1

EMPLOYMENT & LABOR LAW

Prepared in 2010
Updated in 2012
3/12/2020
  ..INTRODUCTION
» This unit will try to give you the introductory
remarks for the course in general.
» Accordingly, you will be given highlights that
enable you grasp the analysis made in the rest
of the units
˃ defining the terms “employment law” and “labour
law”
˃ look at the history of labour law
˃ “sources of labour law”
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2
 Q. what is Employment law?
» is an area of law that regulates employment
relationships
Q. what constitute employment relationships?
» employment relationship is deemed to exist between
persons where one agrees directly or indirectly to
perform work for and under the authority of an
employer for a definite or indefinite period or piece
work in return for wage.
» Employment relationship includes all such relationships
as defined above irrespective of the sector of
employment or the identity of the persons (be it
government or private) involved in the relationship.
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3
» Though employment relationship is as such a very broad term
there are obvious separate legislations/ laws/ that are
specifically aimed at regulating certain aspects of
employment relationships.

» In other words, taking into account various factors such as the

sector of employment, different legislations (laws) aimed at
regulating specific employment relationships can be enacted.

» For instance, there is the "civil servants proclamation

1064/17" that regulates employment relationships mainly
between government institutions & its civil servants,

» there is also “the labor proclamation “that regulates

employment relationships in the industrial sector, and so on.

» Employment law is, therefore a very broad name that refers

to all those areas of laws which are made to regulate the
different aspects of employment relationships. 4
 » "employment law” is an umbrella term that represents vast
area of laws which are made to regulate any aspect of
employment relationships.

» In this context, there is no as such a single or unified

legislation (law) named employment law.

» When we come to labor law, it refers to an area of law that

governs certain employment relationships.

» As compared to employment law which is interested in all

employment relationships; labor law is narrow in scope.

» This is because employment relations that are the subjects of

labor law are only those which are found mainly in the
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industrial sector 5
 » labor law is also known as “the law of Industrial Relations".

» Therefore, unlike employment law, labor law is not interested in

all employment relationships, as so many of such relationships
are outside the ambit of this law.

» Labor law is, thus, concerned with employment relationships

that arise mainly within the industrial sector.

» Such relationships, in other words, can be named as labor

relationships.

» Industry for the purpose defining labor relationships doesn't

solely refer to the manufacturing sector.

» It rather denotes the profit making sectors of the economy such

as tourism, banks, insurance, hotels, etc in addition to the
manufacturing sector.
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» So, broader meaning it has.

» why Labor Law/ what factors triggered the state to
come up with the labor Law?
» under this part,the primary factors that triggered
states to come up with domestic labour laws, and
the long journeys and historical incidents they went
through up to that stage will be examined.
» There exist three important stakeholders in
employment relationships. they are:-
+ state
+ the employer &
+ the employee. 7
 » During the conclusion of the contract, the employee
who is going to render his physical or intellectual
service during their terms of engagement comes
with his/her labour and

» the employer who seeks such service comes with his

money which, obviously, is going to be paid for the
employee in the form of wage or salary.

» This, in other words, means on the supply side of

such labour market one observes labour and it is
capital (income) that stands on the demand side
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8
 » Thus, for employment relationship to exist free labour, labour
which is entitled to enter into a free contractual agreement,
should be there.

» This makes our discussions of the history of employment

relationships and the necessary regulatory machinery for such
relationships mandatory

» because employment law revolves around the evolution of

free labour.

» Besides, for labour law is a law of industrial relations our

understanding of the history enables us to appreciate the
evolution of the industries themselves.

» The following few slides would therefore be devoted to the

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closer look at the emergence of free labour and industries. 9

 » In history, there were different social
relationships in the past:

the slave owning society,

feudalism,

capitalism and

the socialist society.

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10
» In this society we have slaves and slave owners.
» Their relationship was governed by the system in such a
manner that slaves are slaves by status and slave owners are
given a higher rank.
» As slaves are deemed as properties, in fact as speaking
properties, of their masters one can’t think of free labour in
that society.
» Slaves were not even subjects of the law as they were not
deemed as persons in the eyes of the law.
» Since there was no free labour that bargains with capital, one
can’t imagine employment relations to exist in that society.
» Therefore, in the slave owning society there was no
employment law and even no need of having such a law, as
there is nothing to be regulated by it.

