Huge salary imbalances to be addressed

via Huge salary imbalances to be addressed – NewsDay Zimbabwe April 8, 2016

The Ministry of Public Services, Labour and Social Services has started laying the groundwork for revamping the legal and institutional framework for wage determination in the country, a senior official in the ministry has said.


Speaking at the National Economic Consultative Forum validation workshop on wages study report, Secretary for Public Service, Labour and Social Services Ngoni Masoka said stakeholders had expressed concern that labour costs in Zimbabwe were relatively higher than in other African and Asian countries. Such a situation had negative impacts on employment growth, prices of goods and services as well as the competitiveness of local products on the regional and international markets, he said.

“Even as we discuss the modalities of aligning remuneration with productivity, we must reflect on the huge pay disparity currently obtaining in country. Though this now seems to be a global concept, Zimbabwe must have its own homegrown solution. Huge salary imbalances can send negative messages throughout the firm, weakening loyalty and eroding the talent pool,” Masoka said.

He said such inequality also resulted in low staff morale and companies risked suffering from lower productivity once employees were aware of the disparity.

“I am informed that the study we are gathered to validate today covered a lot of issues relating to wages and salaries in Zimbabwe. However, of particular interest to us as policymakers is the analysis of wage determination system in both the public and private sectors and its impact on the economy.

“It is, therefore, my fervent hope that guided by the findings of this study discussions, stakeholders will focus on how the institutional and legal framework for wage setting could be revamped to bring about a remuneration system that promotes productivity, employment growth and national competitiveness.”

Masoka said the stage was set for a fruitful deliberation that should eventually lead to robust policy recommendations on how to achieve a sustainable and equitable wage structure in the public and private sectors.

The Labour Amendment Act passed last year streamlined issues of competitiveness and productivity into the wage determination processes.

The provisions on collective bargaining now compel parties engaged in wage negotiations either at the works council (company) or at the employment council (industry) level to take into account productivity at the foremost level in setting remuneration levels.

He, however, said the ministry was in the process of expediting the establishment of the Zimbabwe National Productivity Institute which would promote productivity-related rewards in industry as well as its measurement.

“The concept is to come up with scientifically determined benchmarks in order to facilitate productivity-based collective bargaining,” he said.

Masoka said the ministry would reflect on the outcomes of the workshop seriously and any policy initiatives recommended would be considered earnestly.