Wednesday, January 27, 2021

BR, union face clash over retrenchment packages

Botswana Railways’ employees who face the chop don’t yet know how much they will earn but information about what has been proposed by consultants has come out.

EOH Consulting, the company BR engaged to carry out a study on its operations, proposed a separation package that would award retrenchees a gratuity of 33 percent of their pension value. The gratuity would be paid according to employees’ contracts of employment and be subject to the current provisions for such remuneration.

The formula for the gratuity is as follows: for the first five years, a monthly total package divided by the number of days worked in a month (whereas five days per week equal 22 days, 5› days equal 24 days and six days equal 26 days) referred to as the daily rate, multiplied by the number of months worked or 60 months where an employee has worked for more than five years.

The calculation for gratuity for employees who have worked for more than five years for the years worked above five years would be as follows: daily rate multiplied by two multiplied by the number of months. The total gratuity payable for an employee who has worked for more than five years would be the total for the first 60 months plus the total for additional months above the first 60. It is also proposed that the terminal package should include notice pay for at least for two months, relocation expenses, leave days accrued, service recognition awards and pension paid according to BR Staff Pension Fund rules and regulations.

However, it is important to note that this is merely a recommendation which BR can choose to accept, modify or reject altogether. EOH’s recommendation is that the retrenchment package should be calculated and communicated to affected employees well in advance of being the process being carried out. The consultants further recommend that the cost of retrenchment should be calculated and provision be made for payment at agreed periods.

On the other hand, a consultancy report prepared by Mosweu & Co. Legal Practice, a law firm that the Botswana Railways Workers Union engaged, notes that “exit packages are not for a consultant to determine but for the Union and BR management to negotiate.” The latter also notes that the union was not provided with the proposed salary structure which would assist the union to make an independent assessment of whether or not it was sufficiently aligned with the proposed job profiles for the impending organisational structure.

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