Collective Bargaining Agreement: National Employment Council for Municipals and Allied Institutions: Levy Deduction Agreement, 2026
Urban councils and municipal employers must pay a 2% levy on every employee's gross earnings, including all allowances, to the Municipals NEC — backdated to 28 January 2026, with failure to remit a breach of a registered agreement.
A 2% levy is now payable for every employee in the municipals and allied institutions undertaking. It is calculated on gross earnings inclusive of all allowances, not on basic pay, and it runs from the date an employer joins the National Employment Council.
Who actually bears the 2% is not clearly drafted. The agreement says there "shall be a levy deduction of 2% per employee, with the employer paying the same for every employee" — which can be read as a deduction from the employee's wage, as a charge borne by the employer, or as 2% from each side. Employers should get a Council ruling before setting up the payroll deduction.
Remittance is due within the period prescribed by Council resolution, which the agreement does not state — so the deadline has to be obtained from the NEC directly. Failure to deduct and remit is a breach of a registered collective bargaining agreement and attracts enforcement under the Labour Act.
The scope is broad: every city, municipality, town, urban council, local board and any business entity wholly or partly owned by them and admitted to the Council, covering permanent, contract, fixed-term, seasonal and probationary employees alike.
The agreement takes effect on its registration date of 28 January 2026, was signed on 1 March 2026 and gazetted on 15 May 2026 — so employers are picking up an obligation that has been running for several months.
What changed
- A 2% levy per employee is introduced, calculated on gross earnings inclusive of all allowances
- The levy runs from the date the employer joined the National Employment Council
- Employers must deduct and remit within a period set by Council resolution, which the agreement does not specify
- Failure to deduct and remit is a breach of a registered collective bargaining agreement, enforceable under the Labour Act
- Coverage extends to permanent, contract, fixed-term, seasonal and probationary employees
Who this affects
- cities, municipalities, towns, urban councils and local boards
- business entities wholly or partly owned by urban councils
- employees of municipal and allied institutions, permanent and contract alike
- payroll administrators at local authorities
- the Municipal Workers Union of Zimbabwe and other unions party to the Council
Plain-language summary — not legal advice. Always read the full instrument.