AFHRMA
Regional Report - April 2007

The region's macroeconomic status

The region is still lagging behind the global economic growth trends. However, to some extent the region has made progress in some areas while in other areas it is in a regressive direction. Countries such as South Africa are experiencing economic growth of 5.5% while on the other hand a Zimbabwe is faced with a number of social, political and economic challenges with over 1700% inflation rates. The political instability in countries like Somalia poses challenges for HR professionals on the continent.

HIV/AIDS continues to pose a threat to the efforts of HR professionals in the workplace.

Some Governments, in the face of globalisation, have amended the existing employment acts / labour laws, eg Uganda, Swaziland etc, to address the changing business environment. A lot of focus has been placed on the rights of employees in the workplace through occupational health and safety laws, Workman’s compensation laws, etc

With a focus on good corporate governance on the continent there is a great amount of opportunity for the institutionalisation of professional HR best practices.

National associations
Notwithstanding the challenges facing the continent and the HR profession as a whole, there is continuous growth in individual countries in the area of HR activities. The national associations at large are recording increased growth in membership and HR events, however the challenge that the region faces is the continued individualistic approach the HR activities at a country level as opposed to the continental level.

There is a marked competency shift for human resources professionals, as most of the country associations are focusing on ways of uplifting the HR profession including certification initiatives. Universities and Institutes of management are providing programmes in the HR professions while some are taking initiatives to partner with world re-known gurus to provide a better insight into the HR profession for their members.

However, a more concerted approach on the continent is required to drive the young federation into the future. Efforts have also been made to win over the rest of the continent membership through serious negotiations with the AFIDP but this is yet to be achieved.

SWAZILAND

Swaziland’s average economic growth was 1.2% in 2006 compared to 2.0% in 2005 with a projection of 1.0% in 2007. The IMF global reports have highlighted the HIV/Aids prevalence at 38.8% of the population, 30% high unemployment rate, poverty and high-income inequality whereby 70% of the population lives below the poverty line. To boost the economy, the weakening currency i.e. the Lilangeni (Rand)/ US Dollar exchange rate has helped enhance the competitiveness of the manufacturing and other export sector such as tourism.
To curb the high level of unemployment, Government’s focus is on developing the cotton industry to promote textiles and clothing in the country and also to grow drought resistant crops to improve the lifestyle of the people. This has seen a growth in Textile jobs mainly driven by Asian investors in the past five years or so.

On the political front, not much has changed since the last report in November 2006.

Challenges facing HR practitioners in Swaziland

The HR profession has not been given the utmost importance it deserves in Swaziland. This is worsened by the increased textiles firms with investors that do not want to adhere to country’s labour laws.

However, practitioners in the field have raised concerns and most organisations have started viewing HR practitioners as strategic business partners. This has been made more possible by globalisation, with a more complex global expectation of the HR role in the multinational businesses to add value just like any discipline or function.

All the labour laws now have a clearly definite impact on HR practitioners because of the recent adoption of the Kingdom’s constitution, which entrenches fundamental worker rights and employer’s rights to a certain extent to be overriding any other laws.

The challenges posed by the HIV/AIDS pandemic and highlighted earlier remain a focus for HR practitioners.

Lastly the code of ethics for the HR profession is to be a major priority for the 2007 for the Institute.

MALAWI

Challenges facing Malawi 2007

Political

Political landscape is tense with a lot of antagonisme despite the fact that the present regime has tremendously changed a lot of things positively resulting in the World Bank and IMF writing off debts amounting to 2.9 billion United States Dollars. The food security outlook remains good with an expected surplus in maize which is the staple food of the country. The impeachment was dropped after the High Court found out that the procedures were not in line with principles of natural justice. However, attempts have been made to re-draft the same but they have not yet been presented in Parliament for adoption.

Political bickering is still going on with members of Parliament rejecting the proposed mini-budget. The country realised a heavy saving from the debt relief it received from Bretton Institutions and wanted to use part of the proceeds for developmental projects. Despite this noble cause advanced by the Government, Opposition members of Parliament declined the approved the budget.

The bumper harvest is expected this year which may provide direction to government focus on issues of national development other than the hunger crisis which may lead to job creation.

