Home ECONOMY Sakaja Bill’s unpaid leave proposal unsustainable

Sakaja Bill’s unpaid leave proposal unsustainable

by biasharadigest
Ideas & Debate

Sakaja Bill’s unpaid leave proposal unsustainable

Nairobi Senator Johnson Sakaja
Nairobi Senator Johnson Sakaja. FILE PHOTO | NMG 

The spirit of the Pandemic Response and Management Bill 2020 is in line with the current Covid-19 predicament. Seeing the Senate ad hoc committee, chaired by Nairobi Senator Johnson Sakaja, come up with such quick recommendations to try to cushion the citizens against any imaginable financial burden is commendable

Reading through the very well written 40 sections of the proposed law, anyone can see that a lot of thought went into the drafting. There is a clear description of the application of the Act, which is only during the period of a pandemic — described as one where there is an infectious disease across borders. This means that as soon as the pandemic is declared non-existent, then everything goes back to normal.

Part VI, on the Socio-Economic Protective Measures, will have most common people feeling protected as the sections seek to give reliefs, ranging from tax reviews, loan holidays, enforcement of force majure, tenancy relief and employment protection.

I am concerned largely by the supposed employment protection. While the Bill acknowledges that the pandemic might adversely affect the ability of an employer to pay salaries it also requires that the employer does not terminate a contract of service or dismiss an employee or coerce an employee to take a salary cut.

The Bill proceeds to give relief or what is envisaged as such to the employer to permit an employee to take leave of absence without pay for the duration of the pandemic.

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It seems that the Bill primarily wants to address two aspects in regard to employment — manage the arbitrary layoffs that could cause even further misery in times like this and give legal standing to the use of unpaid leave which the current Employment Act has not envisaged or provided for.

The management of the two aspects are perfectly in order. However, I would like to point out that they are not sustainable.

In the management of arbitrary layoffs, it is assumed that layoffs are cheap. This cannot be further from the truth. Organisations have huge debts in regards to severance pay and any such layoffs could occasion extremely large cash outflow, which would not be ideal in a cash conservation bid.

In giving life to the granting of unpaid leave, while stopping the organisations from layoffs, the Bill seeks to give a false sense of hope to the employees. It seems to equate long periods of absence with the retention of the jobs. It seems to prescribe the unpaid leave as a cushion for the said employees. It also erroneously believes that the only liability that the employer has is salaries and wages.

I appreciate the need to regulate where the people do not regulate themselves. There are cases of employers using such opportunities to exit long-serving employees empty-handed. This is of course neither sustainable nor ethical. However, this Bill will not only regulate but also cripple the very persons it intends to protect.

If the Bill is passed into law and a pandemic such as Covid-19 occurs or this current pandemic – God forbid – stays on for a further 12-month period, this is the sequence of the events:

The employer shall permit — if requested, as this Bill does not allow the employer to make the decision, leaving the prerogative to the employee who we well know might forget to ask for the unpaid leave — the employee to go on unpaid leave.

The employer, who has other obligations without relief from this Bill being offered to them, will then proceed to close its doors after the one year period and once the pandemic is declared over, the employee is supposed to resume work and only then can a layoff be executed.

Several questions arise on the sustainability of this proposal. First where will the employee resume work, assuming that the employer – since there was no cushioning of the entity – couldn’t stand the test of time? The employee not only has no place to go after the pandemic but also loses any benefit they might have had under a severance package.

Secondly, the closure of the business means that there is not only loss for the economy in terms of the employment, but also the product or service offered by the organisation.

This means a disruption in the supply chain. What then happens after the pandemic is declared over? Does the country start from building this supply chain built over long periods of time from scratch?

Thirdly, assuming that the tax, loan and tenancy relief envisages that the employees going back to work will pay back the relief after resumption of work, what happens to the money economy? Do these institutions – since there is a collapse of industry – term this bad debt? I am not an economist, but I cannot see how this does not cause an economic problem.

In Africa and specifically in Kenya, human resource is our greatest asset. However, this can only exist together with the businesses. There cannot be protection of one without the other. But this is a mistake repeated over and over in the provisions of the employment laws drafted in this country.

It is no longer a master and servant relationship — both are workers in the enterprise — thus the introduction of vertical organisations, feedback loops that enable all parties to contribute, tripartite agreements and many other forms of engagement, which appreciate that none can become without the other.

The Bill in my opinion lacks both foresight and vision beyond the pandemic. Whilst sounding like a saviour in these very difficult times, this Bill could occasion misery at the end of the period.

The Bill should seek to keep as many businesses open as possible and as many employees at work as possible who continue to earn a living during the period of the pandemic. Noting that one employee supports between five and 10 people with his or her salary, including the mama mboga, this not only ensures that the economy continues to survive but also that industry does not collapse.

Having defined the pandemic as an airborne disease, it should ensure that the public health directives and Occupational Health Act reviews for workplaces are immediately introduced and implemented, and that the people would still be able to work and be safe.

The Bill should provide for a fund to ensure that the employees continue drawing a salary — even a subsidised one, mainly through a social safety net or the response fund as envisaged in the Bill — in partnership with the employers.

Asking people to go on unpaid leave, without any certainty of ever coming back and resorting to handouts is not only unsustainable but will only cause a crippling of body and minds. How long can the country feed its citizens if industry is closed? Where will the country buy the food to feed its citizens if industry is closed? As seen already, many governments in Africa and elsewhere have stopped exportation of their key items as they seek to safeguard their own.

A handout economy — especially where there is an unpredictable period of danger — is not only unsustainable but can also cause more harm than good. Any response should be viewed as a business continuity plan for the country, not as a short-term solution to a short-term problem. I hope there will be a review of this Bill to include a much more sustainable approach to responding to this very unfortunate event of our lives.

Kinyua is the director of human resources and administration, Oserian Development Company

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