‘Pay freeze protests will hurt workers’

POLICY analyst Butler Tambo says trade unions should consider calls by Reserve Bank of Zimbabwe (RBZ) governor John Mangudya on its merits because their strike threats against a salary increment freeze would further disadvantage workers.

BATANAI MUTASA
OWN CORRESPONDENT

Tambo told Southern Eye Business that with the high unemployment rate in the country, including many qualified people and the impending labour law reforms, people could easily be fired and replaced, making strikes very risky for workers.

In his January 2015 monetary policy statement, Mangudya said the national economy was not able to sustain further increases in wages and salaries, and that the welfare of consumers and employees should be addressed through the reduction of prices and deflation to enhance the purchasing power of current wages and salaries.

“What needs to be done is to grow the cake, not stifle what we have because if a company cannot afford to pay hefty salaries, who wins?”

“What needs to be done is to grow the cake, not stifle what we have because if a company cannot afford to pay hefty salaries, who wins?”

This, however, sparked retribution from the Zimbabwe Congress of Trade Unions (ZCTU), which said the government should be ready for demonstrations if it implemented the salary freeze.

But Tambo commended efforts by Mangudya to arrest cost drivers in the economy saying he was well within his means since he could not address economic issues from a monetary perspective as the country did not have a currency to manipulate economic trends by printing money.

“What needs to be done is to grow the cake, not stifle what we have because if a company cannot afford to pay hefty salaries, who wins?” Tambo asked.

“Companies are struggling to pay salaries that are there at the moment and if we call for more money, which they cannot meet, it starts legal proceedings which usually lead to the organisations closing. Is it not better to get $250 to $300 per month in your pocket than $1 000 on paper only.

“The monetary authority’s advice is feasible and if you look at the poverty datum line in this country at about $540, which workers consider as the benchmark for minimum wages and offer it to employees in South Africa, they would live more comfortably because their goods are affordable.”

Tambo advised the ZCTU to consider that the economy could not sustain any more cost drivers like salary increments.

Responding to Tambo’s argument, ZCTU president George Nkiwane said the situation was a double-edged sword since workers were disadvantaged in both scenarios.

“We are not calling for unreasonable action for salary increments, but we are in defence of our rights as workers,” he said.

“Therefore, as a matter of principle, nobody should try and interfere with procedural processes like salary negotiations by putting an umbrella freeze on increments.”

He said the union always operated in good faith and some sectors had gone for years without salary increments, but such situations arose through negotiations where employers brought their arguments to the table and a mutual understanding was reached.

Nkiwane said Mangudya’s call for the nation to focus on price reductions and not salary increments was tantamount to putting the cart before the horse.

“We should see price reductions first because as it is, the cost of living is high and people need more money,” Nkiwane said.

“In salary negotiations, if a company says they cannot afford to pay more and proves it, we agree and back down.”

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