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Zimbabwe: #WageTheft

AfricaFocus Bulletin
July 15, 2016 (160715)
(Reposted from sources cited below)

Editor's Note

"An astounding 80,000 Zimbabwe workers in formal employment--out of some 350,000 workers--did not receive wages and benefits on time in 2014, according to a new Solidarity Center report, 'Working Without Pay: Wage Theft in Zimbabwe,' released today in Harare." - Solidarity Center

This AfricaFocus Bulletin released today, not sent out by email but available on the web at http://www.africafocus.org/docs16/zim1607b.php, includes a press release and excerpts on a report released today in Harare: "Working without Pay: Wage Theft in Zimbabwe." This study, by the Labour and Economic Development Research Institute of Zimbabwe (LEDRIZ) and the Solidarity Center, documents the failure of both government and the private sector in Zimbabwe to pay wages to ordinary workers, despite lavish pay and benefits for top executives.

Another AfricaFocus Bulletin, sent out by email today and available on the web at http://www.africafocus.org/docs16/zim1607a.php, contains a short news report on the release of Pastor Evan Mawarire, who sparked the #ThisFlag citizens' protest movement in Zimbabwe, and excerpts from a longer analytical article by Zimbabwean political analyst Alex Magaisa.

For previous AfricaFocus Bulletins on Zimbabwe, go to http://www.africafocus.org/country/zimbabwe.php

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Working Without Pay: Wage Theft in Zimbabwe

By Nyasha Muchichwa

Researcher, Labour and Economic Development

Research Institute of Zimbabwe (LEDRIZ)

June 2016

[Press release and excerpts only. Full document available from Solidarity Center (http://www.solidaritycenter.org, download at http://tinyurl.com/jak4joj]

Solidarity Center Press Release, July 15, 2016

Report: Working without Pay--Wage Theft in Zimbabwe

An astounding 80,000 Zimbabwe workers in formal employment--out of some 350,000 workers--did not receive wages and benefits on time in 2014, according to a new Solidarity Center report, "Working Without Pay: Wage Theft in Zimbabwe," released today in Harare.

As a result of this widespread wage theft, many workers say they are forced to eat only one or two meals a day; move repeatedly to access affordable housing; and rent two rooms or fewer for their entire family to make ends meet.

Through first-person interviews and other research by affiliates of the country's main trade union confederation, the Zimbabwe Congress of Trade Unions (ZCTU), the report provides hard data behind last week's successful one-day shut-down of businesses, government and services by workers across Zimbabwe outraged over wage theft and a new law targeting market vendors who make up the vast proportion of the workforce.

One woman interviewed in the report, whose experience is not uncommon, says she has received $26 a month in wages for the past eight months, although her monthly salary is $342. Yet basic living costs, which on average include $60 for renting a single room, $30 for electricity, $15 for water and $22 for transportation to work, mean she only has sufficient funds to get to and from her job.

"This failure to pay what workers are legally entitled to is wage theft in that it involves employers taking money that belongs to their employees and keeping it for themselves," the report states. "This is a clear violation of international labor standards, as well as national legislation on the employment of workers."

The report traces the ongoing wage theft to 2012, as employers in the public- and private-sector increasingly began delaying wage payments.

Simultaneously, the number of jobs in the informal economy has skyrocketed, the report points out. Some 6.3 million people made up Zimbabwe's workforce in 2014, of which 5.9 million workers (94.5 percent) were informally employed, compared with 84.2 percent in 2011, according to "Working without Pay." An additional 800,000 women and men were in the workforce, but unemployed.

Last month, the government introduced a statutory law that bans imports of basic commodities--a law that directly affects hundreds of thousands of informal economy workers who survive on cross-border trading. Up to 95 percent of jobs in Zimbabwe are in the informal economy, and workers say the new law takes away their livelihoods.

Based on surveys at 442 companies, and the result of extensive research by the Labor and Economic Development Research Institute of Zimbabwe, the report also documents extravagant salaries and benefits to middle and top management even as workers go unpaid and presents recommendations for action to address the problem.

Some of the recommendations include:

  • The Ministry of Labor, together with representatives of employers and unions, should review the status of companies that are not paying their workers and assist in developing plans to rectify the injustice.
  • Unions representing workers in companies not paying salaries--in full and on time--should demand that the government bring criminal proceedings under the relevant provisions of the Labor Act against employers.
  • Trade unions should advocate for payment of interest on late payment.
  • The government should set an example by reviewing the wage structure in government agencies and quasi-government agencies to limit benefits to top managers, institute a more just pay scale and prioritize payments to workers through collective bargaining or social dialogue.

