Protection of Employees upon Corporate Liquidation: A Case of the Companies Act, [Cap. 212 R.E. 2002].

Abstract

In many jurisdictions, there has been a positive response in respect of legal protection of employees as the bundle of rights and entitlements being enshrined in the employment contract. The same is emphasized by the international instruments in that without fair and effective laws, the rights or entitlements of employees would be jeopardized. Having relevant laws which are by themselves deny or rather less favourable to the employees is illogical and hence injustice in the letters of law. The Tanzania, in particular, the legal protection offered to the employees as a result of company’s liquidation is questionable. This paper, therefore, examines the legal framework revolves around company’s liquidation and the associated adverse effect to the employees. It depicts the scope of protection of employees under the Tanzania Companies Act, the expected reasonable protection standard and the implication towards employees upon company liquidation. It is governed by the main objective which is to assess the effectiveness of Tanzania Companies Act Cap 212 R.E 2002 on the protection of employees and to draw experiences from other jurisdictions in treatment of employees as specific objective, and finally recommends the way forward in terms of changing the law in Tanzania regime for the best interest of employees.