Employers blame job cuts on ailing economy

via Employers blame job cuts on ailing economy – NewsDay Zimbabwe August 10, 2015 by Tatira Zwinoira

EMPLOYERS’ Confederation of Zimbabwe (EMCOZ) president Jack Murehwa has attributed the ongoing massive job cuts triggered by a recent Supreme Court to the poor state of the economy, saying employers were not to blame.

Murehwa told NewsDay last week that the job cuts, which have so far affected nearly 20 000 workers, were a symptom of an ailing economy, adding that the majority of local companies were struggling to keep afloat.

The Supreme Court ruling, which has affected workers in both the private sector and parastatals, gives the employer the right to terminate employees’ contracts at three months’ notice and avoid retrenchment costs. Government has indicated plans to significantly reduce its wage bill, mostly likely through a similar exercise.

“You seem not to be aware of the fact that the majority of companies in Zimbabwe are struggling. Sadly, that fact cannot be hidden to anybody interested in investing in our country. If you are uninformed, all you need to do is to drive around the industrial sites and that will be sufficiently revealing,” Murehwa said.

“A large number of businesses have already closed shop and those that are struggling on are operating and producing way below their potential capacities.”

Murehwa said focus should now be towards supporting, growing and forming new businesses and also come up with “an investor-friendly Labour Act in the concoction to treat the disease that causes job losses”.

EMCOZ promotes and protects the interests of employers in Zimbabwe, by lobbying government on national policies, practices and standards on labour, employment and related socio-economic issues.

“When the decision to amend the labour laws was made, the driving reason was to make it more investor-friendly than it currently is. There was a meeting of the minds on that aspect from government, business and labour. The wish of business, therefore, is that at the end of this project, the three parties would have succeeded in proposing amendments to the current Labour Act that making it more investor-friendly,” Murehwa said

“Any company, or institution for that matter, is going to release its employees into the market if the company or institution is struggling or going to close shop. So the only way to ensure that the employees at work stay at work and more employees are hired is to ensure that the existing businesses are supported and new businesses are encouraged to commence operations.”