Foreword

by Tefere Gebre , Executive Vice President, AFL-CIO

More than 100 women gathered in October 2013 to peacefully protest at the state-controlled Hwange Colliery coal mine in western Zimbabwe, where many mineworkers had gone months to almost a year without pay. The women had gathered at the manager's office to demand wages owed to the men. For their trouble, they were met by armed police and, in the violence that followed, several women were injured. This incident and other anecdotal stories of wage theft, on the rise in the intervening years since that incident, prompted the Solidarity Center to commission this report, which details the magnitude of wage theft in Zimbabwe and the impact this widespread practice has on workers and their families.

Wage theft is impoverishing workers who, under other circumstances, would be the bedrock of the middle class. It forces families to devise coping strategies that can tear at family ties, make difficult choices and mortgage their future. Wage theft disempowers and robs workers of dignity: The inability to support one's family through work gives rise to shame, embarrassment and the loss of dignity. Zimbabwe's governance structures and industrial relations system are seriously broken. The government does not enforce laws that would protect workers. In the event of a closure, for example, companies are not obliged to recognize payment of wages to workers should be prioritized. Indeed, they are rarely paid even a fraction of what they are owed in wages. In fact, the government is a major culprit as public-sector workers, including teachers, police officers and members of the military, are unable to predict their pay dates with any certainty.

In a country where formal jobs are few, Zimbabwean workers often cannot fight exploitation like wage theft. Fortunately, trade unions are advocating for their interests and working to prevent further erosion of their economic status, as they have fought for peace, human and worker rights, and economic justice over the decades. The American labor movement stands in solidarity with the people of Zimbabwe in their ongoing struggle for social justice, human rights and dignity in the workplace. In addition to continued support through the ongoing partnership programs of the Solidarity Center, our most meaningful demonstration of solidarity is represented by our unflagging efforts to ensure that our government's global policies protect worker rights including freedom of association, promote gender equality, and create inclusive approaches to economic development around the globe. Only such policies will ensure that those who produce wealth are able to share in the prosperity, including the working people in Zimbabwe.


Executive Summary

Zimbabwe's economic and political crisis, notwithstanding a brief hiatus in 2009-2010, continues to bring economic hardship and suffering to the majority of Zimbabweans. Increasingly, even employed workers with long-term contracts, who have relative protection with job security, are experiencing sharp declines in their economic position. Between 2011 and 2014, the number of workers in informal employment grew from 84.2 percent of the currently employed work force to 94.5 percent, rising to 5.9 million workers in 2014. Among approximately 350,000 workers in formal employment in 2014, more than 80,000 workers did not receive wages and benefits on time.

Wage non-payment affects an estimated 22,000-plus workers for urban councils (local government entities), 12,000 in agriculture, and more than 7,500 each in the security sector, automotive industry and railways. Workers in several sectors are averaging more than 20 months without a pay check. Those affected include people who are still formally employed and required to go to work, as well as others who have been laid off without re ceiving the wages and benefits due to them under their contracts.

Notably, this violation of the right to be paid for one's work is common in the public as well as private sectors. And, while governmental institutions in Zimbabwe are complicit in these violations, top managers continue to receive high salaries and generous benefits.

International standards, particularly the International Labor Organization (ILO) Protection of Wages Convention, 1949 (No. 95), which has been ratified by 98 countries, mandate the regular payment of wages to workers and the priority of such payments over other financial obligations of employers. Although Zimbabwe has not yet ratified most of the relevant conventions, national law in Zimbabwe defines employers' obligations for payment of regular wages in legal tender.

This failure to pay what workers are legally entitled to is wage theft in that it involves employers taking money that belongs to their employees and keeping it for themselves. This is a clear violation of international labor standards, as well as national legislation on the employment of workers.

This report, based on extensive research by the Labour and Economic Development Research Institute of Zimbabwe in 2015, supported by the Solidarity Center, lays out the scope of wage theft in Zimbabwe, the responsibilities of the state under international standards and national legislation, and the failure of the state to address the impact on workers and their families. It also presents recommendations for action to address this problem.

Ensuring compliance with international labor standards and curbing wage theft in Zimbabwe requires actions by both government and unions. Most urgently, this means that existing law be enforced and union pressure increased to curb wage theft and hold employers accountable for their violation of worker rights. In addition, the Zimbabwe Labor Act should be reviewed and strengthened to provide procedures for monitoring of and action on such cases in both the public and private sectors. Pay structures should be reviewed in the public sector in particular, which should set an example for the private sector. Zimbabwe should move expeditiously to ratify international conventions on wages. And unions as well as government should provide support for workers and their families who have suffered and continue to suffer from wage theft.


