Saturday, July 13, 2024
NewsAs foreign banks circle, Ethiopia's unions demand representation

As foreign banks circle, Ethiopia’s unions demand representation

Representatives of workers in the finance sector have issued an urgent demand for authorities to respect the rights of labor unions, as foreign banks prepare to tap into Ethiopia’s age-old reserve of the finance system.

Representatives of finance sector workers, organized under the Confederation of Ethiopian Trade Unions, have urged authorities to ensure labor union formation is respected as international banks gain entry to the sector.

For too long, finance workers have operated in a union-less system that has left them at the mercy of management whims, according to the Industrial Federation of Ethiopian Financial Institution Trade Union, one of the entities that make up CETU.

Without clear union protections in place, the Federation warns, a lack of industrial peace may follow, which risks undermining government aims.

The call for respecting labor union rights in the sector comes as the National Bank of Ethiopia (NBE) prepares to open up the banking sector to foreign competition. The Council of Ministers approved a policy liberalizing the banking industry.

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Several multinational lenders have expressed interest in joining the sector, including Kenya’s KCB Bank, the Commercial Bank of Egypt, and Standard Bank, among others.

There are currently 31 banks, 17 insurance companies, and 41 microfinance institutions in Ethiopia. The Federation represents workers at 21 banks, six insurance companies, and three microfinance institutions.

“Investors entering the country must adhere to Ethiopia’s laws and regulations, and authorities must ensure any policy or legal framework complies,” said Desta Berhe, president of the Industry Federation.

Ethiopia’s labor proclamation for private entities allows workers to form unions, while a separate proclamation that governs government workers prohibits them from doing so.

Another regulation stipulates that banks must join the Ethiopian Workers’ Union to operate in the country.

“The foreign banks, upon entry, will be governed by the same rule,” Desta added.

All foreign bank employees also have the right to join the labor union to access protections and negotiate better conditions, according to Desta.

The regulations also ensure foreign banks comply with Ethiopia’s existing labor laws governing remuneration, social security, and working hours.

The Federation also wants to invest in foreign banks if they float shares publicly upon establishing operations in Ethiopia. Desta believes this strategy will protect workers in the event of an exit.

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