Personal Finance

Kenya needs furlough law these Covid times

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Parliament during a past session. FILE PHOTO | NMG

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Summary

  • The amendment to the employment law allows adopting parents to seek pre-adoptive leave similar to existing maternity and paternity leaves.
  • The procedure for obtaining pre-adoptive leave is such that the adoptive society is involved in authenticating the process.

A few days ago President Uhuru Kenyatta signed into law two key laws that will change the business environment. These are the Employment (Amendment) Act 2019 and the Business (Amendment) Act 2020.

The amendment to the employment law allows adopting parents to seek pre-adoptive leave similar to existing maternity and paternity leaves. The procedure for obtaining pre-adoptive leave is such that the adoptive society is involved in authenticating the process.

The new provision ensures that there is no discrimination between biological parents and adoptive parents in so far as employment rights and leave applications are concerned.

The Act so far caters only for parents who are adopting. No provision has been made on parents who have taken a child into foster care or persons who are guardians of children.

One amendment I really wish to see in the employment laws, is the provision for a “furlough” to cater for the current economic situation. A furlough provision is treated as a temporary unpaid leave that employees take to allow an employer restructure. During a furlough period, an employee is not paid. However the beauty with the provision is that the employee still retains their job. It is better than laying off staff.

The advantage of furloughs over layoffs is that unlike a termination, a furloughed employee will be allowed to return to work on a specified future date and on set conditions. During the furlough period, an employee cannot be sacked or replaced.

Lock-down distress

The second advantage is that during the period an employee will still retain access to employee benefits like medical benefits and pensions. Unless the contract otherwise provides for it, a laid off worker cannot access benefits like medical benefits or insurance. A furloughed employee still has access to these benefits and it is therefore better than being laid off.

According to a business report, about 20per cent of Kenyan businesses laid off staff during the last year as a direct result of the pandemic. One of the issues that has caused a lot of distress amid the fresh containment measures is the risk of job loss. Some sectors like aviation and hospitality have been directly affected by the new regulation which requires them to completely shut down. Restaurants have already laid off most their staff choosing to retain few key staff members.

A furlough provision would provide a little bit of hope to employees in such industries, giving them a return to work formula when things get better.

Win-Win outcome

Many employers do not wish to lay off their staff. They do it only as a survival measure. A furlough provision is therefore a win-win between the employers and their staff. A furlough allows an employer to restructure and recover and also saves the employer the expenses of laying off workers.

For the employee it allows the employee access benefits. Should an employer require a furloughed employee to work then the employer must pay for the days the employee has worked during the furlough period.

I hope the government considers legislating a furlough law to shield staff from massive layoffs.

The absence of a law, however doesn’t preclude you from entering into contracts with furlough provisions when it comes to current employment contracts. They can still be included in employment contracts.