts of interest’ and ‘economic disputes’ refer to the nature of
issues involved. There are no set principles to arrive at a settlement of interest
disputes, and recourse must be had to bargaining power, compromise, and
sometimes a test of economic strength for the parties to arrive at an agreed
solution. Such disputes are solved generally on ‘give and take’ basis.

ii. Disputes over Unfair Labour Practices:

Such disputes arise over the malpractices adopted by the management against a
worker or trade union. The examples of such malpractices may be discrimination
against workers for their being members of the trade union or their involvement
in union activities; interference, restraint or coercion of employees from
exercising their right to organize, join or assist a union; establishment of
employer sponsored union and coerce the workers to join such union; refusal to
bargain with the recognized union; recruiting new employees during a strike
which is not declared illegal; failure to implement an award, settlement or
agreement; indulging in acts of violence. These practices are also known as
‘trade union victimization’. In some countries a procedure is given to settle such
disputes. In the absence of any such procedure, the disputes are settled in
accordance with the provisions of the Act relating to industrial disputes.

iii. Grievance or Rights Disputes:

These disputes are also known as ‘conflicts of rights’ or ‘legal disputes’. They
involve individual workers or a group of workers in the same group. In some
countries, such disputes are called ‘individual disputes’. Such disputes arise from
the day to day working relations of the workers and management, usually, as a
protest by the workers or workers against an act of management that is
considered to violate his or their legitimate right.

Grievances typically arise on such questions as discipline, promotion, transfer or

dismissal of a worker, payment of wages, fringe benefits, overtime, retirement
benefits, seniority work-rules, leave rules etc., which are against the practice and
affect their rights adversely. In some cases, disputes arise especially over the
interpretation and application of collective agreements.
 Such grievances, if not dealt with according to the practice, may embitter the
industrial relations and may result in industrial strife, ‘conflict of rights’ refer to
the disputes based on alleged violation of an existing right or an alleged unfair
treatment by the management. There are, more or less definite standard for
resolving a dispute i.e., the relevant provision of the Act or collective agreement,
employment contract, works rules or law, or customs or usage.

iv. Recognition Disputes:

Such type of disputes arises when the management refused to recognize a trade
union for purposes of collective bargaining. Issues under this category differ
according to the cause that led the management to refuse recognition. Here the
problem is that of attitude.

However the management refusal may be on the ground that the union
requesting for recognition does not represent a specific number of Workers. In
such case, resolution of issue depends upon whether the rules for recognition of
a trade union exist or not. Such rules may be laid down by law, for they may be
Conventional or derived from prevailing practices in the country.

2.1.1 Causes of industrial disputes

Causes of industrial disputes can be divided into four major parts i.e., economic causes,
managerial causes political causes and other causes.
1. Economic Causes
Most of the Industrial Disputes are due to economic causes. Either directly or indirectly,
economic causes are at the back of industrial disputes.
Main economic causes are:
i. Low Wages:

In industries wages are low. As a result, it becomes awfully difficult for the
labourers to meet their minimum necessaries. Labourers demand that wages
should commensurate with the amount of work.

Such a demand leads to industrial disputes. Demand for higher wage-rate is the
most dominant cause leading to industrial disputes.
ii. Dearness Allowance:

Increasing cost of living is another factor responsible for industrial disputes. In
order to neutralise it, workers demand additional remuneration in the form of
dearness allowance.

Rising prices are at the root of demand for dearness allowance and non-
acceptance of this demand leads to industrial dispute.
 iii. Industrial Profits

Workers are an important part of production. Profits of the employers multiply
because of the untiring labour of the workers. That they should not be treated as
a part of machine is the persistent demand of the workers, rather they be
considered as partner in production.

On the basis of this concept, they demand share out of the increasing profit.
When this profit-sharing demand is rejected by the employers, industrial dispute
crops up.
iv. Bonus

Demand for bonus is also a cause of industrial dispute. Workers consider bonus
as deferred wage. Demand for payment of bonus constitutes cause of industrial
dispute.
v. Working Conditions

In many countries of the world, working conditions of the workers are not
satisfactory. Obsolescence of machines, lack of safety provisions, inadequate
light arrangement, less moving space, lack of other necessary facilities, are the
normal features of industrial units.

