Zimbabwe: Mine Workers Cry Foul, 'Employers Abusing Zim Dollar Return'

Zimbabwe's bond notes and U.S. dollar notes (file photo).
23 September 2019

Government's decision to reintroduce the local currency two months ago has left workers in the mining sector underpaid and impoverished, a union leader has said.

According to the Zimbabwe Diamond and Allied Minerals Workers Union (ZIDAMWU), mine workers have been turned into the least paid employees in the country following the decision to discontinue the multi-currency regime.

"It is with great concern that employees in this industry are being underpaid as a result of the grave effects of Statutory Instrument (SI/142) of 2019 and SI 33 of 2019," ZIDAMWU secretary general Justice Chinhema said in a letter addressed to the National Employment Council for the Mining Industry, recently.

In July, Treasury gazetted SI 142 of 2019 that designated the local currency as sole legal tender in the country while banning the use of the US dollar in particular that had dominated the local market since introduction in 2009.

Said Chinhema: "The wages have arbitrarily dropped resulting in many people failing to cope with the inflationary pressures.

"It is our belief that the effects of the aforementioned Statutory Instrument are a result of misinterpretation by the employers."

He said there should be a way of balancing to provide for sustainable wages given that some mining houses especially gold producers are keeping a percentage of their proceeds in hard currency only to turn around and pay their workers all in the local unit.

"Gold mining companies are retaining 45% in local currency and 55 % in US$ when they sell their proceeds to Fidelity. The 45 % retained in local currency is paid at the interbank market rate.

"However, the basic wage of the worker has not been given due consideration despite the devaluation caused by the statutory instrument. This means employers are benefiting from the SI at the expense of the workers," he said.

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