The state-owned Herald newspaper reported Wednesday the bill passed late Tuesday in the House of Assembly and now awaits a rubber-stamp from the Senate.
The approval came as the capital's municipality mulled laying off more than 3,000 workers to reduce its wage bill -- the latest in a slew of firings following a court ruling that allowed employers to dismiss workers after giving three months' notice.
"At least 3,000 Harare city council workers will receive their letters of termination of contract on three months' notice today (Wednesday) in line with the Supreme Court ruling allowing employers to sack employees on that basis," the Herald reported.
Unions claim that more than 18,000 people have been sacked since the controversial Supreme Court ruling last month.
Several companies long saddled with huge wage bills and battling to meet operational costs cashed in and sacked workers, including mobile service provider Econet and the state-owned Zimbabwe Broadcasting Corporation, which last week fired nearly 300 employees.
The government introduced the labour amendment bill last Friday, stating "no employer shall terminate a contract of employment on notice unless the employer and employee mutually agree in writing to the termination of the contract."
It also compels employers intending to sack workers to give notice to a works council as well as the government retrenchment board, to determine whether the decision is justified.
The Senate is expected to rubber-stamp the changes to the law on Thursday before long-ruling President Robert Mugabe signs it into law.
Zimbabwe's economy has been on a downward spiral for more than a decade with slow growth, low liquidity and high unemployment.
Many companies have closed, downsized or relocated to neighbouring countries.
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