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Beaven Dhliwayo Features Writer
Government move to increase civil servants’ salaries by 76 percent, with probability of further review is a positive development as it moves to cushion its workers from the obtaining economic challenges.
The noble development will see the lowest paid worker earning $1 023 up from $582.
Despite attacks from the private media that Government’s plan to hike civil servants salaries will escalate inflationary pressures and push the economy deeper into recession, the move will go a long way in maintaining a valued staff and help in recruiting skilled candidates.
Attacking the noble move will probably not deter the determination by the Second Republic to ensure its employees are well remunerated, especially following a wave of unjustified increases in the price of goods and services.
The latest salary increment comes at a time when Government has said all civil servants will get their bonuses for the year in November, with Finance and Economic Development Minister Professor Mthuli Ncube conceding that since the introduction of Statutory Instrument (SI) 142 of 2019, also known as Reserve Bank of Zimbabwe (Legal Tender) Regulations, wage and salary erosion was now a big challenge, hence the need to continuously adjust wages and salaries.
The salary alteration also came as teachers, doctors and college lectures had threatened a crippling industrial action after raising that there are now financially incapacitated to continue reporting for duty.
Government move is thus timely and relevant as it seeks to address the challenges facing its workers.
The workers were clear, that if their employer does not initiate a cost-of-living adjustment (COLA), they will not report for work.
Not reporting for duty will harm the beneficiaries of the service such as school children and those seeking medical care among many people who use Government services on a daily basis.
The world over, strikes that continue for a long time have a negative impact on the economy and do not benefit anyone.
Prolonged strikes hurt both the employer and employees and also have a negative impact on the country’s economy.
There are no winners in these industrial actions.
They hurt both employers and employees the same — employers lose income while trade unions or employees lose wages, which is hard to recover after a prolonged industrial action.
Before attacking Government there is need to understand what COLA entails.
A COLA adjusts salaries based on changes in a cost-of-living index.
They may also be tied to a cost-of-living index that varies by geographic location if the employee moves. In this later case, the expatriate employee will likely see only the discretionary income part of their salary indexed by a differential CPI between the new and old employment locations, leaving the non-discretionary part of the salary, for instance, mortgage payments, insurance and car payments unmodified.
Additionally, annual escalation clauses in employment contracts can specify retroactive or future percentage increases in worker pay which are not tied to any index.
These negotiated increases in pay are colloquially referred to as cost-of-living adjustments or cost-of-living increases because of their similarity to increases tied to externally determined indexes.
Cost-of-living allowance is equal to the nominal interest minus the real interest rate.
COLA is not unique to Zimbabwe.
The Economist Intelligence Unit produces a semi-annual (twice yearly) worldwide cost of living survey that compares more than 400 individual prices across 160 products and services.
They include food, drink, clothing, household supplies and personal care items, home rents, transport, utility bills, private schools, domestic help and recreational costs.
The survey itself is an Internet tool designed to calculate cost-of-living allowances and build compensation packages for workers.
Hence, the decision by Government for a COLA for its workers is noble and should be on-going until such a time that salaries will not be eroded by inflation.
Negotiations for a further salary review, according to the council and Apex Council chairperson Cecilia Alexander, will continue with other non-monetary incentives being considered.
The Government has been continuously battling to address the salaries of its workers who are finding it hard to meet the ever increasing prices of basic commodities in the country.
Salaries were not enough to cover for basic needs, let alone for transport and other costs needed to sustain families.
Those that do not subscribe to the increment of civil servants salaries are the ones that want unrest in the country to fuel regime change.
It is very important that Government keeps revising the salaries of its workers to improve their living standards.
Civil servants had lost their dignity as they are repeatedly mocked by so called dealers awash in the country that school does not pay as they are failing to meet their day-to-day needs.
It is painful to be schooled and fail to put food on the table for your loved ones who look up to you for survival.
Why is a salary evaluation so important?
For one thing, it is good for retention.
While money isn’t everything, it’s certainly a key priority for workers.
Most of the country’s civil servants have vast experience and definitely want to feel they’re earning what they’re worth.
Another reason to do a salary evaluation is that the market value of some jobs changes quickly.
Keeping salaries for civil servants highly competitive gives them an incentive to stay on board.
After all, replacing a good employee nowadays is highly expensive because of lost productivity and training expenses.
Additionally, in today’s competitive market, Government will likely end up paying market value for the replacement of its workers if they are not remunerated very well.
Those who are against Government’s COLA are merely looking at salaries as an operating expense, which might give shocks on the country’s budget, but like any good investment, strong staff salaries can deliver healthy returns.
The whole civil service may look sound and giving an excellent service, but like any other business the true strength of the firm or organisation lies with your people — and top talent deserves to be well remunerated.
In both public and private entities, salary levels are still a crucial element when it comes to attracting and retaining the best people.
To put it bluntly, companies that do not offer competitive pay packets can put themselves out of contention when it comes to sourcing top talent.
Government thus cannot sacrifice its talented workforce for the sake of utterances by enemies of prosperity.
In the skilled and professional jobs arena, everyone knows that an employee’s departure can often cost a company more than double their annual salary, without taking into account the intangible cost of lost productivity.
Other sunk costs associated with losing an employee include the expense of hiring and training a replacement, or having to spend resources for on boarding programs.
These are financial repercussions that companies can avoid simply by instituting a competitive salary policy.
So anyone in their sober mind should bow down and respect the decision by the Government to cushion its workers in these trying times.
As indicated earlier, it is better to adjust salaries in the civil service than lose talented workforce.
Government should continue reviewing salaries other than creating discontent among its workers.
A competitive salary package will incentivise workers to do their best, promoting employee engagement and encourages loyalty.
In these times where others are busy trying to push for regime change, having proper salary policies in place is a tangible way for Government to show its commitment in taking care of its people, and this is likely to be reciprocated if and when the civil service finds itself in tough times.
COLA is a noble initiative, which should continue because a carefully constructed salary policy shows Government commitment to its workers, and this in itself can be a tremendous incentive for civil servants.
Aluta continua to boosting wages in both the public and private sectors as it is vital in restoring living standards and creating consumer demand.
Online Reporter