DEBT-RIDDEN OK Zimbabwe has suspended salaries and wages for all employees effective May 2026 as it cobbles a last-ditch survival plan amid persistent stock shortages.
The decision was approved by the company's works council on May 22, according to a resolution signed by works council representatives and corporate rescue practitioner Bulisa Mbano of Grant Thornton Zimbabwe.
The parties said the suspension of the payroll and compensation structure was an “attempt to stabilise the business en route to full recovery and mitigate the impact of current poor performance and revenue.”
“The company has agreed with its staff to suspend all salaries and wages with immediate effect and will not run a payroll from May 2026 until further notice,” the resolution said.
The parties described the move as a “difficult and uncomfortable measure” but a necessary intervention in “our efforts to turn around the business”.
OK Zimbabwe entered corporate rescue on February 24, 2026, after suppliers cut credit terms to 1-2 weeks and halted deliveries.
The company said stock shortages triggered a sharp drop in revenue and cash flow, bringing operations “virtually to a halt”.
As of February 28, 2026, creditors were owed US$37,4 million. Supplier debt accounted for US$24 million, with US$5,2 million in utilities, services, marketing and security, and US$880 000 in statutory obligations outstanding.
The retailer last year embarked on a capital-raising initiative to recapitalise the business. It raised US$20 million from existing shareholders and put up assets for sale to raise US$10 million.
The interventions appeared to be too little too late as the retailer has struggled to restock with suppliers demanding cash upfront.
Analysts say the suspension of the payroll is designed to stop digging the financial hole and make it attractive to suitors.
But they cautioned that the no-pay measure may demotivate employees, thereby affecting the turnaround plan.