Demand for better working conditions on the part of the workers also contributes
to industrial disputes.
vi. Working Hours

Hours of work is another matter of controversy between employers and workers.
Despite legislation to this effect, it is always the intention of the employers to
keep the workers engaged for long hours at low wages.
It is opposed tooth and nail by the workers. Result is industrial dispute.

Other Causes
i. Safety of work,
ii. Modernization of machines,
iii. Pension, Gratuity, Provident Fund and other Beneficiary Schemes,
iv. Medical and accommodation facilities,
v. Leaves and Leaves with pay,
vi. Share in Profits.

2. Managerial Causes
Success of an organisation depends largely on its managerial capacity. Growth of the
organisation is based on the policies of the management. If the management pursues
appropriate policies, development of the industrial unit will be automatic. But many a
time, due to wrong policies of the management, disputes get accentuated.
Managerial causes of industrial dispute are as under
i. Non Recognition of Unions

Employers’ attitude towards trade unions has been antagonistic from the very
beginning. They do not want that labourers should organise themselves. Hence,
to prevent the workers from uniting, they refuse to recognise their unions.

It leads to conflict between the employers and the workers. In order to create
rift among the workers they deliberately recognise the rival union.
ii. Violation of Agreements

Employers and workers do enter into agreements on various issues. On many
occasions, the employers do not enforce these agreements nor do they strictly
adhere to them. It also accounts for dispute between the two parties.
iii. Ill-Treatment by Managers and Supervisors

Managers and supervisors consider themselves to be superior. It is under the
influence of this superiority complex that they ill-treat the workers. The same is
vehemently opposed by the trade unions.
iv. Defective Recruitment Procedure and Employees Development Policies

Defective Recruitment system also gives rise to industrial disputes. Many a time,
workers are recruited by the middlemen who get bribe from them.
They take undue advantage of the helplessness of the workers.

Defective development policies like favoritisms in promotion, unnecessary and
biased transfer, casual approach towards training facilities, on the part of
employers also contribute to industrial disputes.
v. Wrongful Retrenchment, Demotion and Termination

Sometimes on account of fall in production labourers are retrenched. Those
workers who take active part in trade union activities are demoted. Sometimes
employers terminate the services of the workers without assigning any reason.

All these provocative acts of the employers are not only strongly opposed by the
trade unions but also serve as good cause for industrial disputes.
vi. Selfish Leadership

Lack of right and effective leadership weakens the trade unions and the
employer class takes advantage of it. In order to serve their selfish ends, these
leaders enter into unholy alliance with the employers against the interests of the
workers. Often this also becomes cause of dispute.
vii. Violation of Accepted Code of Conduct

Code of conduct refers to the terms accepted by both the parties and both the
parties are required to abide by it.

Employers agree to all the codes on paper but fail to carry them out in practice.
As a result, workers oppose it.
viii. Collective Bargaining and Workers’ Participation in Management:

In the modern industrial world, labour class is seized with new awakening and is
influenced by new concept of management. Trade unions, therefore, insist on
workers’ participation in management.

By collective management they try to protect their interests to the maximum.
The employers oppose it. The inevitable result is industrial dispute.

3. Political Causes:
Political causes are no less significant than economic and managerial causes in
accounting for industrial disputes.
Chief among them are as under:
i. Influence of Politics:

In a country some countries of the world, influence of politics on trade unions is
clearly visible. Political parties have been using their influence on trade unions for
their selfish ends. Parties mislead the unions and instigate industrial unrest.
ii. Trade Union Movement:

Ever since trade union movement got recognition, industrial disputes have
multiplied. Many a time trade unions take undue advantage of their position and
this result into industrial dispute.
iii. Strikes against the Government:

During the struggle for independence labour-class had taken leading part in it.
Now this class directs its struggle against the government thereby adding fuel to
industrial disputes.

