Protection of Workers' Claims (Employer's Insolvency) Convention, 1992 (No. 173) - Botswana (Ratification: 1997)

Direct Request (CEACR) - adopted 2018, published 108th ILC session (2019)

In order to provide a comprehensive view of the issues relating to the application of the ratified Conventions on wages, the Committee considers it appropriate to examine Conventions Nos 95 and 173 in a single comment.

Protection of Wages Convention, 1949 (No. 95)

The Committee notes the observation made by the Botswana Federation of Trade Unions (BFTU) received with the Government’s report.

Article 4(2) of the Convention. Partial payment of wages in kind. Further to its previous comments on the need to adopt measures to ensure that allowances in kind are appropriate for the personal use and benefit of the worker and the value attributed to them is fair and reasonable, the Committee notes the absence of information on this matter in the Government’s report. The Committee also notes that the BFTU indicates that they had sent proposals to the Government in 2015 concerning possible amendments to the Employment Act, which included the repeal of its section 84 which allows for partial payment of wages in kind up to a limit of 40 per cent of the total amount of wages due. According to the BFTU, payment in kind should be limited to additional benefits other than the agreed wages. The Committee recalls once again that Article 4(2) is not self-executing and requires the adoption of practical measures to ensure that any allowances in kind which may be provided in partial settlement of wages due are appropriate for the personal use and benefit of the worker and the value attributed to them is fair and reasonable. In its 2003 General Survey on protection of wages, paragraph 153, the Committee notes that this obligation may be met in a variety of ways, such as the inclusion in the relevant laws, regulations, collective agreements or arbitration awards of corresponding general conditions and/or more specific rules respecting the types of benefits in kind which may be provided and the principles or methods determining, supervising or, if necessary, adjudicating the value attributed to them. The Committee requests the Government to take the necessary measures to ensure the effective implementation of Article 4(2) of the Convention and to provide information in this respect.

Article 7(2). Works stores. The Committee notes that section 86(1) of the Employment Act provides that no employee shall be compelled by any contract of employment, agreement or order, written or oral, to purchase provisions at any shop established by the employer. It notes that this provision does not give effect to Article 7(2) which provides that, where works stores for the sale of commodities to the workers are established or services are operated in connection with an undertaking, and access to other stores or services is not possible, the competent authority shall take appropriate measures with the object of ensuring that goods are sold and services provided at fair and reasonable prices, or that stores established and services operated by the employer are not operated for the purpose of securing a profit but for the benefit of the workers concerned. Therefore, the Committee requests the Government to indicate the measures taken to ensure compliance with this provision of the Convention and to provide information in this respect.

Articles 8 and 10. Deductions from wages. Attachments of wages. Further to its previous comments on the need to set limits to the possible deductions from and attachment of wages, the Committee notes the Government’s indication that this matter will be taken into consideration in the process of amending the Employment Act. The Committee requests the Government to provide information on the progress made in this respect.

Article 14. Information on pay conditions and wage statements. The Committee notes that the BFTU indicates that there are no measures in place to ensure that workers are informed of wages applicable to them before entering employment and that many workers still receive undocumented wages from employers. In the absence of a reply from the Government on this point which was also raised in its last comments, the Committee once again requests the Government to indicate the measures taken or envisaged to ensure: (i) that workers are duly informed of the wage conditions applicable to them before they enter employment (Article 14(a)); and (ii) that they receive wage statements at the time of each payment (Article 14(b)).

