Key changes to Tanzania's Employment and Labour Relations Act

With the goal of improving the employment environment in Tanzania, the Labour Laws (Amendments) Act No. 4 of 2025 (the Labour Amendments Act) has been enacted, which amends the Employment and Labour Relations Act [Cap 366 R.E. 2019] (the ELRA), amongst other employment legislation. This month’s legal update highlights the key changes made to the ELRA introduced by the Labour Amendments Act. The key changes introduced to the ELRA by the Labour Amendments Act include the following:

Expansion and addition of definitions

The Labour Amendment Act amends the definition of basic wage initially excluded additional payments made to employees for work done on Sunday, but the amendment now specifically refers to work done on any rest day. A “rest day”, is defined as a continuous period of not less than 24 hours, granted on either a regular or irregular basis, during which an employee is entitled to abstain from performing any work-related duties for the employer.

In addition, the Labour Amendments Act adds the following definitions:

1. award which includes agreements reached after mediation, decision, decree and ruling;
2. personal representative, which means a person appointed by a party to a dispute for the purpose of representation; and 
3. process server, which means a person determined as such under any written law to undertake service of court documents.

Expansion of persons able to form part of a trade union 

With the enactment of the Labour Amendments Act, a senior management employee who may not belong to a trade union that represents the non-senior management employees of the employer has now been expressly stated to include a person who has authority or is authorised to hire or terminate an employee.

Increase in flexibility of employment contracts

The Labour Amendments Act amends section 14(1)(b) of the ELRA by substituting and introducing the following contracts for a fixed term:

1. Temporary workload increases: Work load increase that is not expected to endure for a duration exceeding 12 months.
2. Graduate Trainees: Training or work experience opportunities for up to 24 months.
3. Seasonal Workers: Addressing seasonal labour demands.
4. Specific Project: Contracts for specific projects for a limited or defined duration.
5. Non-Citizens: Contracts aligned with the duration of work permits.
6. Public Scheme Work: Contracts for an official public works scheme.
7. Funded Positions: Contracts for positions funded by an external source for a limited period.
8. Retirees: Contracts with people who have reached retirement age.
9. Tender-based: Contracts depending on the acquisition of tenders for business.

Introduction of an agreement in case of emergencies

The Labour Amendments Act has introduced a new provision in the ELRA that allows employers and employees to agree on methods to address disruptions during emergencies, such as pandemics or natural disasters, ensuring job security and maintaining productivity. In the event the employer and employees are unable to reach an agreement, any party is allowed to refer the matter to the Commission for Mediation and Arbitration (CMA).

Enhancement of maternity leave

Section 33 of the ELRA has now been introduced a provision on paid maternity leave that entitles employees who give birth to premature children to a paid maternity leave from the date of giving birth up to completion of the 40 weeks of pregnancy in addition to the ordinary maternity leave period provided under section 33(6) of the ELRA.

Expansion of paternity leave 

The Labour Amendments Act has also introduced the paternity leave of seven (7) days in the case of premature birth, which is to be taken within seven (7) days of the said premature birth of the child. 

Introduction of unpaid leave

The Labour Amendments Act introduces a provision in the ELRA on unpaid leave, which was not provided in the ELRA. An employer can now grant an employee, upon a written application, unpaid leave for a period not exceeding 30 days. However, the duration of unpaid leave may be extended to a further period upon agreement between the employee and employer.

Suspension of disciplinary procedures

In ensuring a just and structured dispute resolution process, the Labour Amendments Act has introduced a provision which prohibits employers from initiating or continuing disciplinary proceedings if the dispute has been referred to the CMA or a Court for determination. 

Remedies for unfair termination

Previously, the remedies for unfair termination as provided under section 40 of the LRA were limited to reinstatement, re-engagement or compensation of not less than 12 months. However, the Labour Amendments Act has introduced new compensation caps depending on the cases of termination:

1. in case of termination based on unfair procedure, not less than six (6) months' remuneration but not exceeding 12 months' remuneration;
2. in case of termination based on unfair reason, not less than 12 months' remuneration but not exceeding 18 months' remuneration;
3. in case of termination based on both unfair procedure and unfair reason, not less than 12 months’ remuneration but not exceeding 24 months’ remuneration; and 
4. in case of termination based on discrimination or harassment, not less than 12 months’ remuneration but not exceeding 24 months’ remuneration.

