Careless negotiations costly

14 Feb, 2019 - 00:02 0 Views

The Chronicle

Davies Ndumiso Sibanda, Labour Matters

MANY organisations today have to live with bad agreements, which are costing their business a lot of money and negatively affect labour relations. 

Before an employer or workers’ committee can decide to negotiate anything related to employment, there is a need to evaluate a number of things related to the particular issue and whether negotiation is the best way out. 

Parties need to understand that as they engage in negotiation, the negotiation could be of mutual benefit to both parties or it can be of benefit to one party and detriment to the other. 

For that reason negotiating a way out of a problem might not always be the best option. 

There are many cases where workers and employers have gone on to negotiate an agreement, which becomes problematic yet the issue could have been better resolved through litigation and on the other hand there are some issues better resolved through negotiation.

Parties have to apply their minds in negotiations as reckless negotiation can result in huge costs or commitments a party is unable to come out of. 

The classic case is Posts and Telecommunications Corporation vs Zimbabwe Post and Telecommunications Workers’ Union and Others Judgment No. SC 107/2002 where it was held that there was no evidence of Justus error and said “Negotiations were held on the instruction of the appellants’ board that the workers be placed on the median quartile. 

Figures were worked out by the appellants’ experts and technocrats. 

The appellants’ board was represented on the negotiating committee. 

Agreement was reached and published in the Statutory Instrument. 

The new salaries were paid for several months. 

It was only when the appellant realised the enormity of the resultant wage bill, that it reneged on the agreement. 

It was only then that the appellant turned round, sought to dispute its authority and raised the issue of errors in the figures.

This case makes it clear that once one has negotiated and agreed with workers, it is not easy to turn around and say it was a genuine error as the court will look at how the agreement was arrived at and with all the consultations and expertise involved in the negotiations, chances of successfully claiming an error was made are very slim.

Before going into a negotiation, parties should do a cost benefit analysis of entering into an agreement on a particular issue. 

They should look at the potential short and long term costs of the agreement and at the same time look at the short and long time benefits. 

This can only be achieved through fully understanding issues to be negotiated, the method of negotiation and how the party wants the agreement to look like. 

Above all, all agreements which have a potential of going wrong should have a safe exit clause or a clause allowing for amendments in the event certain things happen and those things should be specifically mentioned. 

Further, the agreement should contain a mechanism for resolving disputes related to the interpretation of the agreements.

Davies Ndumiso Sibanda can be contacted on: E-mail: [email protected] 

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