Good corporate governance is the main driver of value in an economy and is being seriously advanced by Malawi Government Adherence to good corporate governance would speed up economic development of the country. All companies are encouraged to practice good corporate governance in order to attract investment with subsequent results of job creation so as to increase social status of employees and society as a whole.

Economic

Malawi is relatively an unproductive colony with no mineral wealth and only limited potential for plantations. The limited natural resources and in the absence of significant industry, the economy has been dependent on its agricultural exports, mainly tobacco, sugar and tea and on the limited tourism for foreign exchange earnings. Tobacco alone accounts for over 60% of those earnings. The majority of the population remains in the rural areas, mostly living as subsistence farmers, 85% of who are below the absolute poverty line.

Coupled to this, the poor macro-economic policies of the previous government had led to a high debt burden, suspension of donor aid which led to high domestic borrowings and high interest rates. There was a lot of positive sentiments on each of these factors after a new government was elected in 2004 and there was a beginning in reversals in the upward swing of most factors. Inflation has been running at around 16% in the year before.

The economic base of Malawi is narrow and depends mainly on its agricultural exports to earn foreign exchange. Manufacturing is not so much advanced hence the country heavily relies on importation of materials from other countries such as South Africa etc and is labeled as a net importer. The present Government is trying to transform the economy to a predominantly exporting country. Attempts are being made to start mining Uranium at Kayerekera as an alternative foreign exchange earner though on a smaller scale.

The Government heavily relies on donor support for its budget support. The kwacha has remained stable at K140 to a United State Dollar while the bank rate has been reduced from 25% to 20 %. The volatility of the kwacha and high interest rates are likely to affect operations in the country. Despite the adverse effects, it s expected that the economy would grow by 6%.

The fuel hikes in the international market has a direct impact in the local market with subsequent results of pushing up prices of commodity. The first quarter of 2007 the price index has remained stable and no further increase is expected. The oil prices in the international markets stabilised after a very big swing which threatened the country and the world as a whole. This has enabled employees to have a cushion on their purchasing power as prices of essential commodities has not substantially increased.

The inflation rate is around 9% but it expected to decrease with the availability of food after harvest and the debt relief which multilateral institutions have written off. It is expected that interest rates will be lowered hence increased borrowing by companies which may in turn expand their operations and employ more people.

HIV/AIDS pandemic

HIV/Aids crisis is still a major threat world wide though the situation is now under manageable levels with the advent of ARVs and health education on the same. Malawi as a nation is of no exception.

Whilst more workers are affected by the scourge, most employers are adopting the workplace policy on HIV/AIDS with the aim of mitigating the impact of the pandemic on its work force in line with the policy advanced by International Labour Organisation who championed the initiation of the workplace policy.

The coming onto the scene of National Aids Commission (NAC) and formation of Malawi Business Coalition Against HIV/AIDS (MBCA) which has a membership of both private and public sector employers is a big relief to the havoc the disease used to cause to employers as they spent more time and resources on the management of the diseases especially to the affected staff. This has greatly assisted to bring awareness to the workers and tried to promote sound policies of non-discrimination and humane treatment. MBCA has now increased its membership and has entered into alliance with member organisations who have medical aid membership so that their employees may procure ARVs from outlets at a reduced fee.

Efforts are being made to continue to fight against the scourge by among other things encouraging abstinence and creation of public awareness through public health education.

Privatisation

The Government is still pursuing a policy of privatisation having stopped the process for a while for a review. Meanwhile, the Malawi Telecommunications Limited, the sole ground line phone company, has been privatised and Electricity Supply Commission of Malawi and the water boards are being considered for privatisation. Whilst the argument of the sale is being advanced, some groups of people are against the sale for it is argued , it leaves most employees jobless and the benefits of the same are being enjoyed by foreigners and not the locals as they have the financial muscle to purchase the sold companies.

