HomeNewsHands off executive salaries

Hands off executive salaries

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Zimbabwe Congress of Trade Union (ZCTU) should stop demanding that companies paying their executives salaries above $10 000 put a lid on remuneration as those companies are justified by their impressive performances, a human resources consultancy, Industrial Psychology Consultants (IPC), has said.

In April, the labour body’s president Wellington Chibebe said it would embark on a “name and shame campaign” to expose executives, their companies, salaries and allowances, as well as identifying their children’s schools and how much the companies are paying in fees.

However, the consultancy firm said “. . . what should be of concern for the ZCTU is companies that are paying their top executives extremely well, but at the same time underperforming”.

In a report titled, Are Zimbabwean Employees Underpaid? An Analysis of Salary Trends released this week the consultancy firm said the number of employees earning above $10 000 was less than 1%.

“The number of employees earning above $10 000 is less than 1%. In most cases those earning above $10 000 are in companies that are doing well in terms of performance.

“The trend the world over is that salaries are based on level of expertise and performance of the individuals concerned,” reads part of the report.

It said the call to put a ceiling on executive salaries is not wise considering the shortage of talent and the labour body cannot bargain for higher salaries by generalising executives’ earnings.

“The ZCTU needs to understand that attracting some of the skills that are attracting premium salaries will be impossible if they are not paid salaries that are comparable to regional and to some extent international markets,” the report said.

The consultancy firm said according to their findings it is very unlikely that there will be a ceiling on salaries for executives in a long time to come because of the current economic situation. It added that from their research most companies that are paying competitive salaries would be performing well.

“As long as the shareholders of these companies are happy with what their executives are delivering, it is not the business of the ZCTU to put a cap on these salaries . . . It would be interesting to know if the ZCTU leadership earns the same salaries as their lower-level workers,” reads the report.

The consultancy firm said arguments on salaries are advanced without having looked at objective data currently obtaining on the market.

It said a salary survey of 44 organisations in Zimbabwe across all sectors excluding the civil service reveals that only less that 2% of the employees earn a basic salary of below $200.

The survey also shows that only 24% of the working Zimbabwean employees earn below $500 in basic salary per month.

More than 51% of the employees earn over $1 000 per month.

Only 13,8% of the employees earn above $3 000 in basic salary per month and 5,6% of the employees earn above $5 000 per month in basic salaries.

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