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Ethiopia: Financial Employees Finally Get Pay Raise
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Addis Fortune (Addis Ababa)
3 March 2008
Posted to the web 3 March 2008
Issayas Mekuria
Those with fixed salaries have been hit the hardest by the double-digit inflation. One group, those working in state financial intuitions, has finally had its pleas for an increment heard. Still others at development agencies are not so lucky yet.
The belated salary adjustment for employees of state financial institutions has finally arrived. The Public Financial Enterprises Agency (PFEA) approved a 30-50pc salary increase for these institutions it supervises.
According to a letter Eyob Tesfaye (PhD), director of the Agency, wrote to the Commercial Bank of Ethiopia (CBE), Construction and Business Bank (CBB) and the Ethiopian Insurance Corporation (EIC), on February 28, 2008, the Agency has increased their salaries more than the 25pc the institutions had requested four months ago. However, a copy of the letter has not been sent to the Development Bank of Ethiopia (DBE).
"The letter will be sent to DBE next week," a senior official at the Agency, told Fortune.
The salary adjustment is effective as of November 2007, and the payments for the four months running up to February 2008, is expected to be added employees salaries this month.
"We are glad that our demands have finally been accepted," Mintesenot Tibebe, president of the labour union at CBE, told Fortune.
The four state financial institutions collectively have 11,700 employees, of which 8,000 are from CBE.
Following the escalation of the consumer price index (CPI) six months ago, the government increased wages of civil servants as much as 37pc but employees of state development and financial institutions have not enjoyed any salary increment, prompting a request.
On February 12, 2008, the labour union of CBE also had threatened to call an employee general assembly and pass a resolution if the request was not addressed within 15 days. However, following a discussion the labour union had with Eyob, it announced on February 21, 2008, that it had cancelled the precondition.
"I am glad but it is quite late," an employee of CBE told Fortune.
The highest percentage increase was given to the low income-earning employees while the management members enjoyed a raise of 30pc.
"This is the highest increase in CBE's history," said an employee of the state giant. "It tops the 20pc increase made right after the EPRDF's took power."
According to sources at the Agency, the latest increase is temporary. He disclosed that the new salary rate would again be readjusted based on the Business Process Reengineering (BPR) study that these banks are conducting now.
"A new regulation on employees' bonus and annual salary increase will be issued soon," an Agency official disclosed.
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CBE spends close 168 million Br for salary payments annually while CBB's 1,000 employees require 23 million Br for salaries. For its 900 staff, DBE allocates 22 million Br while as the state insurer, EIC, apportions 18 million Br for its 1,800 employees.
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