By Thomas Chidamba
SEVERAL major mining companies in Zimbabwe have laid-off workers in recent months as a cost-cutting measure in response to falling metal prices globally and a lack of demand for precious metals.
Industry Challenges
The mining sector has faced significant viability challenges because of a drop in prices for metals like platinum and chrome. Lower demand has prompted companies to activate measures like retrenchments to control operational costs and avoid insolvency.
Companies Retrenching Workers
Over the past six months, major mining firms, including Zimplats, Mimosa, and Zimasco have retrenched employees.
According to statistics from the Zimbabwe Diamond and Allied Workers Union (ZIMDAWU), more than 1,000 mine workers have lost their jobs during this period.
Retrenchment Process
Companies have implemented both voluntary and compulsory retrenchment programmes. However, compulsory retrenchments have drawn criticism from workers and legal experts.
Legal Concerns
Taurai Mrewa, a respected labour relations lawyer, highlighted concerns around compulsory retrenchments during a recent labour workshop hosted by the Iron and Steel Engineering Association of Zimbabwe (ISEAZ).
“The absence of a minimum retrenchment package in the Labour Act has left employers with a serious challenge when implementing compulsory retrenchments,” Mrewa said. “Compulsory retrenchment may not be an option at this stage.”
Mrewa explained that, because of the lack of a legally defined minimum package, voluntary retrenchments, or mutual separations, are often the only viable option for employers.
“Retrenchments leave employees financially and emotionally vulnerable because of loss of employment, hence the need to handle the process professionally,” he added.
Avoiding Retrenchments
According to Section 12D of the Labour Act, employers are required to:
• Keep employees informed about major changes that could lead to retrenchments
• Consult with employees or worker committees on measures to avoid retrenchments
• Implement options like short-time work or shift systems for up to 12 months
Mrehwa suggested that companies should proactively explore these measures to minimise the need for retrenchments.
As the mining industry continues to grapple with declining metal prices and demand, firms face hard decisions to maintain viability. However, labour experts emphasise the importance of following proper legal procedures and minimising the impact on workers during retrenchment processes.
