Employers forgo bonuses

Debra Matabvu —
A number of private companies are unlikely to pay annual bonuses to their employees this year due to subdued industrial performances brought on by challenges in the broader economy, it has been established.

Though some firms have returned to full operational capacity in response to major Government interventions, many others did not make profits in 2016 and cannot afford the 13th cheque.

According to the Confederation of Zimbabwe Industries 2016 Manufacturing Sector Survey Report released last week, capacity utilisation rose to 47 percent from 34 percent in 2015.

However, the larger proportion of companies surveyed said their viability position remained unchanged, with 36 percent registering a decline and only 4 percent improving.

The report shows that a good number of organisations that were previously competing with large-scale imports were now operating at full capacity, thanks to Statutory Instrument 64 of 2016 which restricts importation of products that can be manufactured locally.

Manufacturing capacity for foodstuffs is 56 percent, while that for drinks, tobacco and beverages is 52 percent.

Employers’ Confederation of Zimbabwe executive director Mr John Mufukare told The Sunday Mail, “The term bonus is interpreted differently by people. For some, it is a 13th annual payment which is a right, whilst others know it is a benefit or privilege only to be paid as appreciation for increased productivity.

“With the reduced productivity in our country now, very few organisations are profitable enough to pay bonus. Most workers in the private sector are not expecting a bonus,” said Mr Mufukare.

Human resources and management consultant Mr Memory Nguwi advised companies facing cashflow problems to withhold bonuses to keep afloat.

“The first challenge is that most companies are already in normal salary arrears, and giving out bonuses going forward would affect sustainability, especially given that companies do not perform very well during the first quarter of the year,” he said.

Zimbabwe Congress of Trade Unions secretary-general Mr Japhet Moyo said certain sectors posted profits in 2016 and should pay bonuses.

“It really depends on individual companies, the picture is mixed. It is not 100 percent doom and gloom. Some are struggling to pay salaries and wages such that they may not be able to award the bonuses. But those doing well might be able to afford.

“Some sectors such as the food and beverages are doing well and are in a better position to pay compared to other companies in other sectors.”