Other Causes:
i. Government’s inclination to support management.
ii. Internal conflicts in Trade Unions.
iii. Resistance to automation.
iv. Influence of Communist thinking on labourers.
v. Effect of non-acceptance of Human Relations.

2.2 Mechanism for labour disputes settlement:

i. Works Committee:

The competent Government may, by general or special order, necessitate the
employer to form in the prescribed manner a Works Committee consisting of
representatives of employers and workmen involved in the establishment in
the case of any industrial establishment in which one hundred or more
workmen are employed or have been employed on any day in the preceding
twelve months.

The workmen’s representatives shall be selected in the prescribed manner
from among the workers in the establishment, in conjunction with their trade
union.
ii. Conciliation officer:

The competent Government may appoint as many conciliation officers as it
sees proper to promote and settle industrial disputes by notifying them in the
official Gazette. The major goal of selecting a conciliation officer is to
establish a friendly culture in the workplace and to resolve disagreements
between workers and employers. He can be appointed for a specific area,
specific industries in a specific area, or one or more specific industries, and
for a long or short period of time.

The conciliation officer’s role is administrative rather than judicial. He must
convene conciliation sessions, investigate the disagreements, and do anything
else he deems necessary to persuade the parties to reach a fair settlement of
the disputes.
iii. Board of Conciliation:

If the appropriate government believes that there are any industrial conflicts
in a particular industry, it may refer the matter to the Board of Conciliation
for resolution. The Board of Conciliation is responsible for resolving the issue.
He must submit a report as well as a memorandum of settlement to the
appropriate government officials.

In the event that no settlement is reached, he must submit a detailed report
to the appropriate government outlining the Board’s actions.
iv. Court of Inquiry:

By notification in the official Gazette, the appropriate Government may form a
court of inquiry into any matter appearing to be associated with the
settlement of industrial disputes, consisting of an independent person or such
independent persons as the appropriate Government deems appropriate.

The court must have at least two members, one of whom must be chosen by
the Chairman. The court is required to deliver a report to the appropriate
government within six months of the start of any investigation. A court of
inquiry has no authority to improve any agreement reached between the
parties.
v. Voluntary Arbitration:

The Industrial Dispute Act also allows for voluntary arbitration. If an industrial
disagreement exists or is suspected, the matter may be referred to
arbitration. If a majority of each party signs the arbitration agreement, the
government may publish a notice allowing employers and employees who are
not parties to the arbitration agreement but are involved in the dispute to
 present their case to the arbitrator or arbitrators. The arbitrator(s) will
investigate the case and present the government with the arbitration award,
which must be signed by all arbitrators.
vi. Adjudication

It is not that adjudication completely replaces conciliation; rather, if
conciliation fails to resolve a dispute between two parties, adjudication steps
in to do the job that the conciliation mechanism was supposed to finish.
vii. Labour Court

The labour court is made up of one person who is either an independent
judge or a High Court or District Court judge. The judge could alternatively be
a previous labour court judge with at least 5 years of experience.
viii. Industrial Tribunal

The government can establish one or more industrial tribunals as he sees fit,
with the courts having broader jurisdiction than the labour court. It is not to
be considered a permanent body, but rather one that has been put up for the
sole purpose of hearing on an as-needed basis.
ix. National Tribunal:

The Central Government establishes a national tribunal by an official gazette
for the adjudication of industrial disputes of national importance.

2.3 Disciplinary proceedings in settling labour disputes

Employers in Tanzania may face legal action as a result of failure to follow
Tanzania labour related to disciplinary hearing and its procedure.

The disciplinary hearing procedures in Tanzania are governed by the
Employment and Labour Relations Act CAP366 of 2004 the Employment and
Labour Relations (Code of Good Practise) G.N 42 of 2007, and the schedule to
the Code of Good Practice G.N. No. 42 of 2007, Guidelines for Disciplinary,
Incapacity and Incompatibility

The main purpose of a disciplinary hearing is to correct the employee's behaviour
and ensure that they conduct themselves professionally at work. However, it can
also be a question of the employee not having the capability to perform the job
as well.