11
» During the feudalist society instead of owning human beings, men started to
own land.

» As the slave is no more subject to transactions of sale or exchange, one can

say that a qualitative change has occurred during this society.

» Since the slave had upgraded its status to be the drams of a “person; he
became the subject of the law as a tenant, and the principal actors on the
scene became the tenant and his land-lord.

» Though there was a relatively better situation in terms of the livelihood of the
tenant, unfortunately, he was not lucky enough to decide on his labour

» In the then society, let alone freely bargaining with his labour, the tenant was
not in a position even to choose his master.

» As a resultant effect of all these it was unthinkable to get an employment

relationship that is an outcome of freedom of contract.

» Hence, there was no employment law. 12

 » Under the womb of feudalism, capitalism seeds
started to grow.
» The capitalism ideology which is mainly
characterized by liberal democracy principles
has recognized so many principles for its fellow
citizens,
» to mention,
 freedom of expression,
 freedom of movement,
 freedom of contract principles
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 the market economy principles and so on.

13
» As a corollary to such developments there happened
transformation in various sectors of the economy which
started to become profit making as opposed to the previous
ones that were characterized by making for subsistence
consumption and very minimal profit.

» In the agricultural sector there was mechanization of farming

which required vast land.

» This land was obtained by evicting the peasants (tenants)

from their lands;

» and these people once evicted remained with nothing but

their labour. 14
  In the manufacturing sector, as an outcome of the then upraised
free market economy dogma as every one can reasonably expect,
there were losers and winners of the competition among
handicrafts.

 Just like the situations that happened to their peasant counterparts

those who could not survive the change were left only with their
inborn asset, i.e. their labour.

 The scenario in the business sector was not a different one.

 Business men who end up as losers of the unregulated race had

lost their capital and remained with their labour.

 Do you see how free labour and industries which are the sole
inputs of employment relations evolved?
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 How these inputs had come together and started to undertake

contractual engagements? 15
  Though agriculture took the mechanized form, we
can’t think of it to be hundred percent mechanized,

 hence, on the part of capital there was still a need to

employ labour.

 In the manufacturing and business sectors on the

other hand when capital owners begun to expand
their undertakings and their business enterprises by
the accumulation of profits, family members labour
was found to be inadequate to respond to the
change.

 There also arose a need to employ extra labour.

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16
 » Besides such need for employment of extra labour,

» we had a large free labor which had no option but to sell its labor.

» So, capital and labour became keen to bargain and establish

employment relationships.

» Employment no longer is a status as in the slave owning and feudal

society.

» It’s rather a contract.

» The employee can choose his employer and successfully terminate

his contract since he has something that can move with him freely
i.e. labour.
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17
 » As a capitalist principle, under this relationship the working
conditions were to be freely agreed in the contact.

» These include:
 The wage of labour,
 Various leaves
 Working hours per day,
 Duration of employment and
 Safe working conditions.

 Besides, every aspect of their relation is to be established

based on their agreement in the contract.
 For such labour and capital mixture is an economic affair, the
state can’t interfere in such relationship.
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 It is there only to enforce the contract, if and when a dispute 18

arises.
» Though this was the then assumption, freedom of contract
principle has brought so many problems.
» During that period, capital owners were few in number
compared to the huge number of labour.
» Labour had as its aim eating for today, it was also bargaining
individually.
» All these gave labour no option to bargain, and made it weak
in this bargaining.
» In effect, labour was made to freely adhere to the terms the
capital owner stipulates in the contract.
» The employer usually proposes for the worker for
 minimum wage,
 for the employment contract to last so long as they agree,
 for longer hours per day and
 for voluntary assumption of employment risk
 i.e. whenever the employee sustains employment injury the possible risk to be
considered as had been foreseen by the employee.
 The employee agrees to these terms with no hesitation. 19
 » Ultimately, low wage started to subject the
employee to longer working hours per day to earn
more,
» and this led the employee to over exhaustion and
finally to employment injury.
» But, the employee had no remedy even to get
benefits for the injury he sustains at work due to his
prior agreement for voluntary assumption of risk.
» There was also a severe problem with regard
employment security since termination by will is
there in their agreement.
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  The cumulative effect of all these was demonstrated by the
excessive accumulation of wealth of the capital owner/
employer at the expense of the employee.
 The wage that should have been paid to the employee went
to capital;
 and lack of governing employment injury also played its own
role in the boom of the wealth of the capital owner.
 This brought polarization of living standard:
 few become richer and richer and the majority becomes poorer
and poorer.
 The resultant effect of freedom of contract which led the
employee to lower living and working conditions triggered anger
and dissatisfaction on the part of the working class.
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 » Employees then started to express their anger and
dissatisfaction in various ways,
 such as by destroying the means of production and
 showing down production.
 But, these ways of struggle was not effective as such, since it was
held in a disorganized manner.
 Instead, as it was easily detectable, it led the employees to
employment insecurity.

