The question that this article attempts to answer, namely whether the labour laws of Zambia are designed to encourage dialogue is central to the understanding of today's industrial relations scenario in this country. Indeed, it could also be used as a protective analytical tool in our efforts to predict the likely future of industrial relations given the existing labour legislation and practices.
To some of us who subscribe to the conflict theory of labour relations, dialogue is not only important but necessary and inevitable. Unlike the unitarists who believe that the interests of management and labour are the same and harmonious and that factionalism at work places is a pathological social conditions conflict theory adherents believe that the very existence of the two groups is a reflection of the power relation with a never-ending potential for conflict. Similarly, unlike the unitarists' belief that trade unions constitute an illegitimate intrusive element in the presumed unified and cooperative structure at the work place, conflict theory analysts have come to conclude that trade unions, including the institution of collective bargaining, are necessary institutions through which conflict can be resolved and rendered more acceptable.1
Therefore, the parties to labour relations -- trade unions, employers and their associations and the state -- both as a n employer as well as the custodian of public interest have a duty (or the law must given them a duty) to engage in constant dialogue as a mechanism to forestall, coordinate, channel, regulate and resolve conflict in industrial relations. A preliminary point must be made here that there can never be (and indeed there has never been a successful) conflict-preventing law in labour relations. All there can be is a regulatory law. Whether the law on industrial conflict is one or the other will depend, largely although not exclusively, on the mechanism that the law has prescribed for handling conflict situations. These will be dealt with in due course within the framework of the question this paper is addressing. But the point that has to be made at this stage is that while conflict is inevitable and even sometimes necessary, this comes about as a symptom of lack of dialogue.
We have used the word dialogue several times in this article so far without attempting to define it. That was not an oversight but rather deliberate. It was intended that the reader should take the meaning of the word in its literal sense, that is, a talk between two or more people. Yet that is wrong! When persons are engaged in dialogue in everyday life there is no law compelling them to do so. Also they usually do that not in anticipation of conflict (although this may be so sometimes).
In labour relations dialogue assumes a different character and dimension. It is dialogue not between individuals but between institutionalised groups of persons. It is dialogue between two contending groups for purposes of regulating, regularising or managing conflict, actual or potential. This dialogue in labour relations, therefore, is formalised although informal dialogue also takes place behind the scenes, although that is only supplementary and not a substitute for the formalised one. The question therefore is whether the law encourages such a dialogue and if so through what channels and institutions, formal or informal, voluntary or compulsory.
The institution of collective bargaining is perhaps the most important and acknowledged form of dialogue in labour relations whereby organised labour through trade unions as agents2 negotiate with management to improve their terms of employment. It has to be emphasised here that the concept of dialogue in labour relations through the institution and process of collective bargaining is the raison d'etre of collective labour relations. Although the basis of the employer and employee relationship is, in the theory of the law, to be found in an individual contract of employment, it has now been overwhelmingly agreed that labour relations is about collective labour relations. Collective bargaining is, therefore, the linchpin of collective labour relations.
The reason for this is simple but important. If it is accepted that the basis of the employer/employee relationship is the contract of employment, then this assumes freedom to contract whereby the individual employee is seen as having freely and willingly negotiated (or entered into a dialogue)with the employer resulting in the contract. The reality of the situation, however, points in the opposite direction in that the rule, rather than the exception seems (and actually is) the standard whereby the individual employee is given a contract on a take-it-or-leave-it basis. In such a situation the employee can hardly be said to have negotiated. Thus the employee in need of a job will take, in the meantime at least what the employer has offered. As an individual employee he is at the mercy of the employers.
However, in order to bring about a relative equilibrium between the employer and the employee, the employees combine together as organised labour in entities called trade unions. Through these bodies employees have the strength and capacity to negotiate, so to speak. Collective bargaining cannot take place at individual level. It remains, therefore, upon the law to recognise and rationalise collective labour relations through which the process of collective bargaining can take place.
It would however be wrong to suggest that dialogue in labour relations only takes place and should take place through the process of collective bargaining. Indeed, collective bargaining maybe regarded as dialogue at the highest formalised level. Dialogue must be able to take place at lower levels as well. One might in fact argue that while dialogue at the highest level is important, dialogue at lower levels of industry might be decisive. The elected trade union officials are not in constant contact with the managers and are, therefore, only called upon when problems arise. Of course, this will depend on the structure of trade unions. Where trade unions are by law or practice organised at national or even industry level, the problem of contact becomes more accentuated. In such cases the need arises to establish other institutions of dialogue at work places. However, where a trade union is organised at the level of the work place the problems of contact resolves itself as trade union officials will be stationed at that level.