Challenges facing HR practitioners in Malawi

The issue of Pension versus Severance Allowance is still very sticky and efforts are being made to correct the situation. The position is if Severance Allowance is legislated hence its compulsory for an employer to give to an employee once his/her services are terminated whilst pension is not. This has brought a lot of misunderstandings to the Government, employers and other stakeholders like trade union organisations.
Most employers are operating pension funds hence payment of severance allowance is viewed as double payment to employees who are on pension since the organisations are already contributing towards the funds.
A draft bill was drafted and sent to Parliament but due to insufficient time, it was not deliberated hence the status quo remains. This means that at present some companies stopped remitting pension funds to insurance companies pending the revised position.

The Government has drafted the Retirement Bill which will shortly be enacted into law. However, once the bill will come into force several things on administration of security for employees will have to change as well since the new law among other things advances for the employee not to have access to his money until he or she finally retires. This is a new phenomenon which Malawian employees will have to live with and adopt. However, debate is being advanced about the inflation and the use of the same as security in case where one wants to acquire a loan.

Change Management is a feature which is prevalent in Malawi. As reported in the previous situational country report, the change to multipartism coupled with the various amendments and repeal of various pieces of legislation, labour administration has posed challenge to various groups of people especially the labour administrators. The coming into the scene of Industrial Relations Court has eased a lot of labour problems as so many cases are being ferried to the court for settlement.

Qualification Framework- Malawi is currently working on coming up with the Qualification Framework for Human Resource. The Institute of People Management of Malawi initiated the process in order to grade its members so that they are properly graded. This is a necessary tool in terms of segmentation of the practioners in the field of human resources.

Gender Equality – Malawi is also facing the global war on gender equality whereby men and women should be treated the same if they have the same qualifications or doing a similar job. It would still appear that women are still earning less than men even though they are equally qualified.

Conclusion

The advent of globalisation has made it a necessity for Malawi human resource practice to be in line with the international standards. The need for well trained human resource managers with new skills, knowledge and attitudes is becoming a requirement in order to be able to cope with the current dispensation.

The Institute of People Management of Malawi is tirelessly working towards professionalising the practice of human resources by among other things advocating for the certification of members and encouraging them to enrol for courses which may be relevant for advancement in their calling. The institute has also initiated a Continuous Professional Development (CPD) as one way of ensuring that the practising members are kept up to date with the current thinking in the HR profession.

Members who join the Institute are encouraged to subscribe to People Dynamics and World Link in order for them to acquire knowledge and skills required in their field of specialisation.

Institute of People Management of Malawi has drafted the code of ethics which will regulate the conduct of its members.

All in all, the new policies being introduced by the Government may necessitate job creation which will in turn reduce unemployment levels.

UGANDA

Uganda is one of the East African countries covering a total surface area of 241 thousand sq. km. According to the World Development Indicators of 2005, Uganda’s population is estimated at 28 million people with an annual population growth rate of 3.5%. Literacy rate among the youth female (aged 15-24) is estimated at 71%. Prevalence of HIV among the working population is 6.7%.

The Poverty Eradication Action Plan (PEAP) is Uganda’s overarching development framework. One of the objectives of PEAP is the promotion of employment creation through labour-friendly technology and the development of a new economic order.

It is also worth noting that new labour laws governing employment in Uganda are in effect as of June 2006 following a review and some amendments by GoU.

Macroeconomic Data

Analysis of the labour market in Uganda is based on the available indicators as per the last Uganda National Household survey conducted in 2002/03. The Uganda labour force is estimated at 9.8 million of which 53% are female. Overall, 36% of the Uganda labour force are working poor (3.5 million persons) of whom nearly half are employed in agriculture. The share of wage and salary in non-agricultural employment is very small. The share of women in non-agricultural employment is 28%.

The overall unemployment rate in Uganda is 3.5%. The unemployment rate for females is 17%. The urban unemployment rate is at 12%. Generally, unemployment for youth is 6.3% and is highest among female youths (8.8%) than for males (7.5%). The national underemployment rate stood at 17%.

HIV/AIDS continues to be a major threat to employment objectives and labour market efficiency. The loss of competent employees due to AIDS related-illnesses and/or absenteeism due to the demands of caring for people living with AIDS has an impact on productivity, income generation, skills, knowledge, talent and experience in many organisations. The effect of HIV/AIDS on employment is very much an HR issue and a major challenge for practitioners.

