RTSA employees contemplate law suit for nonpayment of gratuity and abrogation of Employment Act

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Employees of the Road Transport & Safety Agency (RTSA) are waiting for the new board of directors to take corrective measures before they can take legal action against the agency.

The 13-member Board, chaired by Dr. Cornelius Chipoma, has Mr. Patrick Malindi, Dr. Henry Nkhoma, Mr. Martin Libinga, Ms. Womba Kasambu, Ms. Mumeka Walumweya, Mr. Daniel Kampilimba, Mr. Mwenya Bwalya, Ms. Lombe Kamukoshi Engineers Misheck Lungu, Engineer Wallace Mumba, Engineer Elias Mwape and the Director of RTSA as members. The board was constituted by government through the Transport and Communications Mutotwe Kafwaya on August 14, 2019.

The employees want the new board of directors to quickly correct the abrogation of the employment law of Zambia for failing to pay gratuities for more than 120 employees dating as far back as 2018 to date meaning that each passing month the list is growing & the longer it takes to pay gratuities the more money is losing its valve.

More than half the number of employees are willing to sue & will soon sue RTSA if this is not corrected soon. Because the law is clear & has to be followed to the point.

Things are hard nowadays the value of money is less tomorrow this is sad to note,but can be corrected if the new board is willing to work to clean up the mess that is there at RTSA.

Below are the sections that have been abrogated by the RTSA:

Chapter 268 of the Employment Act of Zambia

48. (1) Subject to the provisions of subsection (3) and (4), the wages of an employee shall be due- Wages, when due and payable

(a) in the case of a contract of service from month to month, on the last day of each month;

(b) in the case of a contract of service from fortnight to fortnight, on the last day of each fortnight;

(c) in the case of a contract of service from week to week, on the last day of each week;

(d) in the case of an employee employed on a task or piece work, on the completion of such task or work:

Provided that where an employee is employed on piece work, it shall be lawful for an employer, with the consent of such employee, to accumulate the wages due to the employee for such period not exceeding one month as may be agreed by the parties;

(e) in the case of an employee employed to perform a journey, on the completion of such journey;

(f) in any other case, in accordance with the terms of the contract of service.

(2) The wages of an employee shall be paid at regular intervals not being later than the fifth day following the date upon which they fall due under subsection (1).

Zambian Employment Act 2019

PART IV
PROTECTION OF WAGES
66. (1) Subject to subsections (3) and (4) an employer shall pay the wages of an employee—
(a) in the case of a monthly contract of employment, each month, from the last day of payment;

(b) in the case of a fortnightly contract of employment from fortnight to fortnight, on the last day of each fortnight;

(c) in the case of a contract of employment from week to week, on the last day of each week;

(d) in the case of an employee employed for a task or piece work, on the completion of the task or piece work, except that where an employee is employed to do piece work,
an employer may, with the consent of the employee,
accumulate the wages due to the employee for the
period not exceeding one month, as may be agreed by
the parties;

(e) in the case of an employee employed to perform a journey, on the completion of the journey; or

(f) in any other case, in accordance with the terms of the contract of employment.

(2) The wages of an employee shall fall due and be paid at regular intervals not being later than the fifth day following the date on which they fall due under subsection (1).

73. (1) An employer shall, at the end of a long-term contract period, pay an employee gratuity at a rate of not less than twenty five percent of the employee’s basic pay earned during the contract period.

79. A person commits an offence if that person—

(b) without reasonable excuse, fails on demand to pay in accordance with section 66 any wages due to an employee; is liable of an offence.

Two issues fall in about the late payments for gratuity which is a disadvantage to the employees of RTSA (Road Transport & Safety Agency).

1) Inflation.

2) Purchasing Power.

A definition of both is below and the implications there of to the employees.

Purchasing power is the value of a currency expressed in terms of the amount of goods or services that one unit of money can buy. Purchasing power is important because, all else being equal, inflation decreases the amount of goods or services you would be able to purchase.

The impact that inflation has on the time value of money is it decreases the value of a dollar over time. The time value of money is a concept that describes how the money available to you today is worth more than the same amount of money at a future date.

Essentially, if you have a kwacha in your pocket today, that kwacha’s worth, or value, will be lower less one month to one year from today if its kept.

Inflation increases the prices of goods & services over time, effectively decreasing the amount of goods & services you can buy with the kwacha you have today in the future as opposed to kwacha today. If wages remain the same but inflation causes the prices of goods & services to increase over time, it will take a larger percentage of your income or gratuity to purchase the same goods or services in the future.

So, for example, if a plot costs 10,000 Kwacha today, it’s possible that it could cost 30,000 kwacha for the same plot one month to one year from today.

This effectively decreases the time value of money, since it will cost twice or thrice as much to purchase the same product in the future.

For example if ones gratuity is 50,000 kwacha for 3 years of service its due on the last day of the expiration of the contract not when RTSA feels like paying i.e 2 years later.

This 50,000 kwacha in 2018 one could buy a lot more than now in 2019 hence lose of value comes.

The question is how can an agency like RTSA break the law made by the government of the day with out any remorse.

Does this mean it only applies to other organizations,individuals or companies that must comply to government directives or legal laws of the land & not RTSA.

Let government,the ministry of transport, new board of directors ensure that this back log of gratuities is cleared before the RTSA is sued by the employees of the said agency because this is not a good sign.

If the employees have not reacted since 2018 till date its not that they don’t know the law but they have given the said management a lot of time to correct the mess but every thing must come to an end.

Those with ears let them listen & those with eyes let them see to it that the employment act on gratuity payments must be made on the last day of the expiration of the contract is adhere to by RTSA.

To avoid a big law suit which will be really costly for the RTSA. The law suit will run the agency down if the employees are not paid because they have backing by the laws made by the government of the day under the employment act of Zambia.

Let the government immediately check the payment records/books of RTSA to see what is happening at the said agency. Because whether they try to hide the truth will be exposed soon. An abrogation of the employment act has been made by a state owned agency which sends wrong signals to the country.

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Start: 2019-07-01 End: 2019-07-31