HomePoliticsRetrenchments take centre stage as economy slips further

Retrenchments take centre stage as economy slips further

Reagan Mashavave

MORE that 400 retrenchments were officially concluded through the Retrenchment Board since the beginning of the year, the Employers Confederation of Zimbabwe (Emcoz) has said.

Analysts said the real figure runs into thousands, as many retr

enchments did not pass through the board as firms scaled down operations or closed down due to the harsh economic environment.

Emcoz, executive director, John Mufukare, told the Independent that since January, 408 retrenchments were concluded through the retrenchment board with 98 of them being managers.

“The majority of the retrenchment cases recorded were labour disputes that went through the retrenchment board, otherwise more cases were solved on employee/ employer basis,” Mufukare said.

Mufukare said the figure of retrenchments is higher than 408 because Emcoz does not have records of cases that were not solved through the retrenchment board.

Hundreds of employees are losing jobs every month as companies are embarking on retrenchment exercises to cushion themselves against the deteriorating macro-economic environment.

There have been massive job losses in the manufacturing sector where companies are operation at below 25% of their normal capacity due to foreign currency shortages and the high interest rates.

The have been job losses in the insurance sector where Fidelity Life Assurance recently retrenched 56 workers.

The group’s managing director, Simon Chapereka, confirmed the lay offs saying the decision was taken in anticipation of a decline in policies.

“We have retrenched 56 workers as we are anticipating a reduction in the number of policies. As you are aware, the minimum value of our policy is going to be costing $1 million,” Chapereka said.

The retrenchment exercise would result in Fidelity Life Assurance closing three more branches following the closure of its Kwekwe branch recently.

Chapereka said that the company anticipates that between 35-40 % of their clients would not be able to carry on with their policies.

Total Zimbabwe (Pvt) Ltd, which recently acquired Mobil Zimbabwe, retrenched 64 workers citing a decline in business activity, the need for rationalisation and duplication of efforts since the two companies were in the same line of business.

Total public affairs director, Stanley Hatendi confirmed the retrenchments in a letter faxed to the Independent.

“During the period 2002 to 2005, there has been a massive drop in business activity making it difficult to maintain overheads and keep business viable. Since the beginning of 2006, this trend has prevailed,” the statement says.

Zimbabwe National Chamber of Commerce (ZNCC) chief executive officer, Cain Mpofu, said his organisation was yet to compile a report on any retrenchments being undertaken by different companies but acknowledged that the were job losses.

“The economic situation in Zimbabwe has made it impossible for companies to operate at 100% capacity. As such retrenchments have become the order of the day,” Mpofu said.

Oil firm BP & Shell closed down its lubricants blending plant in Willowvale due to foreign currency shortages which resulted in more than 40 workers being retrenched.

Zesa Holdings is set to retrench workers after the announcement of its restructuring exercise while Air Zimbabwe is still locked in a bitter dispute on retrenchment packages with its workers.

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