Protection of Workers’ Claims (Employers’ Insolvency) Convention, 1992 (No. 173)

Articles 6, 7 and 8. Workers’ claims protected by privilege. Limitations. Rank of privileges. In its previous comments, the Committee noted that the Employment Act and the Insolvency Act establish differing degrees of protection for workers’ claims in the event of the insolvency of their employer. The Committee had considered that these two Acts should be amended for the sake of legal certainty and with a view to ensuring compliance with the Convention. The Committee recalls that Section 91A of the Employment Act establishes a privilege over non privileged claims for employees’ claims covering wages up to three months prior to the insolvency or termination of contract, holiday with pay, other paid absence and severance benefits. However, the Employment Act does not indicate the rank of the wage claims’ privilege among other types of privileged claims. On the other hand, sections 82–86 of the Insolvency Act, establish that wage claims are to be paid after the payment of funeral expenses, costs of sequestration and costs of execution but before the payment of taxes on income and other claims. However, section 85(1) of the Insolvency Act limits the amount of workers’ claims protected by this privilege to 100 pulas. The Committee recalls that the Convention requires that workers’ claims be given a higher rank of privilege than most other privileged claims (Article 8(1)) and that when the protection is limited to a prescribed amount, this amount shall not be below an acceptable level and it shall be adjusted as necessary as to maintain its value (Article 7). The Committee notes that the Government indicates in its last report that the Insolvency Act needed to be amended to protect the claims of employees. The Committee requests the Government to provide information on any developments in this regard.

Direct Request (CEACR) - adopted 2011, published 101st ILC session (2012)

The Committee notes that the Government’s report has not been received. It hopes that a report will be supplied for examination by the Committee at its next session and that it will contain full information on the matters raised in its previous direct request, which read as follows:

Repetition

Article 6 of the Convention. Protected claims. The Committee notes that following the adoption of the Employment (Amendment) Act 2003, new section 92A grants preferential treatment to workers’ claims in respect of wages, holiday pay, paid absence, and severance pay in terms which are in conformity with the requirements of this Article of the Convention. The Committee understands that workers’ claims continue to rank fourth among privileged debts, i.e. after funeral expenses, estate administration costs and costs of any execution against the estate but before income tax claims, as set out in section 85 of the Insolvency Act (Cap 42:02). The Committee further notes the Government’s explanations that section 85 of the Insolvency Act has been superseded by new section 92A of the Employment Act and is therefore no longer applicable. The Committee considers that, for the sake of legal certainty and clarity, section 85 of the Insolvency Act should be amended to follow the relevant provisions of the Employment Act and also that the Employment Act should contain an indication, or possibly a cross reference to the Insolvency Act, as regards the rank of the privilege granted to workers’ wage claims. The Committee trusts that the Government will consider the need to take appropriate action in the light of the above observations.

Part IV of the report form. Practical application. The Committee would be grateful if the Government would provide in its next report detailed information on the practical application of the Convention, including for instance any available statistics on the number of bankruptcies and the amount of unpaid wages recovered through judicial proceedings in accordance with relevant laws and regulations.

Direct Request (CEACR) - adopted 2007, published 97th ILC session (2008)

The Committee notes the information provided by the Government in reply to its previous comments.

Article 6 of the Convention. Protected claims. The Committee notes that following the adoption of the Employment (Amendment) Act 2003, new section 92A grants preferential treatment to workers’ claims in respect of wages, holiday pay, paid absence, and severance pay in terms which are in conformity with the requirements of this Article of the Convention. The Committee understands that workers’ claims continue to rank fourth among privileged debts, i.e. after funeral expenses, estate administration costs and costs of any execution against the estate but before income tax claims, as set out in section 85 of the Insolvency Act (Cap 42:02). The Committee further notes the Government’s explanations that section 85 of the Insolvency Act has been superseded by new section 92A of the Employment Act and is therefore no longer applicable. The Committee considers that, for the sake of legal certainty and clarity, section 85 of the Insolvency Act should be amended to follow the relevant provisions of the Employment Act and also that the Employment Act should contain an indication, or possibly a cross-reference to the Insolvency Act, as regards the rank of the privilege granted to workers’ wage claims. The Committee trusts that the Government will consider the need to take appropriate action in the light of the above observations.