The problem however, seems to be where to draw the line or distinction between the functions of trade unions and those of other institutions of dialogue at the lower level. This seems to have been the problems in Zambia under the 1971 Industrial Relations Act. Under this Law works councils were established alongside the trade unions. Their role was mainly participative rather than negotiative. These were established at the level of the work place and their objects were to maintain the effective participation of workers in the affairs of the undertaking as well as to ensue the mutual cooperation of workers, management and the union in the interest of industrial peace, improved working conditions, greater efficiency and productivity. These objectives tend to suggest that works councils acted as a bridge between the management of the undertaking and the trade union.3 It must be emphasised that under the 1971 legislation, a works council was mandatory for every undertaking having twenty-five or more employees.
Works councils had certain powers and rights. For instance, they had the power to participate in schemes relating to health and welfare of eligible employees. The main criticism against this was that the right ended at participation and the ultimate decision lay entirely with management. If such a scheme was the product of management at industry level4 then it would appear that the works council was precluded from participating.
Works councils also had a right to be consulted and informed on certain decisions made by management. Again a mere right to information without a right to question would appear to be ineffective. Yet it does appear that the law preserved management prerogative on a number of decisions. One area where the law recognised works councils' right of veto was in the field of personnel management and industrial relations. The specific areas in which a veto was applicable included recruitment of employees and assessment of their salaries, transfer of employees, redundancy, disciplinary rules, safety of employees and bonuses, and incentives and their mode of payment.
Two points are noteworthy of the 1971 legislation. First, it is that the legislation recognised the important fact that trade unions may not be the most effective bodies to monitor and question management actions especially in a situation where there is only one union in an industry. Watchdogs, in the name of works councils were therefore made mandatory in an undertaking having twenty-five or more employees.
Secondly, as explained above, the powers conferred on the works councils did not include the power to enter into collective bargaining for purposes of regulating conditions of employment. Although negotiations may have taken place, the outcome was not strictly speaking a collective agreement.
What one must perhaps acknowledge is the fact that in a number of ways the powers conferred on works councils fell within the domain of trade unions thereby causing a lot of friction between trade unions and works councils. In consequence, the effectiveness of works councils was rather questionable.5
The law in Zambia recognises the institutions of collective bargaining and the works councils. Their recognition is one thing, but whether they have been designed to encourage dialogue is quite another. We now address this specific question.
It has been previously noted that labour relations are essentially collective rather than individuals. In this sense, therefore, the law relating to collective labour relations, that is, the Industrial Relations act, (No. 36 of 1990) is relevant. The Employment Act,6 which is primarily concerned with individual contracts of employment will not be considered here except to note that it is provided in the act that collective bargaining facilities shall be taken into account when resolving disputes arising out of the contact of employment. While such a proviso does not appear to have appreciable impact on the individual contract of employment between the employer to have resort to collective bargaining facilities, such a s consulting with the trade union or taking such steps as are appropriate within the framework of collective bargaining for purposes of resolving or dealing with a dispute with an individual employee. This does not go far enough in terms of establishing the institution as a permanent one to deal with such disputes to the same extent as collective bargaining. Under the Employment Act, it must be noted, it is the facilities of collective bargaining and not the substantive process of collective bargaining that must be taken into account. The two are fundamentally different.
Under the Industrial Relations Act of 1990 (IRA:90), dialogue by way of collective bargaining may take place either at the level of the work place or industry. The appropriate bargaining unit at the level of the work place consists of a negotiating team representing management of the undertaking and the trade union representatives of employees in such undertaking. At the same time, a joint council, formed by a trade union and the employers association in that industry shall constitute a bargaining unit.
Under Section 85 a duty is imposed on the bargaining unit to commence negotiations for the purpose of concluding a collective agreement at least three months before the current one expires. It is implicit that under the clause where a collective agreement does not exist, negotiations for purposes of concluding one must commence within the same period. It is an offence not to do so.
Under Section 90, any collective agreement concluded by a joint council shall bind every employer and employee engaged in the industry concerned notwithstanding that the employer or employee is not a member of the association or the trade union concerned, or was not a party to the collective agreement. However, an employer is not precluded from concluding a collective agreement with the appropriate trade union on terms which are not less favourable than those concluded by the joint council.