» However, employees did not yet frustrate. They took

lessons from their mistakes and continued their
struggle by raising economic questions:
˃ increase in wage,
˃ limitation in working hours per day,
˃ employment security and safely working conditions.
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22
 » these demands are directly the reflections of the outcomes of
the problems due to freedom of contract.
» These were the relatively organized demands of the working
class.
» In some countries they managed to get some concessions.
» For instance, regarding the demand for better wage, capital
accepted some margin of increment of wage.
» But, the increase was included in the price of every
commodity.
» In effect, the increase in wage of the employees didn’t change
the working nor living condition of the employees.
» So, no much development in this respect;
» net outcome became almost zero if not negative.
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23
 » Following the working classes anger and dissatisfaction, which
culminated in the demand for betterment in terms of
employment conditions as well as in the life of the employees,
» there came out the Marxist Ideology which went further and
came up with an extreme thought.
» This ideology agitated the working class not only for better
life conditions but for the seizure of power to the proletariat.
» Accordingly, economic reforms are only provisional to deal
away with such problems once and for all.
» Hence, economic measures, according to this thought are
only means to the mandatory end of the worker’s seizure of
political power.
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 » Tuned by this assumption, struggles were held in
various parts of the world especially in Eastern
Europe,
» though no satisfactory results were obtained until
1917 G.C.
» In this regard, the October 1917 Russian Revolution
was the successful one to be taken as a turning
point in the history of the evolution of employment
laws.
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25
 » This revolution declared the dictatorship of the proletariat in
Russia.
» So as to protect the interests of the working class, so many
radical measures were taken:
» the most important transformation being the nationalization
of the means of production.
» Capital, they said, is an accumulation of unpaid wage that
should have gone to the to the employee;
» so decided all the means of production to be handed to the
working class who is the legitimate owner of “capital”,
» hence, nationalization.
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26
 » This unexpected occurrence in Russia posed fear
and frustration in the west.
» They thought their respective workers would take a
lesson from outside and revolt against the system.
» Therefore, they had to look for a possible solution to
avert such likely disaster.
» As a way-out, they conspired to take two measures
of primary and secondary importance;
+ if possible to crush the Russian Revolution;
+ if not at least to hold it there within the territory of Russia.
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27
 » Later on, as the west come to know that the first
solution is infeasible,
» they preferred to adhere to the alternative
containment policy and to resolve the problem
through various measures.
» These measures, which were aiming at containing
the revolution as it is and where it is, as one can
reasonably expect,
» were measures that tried to give a better protections
to the employees so that the workers do not at least
raise the issue of assumption of political power.
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28
» Hence, immediately after two years of the Russian Revolution
in 1919 the International Labour Organization (ILO) was
founded,
» and begun to take care through its slogan of “Distributing
Justice in Equitable Manner”.
» Formerly, share of capital was lions share and that of labour
was less.
» So to distributing capital the way was giving concessions,
which could be achieved by the intervention of the state in
the contractual terms of the employer and the employee.
» Upon its establishment the ILO took the primary mission of
providing guidelines that member states employ as inputs for
measures they take in order to avert the problem of the free
market economy brought.
» Don’t forget! In the labour market which is an interaction of
labour and capital we had no equal market powers
» i.e. demand and supply factors that determine the different 29

working conditions such as level of wage.

 » But for such market to operate well we should have
an equal bargaining power on the supply and
demand sides of the transaction.

» Under this market we were not fortunate to observe

labour appropriately dealing, with capital.

» And this ways an indicator of the fact that the free

market principle was not operating well.

» This triggered a need for the intervention of state in

the contract between the employer and the
employee.
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30
 » Accordingly, ILO member states came to enact separate laws that
deal with employment relations so as to limit the freedom of the
parties

» in view of industrial peace and welfare by backing the weaker party

i.e Labour.

