No salary increase for Zim tobacco employees

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THERE will be no salary increases for employees in the Zimbabwean tobacco industry as operating costs rise and earnings from the golden leaf decline on the back of lower prices and lower quality, with about 201.5 million kilogrammes sold by September 9.

Most companies are bearing the burden of poor productivity in Zimbabwe, worsened by low commodity prices and a biting economic environment. Other companies whose employees have had to skip salary raises include workers at Zimplats, the Zimbabwean unit of Impala Platinum.

Employers and employees

The Zimbabwe Tobacco Industrial Workers Union and the Tobacco Industry Employers’ Association have agreed to stay a salary raise for workers in the industry for this year.

Zimbabwe is a major tobacco producer and sells its flue cured leaf to markets such as China, South Africa and others.

“The 2015 wage rates shall be maintained for the period January 1 to December 31 this year,” reads an agreement brokered between employers, employees and the National Employment Council for The Tobacco Industry published in the government gazette published on Friday.

The agreement has been signed by Terrence Kwaramba, the chair of the tobacco industry employers association, and Emson Sibanda, general secretary for the Zimbabwe Tobacco Industry Workers Union.

In 2015 a collective bargaining agreement for the tobacco industry set the minimum wage for the sector at $209.36, after parties to the industry agreed on a 2.5% raise.

Zimbabwe has so far exported about 81 058 tonnes of tobacco and earned about $592.6m from tobacco sales. This has come as a boon for the cash-starved and struggling economy, according to statistics from the Tobacco Industry and Marketing Board.

Worsening prospects

British American Tobacco is one of the major cigarette manufacturers in Zimbabwe, while there are also other smaller players such as Savanna Tobacco.

Most farmers are however now taking up contract farming. Several others have been affected by the El Nino phenomenon while irrigation sources are drying up, worsening prospects for a rebound.

Tobacco producers are among Zimbabwean exporters that will be given a 5% incentive to their earnings. The incentive will be paid in the new Zimbabwean bond note currency to be introduced by the Reserve Bank of Zimbabwe next month.-Fin24

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