Mauritius Employment Act Update - The Workers’ Rights Act 2019 12 December 2019

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Peter Nagle

Country Head - Mauritius

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The Workers’ Rights Act 2019 (the “WRA”) came into force on 24 October 2019 repealing and replacing the Employment Rights Act 2008 (the “ERA”). This communiqué highlights the main changes and new concepts brought forward by the WRA and which may be of relevance to you as an employer.

1. Definition of Worker

While formerly under the ERA, employees earning up to Rs 360,000 per year were categorized as Workers, the WRA has raised this threshold to Rs 600,000 per year.

SANNE Comments: The implication is that any employee earning a basic salary of up to Rs 600,000 per year will be categorized as a Worker and will be governed by almost all the provisions of the WRA. Those earning a yearly basic salary above Rs 600,000 will be subject only to a few mandatory provisions of the WRA.

2. Hours of Work

The normal working hours per week has been increased from 40 hours to 45 hours (excluding lunch time and tea breaks). The 45 hours can consist of:

  1. 9 hours per day for 5 days; or
  2. 8 hours work on any 5 days of the week and 5 hours’ on one other day of the week.

SANNE Comments: As per the WRA, an employer can have other “stipulated working hours” that can be less than 9 hours if same is stated in the contract of employment.

3. Discrimination in Employment and Occupation

The WRA now provides that if an employee of a subsidiary company performs work of equal value and operating in the same field as an employee of the parent company and / or other subsidiary companies, and receives less favourable salary, or is subject to less favourable terms and conditions of employment, it will be considered as discrimination.

SANNE Comments: It is worth highlighting that the above provisions will be only applicable if the employment matters of both the Parent Company and the Subsidiary Company are governed by Mauritian law.

4. Fixed Term Agreements

The WRA now prohibits an employer from entering into fixed term contracts with employees if the position is of a permanent nature and relates to the fixed, recurring and permanent needs of the continuous normal business activity of the employer. Fixed term contract with a worker can be entered in very limited circumstances like for providing training, completion of a specific piece of work which is temporary and non-recurring etc.

SANNE Comments: This provision does not apply to an employee earning a basic salary of more than Rs 600,000 annually or to an employee who is not a citizen of Mauritius.

5. Flexitime

Pursuant to the WRA, an employer may request an employee to work on a flexible time basis.

An employee may also request to be shifted to a flexible time basis to care for his/ her child who is below school age or has an impairment.

6. Overtime on public holidays and Sundays

New rates for overtime performed on Sundays and public holidays have been introduced as follows:

Overtime during normal working hours

2 times the basic hourly rate

Overtime after normal working hours

3 times the basic hourly rate

Overtime performed during week days, other than Sunday and public holiday, would be remunerated at 1.5 times the basic hourly rate.

7. New types of Leaves

The following table summarises the new types of leaves that have been brought by the WRA and the conditions attached to them:

Type of Leave

Condition

1. Vacation Leave

Beginning from the date of implementation of the WRA, every Worker who has remained in the continuous employment of an employer for a period of at least 5 consecutive years will be entitled to a vacation leave of up to 30 days in the fifth year.

The Worker must have completed at least 5 years of continuous employment starting from 24 October 2019. Subsequent five year period will start when the employee resumes office from the vacation leave. This applies only to employees earning less than Rs 600,000 per year.

2. Special Leave:

(a) 6 days on first marriage,

(b) 3 days upon son / daughter’s first marriage,

(c) 3 days upon death of spouse, child, father, mother, brother or sister     

Continuous employment by the employee for a period of 12 consecutive months with the same employer.

This applies to employees earning less than Rs 600,000 per year.

3. Juror’s Leave:

Any employee who has been summoned by a Court in Mauritius to serve as Jury shall be granted fully paid leaves to that effect.

Applies to all employees.

4. Leave to participate in international sports events

This type of leave will be applicable only if an employee is to represent Mauritius for an international sporting event.

Applies to all employees.

5. Leaves to attend Court:

When an employee is summoned to attend court, either as a witness or a party, the employer should grant to that employee leave to attend court.

This type of leave shall be on full pay only if the employee is attending court as a representative of the employer or on behalf of the employer.

This applies to employees earning less than Rs 600,000 per year.

6. Maternity leave on adoption of a child:

A female employee will  be entitled to 14 weeks’ leave on full pay upon adoption of a child aged less than 12 months.

The female employee must have remained in continuous employment with the employer for at least 12 consecutive months.

Certified true copy of court order and birth certificate of child to be provided to employer.

Applies to all employees.

8. End of Year Bonus

End of year bonus shall be calculated based on the ‘earnings’ of an employee during the calendar year. The bonus will be one-twelfth of the earnings of the employee. Earnings include basic wage or salary, overtime payment, any bonus related to productivity, commission and other regular payments. It is to be further noted that pursuant to a communique issued by the Ministry of Labour on 21 November 2019, if the average remuneration of an employee during the year is less than his last salary for the year, the end of year bonus shall be calculated based on his last salary in accordance with the End of Year Gratuity Act.

Additionally, the WRA provides that if the employment of an employee is terminated by the employer (for any reason) or the employee retires at any point during the course of a year or if an employee who has remained in the continuous employment with an employer for at least 8 consecutive months in the course of a year resigns, the employer will have to pay, not later than the last working day of the month in which the employee is leaving the employer’s organization, a bonus equivalent to one-twelfth of his earnings for that year.

SANNE Comments: This will be applicable to all employees.

9. Portable Retirement Gratuity Fund

Effective as from 1 January 2020, the Portable Retirement Gratuity Fund (the “PRGF”) will become operational. Employers will have to make monthly contributions for each relevant employee to the PRGF. The objective of the PRGF is to pay a gratuity to the employees upon retirement or to his / her legal heirs in case of an employee’s death. The rate of the monthly contributions will be proclaimed by way of Regulations (as per Parliamentary debates, a rate of 4.8 % of monthly remuneration of each employee has been hinted). The retirement gratuity will be payable from the contribution made by his / her current employer and any subsequent employer with whom the employee has been in employment during his whole career.

SANNE Comments: The PRGF provision will only be applicable to employees who are citizens of Mauritius. An employer need not contribute to the PRGF if it already contributes to a Private Pension Scheme regulated by the Financial Services Commission of Mauritius at the prescribed rate. Employees who earn a monthly basic salary of more than Rs 200,000 are not eligible to join the PRGF.

10. Violence at work

Employers may be vicariously liable for violence at work, including sexual harassment, committed by a worker or any third party where the employer knew or should have known of the violence at work and failed to take any action to prevent or stop the violence. 

11. Additional Remuneration

The WRA provides that to compensate employees for increase in cost of living, an employer shall pay to every employee such additional remuneration as may be prescribed, in addition to the employee’s actual wage or salary.

12. Promotion

Employers have an obligation under the WRA to post any vacancy that arises in a higher grade position, in a conspicuous place at least 5 days before the promotion or selection exercise is carried out.

SANNE Comments: This provision does not apply to an employee earning a basic salary of more than Rs 600,000 annually.

Should you have any further questions please get in touch with Bimal Nuckchadee, Associate Director, SANNE.