The IRA: 90 also recognises the works councils. Under Section 95, it is provided that every undertaking employing less than one hungered but more than twenty-five eligible employees, or more than one hundred eligible employees not members of any registered trade union shall cause to be formed a works council at such undertaking. Thus, works councils can only be formed in an undertaking where the number of eligible employees is such that they cannot constitute a trade union7 or where no trade union exists. The two cannot coexist.
This formula (that no works councils can be formed at the undertaking where a trade union already exists) was probably deemed necessary following the many complaints lodged by trade union officials under the 1971 IRA that works councillors were meddling in matters which collective bargaining was best suited to address or were a preserve of trade union negotiation.
While it is true that there were areas of overlap of responsibility between trade unions and works councils under the 1971 IRA resulting in friction in some cases, to completely do away with them where a trade union exists under the IRA:90 has not been particularly impressive. As has been suggested above, dialogue must be encouraged at the level of physical interaction between the employer, the mangers, the employees and the trade union officials. What could have been a better approach under the IRA:90 was the retention of the works councils by streamlining their operations, removing areas of potential friction in their relationship with the trade union and, above all, defining their powers and responsibilities in such a way as to give them the status merely of watchdogs at that lower level notwithstanding the existence of a trade union. The assumption under the IRA:90, unfortunately, is that the functions of trade unions and works councils are irreconcilable.
It must be pointed out that the institution of works councils is commonly considered as a means of worker participation and not necessarily decision-making at the work place. This model is quite common in many countries and has been well documented.8 The assumption therefore that trade unions cannot coexist with such bodies is not convincing. The correct view should be that works councils are there to supplement the efforts of trade unions. This role only breaks down into industrial anarchy if the roles of the two (i.e. the trade unions and works councils) are in conflict.
There is a further problem under the IRA: 90 concerning representation for collective bargaining purposes. As already pointed out, a bargain concluded by a joint council binds every employer and employee in that industry notwithstanding that such employer is not a member of an association and an employee is not a member of a trade union. the only exception is here an employer concludes a more favourable bargain with a trade union at his undertaking. This is, of course, possible given the policy of multi-unions in an industry under the IRA: 90.
According to the agreed guidelines for the pay policy of free collective bargaining agreed by the tripartite meeting between the Zambia Congress of Trade Unions (ZCTU), the Zambia Federation of Employers (ZFE) and the Government of Zambia in December 1990, it was emphasised that the principle of "ability to pay" should be considered as the most important factor. The principle of automatic application of the terms of employment negotiated by the joint council across the industry seems to run counter to the principle of "ability to pay." It is quite possible that while some employers within the industry can afford to pay the negotiated terms others in the vulnerable bracket of the same industry might not. This may result in such firms either folding up or embarking on retrenchment exercises. A good example of the situation is in the banking industry. The demand by the bankers this good example of the situation is in the banking industry. The demand by the bankers this year (1992) through their union, the Zambia Union of Financial Institutions and Allied Workers (ZUFIAW) of a K40,000 pay rise across the board can be met by the established banks but would expose smaller, emerging banks to financial risks.9 the automatic application principle does not therefore give opportunity to the weak, the vulnerable within the industry to offer and negotiate for the terms they can afford. In essence, since it is the law of the "survival of the fittest" at play, weak partners in the industry having no incentive to negotiate and the law, in that context, does not encourage them to get involved in meaningful dialogue.
This arrangement raises another related problem. The law provides that any one hundred eligible employees may form a trade union and have it registered.10 Where there is no trade union, either because of the insufficient number of eligible employees or for sheer lack of organisational ability, then, provided that there are more than twenty-five employees, a works council must be formed.11
Under Section 108(1) of the IRA: 90, it is provided that certain decisions of management shall have no effect unless approved by such works council. Included are decisions in respect of (inter alia):-
a) the conditions of service of eligible employees;
b) the recruitment of eligible employees in the undertaking and the assessment of their salaries.
c) the rules as to discipline; and
d) redundancy.
The pertinent question here is whether a works council can effectively exercise its powers of approval in the event that a joint council constituted in that industry has concluded a collective bargain for the industry given that such a bargain is binding on all parties willy-nilly subject to the "better deal" exception. On the true construction of the law, it would appear that the works council only has a right of approval when there is no industrial collective agreement in place (i.e. concluded bythe joint council). this, then, renders the institutions of the works council rather redundant and only of significant the law books.
