ILO Technical Assistance in a LDC:
Labour law reform in Lesotho
Debbie Collier & Shane Godfrey
University of Cape Town
Outline
1. Four categories of constraint/challenge that
we identified in the context of the project
2. Lesotho in social and political context
3. Labour law and law reform in Lesotho
4. Lesotho’s economic and labour market
context
5. Policy and development goals in Lesotho
6. Our proposals
1. Four categories of challenge
• Stakeholder resource and capacity constraints
• The host county political and policy context
• A ‘one-size-fits-all’ (or ‘once-off’) approach to
labour standards
• The negotiated boundaries for external
consultants
2. Lesotho in context
• Constitutional
monarchy
• Deeply dependent on
South Africa
• Economy attempting to
transition from reliance
on primary sector
activities
• Low levels of HD / high HIV/Aids prevalence
• Political instability
3. Labour Law and Reform in Lesotho
• August 2013 letter (‘Labour law review 2006’)
from the Ministry of Labour and Employment
requesting ILO assistance in bring finality to
the review process that stalled in 2006
– Parliamentary Counsel advice that amendments
‘too bulky’ and the need for codification
• Expected outcome from the consultancy
– Issues Paper
– Instructions to guide the drafting of a new Code
Outline of labour law
• Labour Code Order 1992
– Consolidated existing laws, regulates all conditions of work
(incl. H & S), wage machinery, collective bargaining and
establishes a Labour Court
• Labour Code Amendment Act 1995
• Labour Code Amendment Act 1997
• Labour Code Amendment Act 2000
– Established the DDPR and a Labour Appeal Court
• Labour Code Amendment Act 2006
– HIV/Aids
• Labour Code Amendment Bill 2006
– Various oversights/deficiencies – including H & S, domestic
work, discrimination law, power of inspectors
Areas identified for reform
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Incorporating relevant 2006 amendments
Urgent and other revisions
Regulating temporary employment agencies
Labour market policy direction
Revisiting the key labour institutions
The use of Codes of Good Practice
Protection of children
Regulatory framework for collective bargaining
Revising the occupational health and safety standards
Skills development
Scope of protection - who is an employee?
– Mechanisms to address disguised employment
– Exclusions in subsistence agriculture
• Formalising informality associated with formal firms
– Regulated flexibility
• Casual and part time work
• Temporal flexibility
4. Economic and labour market context
• Historically economy was dependent on migrant worker
remittances and SACU revenues – both have declined
considerably in past 20 years
• Still dependent on remittances and SACU revenue but
much less so – 64% of total income now generated
internally
• Average real GDP growth of 4% from 1982-2011
• But employment growth has lagged GDP growth
• And distribution of income very skewed
• The result is that high levels of poverty, unemployment
and inequality
Economic and labour market context
• In 2003 56% of population below the poverty line
• Unemployment rate in 2009 of 29.4%
• Gini coefficient very high at 53% in 2003 (although down from
57% in 1995)
• Agriculture – involves 40% of EAP and 68% of labour force,
but in decline: 50% of GDP in 1966 but currently only about
8%
• Internal migration replacing external, from rural to urban,
more women, more young people
• Youth unemployment extremely high at 47%
Economic and labour market context
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Labour force of 608 000 in 2008
38% of labour force in formal employment
62% of labour force in informal employment
Of those in informal employment, 51% in formal enterprises
and 49% in informal enterprises
• Subsistence agriculture seems to make up a large proportion
of informal employment
• Vast majority of employed population are employed in
‘elementary occupations’ – skilled workers in short supply
• Limited vocational and technical education and training
5. Policy and development goals
• Labour market policy needs strong development orientation, i.e.
integrated with NSDP and focused on addressing poverty,
employment creation and inequality
• Needs to take account of the regional and sectoral contours of
Lesotho’s economy
• Needs to respond to and complement the transition the economy is
making from agriculture to manufacturing and service sectors
• But also needs to address major labour market problems and
development vulnerabilities: declining remittances; fragile
agriculture sector; threat to garment sector; need for foreign
investment
• In summary, support for better livelihoods in agriculture, transition
informal to formal jobs, and create many more jobs
6. Our proposals
4th layer
Flexible wage setting and collective
bargaining
3rd layer
Active labour market policy : enhanced
skills development system
2nd layer
Health & safety and decent conditions
of work
Extension of social security
1st layer
Layering of rights approach
Enhanced
enforcement
mechanism
Layered approach in specific sectors
• Agriculture
– Informal employment / livelihoods in subsistence
agriculture
• Social security
• Health and safety
• Workman’s compensation
• Manufacturing
– All four layers
– Small business exemptions for some provisions
Transitioning from informality
• New categories of employee
– The Issues Paper proposed three categories of
‘flexible’ employees distinguished by reference to
both their hours of work and the manner of their
engagement.
– Employees working 24 or less hours per month;
– Employees working more than 24 hours per month
but 72 or less hours per month on a temporary or
irregular basis – these are described as ‘casual
employees’;
– Employees working for more than 72 hours per month
but less than the hours of a full time employee,
described as ‘part-time employees’ who are employed
indefinitely or on a fixed-term basis.
Temporal flexibility
• An alternative way of articulating hours of work that accommodates
flexibility in the context of hours of work is to provide for a variety of
alternatives to the existing norm, for example to include in the Labour
Code:
– Provision for compression of ordinary weekly hours of work within a week
subject to a maximum of 12 hours per day without overtime pay. Excludes
Sundays.
By agreement with [xxx]
Transport arrangements [xxx]
– Provision for compression of monthly hours of (4.3 x 45 = 193.5 hours)
within a month without overtime pay subject to a maximum of 11 hours per
day, 6 hours on Saturdays and excluding Sundays.
By agreement with [xxx]
Transport [xxx] expediency
– Provision for averaging of weekly hours over four months subject to
maximum of 56 hours per week, with hours over 52 hours in a week to be
paid at 1.25 overtime pay.
By agreement with [xxx]
Transport [xxx]
Returning to technical assistance and
development constraints in an LDC
• Ownership of the project – regular
communication
• Ongoing political instability and economic /
labour market constraints
• “ … to offer legislative proposals whose
implementation could be realistically
undertaking in the context of each country”