A sweeping Labour Laws (Amendments) Act, No. 4 of 2025 has just been enacted, bringing major changes to Tanzania’s labour law framework. The aim is to modernize the Employment and Labour Relations Act (ELRA) and related laws to improve workplace fairness and flexibility. Key highlights include new rights for workers, tighter dispute rules, and updated work-permit rules for non-citizens.
On the worker protections side, the amendments introduce several new concepts. For example, the law now explicitly allows employees to take unpaid leave of up to 30 days with written employer. This could help workers with personal issues without losing their jobs (previously unpaid leave wasn’t addressed in Tanzanian law). Employers must be careful to process leave applications formally. The amendments also strengthen the dispute-resolution process: if a worker files a grievance, employers cannot continue disciplinary action on the same issue while the case is pending at the Commission for Mediation and Arbitration (CMA) or in. In practice, this means employers must halt any fired or written warning process once an official dispute is in play.
Another big change involves remedies for unfair termination. Before, a wrongfully fired employee could only get 12 months’ wages at most. Now the law ties compensation to the type of. For a dismissal based on procedure alone, the cap is between 6 and 12 months’ salary; for unfair reason dismissals it’s up to 18 months; and if both unfair procedure and reason apply, the ceiling is 24 months’. Cases involving discrimination or harassment also see up to 24 months’ pay. These caps create a predictable range of damages, but firms must beware – the actual award can still be high, and companies must budget for potentially larger payouts. Importantly, reinstatement (returning the worker to the job) remains an option under Section 40 of ELRA; so legal advisors should consider whether to seek or defend against reinstatement in court.
The amendments also affect collective bargaining. Now collective agreements are binding on public institutions once approved by the Permanent Secretary of the relevant ministry. This means that if a union reaches a deal, government-run hospitals, universities, etc., must abide by it. In addition, the law now allows multiple trade unions to negotiate a single agreement, giving more flexibility to labor groups. On mediation, the law adds that parties must personally appear (or appoint someone in writing) at mediation hearings, and it sets a strict 30-day deadline to move a dispute to arbitration after failed. These procedural rules aim to speed up dispute resolution.
Crucially, the Labour Amendments Act also updated the Non-Citizens (Employment Regulation) Act (NERA) 2015. Among other changes, foreign investors holding Class A work permits can now engage in multiple businesses with one permit – they only need a tax clearance and authorization for each new. Prior law required a separate permit for each company. The amendment reduces red tape for expatriate entrepreneurs and supports investment. The law even allows recognized refugees to hold a valid work permit so long as their refugee status remains in. In practical terms, companies hiring foreign experts should note the new renewal rule: work-permit renewals must be applied for 60 days before expiry, giving government time to process. Lawyers advising international firms will need to update compliance systems accordingly.
Overall, the 2025 labour law changes reflect a push to balance worker rights with economic flexibility. For both employers and employees, the advice is to review policies and contracts. For example, employers should revise employee handbooks to include the new unpaid-leave policy and note the higher compensation caps for unfair firing. They should also set up tracking for permit expirations (to meet the 60-day rule) and get ready to negotiate with unions as new bargaining rules kick in. Workers, on the other hand, have stronger legal footing: those wronged by unfair dismissals or workplace bullying now have clearer remedies and recourse.
Legal professionals should digest these reforms carefully: they rewrite key sections of Tanzanian labour law. Compliance is critical, because failure to follow the new rules (for instance, denying a worker due process or failing to process a permit renewal properly) could lead to Tribunal cases or hefty compensation awards. Ongoing cases might even be affected: imagine a pending unfair dismissal suit, now with potential compensation up to two years’ salary. In sum, the Labour Amendments Act opens a new chapter in Tanzanian employment law – one emphasizing fair play for workers, while aiming to keep the economy nimble for investors. Smart businesses and their lawyers will take note.
