Trust key to improved labour relations

16 May 2013

International investors are said to be wary of bringing their investments to Namibia because of unstable labour relations and low productivity of the country’s workforce.


Namibia’s labour force has been highly politicised during the colonial era because of its involvement and participation in the independence struggle of the country, fighting for the abolition of the contract labour system and the right to form and join labour unions.

Upon independence the founding fathers who wrote the constitution have entrenched the workers’ right to form and join labour unions.

A Labour Act was also adopted stipulating the rights of workers and labour dispute resolution mechanisms in the event of differences between management and the workforce.

When the Namibian worker demands for fair compensation and a decent working environment, employers see these as unreasonable, saying it scares away existing and potential investors.

However, no empirical proof has been provided for this, as the country continues to benefit from a fair share of foreign direct investment flowing into Africa.

The Africa Competitiveness Report released this month by Ernst & Young ranked Namibia a favourable investment destination.

According to the report Namibia is among the top three investment destinations of South African FDI project investments, with financial services a key focus.

However, what is of concern are the wildcat strikes that have been plaguing a number of economic sectors in the country, which may scare investors.

The workers often find themselves on the wrong side of the law because they ignore the laid down procedures, take shortcuts and embark on illegal strikes which cost them money and also impact on the productivity of companies.

This week the deputy general secretary of the Namibia Public Workers Union, during the signing of a wage increment agreement with Namcor called on his members to improve their productivity and not absent themselves from work and abstain from using alcohol while on duty.

We welcome the call by the trade unionist, as we see a trend in a number of organisations where workers simply absent themselves from work without a valid excuse and sometimes come to work drunk.

These practices, coupled with the wildcat strikes, are not good for the image of the country, in terms of its competitiveness and only reinforce the negative picture painted about the country.

The argument that the Namibian labour is comparatively more expensive than its output has not been proven and in fact a 2007 study by the World Economic Forum in conjunction with the World Bank and the African Development Bank found that unit labour cost in Namibia was much lower compared to countries such as Botswana, Lesotho and South Africa.

Therefore the argument that labour cost is a drag on the competitiveness of our industries does not hold.

What must be realised is that Namibia can only succeed as an investment destination if there is a harmonious partnership between entrepreneurs, capital and labour.

These partners should not only pursue their narrow interests but think of the greater good of the country.

Management and owners of capital must realise that they cannot maximise profits with an unhappy labour force. A happy worker is key to improved productivity and higher profits.

Henry Ford, the American industrialist, is said to have doubled minimum wage to motivate his workers and increase productivity. As a result, his auto company saw increased productivity and profitability. He is also credited with introducing weekends for workers to rest. He was criticised by his peers for what they saw as him increasing labour cost in the auto industry.

But, he realised very early that having a well rested and happy workforce will bring about a win-win situation for both the company and its workers.

Workers need to be treated with respect and dignity by their employers in order for them to be productive.

Asking the employees to work hard for better output is not always the silver bullet to success – fair compensation and decent working environments are. Without these you will have a demotivated workforce leading to decreased productivity, absenteeism and high labour turnover.

While the Namibian worker has been rated favourably by a number of productivity studies conducted, we still need to up this.

We must not rest on our laurels and as President Hifikepunye Pohamba said at the recent May Day celebrations, Namibia needs to improve its productivity to position the country as an attractive investment destination.

He called on the workers to exercise the right to engage in industrial action “in the most responsible manner” to make Namibia an investment destination of choice.

Trade unions must start thinking symbiotically about the interest of the workers and the sustainability of business. In Germany for instance, unions are willing to take salary cuts, because they realise that if the business collapses their members will be on the streets without any prospect of employment.

But, thinking symbiotically can only happen when negotiations are conducted in good faith and there is trust between the unions and employers.

Namibian employers and trade unions should use platforms such as the Tripartite Alliance to develop trust between them and that trust should filter down to their members to see themselves as partners in the production process.

Without trust between the partners, Namibia’s industrial relations will continue to be plagued by illegal strikes and lockouts.

It is only through increased foreign direct investment that more employment can be created. Therefore, it is imperative that both the workers and employees maintain good relations to grow the companies and improve the working conditions of the employees.



The Windhoek Observer is an English-language weekly newspaper, published in Namibia by Paragon Investment Holding. It is the country's oldest and largest circulating weekly.

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