» These domestic laws called labour laws incorporated minimum

working conditions that the employee must be entitled to,

» on the basis of ILOs guidelines that are usually developed in the

form of conventions and recommendations.

» So, it was after all these ups and downs that labour law emerged.

» Is labor law a fruit of the workers’ struggle, or is it simply a law that

is given by the blessing of the rulers of the various ILO member
states?
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 » Labour r/n in Ethiopia has been very low
» Discouraging societal attitudes toward jobs
» All the remaining occupations excluding
priesthood were demoted lower class
» Metal work/Artisan/ linked with low reputation
» prevailing official Imperial position towards
labour and labourers was positive b/c
» Minilik tried to discourage insultation of
artisans in 1908 by law: it amounts to insulting
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emperor but no social revolution 32

 » The religious rules and holidays were unfavourable to
industrial activity
» Until 1942 slavery had legal protection discouraging
free labor r/n through contracting and rule of law
» 1931 H/selasie partial position: law states slave who
wished to be free’ and not to all slaves
» freedom was not automatic but procedural subject
to judge discretion
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33
 » Turning point: 1942 abolition of the legal status
of slavery that one can speak of labour
development in Ethiopia as a freeperson
capable of freely contracting has been an
essential precondition.
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34
 » These are legal instruments that would have
impact on regulating labour relations,
» and /or in resolving labour disputes of and
when the latter arise.
» we have public acts (instruments)
» and private acts (instruments) that could be
employed for the regulation of labour relations.
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35
 » by public acts, for the purpose we are referring to
those legal instruments which are outcomes of
public deliberation;
» the public being represented by the law maker.
» Private acts, on the other hand are legal instruments
which evolve from both or either of the parties to
the contract of employment; and
» we see no or minimum state intervention during the
birth of such instruments.
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36
 » Public acts themselves could be further
dichotomized as international public acts and
municipal (national) public acts.
˃ International public instruments – as their naming implies these are
laws where in states’ participation is involved at their stages of
enactment.
˃ i.Such international acts are in majority of cases the International
Labour Organization’s (ILO) instruments, which are conventions and’
recommendations.
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37
 These are Legal instrument that are handed down by the sovereign
power of a certain state.
 These include constitution, proclamation, regulations, directives etc.
a.FDRE Constitution: Art. 42 of the constitution which recognize the Right to
Association, the right to strike, non-discrimination on employment and
equal pay for female workers and minimum labour conditions has direct
impact of labour relations.
b. Labour Proclamation No. 377/2003: is another source of law that provides
for detailed provisions on the constitutional principles including those
given under Art. 42 of the FDRE constitution.
 As the enactment of labour laws is a federal competence pursuant to Art.
55(3)of the FDRE constitution, we don’t have regional labour laws.
c.Directives of the Ministry of Labour and Social Affairs-
 These directives are laws which are outlined by the executive staff for the
proper implementation of the labour proclamation.
 The ministry is empowered to do so by Art. 170 of the labour
proclamation.

38
 » These are to be made by private parties, i.e.
non-state actors.
» Those private actors in the relationship are the
employer and the workers individually or
collectively.
» These instruments would therefore include
 contracts of employment,
 collective agreements and
 work rules.
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39
» what kinds of employment relationships labour law
intends to govern?
» Doesn’t apply to all employment relations.
» It only applies to employment relations between an
employer and a worker. art.3(1)
» Therefore, our discussion on the scope of coverage
of the law is more or less an examination of the
principle that defines employer-worker relationships
and,
» then the identification of those relationships that fall
under the principle part but are excluded by
exclusion part of the law. 40
 » Such task in it self imposes further duties on us.
» The first duty is to define who a worker is.
» Under such discussion we will evaluate the definition
given by the proclamation, and then we will try to
make a clear distinction between a worker and other
similar terms like agents and independent
contractors.
» The next step to understand employer worker
relations will be to identify the meaning of employer
in the eyes of the law.
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 » Worker employer relationships minus excluded
worker employer relationships = scope of coverage of
the proclamation.
» However, worker employer relationship = worker
(definition: + distinction :) + employer (definition)
» Therefore, [ (worker (defn.+ distincn.)+ Employer
(defn.) ] Minus Excluded worker employer r/ships =
scope of coverage of the procl.
» (W + distn) + E] – Exclusion = coverage of procl.
1156/2011
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42
» In employment relationships there is always an employee and an employer.
» But, labour law does not regulate each and every employment
relationships.
» It normally regulates employment relationships established between a
worker and an employer with in an industrial sector.
» Other employment relationships are basically excluded from the ambit of
labour law.
» It is if and only if the person who is an employee can be considered as a
“worker” that the labour law will be applicable to him.
» Thus, in this section, our focus would be to understand the meaning of a
worker, by looking at the definition as given by the proclamation and by
making a distinction between a worker and other similar terms in
accordance with Article 4 sub article 1 of the Labour Proclamation.

