However, the harmony and cooperation the law seeks to achieve may be compromised due to disputes between workers and employers. One major area of dispute between workers and employers is the one concerning the duration of contracts of employment.
The law in Articles 9 and 10 indicates that a contract of employment may be made for a definite or an indefinite period of time. The confusion lies on identifying which contract is definite and which is indefinite.
In a recent labour dispute, four employees working as security guards sued their employer over the payment of service charges and provision of medical services and other benefits. The employer argued that those benefits were offered only to workers with indefinite period contracts. The employer claimed that the workers were hired on a temporary basis to guard a plot of land that it had secured for construction, which, for the time being, was serving as a parking lot and for keeping some equipment.
That means when construction on the land commences, the employment contract of the workers will be terminated, according to the employer's argument. The court ruled in favour of the plaintiffs and held that the contract must be regarded as an indefinite period since their work has continuity.
"It is the type of work that makes the contract definite or indefinite, not the parties." said Kassahun Folle, president of the Confederation of Ethiopian Trade Unions (CETU).
The law allows the employer and the employee to seal a contract for a definite or indefinite period, although it says that all employment contracts are deemed indefinite, with exceptions like "piece works" such as agricultural labour employment for harvest time. If the contract is not made according to the law, what is on paper may not hold. The type of the work should guide the formulation of the contract to avoid confusion with the law.
"As long as the work is still there," said Kassahun, "the contract is maintained."
However, if the work is seasonal or temporary, and the employer has no use for the employees, the law does not urge the employer to keep the workers while paying their salaries, Kassahun said.
The law, by laying these provisions, aims to provide job security for the worker without discouraging the employer from taking on more employees as the need arises. Besides giving job security to the worker, the law does not seem to discriminate between benefits given to definite and indefinite term employees, except that benefits accrue for employees who stay on the job for long.
However, employers may prepare contracts for, say one year, and the option is left for them either to renew the contract or terminate it. When the contract is renewed, the problem is that the worker is regarded as new. Hence the benefits may be less.
Workers with a lot of work experience in the industry usually know their rights and obligations. It is mainly those new to the industry who suffer the most, according to Kassahun.
"It is very beneficial to form a trade union, which would be very effective in safeguarding workers' rights," Kassahun said. "However, some employers hinder the formation of trade unions."
Currently there are 562 trade unions in both public and private enterprises. One third of workers in Ethiopia do not have trade unions, according to CETU.
Tadele Yimer, president of the Ethiopian Employers Federation, suggests two solutions for resolving the whole confusion. The primary solution is drafting the employment contract carefully with no ambiguities and avoiding oral agreements as much as possible, so that any disagreement that might result can easily be resolved. The other task is laid on the courts.
"Justice should be for both parties," Tadele said. "This issue has political, social and economic factors to it, so care should be given."
While applying the law, according to him, courts should interpret it by taking into consideration the intention of the legislation.
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