Indeed, one can even go further and say that in as far as dialogue is concerned at this level, it can hardly be said to exist given the following two considerations:
a) Apart from the emerging splinter unions which have not yet been registered or recognised, unions in Zambia exist at industry level and the prospects of further proliferation of trade unions are rather dim. Given this factor the formation of a works council would be in breach of the law.
b) Except for the self-employed (and probably garage owners), one can hardly think of an employer employing less than one hundred employees or between twenty-five and one hundred. Even if such cases exist the employees are unskilled and are most likely to resist attempts to organise them into works council for fear of reprisals from their employers most of whom rely on the readily available unskilled labour.
Thus to abolish in effect the works councils' participation rather than to rationalise their area of jurisdiction, may prove counter-productive. While it is arguable that one can find trade union representatives even at the shop level it is difficult to accord to such representatives the same participative status that the works councillors would have had outside the traditional function of trade union organisation.
Given this deficiency of dialogue at the lower level of the ladder, we are left with the consideration of collective bargaining and the law in Zambia. The gist of our inquiry is the extent to which collective bargaining, as an instrument of dialogue, is supported by the law.
It has already been acknowledged above that the law in Zambia recognises collective bargaining and that a duty is imposed on the parities to do so. A duty does not end at entering into collective bargaining, but it is extended to a further obligation to conclude and sign an agreement within three months after the commencement of negotiation. In short, a duty to agree is imposed by law. Where there has been failure to commence or conclude negotiations within the stipulated period (the onus of proof being on the bargaining unit), then every member of the bargaining unit shall be liable, upon conviction, to a fine and may further be prohibited form holding a position in the bargaining unit for a period not exceeding three months.
Although these two important duties are imposed, they lack much of practical significance for two reasons. First, the law does not impose a duty on the parties to bargain in good faith, and secondly the law does not require that the employer should make available to trade union information relevant for bargaining purposes.
There are two facets, to bargaining in good faith. The first is openness and preparedness, and the second is willingness to give in to genuine demands by striking a compromise, if possible.
It is a trite principle of collective bargaining that both parties should be as open as possible and be prepared to furnish the necessary details in order to conclude a bargain which is realistic. If this is not a legal duty then the parties can only be open and prepared on moral grounds. Indeed, cases have been reported where the negotiation process has broken down on the ground that one party did not have the necessary details to justify the continuation of such negotiations. In other words, there is a subtle game of hide and seek and, for this reason, it has been possible to evade the duty to conclude an agreement as the party in wrong can easily say that more information has to be sought. The question, them, is why should such a party have indicated preparedness to commence negotiations.
A recent example of striking teachers in the country is a case in point. The State was obviously not open or prepared enough to commence and conclude a collective agreement but yet, the State was the party mostly in a hurry to conclude one, knowing too well that it contained unprofessional and inexcusable anomalies. Hiding itself behind the veil of contract, the Sate, through the Ministry of Education, is insisting that there are channels through which such disputes must be addressed. The dispute has been brought about by the State itself by not bargaining in good faith, and because there is no law to compel it to do so, it has taken the advantage of the poor workers. Where the State behaves in this manners, then workers in the private sector have little protection.
Noteworthy also is that, since there is no law to compel the employer to furnish the trade union representatives with relevant information for bargaining purposes, the trade unions invariably are forced to put their demands from the point of ignorance as to what the employer can afford. It would indeed be to the employer's advantage if long before the commencement of negotiations the law required that they should provide the trade union with such information so that upon digesting it the trade union could base its demands on the factual information provided. This system cannot work where confidence is lacking between the parties. The prerequisite is the cultivation of confidence in both the parties and the law can play its role by devising a formula which can ensure that all loopholes are sealed. As this is not the case in Zambia one cannot really blame the trade unions for some demands that they make as the necessary information which they can use as the basis for their demands that they make as the necessary information which they can use as the basis for their demands is simply not made available to them. The picture that is steadily emerging is that even if the law recognises collective bargaining and ancillary duties are imposed on the parties, there is still lacking the required ingredient in the crucible of the process, and one can say that the law does not go far enough to encourage this process to continue and be improved upon in an atmosphere of openness, preparedness and good faith.
Finally, it has been pointed out above that industrial conflict is an inevitable phenomenon regardless what the law may have to say about it.12 We postulated that whether a particular labour jurisprudence encourages dialogue or not will to some appreciable extent depend on the laws related to the resolution of conflict situations which may be preventive or regulatory.
