IN a year in which economic turbulences persisted, Zimbabwe’s industries continued in the doldrums, with hundreds of workers sacked from their jobs. The labour crisis rocking Zimbabwe had until now been compounded by deadlocks at the Tripartite Negotiating Forum (TNF) — the platform that was established to ensure that there is fair ground for labour, business and government. But in this interview with our business reporter, Rugare Mubika (RM), Labour and Social Welfare minister Paul Mavima (PM, pictured), says there was a change in culture during 2022. He says TNF meetings resumed during the year, giving important guidelines to how workers can be remunerated in a tough environment. Mavima also explains what impact giving firms a head start in the aftermath of the Covid–19 pandemic had and explores what should be done in the coming year to address the problems that the labour markets face. Below are excerpts of the interview:
RM: The year 2022 saw the continuation of economic challenges. Workers and consumers in general were not spared. How did government handle this problem working together with labour? And do you think National Employment Councils (NECs) were up to the task?
PM: It is a fact that inflationary pressures, particularly during the first half of the year eroded the value of workers’ incomes. However National Employment Councils (NECs) for various industries engaged in sector collective bargaining to ameliorate the situation by reviewing wages quarterly, with some making up to six reviews.
RM: Give us a review of what took place this year in terms of collective bargaining processes and agreements.
PM: An assessment of the collective bargaining agreements (CBAs) registered in 2022 showed that more than half (56%) of the sectors had minimum wages above the food poverty line (FPL).
RM: With rocketing prices, high inflation and the erosion of the Zimbabwe dollar’s value, unions have been calling for salaries to be paid in United States dollar. How did NECs handled this, together with government?
PM: In most of the NECs have followed the lead taken by the government to give a blended salary structure with part of the salary being paid in United States dollars and the other in Zimbabwe dollars. This not only retained the value of wages but also complimented government efforts to contain inflationary pressures. Suffice to mention that credit also goes to the monetary and fiscal measures put by government, which tamed the rising exchange rate, which was putting pressure on collective bargaining across all sectors.
RM: It means there was progress on the collective bargaining front. What do you attribute the success of blended salaries to? Is this something that is sustainable, given the fact that companies mostly trade in Zimbabwean dollars?
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PM: This in our view shows the strength of collective bargaining at sector level, which takes account of the sector specific relativity in view of the fact that sectors were affected in different magnitudes by the effects of Covid-19 pandemic.
It is a fact, however, that the obtaining minimums are reflective of the situation regarding sectors. The ministry will share the information with other sister ministries within the whole of government approach with a view to collectively finding solutions to improve viability in the sectors that are facing challenges.
RM: What new solutions are available, given the fact that all sectors have been struggling for a long period?
PM: Focus will also be given to those sectors to improve productivity through training and interventions by the Zimbabwe productivity institute, which government is in the process of establishing.
RM: During turbulent times like these, job losses cannot be avoided. What was the impact of the economic crisis on the job market this year?
PM: Statistics from the Retrenchment Board show that since the beginning of the year 881 workers had been laid off with the energy, education and welfare as well as the communications sectors being the most affected.
RM: Was the minimum wage of US$150 that was negotiated by TNF helpful to the labour markets in 2022?
PM: The TNF recommended a minimum wage guideline to sector negotiations. This was arrived at after extensive tripartite consultations. The TNF had noted that inflation was severely eroding workers earnings and at the same time noted the need for businesses to attain viability as they emerged from the effects of the Covid-19 pandemic. The guideline has certainly helped as our assessment shows that the majority (60%) of the industrial sectors had minimum wages above the recommended US$150. There will be a review in the first quarter of 2023 based on obtaining realities across the sectors.
RM: What would you say were the biggest threats to the labour market this year?
PM: Apart from fears of a possible resurgence of the pandemic at the beginning of the year, the erosion of workers earnings by inflation was the main threats. Towards the end of the year the power/energy deficits presented challenges as this increased production costs through alternative energy sources. It also increased man hours lost and productivity.
RM: Looking into the coming year, should workers be hopeful? What is the outlook for the labour market?
PM: Most of the recommendations by workers were taken on board. As a case in point Treasury heeded the call for a living wage by setting aside 48% of the budget for employment costs. The easing of inflationary pressures as shown by the progressive fall in the annual consumer price inflation since August 2022 bodes well for collective bargaining and other social dialogue processes going into 2023.
We are glad that the recently held TNF retreat gave social partners an opportunity to build trust and collegial working relations which are very essential to working towards the conclusion of a social contract, which will give much needed stability for the economy. The retreat also gave the social partners an opportunity to craft priorities for 2023, which will form the agenda and work for TNF in 2023.