Note: Although these amendments provide a certain level of guardrails against excesses, there is still a risk of excessive financial loss where the court or an arbitrator orders reinstatement pursuant to section 40(1)(a) of the ELRA, especially in cases that have been pending before the court for a considerably long period.

Remedies for material breach of a fixed-term contract

The Labour Amendments Act has introduced remedies for material breach of contract, which were not previously provided for in the ELRA. On determining that there is a material breach of a fixed-term contract on the part of an employer, an arbitrator or the Labour Court may order the employer to pay compensation to the employee equal to the remuneration for the remaining term of the contract.

Binding nature of collective agreements

The Labour Amendments Act has amended the provision on the bindingness of the collective agreement to include the binding nature of collective agreements for public institutions upon the approval of the Permanent Secretary of the respective Ministry responsible for the establishments.

Conclusion of collective agreements

Previously, section 73(1) of the ELRA had stated that a recognised trade union and an employer or an employer’s association may conclude a collective agreement establishing a forum for workers' participation in a workplace. However, the Labour Amendments Act has amended the provision to allow one or more trade unions to conclude the collective agreement.

Referral of disputes to mediation 

According to the amendment of section 86(6) of the ELRA by the Labour Amendments Act, it has been made compulsory for a party to a dispute to be present at the mediation and specify that only employees can use a personal representative. In addition, a party to a dispute who is unable to attend due to inevitable reasons is required to appoint, in writing, another person to appear on their behalf to proceed with the mediation. Also, the Labour Amendments Act has amended section 86 (7) of the ELRA to introduce a timeframe of 30 days for referring a complaint to arbitration after mediation failure.

Consequences of Non-Attendance in Mediation

Section 87(3)(b) of the ELRA allows the mediator to decide the complaint if the other party to a complaint fails to attend a mediation hearing. The Labour Amendments Act has now amended the provision to allow the mediator to mark the dispute as failed instead of deciding the complaint. 

Additionally, prior to the amendment of the ELRA, the CMA could only reverse a decision made on non-attendance in mediation by the party who referred the complaint. However, the Labour Amendments Act has amended the ELRA to allow the CMA to restore a matter dismissed as a result of the non-attendance of the mediation hearing by the party who referred the complaint.

Arbitration procedures

The Labour Amendments Act has introduced the issuance, by an arbitrator, of an award for admitted claims. In addition, the Labour Amendments Act has amended section 88 of the ELRA to also allow an arbitrator to dismiss a matter on the non-attendance of a party to the matter and introduces a timeframe of 14 days from the date of a decision to make an application for setting aside the ex-parte order or restoration of the matter.

Nevertheless, the Labour Amendments Act has introduced the requirement for an arbitrator to notify the parties in writing and state the reasons for delay and fix the date for delivering of the award or order where he fails to issue an award within 30 days. 

Application for revision

According to the Labour Amendments Act, section 94 of the ELRA is amended to include that an application for revision shall not lie or made in respect of any preliminary or interlocutory decision unless such decision or order has the effect of finally determining or order has the effect of finally determining the matter.

Service of documents

Previously, the service of documents was limited to postage, physical and personal. However, with the amendment to section 97 of the ELRA, service of documents has been extended to include electronic or by a process server. 

Conclusion

The Labour Amendments Act introduces significant and wide-ranging reforms to the ELRA, aimed at enhancing flexibility, promoting fairness, and strengthening protections for both employers and employees in Tanzania. By expanding definitions, introducing new categories of employment contracts, refining dispute resolution mechanisms, and improving leave entitlements, the amendments modernise the employment framework to better respond to contemporary challenges, including emergencies. Employers and employees alike should familiarise themselves with these changes to ensure compliance and to fully benefit from the protections and opportunities the updated legislation provides.