Where the law merely regulates the channels through which conflict shall be managed, and to the extent that such a law gives a power and discretion to manage the conflict within the legally prescribed limits, then one would say that such a law encourages dialogue in conflict situations. On the other hand, where the law prescribes mandatory channels which rob the parties of voluntariness in managing industrial conflict then such a law leaves no room to the parties to engage in dialogue as they have no potion.
While the 1971 IRA prescribed a compulsory conflict settlement procedure by requiring parties to a dispute to adhere to that procedure and giving the ultimate power to the Industrial Relations Court, the IrA: 90 has been infused with the spirit of voluntariness. Under the new system, mediation has been dispensed with reference to conciliation or the Industrial Relations Court is voluntary as the parties are permitted to conduct a strike or lockout ballot. This is the stage and only stage when dialogue is permitted and encouraged.
In order to increase productivity and efficiency it is important that labour laws do not only appear but are actually seen to encourage and foster dialogue. From the above analysis it is clear that, except at conflict stage, the laws do not actively and realistically encourage dialogue either at the lower or higher level of the industrial relations ladder. While duties are imposed on the parties to commence negotiations and conclude a bargain such duties are not supported by the necessary ammunition to take care of fraudulent bargainers. We have also noted that there has been, in the recent past, a classic example of fraudulent bargaining on the part of the State. There is urgent need to restructure the laws in this liberalised economy so that the input of the worker in industry can be properly compensated through the process of constant and sincere dialogue not dented by fraud and treachery.
1. See Famham, D. and Pimlor, J., Understanding Industrial Relations 3rd Edn (Cassell Educational Limite London, 1988) Chapter 1.
2. The agency theory, with all its analytical pitfalls in trade union law is here loosely used to mean the trade union officials negotiate or talk with the management on behalf of the members belonging to that trade union.
3. See also Banda, D.A. and Mukupa, A., "Worker Participation and the Influence of Trade Unions in the Formulation of Employment Policies in Zambia", A paper presented to ILO/ZCTU Seminar in Siavonga, 18-24 June, 1989.
4. Note that under that legislation only one union could exist in any one industry.
5. See Kester Gerard, Industrial Participatory Democracy and Trade Unions. Report on an Exploratory study in Zambia (The Hague: Unpublished paper: 1984).
6. Cap. 512 of the Laws of Zambia.
7. Under the IRA:90, not less than one-hundred eligible employees may form a trade union.
8. See for example the following articles: Ray Loveridge, "What is Participation? A Review of the Literature and Some Methodological Problems", Brit. J. of I.R., XVII, NO. 3 1980, p. 297; Heniz Hortmann, "Co-determination Today and Tomorrow", Brit. J. of I.R., XIII, No. 1, 1975 p. 54; Alan C. Neil, "Co-determination in the Federal Republic of Germany: An External Perspective from the U.K.", Brit J. of I.R., XXV, No. 2, 1987 p. 227; Ary Globerson, "Spheres and Levels of Employee Participation in Organisations", Brit J. of I.R. VIII, NO. 2, 1970 p. 252; Heinz Hortman, "Workers Councils and the Iron Law of Oligarchy", Brit. J. of I.R., XVII, No. 1, 1979 p. 70.
9. This was revealed to the author by some bank officials interviewed in Zambia National Commercial Bank, Standard Chartered Bank, Indo-Zambia Bank, Finance Bank and Barclays Bank of Zambia (all in Lusaka). It is submitted that although the interviews were conducted informally, the picture cannot be far from being a true reflection of the general state of affairs.
10. S.8(1) IRA: 90.
11. S. 95(1), (a) (b), IRA: 90.
12. See for example the following: Kahn, Ottokahn, et al Laws Against Strikes (London: 1972); Ran Chermish, "Strikes as Social Problems: A Social Problem Matrix Approach", Brit. J. of I.R., XIII, NO. 2 p. 281; P.K. Edwards, "Strikes and Unorganised Conflict: Some Further Considerations", Brit. J. of I.R., XVII, NO. 1, 1979, p.95; Joseph, W. Gorbarino, "Managing Conflict in Industrial Relations: USA Experience and Current Issues in Britain", Brit. J. of I.R., VII, No. 3, 1969 p. 317; J. Douglas Muir, et al, "Labour Legislation and Industrial Disputes: The Kenyan case", Brit. J. of I.R., XIII, No. 3, 1975, p. 334.