43
» see art 3(1) & 2(3) of Proc. No.1159/2011
˃ incomplete definition
˃ it cross refers to Article 4
˃ see art 4(1)
» element of Article 4 sub-article 1 is a worker must be
˃ a natural or physical person.
˃ one who renders physical or intellectual services to e.
˃ under the authority of the employer
+ direction element must be fulfilled for a person to be deemed as a
worker
˃ duration of contractual engagement must be concluded for a definite or
indefinite time or piece work
˃ Besides all these the person is regarded as a worker if and only if the wage
element is satisfied.

44
» we did not yet get a complete definition for the term “worker”
» It is actually very difficult to get a full-fledged definition from
the cumulative reading of Article 4 and Article 2(3) of the
Proclamation.
» This is because; to be deemed as a worker the person must be
one who renders service for his employer.
» So, even if elements of the cited provisions are met, we can
not be sure that such person is a worker unless his
relationship is with an employer.
» Thus, so as to have a complete definition for the term “worker”
we are also expected to have a clear understanding of who an
employer is.
» This issue will be raised immediately after we make a
distinction between a worker , an agent, and an independent
contractor.

45
» a worker is defined as a physical person that
renders service for an employer on the basis of
an employment contract .
» However, there are some other persons that
fulfill some or many of the elements of a
worker without being workers, and that give
service for another party.
» Therefore, How is an employee or a worker
different from an agent, or a contractor because
all render service for another party?
46
» Source of Authority
˃ The source of authority of the agent could be a law
or contract,
˃ whereas the source of employment relationship or
the worker’s source of authority is only a contract
» Under whose name the service is rendered?
» Wage
» Whereas a worker is essentially a physical
person, an agent could be a legal person or a
physical person.
47
» how is client – contractor relationship different from
its worker- employer counterpart?
» see Art. 2610 of the Civil Code of Ethiopia
» there are so many features that distinguish the
independent contractor from the worker or the
agent.
 the direction element.
 A contractor could be physical or legal person as the case may be.

48
» see art.2(1) of the procn.
» does not take in to consideration the number of
persons (a person) or (an undertaking) should
employ for it to be deemed as an employer and
ultimately to be governed by our labour law.
» do you think that it is fair to require a man or a
relatively small undertaking employing 1 or 2
persons to be considered as an employer and
requiring him to give the worker all the benefits
the Proclamation provides?
» Undertaking is also defined under art.2(2)
49
» Thus, an employer can be a physical/natural person or an
entity such as Business Company, factory and the like.

» When U see art.2(2) listing activities that are to be performed

by such entity they are:-
* economic in their nature; &
* some even tend to be profit making activities.

» What kinds of activities are those which fall under the

category “any other lawful activity” for the purpose of
defining a person or an undertaking and then an employer?

» Is this expression referring to any activity /lawful/ with no

need to have an economic nature or profit purpose?
50
 » Concerning this issue there are two arguments forwarded by
Ethiopian lawyers.

» the phrase “any other lawful activity” should be construed to

mean activities with nature similar to the prior listing of the
law.

» matters of the same kind as the preceding particular words.

» So, on the basis of the illustrative listing, activities which are

only economic in nature and profit oriented should be
regarded as lawful activities for the purpose of defining an
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undertaking under Article 2(2). 51

» Others, on the other hand, say so long as the activity performed by
an entity is a lawful one, and unless it is excluded by the exclusion
part of the Proclamation,
» such entity should be considered as an undertaking.
» Hence, in order to fall under Article 2(2) it is sufficient for the
activity of an entity to be a lawful one,
» it does not matter whether such activity is of a profit nature or not.
» Supporters of the second argument also invoke Art. 3(2) & (3) which
deal with the exclusion of some employment relations from the
scope of the Labor Proclamation.
» When we examine some of the exclusions made by these provisions
of the law, we get some excluded relationships wherein the
employer is not involved in profit generating activities.
» Therefore, as the exclusion under Art. 3 mentions some non-profit
activities; one can say that the definition has thought of all activities.