The employee must be aware that before conducting a disciplinary hearing
against an employee there are several steps to be conducted against an
employee, this means that an employer cannot initiate a disciplinary hearing
against the employee on the spot.

First step: Counseling and verbal warning

When an employee engages in minor misconduct or performs poorly, the first action
that an employer should take is to issue a verbal warning and counseling so that the
employee understands that certain actions are undesirable and that he may correct the
behavior
Second step: Written warning
When an employee's behaviour or conduct does not improve after being counseled or
given a verbal warning, the next step to be taken by the employer is to issue a written
warning.
The employee may receive a written warning in stages, such as a first warning letter, a
second warning letter, and a third warning letter.
Third stage: Disciplinary hearing
The question is at what stage should an employer conduct disciplinary hearing? A
disciplinary hearing must be conducted on the below circumstance;
i. Further misconduct following a written warning or warning
ii. Repeated written warning for different offences or;
iii. Allegations of serious misconduct which could on their own justify a final warning
or dismissal and may lead to termination of employment

In order for the disciplinary hearing procedure to be regarded fair under the law, the
following process must be adhered to;
i. Conducting an investigation

At this stage the employer is advised to conduct a thorough investigation before
inviting the employee for a disciplinary hearing. The purpose of conducting an
investigation is to ascertain if there are grounds to conduct a disciplinary
hearing.

In conducting an investigation, the employer should be careful in the process.

For example, it is not advisable to postpone a hearing to perform a further
investigation.

In the case Huruma H. Kimambo V Security Group (T) Limited Revision 412 of
2016 [2018] TZH CLD 30. an employer decided to postpone a hearing to conduct
an investigation to ascertain if there are grounds of disciplinary hearing. The
court held that this action by the employer brings a picture that the employer
didn't conduct an investigation to ascertain the grounds for disciplinary hearing.

ii. Notifying the employee of the allegations

The employer is required to notify the employee in writing of the disciplinary
hearing that will be conducted against him. The notification should state the
 allegations, time and date of the proposed hearing. The employer shall give the
employee a reasonable time to prepare for the hearing, which shall be not less
than 48 hours.

The letter should also inform the employee of the right to have a representative
at the hearing and that person can either be a fellow employee or a trade union
representative.

In addition, the employer is required to furnish the employee with a copy of the
investigation report so that he prepares for his defence at the hearing. This
requirement was held in the case of Higher Education Student's Loans Board Vs
Yusufu M. Kisare Consolidated Revision No. 755 of 2018.

iii. Conduct a disciplinary hearing

The law requires for senior management representative to be the chairperson.

The chairperson should be impartial and not involved in the events that led to
the case.

However, if the employee is a senior manager, then in such appropriate
circumstances a senior manager from a different office may serve as a
chairperson.

iv. Presentation of evidence and calling witness

According to Tanzania labour law, the evidence that was collected shall be
presented at the hearing and the witness who can testify on the allegations
should be brought up, both the employer and the employee have the right to call
witnesses and present the evidence on the alleged misconduct.

The chairperson shall rely on the evidence and witnesses present at the hearing
in order to make a decision.

v. Mitigation

According to Tanzania labour law, if the outcome of the hearing finds the
employee guilty of the allegations, the employee is given a chance to put
forward mitigation factors before the decision is made on the disciplinary action
to be taken.

vi. Decision of the hearing

According to Tanzania labour law, the chairperson is required to inform the
employee of the outcome of the hearing as soon as possible but it should not be
 later than 5days, the outcome of the hearing should state the reasons of the
decision and it should be in a prescribed form.

The chairperson should sign the disciplinary hearing from and give a from to the
employee.

vii.Appeals

An employee may appeal against the outcome of a hearing by completing an
appropriate part of the copy of disciplinary hearing and shall give the chairperson
within 5 working days of being disciplined.

The appeal hearing shall not be chaired by the same chairperson but by a senior
level of management. The appeal should not constitute a hearing but is should
focus on the grounds of appeal.