Part IV of the report form. The Committee would be grateful if the Government would provide in its next report detailed information on the practical application of the Convention, including for instance any available statistics on the number of bankruptcies and the amount of unpaid wages recovered through judicial proceedings in accordance with relevant laws and regulations.

Direct Request (CEACR) - adopted 2006, published 96th ILC session (2007)

The Committee notes that the Government’s report has not been received. It hopes that a report will be supplied for examination by the Committee at its next session and that it will contain full information on the matters raised in its previous direct request, which read as follows:

Article 6 of the Convention. Protected claims. The Committee notes with satisfaction that the Employment Act (Chapter 47:01) has been amended and that its new section 92A now extends preferential treatment to all the workers’ claims covered by this provision of the Convention. The Committee requests the Government to indicate whether section 85 of the Insolvency Act (Chapter 42:02) has also been amended in order to avoid any contradiction with the aforementioned section 92A.

Article 7. Limitations. The Committee requests the Government to indicate whether the maximum amount of workers’ claims protected by privilege, as laid down in section 85 of the Insolvency Act (100 pulas) is still applicable and, if not, to specify any limits currently in force.

Part IV of the report form. The Committee requests the Government to provide general indications as to the manner in which the Convention is applied in practice, including, if possible, information concerning the number of workers covered by legislation giving effect to the Convention.

 

Direct Request (CEACR) - adopted 2005, published 95th ILC session (2006)

Article 6 of the Convention. Protected claims. The Committee notes with satisfaction that the Employment Act (Chapter 47:01) has been amended and that its new section 92A now extends preferential treatment to all the workers’ claims covered by this provision of the Convention. The Committee requests the Government to indicate whether section 85 of the Insolvency Act (Chapter 42:02) has also been amended in order to avoid any contradiction with the aforementioned section 92A.

Article 7. Limitations. The Committee requests the Government to indicate whether the maximum amount of workers’ claims protected by privilege, as laid down in section 85 of the Insolvency Act (100 pulas) is still applicable and, if not, to specify any limits currently in force.

Part IV of the report form. The Committee requests the Government to provide general indications as to the manner in which the Convention is applied in practice, including, if possible, information concerning the number of workers covered by legislation giving effect to the Convention.

Direct Request (CEACR) - adopted 2004, published 93rd ILC session (2005)

The Committee notes that the Government’s report has not been received. It hopes that a report will be supplied for examination by the Committee at its next session and that it will contain full information on the matters raised in its previous direct request, which read as follows:

Articles 5 and 6 of the Convention. The Committee recalls its previous comment in which it pointed out that, as it now stands, the Insolvency Act (Cap. 42:02) gives only limited effect to the requirements of Part II of the Convention with respect to the minimum acceptable coverage of protected claims. While noting the Government’s statement to the effect that the relevant legislation is being reviewed to comply with the provisions of the Convention and that a draft bill has been prepared in consultation with the social partners for submission to parliament at its next session, the Committee requests the Government to continue providing information on any progress made in bringing its legislation in conformity with the Convention. It also requests the Government to forward a copy of the draft bill amending the relevant provisions of the Employment and Insolvency Acts. Moreover, the Committee notes the Government’s explanation that the term "servant" is used in the Insolvency Act in a broad sense as being a person in the employment of another, and that it has the same meaning with the term "employee" as defined in the Employment Act.

Article 7. In its previous comment, the Committee had drawn attention to the requirements of the Convention with regard to possible limitations on the amount of the workers’ claims protected by a privilege. In its reply, the Government states that new legislation is currently under consideration to ensure compliance with the provisions of the Convention. The Committee asks the Government to keep it informed of any further developments in this regard. The Committee would be grateful to the Government for information on the application in practice of the Convention in accordance with Part IV of the report form.

[The Government is asked to report in detail in 2005.]

Direct Request (CEACR) - adopted 2003, published 92nd ILC session (2004)

The Committee notes the Government’s report.

