US embassy cable - 04MAPUTO1606

UNCLAS MAPUTO 001606 
 
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 unions, 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 
government officials, union groups, and the private sector. 
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." In addition, during this period the 
USG supported a confederation of business associations pushing 
policy change in the legal system 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. The seminar was 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. 
 
5. The GRM is currently considering revisions of the 
Mozambican labor law. Areas under discussion for revision 
include provisions on hiring foreign labor, the system of 
labor inspections, and the need for labor arbitration centers. 
However, to date the only proposed bill receiving unanimous 
support from government, unions and the private sector deals 
with labor arbitration. Currently only a limited number of 
labor disputes are subject to arbitration, and then via 
procedures that neither employers nor unions find attractive. 
Moreover, even though the law provides for their creation, at 
present no labor arbitration courts have been set up. This 
has led to the creation of a substantial backlog of labor 
cases awaiting decisions. Mozambique compares unfavorably in 
this regard with other countries in the region, all of which 
have functioning labor courts and well-developed alternative 
dispute resolution (ADR) forums. 
 
6. It appears likely that the GRM will approve the labor 
mediation bill and implement new labor legislation by late 
2005. The GRM then will require assistance in establishing 
new labor mediation centers and training mediators. 
 
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 government, 
unions, and the private sector. The groundwork that the USDOL 
has already laid through its labor mediation training (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. 
LA LIME