Human Resource Management in Uganda

As presented in our report at the last WFPMA meeting, according to the Pricewaterhouse Coopers salary survey report (2004), the value of the human resource function in organisations is being realised and thus giving HRM its strategic importance both at management level and in the boardroom. Companies and organisations that have taken up, and put into practice the Human Resource function have no doubt registered success.
At the academic level, most higher institutions of learning in Uganda continue to offer Diploma, Degree and Masters programmes in Human Resource Management, Organisational Psychology, to mention a few. Managers in other professions are also realising the need for HR competences so as to achieve results and have opted to pursue relevant short courses as well as diploma programmes. However, the focus on sciences subjects and disciplines by the Government of Uganda led to the total withdraw of sponsorships /scholarships at the University for all undergraduate and graduate programmes in humanities.
Challenges facing Human Resource Management in Uganda
The struggle to build credibility for the HR Profession is ongoing. Many of the challenges for the HR practice are related to socio-economic factors.

a. Selection and recruitment – Getting the right people for the required positions continues to be a challenge. While there is a lot of support and tools used for determining the fit in terms of skills and knowledge, there is a great lack of tools to use to get the attitude/behavioural or character aspects right. Apparently, the aptitude and personality tests can be easily manipulated to show what is desired rather than what is really true. Considering that success of an individual in a role is over 70% determined by the attitude/character part, this remains a huge challenge to any person involved with recruitment.

In addition, many companies do not have the funds designated to advertising open positions to a larger pool of suitable candidates, which restricts selection and recruitment options. The ‘under table’ practice of hiring for the wrong reasons deters hiring managers from recruiting the suitable people for the job. In the long run this translates into poor productivity.

b. Compensation and benefits – the tight economy makes it impossible for companies to research prevailing market wages and implement competitive salaries. The downside of this, even productive employees are not performing to their full potential because there is no incentive to do so. Organisations still see employees as ‘another’ expense instead of an asset [human capital] with a potential to increase productivity.

c. Performance management – many organisations do not have clearly drawn evaluation policies. Employee accountability is thus not properly developed or given significance. Employees cannot make the connection between their efforts, pay and the bottom line. On the other hand, some organisations are adopting the balance score card approach to performance management in organisations.

d. Training and development – few companies have a fully-fledged HRD function. Developmental assignments that provide for educational / training opportunities for HR professionals and employees in general are overlooked. This could be explained by the economic factor and failure to quantify the HR role to the bottom line.

Notwithstanding the above challenges the HRM profession in Uganda is registering tremendous growth and increased interest by all stakeholders.

HRMAU profile and activities

The Human Resource Managers’ Association of Uganda (HRMAU) is a professional membership association for human resource management practitioners as well as public institutions with a Human Resource function. The Association is affiliated to the World Federation of Personnel Management Associations (WFPMA) through the African Federation of Human Resource Management Associations (AFHRMA). In Uganda, the Association is affiliated to the Federation of Uganda Employers’ (FUE).

HRMAU’s Mission is to institute standards, enhance development and promote HRM as a strategic function in organisations. HRMAU’s vision is to be a leading professional association in people management that enhances competence, productivity and quality of life in the region.

HRMAU represents interests of over 5,000 HR professionals of which about 4% are registered members of the association. Registered membership increased from 18% in 2005 to 24% in 2006.

A strategic plan is in place to facilitate the Association to achieve the following objectives below:
• To network with stakeholders to influence formulation of policies that favour the association, create synergies and share best practices
• Develop, update and disseminate quantitative and qualitative Human Resource Information Systems to stakeholders
• Develop, implement and update HRMAU code of conduct and certification standards to guide HR practices in line with existing international standards.
• Market and publicise the HRMAU to the stakeholders to create awareness and promote HR function.
• Develop and implement resource mobilisation strategies to ensure sustainability of the association.