Articles 5 and 6 of the Convention. The Committee recalls its previous comment in which it pointed out that, as it now stands, the Insolvency Act (Cap. 42:02) gives only limited effect to the requirements of Part II of the Convention with respect to the minimum acceptable coverage of protected claims. While noting the Government’s statement to the effect that the relevant legislation is being reviewed to comply with the provisions of the Convention and that a draft bill has been prepared in consultation with the social partners for submission to parliament at its next session, the Committee requests the Government to continue providing information on any progress made in bringing its legislation in conformity with the Convention. It also requests the Government to forward a copy of the draft bill amending the relevant provisions of the Employment and Insolvency Acts. Moreover, the Committee notes the Government’s explanation that the term "servant" is used in the Insolvency Act in a broad sense as being a person in the employment of another, and that it has the same meaning with the term "employee" as defined in the Employment Act.

Article 7. In its previous comment, the Committee had drawn attention to the requirements of the Convention with regard to possible limitations on the amount of the workers’ claims protected by a privilege. In its reply, the Government states that new legislation is currently under consideration to ensure compliance with the provisions of the Convention. The Committee asks the Government to keep it informed of any further developments in this regard. The Committee would be grateful to the Government for information on the application in practice of the Convention in accordance with Part IV of the report form.

[The Government is asked to report in detail in 2004.]

Direct Request (CEACR) - adopted 2001, published 90th ILC session (2002)

The Committee notes with interest the Government’s first report on the application of the Convention. The Committee would appreciate receiving additional information on the following points.

Articles 5 and 6 of the Convention. The Committee notes that under section 85(1) of the Insolvency Act (Cap. 42:02), servants’ wages shall be paid out of the free residue of the estate, in priority to other claims but after the payment of funeral expenses, death-bed expenses and the costs of sequestration, up to an amount not exceeding P100 in respect of arrears of wages for one month and the wages for the month current with the sequestration, if the servant of the insolvent is engaged by the month, and in respect of arrears of wages for one week and the wages for the week current with the sequestration if the servant of the insolvent is engaged by the week. The Committee recalls, however, that according to the relevant provisions of Part II of the Convention, privileged workers’ claims should cover as a minimum: (i) wage claims relating to a prescribed period which may not be less than three months prior to the insolvency or prior to the termination of employment; (ii) holiday pay due for work performed during the year in which the insolvency or the termination of employment occurred and in the preceding year; (iii) other types of paid absence (e.g. sick leave or maternity leave) relating to a period which may not be less than three months prior to the insolvency or prior to the termination of employment; and (iv) severance pay. While noting the Government’s statement to the effect that the Insolvency Act has not yet been modified in order to specify the workers’ claims to be protected as privileged debts, the Committee hopes that the Government will make every effort to take the necessary action in the very near future to give full effect to the requirements of the Convention in this regard.

Moreover, the Committee understands that the term "servant" is used throughout the Insolvency Act in the broader sense of a person being in the employment of another, and not in the narrow sense of a domestic worker. The Committee would appreciate receiving additional information on the exact meaning of the term "servant" as employed in the Insolvency Act and accordingly on the scope of application of section 85(1) of the Act.

Article 7. The Committee notes that under section 85(1) of the Insolvency Act a maximum amount is fixed for the workers’ wage claims which may be paid out as priority claims in the event of the employer’s insolvency. The Committee recalls that the Convention allows for the limitation of the protection by privilege of workers’ claims to a prescribed amount provided that the amount is not below a socially acceptable level and requires that such amount should be periodically adjusted as necessary so as to maintain its value. While noting the Government’s statement that the Insolvency Act has not been modified to give effect to the provisions of the Convention, the Committee hopes that the necessary measures will be taken in the near future to bring the national legislation into substantial conformity with the Convention and requests the Government to indicate in its next report any progress made in this respect.

The Committee would be grateful to the Government for information on the application in practice of the Convention in accordance with Part IV of the report form.