Wider Context of Wage Non-Payment

Wage non-payment is happening within the context of the wider economic crisis, and workers with formal employment are in the minority. Far more vulnerable are workers with informal employment conditions. Of the entire employed workforce of 6.3 million people reported in the 2014 Labor Force Survey, 5.9 million workers (94.5 percent) were informally employed, as compared to 84.2 percent in the 2011 survey. An additional 800,000 women and men were in the workforce, but unemployed.

This trend toward precarious employment was confirmed by interviews and questionnaires in the LEDRIZ survey. The majority reported themselves to be on fixed-term employment contracts rather than having status as permanent workers. They noted a trend toward termination of permanent workers, who could be later employed as casual workers, especially in the agriculture and manufacturing sectors.

Workers also reported cases of discrimination between permanent and casual workers in terms of payment of wages. For example, permanent workers had gone without wages for months while casual workers continued to be paid. The rationale given by employers was that casual workers only had to be paid wages, whereas permanent workers' paychecks normally included statutory and other benefits. Employers also said that they could afford to delay the wages for permanent workers, since their contracts did not lapse at the end of the month. Ironically, some permanent workers have opted to become casual workers in order to be paid, despite losing access to benefits such as pensions, medical coverage, severance pay and other allowances. Such practices, particularly in the agriculture sector, have in some cases been effectively opposed by unions.

Another trend noted in some interviews was the shortening of the work week to three days, which reduces transport costs for workers. At the same time, there has been an increase in involuntary overtime on those days to compensate (reported by 90 percent of workers filling in questionnaires). Surprisingly, some noted that they were paid for overtime but still were not getting their wages. Many noted that the drop in production was minimal given the substitution of overtime for the missed days.

Workers who are dismissed find themselves competing in the informal sector, which is already under stress from competition and government harassment. Jobs such as market vendors and street vendors are characterized by the absence of official protection and legal recognition; non-coverage by minimum wage legislation and the social security system; low pay; and little job security. In recent years, moreover, the government of Zimbabwe has in effect waged war on vendors.

In February 2015, the then Local Government Minister Ignatius Chombo, addressing mayors and council chairpersons at the 73rd Urban Councils Association of Zimbabwe (UCAZ) annual general meeting in Bulawayo, said, "The role of the informal sector in our economy, the upsurge of indiscriminate vending in urban areas has acutely affected the ambience of our environs while compromising the health of the residents.” He said, "Vendors are selling their wares from everywhere, including on pavements, open spaces and in front of shops." He went on to add that, "All local authorities are therefore required to immediately take necessary measures to remove the vendors from undesignated sites [and move them] to alternative planned vending points." Meanwhile, Finance Minister Patrick Chinamasa has vowed to track down all informal traders to recover what he said they owed the state in sales taxes.


The impact of wage theft

In any country, the impact of workers going unpaid is dramatic. In the context of Zimbabwe’s economic crisis, it is particularly devastating. In interviews with workers for this report, the workers stressed the following points on how their lives have changed and how they have attempted to cope with the impact on their lives.

  • Many were walking to work to reduce transportation costs, requiring them to get up before dawn to be able to make it to work by 8 a.m. Some noted that they no longer had time with their families as they left home when the children were asleep and returned when they were in bed.
  • Many transferred their children to less expensive schools, where the quality of education and facilities is lower. Some pointed out that they were unable to pay even those fees. Some children had to drop out of school entirely.
  • Workers reduced the number of rooms they rented, sometimes taking two rooms or fewer for the entire family. A single room had become the study room, dining room, living room, kitchen and bedroom. Many landlords were also not being paid by their employers and had less tolerance for late payment of rentals. Thus many workers had to move from one place to another repeatedly.
  • Many reduced food consumption, cutting back to one or two meals a day. This affected the performance of workers at the workplace as they came to work hungry. And children of unpaid workers, as well as many other children, had to go to school on empty stomachs.
  • Many could no longer afford to buy clothing, even second-hand clothes. Relatives had to assist by providing clothing for workers and their family members.
  • Many families relocated women and children to the rural areas as a way of reducing costs. With the families living full-time on a rural homestead, they could send food to the male worker in town.
  • With lack of access to affordable medical insurance and the cost of hospital care and medication out of reach for unpaid workers, many relied entirely on faith and traditional healers.
  • Workers also cut back on most other expenses, including letting go of low-paid house hold employees who previously eased the burden of household chores and child care.
  • Many workers could no longer afford to visit parents and other relatives in the rural homestead, a trend which is straining extended family relationships.

AfricaFocus Bulletin is an independent electronic publication providing reposted commentary and analysis on African issues, with a particular focus on U.S. and international policies. AfricaFocus Bulletin is edited by William Minter.

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