AGRICULTURE outfit Kencor Management Services (Pvt) Limited’s human resources manager Isaac Mazanhi says salary reductions will only affect managers and supervisors, after a leaked memo suggested it would affect all the company’s employees.
Kencor is an established Zimbabwean company that has been in existence since 1978, which operates under National Tested Seeds and FarmShop.
In an internal leaked memo, obtained and verified by NewsDay Business, Kencor chief executive officer John Wilde alerted staff of impending salary cuts.
According to the memo, the company would reduce the cost-of-living allowance (COLA) for affected employees by between 5% and 25%, based on individual performance over the past 12 months.
Wilde said that these cuts would remain in place until the company “returned to profitability”.
“This was an internal memo directed to a section of our staff. As we’ve got three categories of staff: The first one is salary staff and salary staff refers to managers and some supervisors,” the human resources manager told NewsDay Business when reached out for a comment.
“So, they are more like senior level employees. This does not affect the lower-level employees, especially the ones that fall under what we call the National Employment Council. So, those ones are not affected.”
He said the managers and supervisors’ salaries were determined by management, and not to lower-level employees as they were under the National Employment Council.
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“These salary employees have got contracts of employment. Where they signed, there’s a clause on their contracts which splits their earnings or salaries. Part of the salary is basic, what we call basic salary, which is fixed,” Mazanhi said.
“When the company introduced it (COLA) to each one of those employees, what we call a cost-of-living allowance, this varies depending on individual and there are a number of other factors.”
Local firms have embarked on cost-cutting measures to stay afloat amid a deteriorating economic environment in which operating costs have outpaced growth in revenue.
A number of financial institutions have right-sized their staff complements to create a lean and agile structure that responds to changes in the environment.
The situation has been worsened by the depreciation of the Zimbabwe Gold (ZiG) currency amid growing calls for the re-dollarisation of the economy. Government insists the ZiG is here to stay and that it had approved a de-dollarisation road map that would result in ZiG becoming the sole legal tender.