52
» considering the historical back ground of
labour law and the primary goals labour laws
aim at which interpretation seems sound?

53
» in principle the Labour Proclamation is applicable to
employment relationship of a worker and an employer with
in an industrial sector.
» see art.3(1) of the proc.
» But this does not mean that all employment relationships of
this kind fall under the ambit of the proclamation.
» there are various employment relationships that are excluded
from the application of labour law,
» we can safely conclude that employment law and labour are
different in the Ethiopian Legal System.
» Employment relations are wider as the legislator excludes
some sorts of labour relations from being governed by labour
law.
» So, labour law /relation is only one segment of employment
law / relation. 54
Divided into two broad classes:
 as outright exclusions and
 conditional exclusions.
 The first class includes employment relations that are
automatically excluded by the proclamation, and hence by no
means can they be governed by this proclamation.
 In other words, such contracts are excluded from the scope of
labour law with no need of waiting for the occurrence or
otherwise of any situation / condition.
 For the latter class of exclusions the exclusion applies upon
the fulfillment of the attached conditions.
 Hence, until the specific condition the proclamation sets for
their exclusion is satisfied, such employment relations are to
be governed by the 2011 Labour Proclamation. 55
» The scope of application of the proclamation is defined by
Article 3.

» Under art.3.1, the law provides that the “proclamation shall

be applicable to employment relations based on a contract
of employment between a worker and an employer”.

» But under Art.3(2), the law excludes some lists of employment

relationships from the coverage of the Proclamation.

» They are automatically excluded from the ambit of labour law.

» In other words, labour law does not regulate these

relationships in any conditions.
56
» Irrespective of the existence of employment
contract between the service provider and the
employer, labour law would not regulate their
relationship. why?
» As the purpose of these relations is not tuned
by profit motive of the employer, the law
maker has opted for their unconditional
exclusion.
 relationship between a guardian/tutor and his/her
minor/child.
 the rehabilitation scheme for prisoners in prison 57
» see art. 3(2)(b) of the procn.
» if an employment contract is concluded for the purpose
of educating or training a person, the relationship
between the educator or the trainer and the student or
trainee is not to be governed by labour law,
» unless the engagement is one of apprenticeship.
» Here, we observe three categories of relations as
provided by the law.
» There are
 students who are getting education in the school,
 trainees who are learning by doing or practicing and
 apprentices who undergo certain training while rendering service
to an employer whose day to day activities are our side of training.

58
 Student:
» When we consider the case of students and trainees and their
relations with schools and trainers, both students and
trainees are there to acquire knowledge or skill.
» Hence, the service they render for the employer is only
incidental.
» To put it differently, the end being the acquisition of
knowledge and skill, the rendition of service is only a means
to such end.
» For instance, students may sometimes undertake some
projects which may in effect give some economic benefits to
their education.
» But such service, if considered as part of the curriculum, can
not be considered as one among the employment
relationships which are to be regulated by labour law.
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 Trainee:
» The same holds true for services rendered by trainees.
» Trainees normally focus on the practical skills of the training
program.
» They are learning by doing according to the guidance of their
trainer.
» Hence trainers are likely to fetch certain economic benefits
from the works of their trainees.
» But, in so far as this is part of the training programme, the
services rendered by the trainees would not trigger the
applicability of the labour law to govern the parties’
employment relationships if any.
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60
 Apprenticeship :

» When it comes to the case of apprentices, the nature of the

services they render are quite different from those of
students and trainees.
» Apprentices are persons who undergo certain trainings while
rendering services to their employers.
» The employer is duty bound not only to pay wages for the
apprentices but also to enable them acquire the skills that the
services require.
» As the purpose of the employer/undertaking is to do some
other businesses rather than giving training, it also employs
other workers who are there only to render service.
» Thus, labour law intends to regulate the relationships of the
employer both with the apprentices and other workers.
» However, due to their special nature contracts of
apprenticeship are governed by their own separate provisions
of the Labour Proclamation, starting from Art. 48 up to Art.52
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of the proclamation. 61
» see Art.3 (2) (c)
» for a person to be deemed as a manager he must have a
managerial power given either by the law, or by delegation of the
employer.
» Therefore, irrespective of actual exercise of managerial power, one’s
entitlement to exercise such power is sufficient to consider one as a
member to the management staff.
» The law goes further and enumerates some activities that are
deemed as managerial functions, for the purpose of defining the
management staff and then for exclusion.