Implementation of the Association’s strategic plan is under way. The Focus this year is primarily on:

• Increasing strategic partnerships and networking
• Mobilisation of members
• Improving the communication system to all stakeholders. A proposal to develop a website has been put forward to the Governing Council and is being considered
• Publicity of the Association

Capacity building opportunities for members have continued through presentations and discussions at breakfast meetings. Topics discussed include Breast Feeding at the Workplace, Benefits of E-Recruitment to Uganda etc.

Certification of members is still a challenge. The certification proposal is yet to be discussed with all relevant stakeholders. A committee has been constituted to follow up the issue.

Competency shifts affecting human resources professionals

Internationally the human resource profession is evolving into a strategic and professional field of practice with proper certification and codes of conduct. Uganda is also beginning to evolve towards a more strategic and professional focus to meet workplace demands and align with International standards.

Internationally, there are several certification bodies and the Ugandan practitioner can decide to obtain any, although it seems to be quite expensive and difficult to accomplish.

In order for the Ugandan HR practitioners to adjust to these changes and match the challenges we need to develop the means of having localised certification for all Human Resource practitioners/personnel in a bid to maintain established professional standards at the workplace.

Currently we have various Universities offering Bachelors and Masters Degrees in Human Resource Management and Organisational Psychology. We also have the Uganda Management Institute which is offering the Postgraduate Diploma in Human Resource Management.

Common competences to all HR specialties include for instance - strong interpersonal skills, communication skills, problem-solving and customer service skills. Depending on which area of specialisation, essential and suitable skills for facilitating a ‘strategic role’ for an HR professional include but not limited to:

1. Team building, facilitation and diagnostic skills – essential for incorporating and translating employee concerns into the organisation’s bottom line. This is synonymous with effective leadership skills.

2. Strategic contribution – this requires innovativeness to create and utilise business strategies and techniques that align HR programs with business priorities. If HR is to be recognised as a business partner, there is need to focus on areas that provide value to an organisation. HR professionals need to be proactive and provide guidance on strategic issues related to employee issues. Cost effectiveness is significant in 3 areas of interest to most organisations with a well defined HR department – a) engaging, measuring and rewarding performance, b) attracting, developing and recruiting talent, c) controlling and reducing employee costs.

3. Change management - The ability to anticipate change and put systems together that can rapidly align employee behaviors with the evolving organisational needs – case in point during mergers and acquisitions, preparing employees for lay offs. This is becoming very important as globalisation takes root.

4. Development and training –employees need to ‘grow’ in their careers. This should be reflected in HR policies set to develop and retain talent.

Key to the above is establishing and following a code of conduct. This issue has been planned for in the Associations strategic plan.

As presented in the last report, before, HRMAU proposes an exam to form a base for the certification. For the Association to start the process, we are recommending the following:-
1. National standards defining the work performed by HR practitioners in Uganda to form the platform for law/policy development.
2. The required core capabilities defined.
3. A verification process for assessment of candidates and administering of the exams.
4. Standardised procedures to ensure that those achieving the designation are meeting and continuing to meet high levels of expertise and competency.
5. A disciplinary committee to deal with the people going against the set standards.
6. A circulation of the core competences to tertiary institutions offering HR and related courses.
Certification of individuals can take place when all academic and experiential requirements are met. The process would be on going and involving recertification where certified professionals must commit to continuing professional development to maintain certification.

The Certification process:

A three-step process is proposed:

1. Completing an academic program of courses
2. Two years experience before undertaking professional exams
3. Completing the professional exams:
• The knowledge exam
• Professional practice assessment (PPA)
4. Keeping current by recertifying

To maintain certification, the Association shall require HR professionals to recertify every three years. Recertification can be obtained by documenting 60 hours of professional development experience including continuing education, instruction, on-the-job experience, research and publishing, leadership activities, membership in a national or international professional organisation such as the Human Resource Managers Association of Uganda (HRMAU), CIPD or by retaking the examination ("recertification by examination") at a fee.

All certified members shall have clear identification for the period of validity.

Upcoming Event
1. HRMAU annual general meeting to be held in Mid June 2007

ZIMBABWE

The social, political and economic challenges Zimbabwe faces are well-known. No official report has been received from Zimbabwe IPM in the last year, but political instability and an inflation rate of 1700% indicate the issues HR professionals in the country are having to grapple with.