BY Kudzai Kuwaza THE deepening economic crisis, characterised by a rapidly depreciating Zimbabwe dollar, has wreaked havoc on wage negotiations across the 48 national employment councils (NECs).
This comes as the economy has been buffeted by a debilitating liquidity crunch, foreign currency deficit, runaway inflation and intensified power outages.
The Zimdollar has been rapidly losing value, currently trading at between $700 and $800 to the greenback on the parallel market. Officially, the United States dollar is trading for $413,43 to the local currency.
This has led to the continued skyrocketing of prices of goods and services, which are now out of reach of the majority of citizens whose local currency wages have been shredded by Africa’s second highest inflation at 191,6%.
The impact of the economic crisis on wage negotiations came under the spotlight at the Mutual Gains Dialogue held by the Employers Confederation of Zimbabwe (Emcoz) in Masvingo last week.
Addressing participants at the dialogue, negotiation expert and Association of Designated Agents of Zimbabwe chairperson Itai Bonda revealed that wage negotiations were now being held on a monthly basis. The expert explained that this was as a result of the deteriorating value of the local unit which is contrary to section 74(4) of the Labour Act which states that wages should be renegotiated after a period of one year.
“Most employers are paying in a currency that does not store value, which is why we are always coming back to the negotiating table,” Bonda said.
He added that as a result of this, the traditional methods of negotiation are no longer viable.
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Bonda later told NewsDay Business that the perennial negotiations have had an adverse impact on production as workers and employers are constantly embroiled in wage negotiations.
These discussions are around matching wages to the prices of goods and services which continue to rise sharply as they are indexed against the United States dollar.
Bonda also noted that production had been slowed down by workers who have been demotivated by the failure to make ends meet.
He called for salaries to be indexed against the greenback to bring about stability.
NECs co-ordinating committee chairperson Rose Mambo, who was one of the presenters at the Emcoz dialogue, told NewsDay Business that wage negotiations were in disarray as a result of the depreciating Zimdollar.
“The main challenge that we are facing across sectors of the NECs is keeping up with the volatile economic environment. We now have sectors which negotiate monthly and this is not viable for NECs because when they get together to negotiate, it has a huge bearing on costs which includes having to mobilise all those who are responsible for the collective bargaining process,” she said.
“It is also difficult when you have a salary that is continuously eroding because even when you negotiate monthly you can never keep up with the prices which are skyrocketing in the shops. Most sectors are still negotiating in the RTGS. What they would ordinarily present is the breadbasket for a family of six and the poverty datum line but now you cannot talk about that because this has been overtaken by events.”
Mambo said there was need for new strategies to be adopted by trade unions which include frequent visits to retail outlets to track the price increases of basic goods.
She further pointed out that sectors that negotiate using the interbank rate were struggling to keep up because the local unit is losing value on a weekly basis.
“Things are not looking good for consumers. It seems we are chasing the tail. We are in a vicious circle. We do not know what will happen next week or next month,” she said, adding that there was need for a return to dollarisation, albeit temporarily, while putting in place measures to ensure the return of a strengthened local unit through consistent and well-thought out policies that engender trust and stability.
In her presentation, Mambo called for gender parity within NEC structures.
“Women are getting lower positions within the NEC structure. This is something we need to think through,” she added.
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