» Managerial function under the pervious amended Procn.

No.496/2006, art.2(1) is defined to mean one’s activity of:

+ laying down and executing management policies of the

undertaking, and / of.
+ hiring transferring, suspending, laying off, assigning or taking
disciplinary measures against workers.
62
Art 3 (2)(e)
» With regard to the legal service head of an undertaking,
managerial power consists of recommending measures to be
taken by the employer regarding managerial issues using his
independent judgment in the interest of the employer.
» It is if and only if the legal service head has such powers that
he is deemed as a member to the management staff.
Otherwise, he is simply not.
» Generally, managerial employees have the power in policy
making, in hiring and firing of employees, in taking disciplinary
measures, in demoting or promoting employees and are
involved in operational and strategic planning instead of
routine activities.
» If some one is involved in all or many of these activities he
would be said to have a managerial post, otherwise simply
not.
63
 » So not title, but content would be seen.
» But, we could still face cases of doubt as one may exercise
some of the functions only.
» Where the situation doesn’t squarely fit to the exception i.e.
the exclusion, the benefit of doubt should be for the worker,
» since exclusions are exceptions and in principles of
interpretation exceptions should be interpreted
restrictively ( narrowly) not liberally.
» So it would be better to consider this kind of relationship as
covered by the Labour Proclamation.
 Having an understanding of the major roles managers &
lawyers play in an undertaking, why such staffs are
excluded from the protective umbrella of Labour law?
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64
» the exclusion of members of the management staff is closely
tied with the notion of trade unionism in labour relations.

» Trade unions are associations (organizations) of workers which

are established by workers so as to protect their collective
rights and interests from encroachment by any one including
the employer.

» The underlining principles of trade unionism, independence,

autonomy and impartiality, are therefore reflections of the
basic function of trade unions.

» Hence, trade unions must be independent and are supposed

to pass decisions representing their members, with no
interference by the employer.
65
 » To this end, trade union members must have a homogenous
interest.

» For the interest of the management staff is closer to the

interests of the employer and not to that of the workers,
members of the management staff don’t have a homogenous
interest with the rank and file.

» This heterogeneity of interest, in effect, is likely to defeat the

underlying principles of trade unionism and

» beyond all it would pose a threat on the very birth of trade

unions.
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» This in turn is likely to make the function of trade unions

impotent. 66
 » see art.3(2)(d) of the procn.
» Domestic servants are workers who have an employment
relationship with their employer in order to give services in a
house-hold and not in business place.

» Bear in mind, it is not the nature of the service, it’s rather the
question to whom the worker renders service, that
matters in defining their relationships.

» This is because, similar services like those given by the

domestic worker can be given in other enterprises that are
included under the coverage of labour law.
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67
 Contracts of personal service: Art 3(2)(d)
 Contracts of personal service for non-profit making
purposes

 Yet, there is no regulation

 This includes House servant, personal guard, family

driver and gardener

 They are governed by Art 2601-2604 of civil code even if it

is difficult to say these articles provide proper protection.

 However there is exception of exception in Ethiopian‟s

Oversea employment proclamation No 923/2015 Art 71 which
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such personal service are subject to labour proclamation 68

 » see art. 3(2)(e) of the procn.
» this category of employees is inclusive of all employees of the
executive, legislative and the judicial tires of the government
machinery.
» these employees include:
+ members of the Armed Force,
+ members of the Police Force,
+ members of judges of courts of law,
+ prosecutors, and
+ employees of state administration.
˃ the ground for the exclusion of these employees is the existence of special
laws governing the relationship of the employees and their employer.
˃ Why these employees are excluded from the coverage of labour law and
are made subjects of special laws?
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69
 » for historical and policy reason
˃ Historically, to be a public servant was a privilege instead
of a disadvantage throughout a time.

