US embassy cable - 04MAPUTO1584

UNCLAS SECTION 01 OF 02 MAPUTO 001584 
 
SIPDIS 
DEPT FOR AF/S - HTREGER and DRL/IL - JHARPOLE 
LABOR FOR ILAB - BYOUNG, PWHITE, AZOLLNER, SHAHN 
JOHANNESBURG FOR RLO - JCOLLINS 
COMMERCE FOR RTELCHIN 
E.O. 12958: N/A 
TAGS: ELAB, EINV, ECON, MZ 
SUBJECT: REQUEST FOR FY 2005 LABOR SECTOR SUPPORT IN 
MOZAMBIQUE 
 
REF: a. MAPUTO 713 
 
b. 03 Maputo 1275 
 
1. This is an Action Request. See paragraph 8. 
 
2. SUMMARY. The Mission, the Mozambican Minister 
of Labor, labor unionsfederations, and private 
sector leaders would like continued USG support for 
labor projects in Mozambique in FY05. In 
particular, there is an urgent need to continue the 
USDOL-funded "Improving Industrial Relations in 
Mozambique" project that provides labor mediation 
training and support to union groups, government 
officials, union groups, and the private sector 
employers. END SUMMARY. 
 
3. In 2003-2004, the Mission, in coordination with 
USDOL - ILAB, State - DRL/IL, and the regional labor 
officer, organized several successful events on 
labor issues in Mozambique. These events included 
training courses on labor mediation and industrial- 
based bargaining, an HIV/AIDS prevention- in- the- 
workplace program, a visit by the Director and 
Deputy Director of the Federal Mediation and 
Conciliation Service (FMCS), an 80-person seminar on 
improving labor relations in Mozambique, and 
authorship of the book, "Labour Relations in 
Mozambique." The USG's assistance to the GRM comes 
at a critical time, as the Mozambican labor law is 
under revision. In addition, during this period the 
USG supported The USG provided and continues to 
provide significant support to this effort via 
recently implemented programs and through its 
support of CTA, a confederation of business 
associations pushing policy change in the legal 
system in order to create a more attractive business 
and investment climate (Ref A). 
? 
4. During this period the USG, specifically 
USDOL/ILAB, supported labor mediation training for a 
group of 30-40 representatives from the private 
sector, labor unions, and the government supported 
an 80-person seminar on improving labor relations in 
Mozambique. The seminar was s taught by FMCS 
personnel, who visited Mozambique on four separate 
occasions. Those receiving the training were solely 
from the capital city, Maputo. Although some of 
those trained took their knowledge "on the road" to 
train employees in the central provinces of Sofala 
and Manica, without funds or adequate teaching 
skills, this effort was minimal. Nevertheless, the 
program has received high praise repeatedly from the 
Minister of Labor, leaders of the commercial 
arbitration center (CACM), union leaders and 
members, and employers (Ref B). The timing of the 
labor arbitration training was key, as it coincided 
with dialogue on labor law reform. 
 
4. The GRM is currently considering further 
revisions of the Mozambican labor law. Areas under 
discussion for revision includeSeveral areas of the 
law are being discussed, including provisions on 
hiring foreign labor, the system of labor 
inspections, and the need for labor arbitration 
centers. However, to date the The only proposed 
bill receiving unanimous support from the tripartite 
group (government, unions and the private sector 
deals with employers, and unions) sets forth the 
creation of a public and several private labor 
arbitrationmediation centers. Currently Under the 
current labor law, only a limited number of labor 
disputes areis subject to arbitration, and then 
viaand under procedures that neither employers nor 
unions seem to find particularly attractive. 
Moreover, eEven though the law provides for their 
creation, at present no labor arbitration courts 
have been ever been set up. This has led to the 
creation of This has allowed a substantial backlog 
of labor cases awaiting decisions. bottleneck of 
labor litigation to develop, and many cases are left 
for years without resolution. Mozambique compares 
unfavorably in this regard with other countries its 
competitors in the region on this issue, all of 
which have functioning labor courts and well- 
developed alternative dispute resolution (ADR) 
forums. 
? 
5. It appears likely that If the Ministry of 
Labor's current dialogue is an indication of future 
action, the GRM will approve thea e the draft labor 
mediation bill and implement new labor legislation 
by late 2005. The GRM then will require assistance 
in establishing new Because it will be a key 
addition to the new system, the structure of labor 
mediation centers and the training of mediators must 
be given proper attention. 
The groundwork that the USDOL has set through its 
labor mediation training (facilitated by FMCS), 
"Improving Industrial Relations in Mozambique" is an 
excellent forum for fostering the development of 
formal labor mediation in Mozambique. 
 
6. The 2003 USDOL-funded program, "Improving 
Industrial Relations in Mozambique" received high 
praise repeatedly from the Minister of Labor, 
leaders of the commercial arbitration center (CACM), 
union leaders and members, and employers (Ref B). 
The training consisted of four FMCS visits by 
excellent instructors that instructed a group of 
thirty private sector, government, and union 
representatives on industrial-based bargaining and 
labor dispute resolution. These group trained was 
solely from Maputo. 7. Comment: Changes to permit 
liberal access to labor arbitration in Mozambique 
are long overdue, however progress is being made. 
There now is a clear opportunity for the USG to 
support the GRM in making the transition to a labor 
system that includes labor mediation practices for 
employers and workers in government, unions, and the 
private sector. The groundwork that the USDOL has 
already laid through its labor mediation training 
seminar (para 4 above) is excellent preparation for 
further developing labor mediation in Mozambique. 
In July, the Ambassador visited with USDOL/ILAB 
staff to demonstrate the Mission's desire to see the 
program continue. 
 
8. Action Request: Mission requests USDOL continue 
funding for the "Improving Industrial Relations in 
Mozambique" program. Mission also requests guidance 
from DRL/IL regarding the availability of Department 
resources to support training in labor mediation. 
Cognizant of the legislation changes likely to be 
made, it is an opportune time to continue with 
training for a wider group of government, union, and 
private sector representatives. The formerly trained 
group took some of their knowledge "on the road" to 
train employees in the central provinces of Sofala 
and Manica, but without funds or adequate teaching 
skills, this effort was minimal. 
 
7. Changes to permit liberal access to labor 
arbitration in Mozambique are long overdue, however 
progress is being made. There is a clear 
opportunity for the USG to support the GRM in making 
the transition to system that includes labor 
mediation and be successful in this effort. To the 
extent resources are to be made available, it would 
be best used to continue training labor mediators 
and arbitrators - both in Maputo and in other major 
cities across the country. 
 
8. Action Request: Mission requests USDOL consider 
the request to continue the "Improving Industrial 
Relations in Mozambique" program. Mission also 
requests guidance from DRL/IL regarding the 
availability of resources to support the labor 
mediation effort. 
LA LIME