Labour and Social Security: Contract, Entitlements, Termination
Labour and social security covers the Labour Code of 1946, the NSSF regime and labour litigation. It tests contract formation, statutory entitlements, lawful termination and dispute resolution.
The employment relationship
- The contract may be fixed-term or indefinite; any probation period must be express and is limited in duration.
- Wages: the minimum wage is fixed by decree; wages are paid in full, with deductions only as authorised.
- Statutory floor: maximum weekly hours, an overtime premium, weekly rest, annual leave, public holidays and maternity leave. Foreign employees need a work permit.
- Registration with the NSSF triggers sickness, family, education and end-of-service cover.
Termination
- Dismissal requires a lawful cause; otherwise it is arbitrary and generates compensation.
- An indefinite contract ends with notice or pay in lieu, plus end-of-service indemnity where due.
- An employee's waiver of statutory rights is generally void; resignation must be genuine; the employer bears the burden of proving the cause alleged.
Disputes
Unions, collective agreements and conciliation through the Ministry of Labour precede the Labour Arbitration Council.
Worked example
An employee on an indefinite monthly contract is dismissed after seven years with no stated reason. She recovers notice or pay in lieu, end-of-service indemnity, unused leave and damages for arbitrary dismissal. The employer's assertion of poor performance fails for want of written warnings and evidence.
Traps
Treating the NSSF end-of-service benefit and the employer's contractual indemnity as one thing; allowing an excessive probation period; relying on an unwritten resignation; alleging cause without proof; overlooking the work permit issue for a foreign employee.