Botswana’s most consequential labour statute since Independence takes effect on 1 September, and it lands in an economy that has stopped creating jobs. Business Botswana calls it “heavily anti-business” and warns that operationalising it could be “catastrophic”. The Manual Workers Union is broadly happy with the Act but shocked at how little has been done to prepare for it. Two tripartite insiders, opposite positions, one verdict: the country is not ready.
By Douglas Rasbash and Tefo Pheage
The Employment and Labour Relations Act, 2025 (No. 27 of 2025) takes effect on 1 September, and is the most significant labour legislation enacted in Botswana since Independence. It consolidates three statutes into one, strengthens protection against discrimination and harassment, expands statutory leave, and establishes an independent Mediation and Arbitration Commission to relieve an Industrial Court backlog that has left workers waiting years for terminal benefits. Eight years in the making, it is in many respects thoughtful and progressive.
The question is not whether it is good labour law. It is whether it is the right labour law for Botswana at this moment. Good policy is not simply about doing the right thing. It is about doing the right thing at the right time.
A SHRINKING MARKET
The headline unemployment rate in Statistics Botswana’s Multi-Topic Household Survey 2024/25 stands at 21.0%, representing 213,437 people actively seeking work, up from 147,206 a decade earlier. That is an increase of roughly 45% since 2015/16.
The headline understates the position. A further 88,671 people are classified as discouraged job seekers, wanting work and available for it but no longer searching because they believe no opportunities exist. Under international definitions they fall outside the labour force altogether. Add them back and unemployment rises to at least 27.3%. The survey itself cautions that apparent improvements may reflect rising discouragement rather than job creation. People are not finding work. They are giving up looking for it.
Youth unemployment stands at 28.9% on the narrow definition. Vice President and Minister of Finance Ndaba Gaolathe has called youth unemployment a national emergency, noting that the economy contracted by 3% in the preceding year and was expected to contract again.
Botswana’s greatest labour challenge, then, is not the exploitation of workers. It is the absence of work itself. Labour law should be judged against two objectives: protecting those who already have jobs, and helping the unemployed obtain them. The Act performs strongly on the first. Its contribution to the second is where the trouble begins.
THE EMPLOYERS OBJECT
Until now this has been a theoretical argument. It is no longer.
On 10 August, Business Botswana issued an advisory note to members under the signature of Chief Executive Officer Tumi Mbaakanyi. It is a remarkable document, not least because Business Botswana is itself a tripartite partner and therefore party to the process that produced the Act.
It records that the organisation has consistently raised concerns within the tripartite structure about what it calls a heavily anti-business law, warning of adverse impacts on employment, investment, productivity and growth. Operationalising the Act in its current unbalanced state, the letter states, could be catastrophic. It warns of financial, administrative and operational burdens falling on MSMEs and informal entities, threats to sectoral viability, and erosion of what it frankly concedes is the minimal competitiveness leverage the country still possesses, leverage needed for a production-led recovery and job creation.
Note what is not being said. The country’s principal business organisation is not arguing that workers deserve less protection. It is arguing that this law, at this moment, works against job creation.
The provisions giving that warning its force are identifiable. Section 157 limits fixed-term contracts to twelve months absent objective justification. The intention is understandable, since some employers used rolling short-term contracts to avoid creating permanent employment. But construction firms depend on project pipelines, tourism operators face seasonal demand, and manufacturers cannot always predict orders. Where that flexibility is removed, employers may not replace temporary contracts with permanent ones. Many will simply not recruit, and the first casualties are young people seeking a first job.
Section 155 limits probation and requires structured feedback before termination. Every additional procedural requirement raises the perceived risk of hiring someone whose capabilities are unknown. Part XII increases maternity leave to fourteen weeks and introduces paternity, adoption and hospitalisation leave. Each reform is individually difficult to oppose. Collectively they raise the cost of employing labour, and firms compare that cost against the value an employee produces. Large corporations absorb such obligations. Small and medium enterprises, the principal job creators in most economies, often cannot.
Enforcement sharpens the point. Failure to pay wages on time attracts a fine of up to P10,000 or twelve months’ imprisonment, and discrimination offences up to P50,000 or five years. The Director of Labour acquires power to seize and sell an employer’s assets to recover unpaid wages. For a firm acting in bad faith these are proportionate. For a small firm navigating unfamiliar obligations without in-house HR capacity, they are a reason for caution about hiring at all.
Nor is the architecture settled. Business Botswana puts on record that tripartite discussions on the Regulations ended without consensus, and that it still awaits the amended drafts weeks before commencement.
THE COMPLIANCE BURDEN
The most telling passage in the advisory is the least rhetorical. Members are told to align new contracts with the Act, audit operations for compliance gaps, and develop roadmaps covering revised discrimination and harassment policies, mandatory complaint processes, child labour schedules, voluntariness documentation, HR systems tracking leave entitlements and union dues deductions, inspection records, welfare audit protocols, 30-day shutdown notices, mediation procedures and 21-day appeals against directives.
Read that list again and consider a firm of eight employees in Kanye or Maun.
None of it is unreasonable in isolation. But the aggregate is a compliance function, and a compliance function is a fixed cost. Large employers spread it across hundreds of staff. Small employers absorb it personally, or decline to grow past the point where it becomes unavoidable. The checklist Business Botswana published as a service to members is, inadvertently, the clearest illustration of the burden it fears.
LABOUR PUSHES BACK
Organised labour sees it differently, though not reassuringly so. Robert Rabasimane, Deputy Chief Executive Officer of the Manual Workers Union, has no quarrel with the legislation. His objection is to the state of preparation. “We are generally happy with the Act, but we are deeply concerned and, frankly, shocked by the level of preparedness for its implementation,” he says.
His example is the Mediation and Arbitration Commission itself. Rabasimane says there is no visible preparation for its establishment, no clarity on offices, staffing or training, and no indication of what happens to cases already before existing structures. The same applies, he says, to labour inspection.
The union is not disinterested. It is currently before the Maun High Court challenging the Public Service Bargaining Council’s constitution, with judgment due on 30 October. But its preparedness critique does not depend on that litigation, and Business Botswana’s own letter corroborates it.
CART BEFORE HORSE
Countries near full employment strengthen labour protections because employers are already competing for scarce workers. Botswana is in the opposite position. Businesses are not struggling to find workers. Workers are struggling to find businesses willing to employ them.
The employers say the law is wrong. The union says the law is right but the state cannot deliver it. Both spent eight years in the room, and both conclude that 1 September will arrive too soon.
One might have expected provisions encouraging apprenticeships, youth employment contracts, startup exemptions or incentives for firms hiring first-time workers. Such measures could have complemented stronger protections while recognising the country’s most pressing reality, which is too few jobs. This is fundamentally an employment protection law. It is not an employment creation law.
This is not an argument against protecting workers. But a young person without a job enjoys none of the protections in this Act. Labour rights begin only when employment begins.
Perhaps the oldest rule of economic governance is this: first create the jobs, then regulate them. Rights at work are meaningful only when people have work in the first place.
Unemployment figures are drawn from Statistics Botswana’s Multi-Topic Household Survey 2024/25. Business Botswana’s advisory note to members is dated 10 August 2026.