At a glance: termination of employment in Zambia

Termination of employment

May an employer dismiss an employee for any reason or must there be ‘cause’? How is cause defined under the applicable statute or regulation?

An employer is required to give a valid reason for termination of the employment contract connected with either the capacity or conduct of the employee or based on operational requirements of the employer’s undertaking. If the termination is based on conduct or performance, the employee must be accorded an opportunity to be heard (see Vekhnik v Casa Dei Bambini Montessori Zambia (2018) ZMCA 312, unreported).

Must notice of termination be given prior to dismissal? May an employer provide pay in lieu of notice?

Generally, the Employment Code requires the employer to give notice or to pay the employee in lieu of the notice period in cases of termination unless the employee is guilty of misconduct of a nature such that it would be unreasonable to require the employer to continue the employment relationship. Where the termination is based on misconduct (ie, dismissal), there is no requirement for notice or payment in lieu of notice, but the employee must be accorded an opportunity to be heard, and due process must be observed.

In cases of summary dismissal specifically, there is no requirement for notice or payment in lieu of notice at all. In such circumstances, however, the Code requires the employer to submit to a labour officer a written report of the circumstances leading to the summary dismissal within four days of the dismissal. If the contract of employment does not provide for a notice period, the Code provides default notice periods depending on the duration of the employment contract. It is not enough, however, for the employer to give notice of termination; the employer must also give a valid reason for the termination based on the capacity or conduct of the employee or operational requirements.

In which circumstances may an employer dismiss an employee without notice or payment in lieu of notice?

An employer may summarily dismiss an employee without notice or payment in lieu of notice under any of the following circumstances:

• gross misconduct inconsistent with the express or implied conditions of the employment contract;
• wilful disobedience of a lawful order given by the employer;
• lack of skill that the employee, expressly or implicitly, is warranted to possess;
• habitual or substantial neglect of the employee’s duties;
• continual absence from work without the permission of the employer or a reasonable excuse; or
• misconduct under the employer’s disciplinary rules where the punishment is summary dismissal.

Is there any legislation establishing the right to severance pay upon termination of employment? How is severance pay calculated?

The employer is required to pay severance pay to all employees except those on long-term contracts, temporary employees, casual employees and employees on probation. The entitlement to severance pay is triggered in five situations:

• where the employee has been medically discharged in accordance with the Employment Code: a lump sum of three months basic pay for each year served;
• where a fixed-term contract expires: 25 per cent of the basic pay or retirement benefits provided by the relevant social security scheme to which the employee is a member;
• where a fixed-term contract has been terminated: 25 per cent of the basic pay;
• where the employment contract has been terminated by redundancy: a lump sum of two months’ pay for each year served; and
• where the employee dies in service: a lump sum of two months’ basic pay for each year served.

Are there any procedural requirements for dismissing an employee?

There are no prescribed procedures under the law for dismissing employees except that the employee must be given an opportunity to be heard regarding the charges, and the rules of natural justice must be observed throughout the disciplinary process (see Vekhnik v Casa Dei Bambini Montessori Zambia Limited (2018) ZMCA 312, unreported).

In the case of summary dismissal, however, the employer is required to submit to a labour officer (within four days of the dismissal), a written report of the circumstances leading to the dismissal. In practice, dismissal procedures are contained in the employer’s disciplinary code. There is no requirement for prior approval to be obtained from a government agency before dismissal.

In what circumstances are employees protected from dismissal?

The Employment Code provides that an employer cannot terminate an employment contract based on the following reasons:

• union membership or participation in union activities outside working hours or within working hours with the consent of the employer;
• seeking office, acting or having acted as employee representative;
• the file of a complaint (or participation) in proceedings against the employer involving alleged violation of laws;
• discrimination;
• absence from work during maternity or paternity leave;
• family responsibilities relating to taking care of a member of the employee’s immediate family; or
• temporary absence from work during sick leave or injury.

Are there special rules for mass terminations or collective dismissals?

There are no such rules.

Are class or collective actions allowed or may employees only assert labour and employment claims on an individual basis?

Employees are permitted to assert their labour rights through class or collective actions (see Catherine Chavula and 14 others v Barclays Bank Zambia PLC, Staff Pension Fund, Appeal No. 25 of 2015) The law requires that the pleadings must clearly indicate the material facts of the cause of action for each employee against their employer, and each employee is required to individually provide evidence proving his or her claim. Furthermore, the pleadings must indicate that the plaintiff cited is suing on his or her own behalf and on behalf of the other employees (see Finance Bank v Weluzani Banda and 162 others, Selected Judgment No. 31 of 2019).

Does the law in your jurisdiction allow employers to impose a mandatory retirement age? If so, at what age and under what limitations?

Employers are not permitted to impose a mandatory retirement age. The law prescribes the retirement age of 60 years, with the option of early retirement at 55 years, or late retirement at 65 years with the employer’s approval.