˃ Instead of exploitation there was a privilege in this area.

˃ Public servants were not, in need of the protection of the

labour law, which was there to back the weaker party (the
worker) in labour relations.

˃ Hence, special laws they had.

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70
» From policy perspectives, the exclusion of the public
servants could be justified by public interest concern and
the purposes labour law is meant to render.

» To regulate the public service by the Labour Proclamation

means to give the public servants all the rights the
proclamation recognizes for each and every worker.

» Among such rights we get the right to freely bargain and

the right to strike of workers.

» But, this area is not an area where you can bargain.

71
 • You can resign if you feel that you are at a
disadvantage; since there is a huge policy concern
behind the public service.
• It requires continuity by its very nature, and may not
be an area of bargaining.
• Even if we allow bargaining in this area, the
bargaining may not work well, because of the
stronger bargaining position of not the employer, but
the worker.
• As an example, we can take the Armed Force.
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72
 » Due to all these reasons they have special laws, and
hence, no need to give additional protection by the
Labour Proclamation.

» So, almost in every nation labour law doesn’t cover

the public servants.

But who are they?

» The identification of members of the armed force,
the police force, judges of courts of law and public
prosecutors is not that an headache.

» Who employees of state Administration are? may,

however, bring sort of problem when the state begin
to involve in economic activities.
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73
» Employees of state include: employees of state administration
and employees of state enterprises.
» The proclamation excludes only members of state
administration, and employees of state enterprises are still
subjects of labour law.
» But it does not clearly provide the difference between the two
categories of employees in government owned institutions.
» It just provides that employees of state administration are
excluded.
» Therefore, in order to have a clear picture of the excluded
employees, we are forced to focus on the identification of the
difference between an “undertaking” and “state
administration”,
» since employees of state undertakings are not parts of the
exclusion.
» The difference between an “undertaking” and a “state
administration” lies on their nature and the primary roles to 74
be played by these government institutions.
» Here are certain yardsticks to be employed for the
differentiation of these two kind institutions. These are:

» Powers of the Institution

+ State administration organs have normally supervision or regulatory
powers, as opposed to state enterprises which are there with
business purpose.

» The Manner of Giving Service

+ Institutions that are part of state administration do not operate
under quid pro quo principle.

+ Quid pro quo principle is a principle that dictates something for

something.

+ Business enterprises, on the other hand, operate under the quid pro
quo principle, and

+ therefore require an equivalent price for what they are giving be it 75

goods or a service.
» Manner of Establishment of the Institution
+ Both state administration offices and state enterprises are
established by legal instruments such as proclamations or
regulations.

+ However, there is a difference between the two in the manner of

their financing.

+ State administration offices are financed by government budget

in the form of annual budget.

+ Whereas, a state enterprise does not expect some money in the

form of annual budget for it’s financing.

+ It would only be provided with some cash or fixed asset in the

form of capital at the start of its business, and no annual budget
allocation or expenditure to a state enterprise.
76
» see art.3(2)(f) of the procn.

77
 Conditional exclusion
» Working in diplomatic or international organization: Art
3(3)(a)

 Unless the Council of Ministers by regulations decides, the

labour proclamation shall not be applicable .

 There is no issued regulation regarding to this point.

 Who is international organization? Does it include

international multi corporations?

 Ethiopia is a signatory to United Nation Charter; hence any

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Ethiopian who employed In UN or organization under UN is not 78

governed by labour proclamation.
» see art.3(3) (b) of the procn.
» which category of employment relation of religious
organization with their employees is excuded?
˃ spiritual
˃ secular
» Spiritual service means a service which is performed only to
discharge functions directly related with spiritual activities
religious organization. Art 2/1 of the regulation.

» regarding the relationship of religious organizations with

their employees in the secular activities, there may not be a
problem with the applicability of the Labour Law for their
regulation
79
 Religious or charity employees

 The council of minister to make a regulation which stipulates

inapplicability of the proclamation on religious or charity
organization.
 Accordingly regulation 342/2015 is issued.
 Per to the regulation Art 3(1) The Proclamation shall not be
applicable with respect to a person who gives spiritual service in a
religious organization.
 Spiritual and administrative or spiritual and charitable activities,
simultaneously, in a religious organization

 Collective bargaining is not allowed to religious or charity

organization.
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