Employers, labour clash over productivity-linked pay proposal

via Employers, labour clash over productivity-linked pay proposal | The Source  April 30, 2014

Zimbabwe’s trade unions on Wednesday said they will mount protests to block proposals by business and government to adopt productivity linked wages.

With the economy flatlining amid a deepening dollar shortage, government and business appear to have reached consensus on the need to change remuneration structures.

Government has announced its intention to change labour law which will among others make it easier for businesses to hire and fire labour.

But labour representatives told The Source ahead of May Day celebrations on Thursday that the country was not yet ready for productivity linked wages.

Zimbabwe Congress of Trade Unions president George Nkiwane said workers wanted to maintain the current poverty datum line (PDL) linked salaries, currently estimated at over $500.

“We are saying we need PDL linked wages.  We need a living wage, one that can sustain an employee and a family,” Nkiwane said.

He said the productivity-linked wage argument only made sense in an economy where production processes were in order.

“They are looking at one factor of production, which is labour, whereas in production there are several other factors,” Nkiwane said.

“Until we set our production processes to internationally acceptable levels then we cannot link our wages to productivity.”

Nkiwane said it was wrong to penalise workers for issues, such as utility inefficiencies, that were out of their control.

Head of pro-government rival union, the Zimbabwe Federation of Trade Unions (ZFTU), Alfred Makwarimba called the productivity-linked plan a ‘right wing’ proposal.

He said as current wages were already negotiated.

“The call by the right wing force in government to remove negotiated minimum wages, maximum hours of work and replace them with the so-called productivity linked wages must be fiercely resisted,” Makwarimba said.

“Wage determinations are already flexible and liberal enough.”

The ZFTU leader criticised huge gap between the lowest paid and highest paid employees.

He urged government to introduce policies that drive economic growth at the same time improving the welfare of workers.

But  Employers’ Confederation of Zimbabwe (Emcoz) said production aligned wages will help keep companies viable.

“We believe what we take home should be clearly related to what we have produced to ensure continued survival,” said Emcoz director, John Mufukare.

He said if wages were not matched with production it would force companies to borrow at high interest rates to meet the huge wage bills which was unsustainable in an environment with tight liquidity.



  • comment-avatar

    What the workers fail to realize is that the success of their employers is directly linked to the efficiency inherent in the production of their product – on the global stage.

    The fact that Mugabe and ZANU-PF have not nurtured the business environment nor maintained infrastructure is irrelevant to a consumer considering buying a product made in Zimbabwe, whether domestically or internationally. If it costs more because the employees are paid more, then it will not sell and the company will eventually close, eliminating everyone’s job.

    Companies are not in business to provide welfare for the masses. However, Mugabe seems to think that this is government’s job – rather then providing efficient services to it’s citizens, requiring the least amount of taxation for their support.

  • comment-avatar
    John Thomas 10 years ago

    Zimbabwe workers want to be mini Cashberts. They want to be paid even if they don’t work if their unions are to be believed.

    Wages are related to productivity. This is an iron law. It cannot be defied. Political and ideological beliefs are irrelevant in this respect. Earnings cannot be more than the value added unless you take up a career as a bank robber. This is the main reason why good companies are closing down. Owners find it cheaper to cease operations than to continue. A big factor is that labour in the formal sector costs more than it is worth.

    $500 per month minimum wage in a country with an annual per capita income of less than $1000 is not sustainable. This is simple arithmetic. Jobs will continue to be lost until the labour law is changed. Like it or not, this is how it is.

    For hard workers performance based wages offer a chance to earn more than the lazy and inefficient. It follows therefore that it is only the lazy who benefit from the current situation. The unions can best be understood to represent those who do not want to work hard.

  • comment-avatar
    John Thomas 10 years ago

    I might add that managers and shareholders have a lot of waking up to do. Many of our companies problems start with bad management the results of which are then blamed on the workers

  • comment-avatar
    zimbo 10 years ago

    The ZFTU leader criticised huge gap between the lowest paid and highest paid employees. These are you bosses stupid – you guys are the problem with current labour issues.

  • comment-avatar
    Gomogranny 10 years ago

    Until 1) The leaders (political, CEO’s of parastatals, large banks and corporations) get it that a severe pay cut is in order FOR THEM due to the mess they have landed us in. And 2) Our leaders get it that their PAY IS ALSO DRIVEN BY THEIR PRODUCTION then we should not ask workers to understand and accept this concept. That is just plain wrong.

    Once every person had up in the salary gate scandal is fired and charged…. AND once we cut the number of politicians by half – then lets’ talk about workers wages being related to their production……NOT A MOMENT BEFORE. It is not the workers pay that is bringing down companies IT IS OUR GOVERNMENT and our leaders who are doing it.

  • comment-avatar
    henry 10 years ago

    A hard-working employee who performs is in no danger of being fired.

    • comment-avatar
      Gomogranny 10 years ago

      Sorry Henry – that is just NOT TRUE. When a company goes bust due to the policies and people at the top (of both Government and/or the Company) a person can work as hard as they like….he will still be out of a job. It’s happening every day in Zimbabwe. This is simply NOT a workers issue right now IT IS A LEADERSHIP ISSUE. Our leaders appear to be last people assessing their competence and taking a good hard look at their OWN worth (or worthlessness!)