The Meat Corporation of Namibia has proposed paying employees two-thirds of their salaries from November to January as foot-and-mouth disease (FMD) strains the state-owned meat processor's finances.
In a letter dated 13 October, Meatco interim chief executive Albertus Aochamub requests an urgent meeting with the Namibia Food and Allied Workers Union (Nafau) to discuss the proposed arrangement.
He says the proposal is part of an emergency labour cost containment package aimed at reducing the corporation's expenses while protecting jobs and retaining critical skills needed for its recovery.
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"Management wishes to propose for discussion a temporary two-thirds salary arrangement for all employees for November, December 2026 and January 2027. For that reason, management wishes to engage openly with Nafau on the practical terms of implementation, including the treatment of benefits, statutory deductions and related payroll matters," he says.
Meatco says the salary arrangement would be temporary, with the position beyond January to be reviewed based on the company's financial and operational circumstances.
According to Aochamub, the corporation also wants to introduce a voluntary separation programme for employees aged 55 and older, as well as those whose positions have become redundant under its revised corporate structure.
Under the proposed programme, management and the union would discuss severance pay, accrued leave, pension-related matters, notice periods and eligibility requirements.
"Our intention is not simply to contain costs but to work together to find measures that are fair, practical and sustainable while limiting the impact on employees as far as circumstances allow," Aochamub says.
Meatco's proposed salary cuts come after The Namibian last week reported the company has sent roughly 400 production workers on three weeks' special leave amid the FMD outbreak, with a review of the situation set for 23 October.
Aochamub yesterday told The Namibian Meatco was commencing negotiations regarding the future.
"We are about to commence negotiations on the future of Meatco with elected representatives of the workers in seven minutes," he said.
In July, The Namibian reported that Meatco's revenue fell by N$757 million during the 2025/26 financial year, dropping from N$1.86 billion to N$1.11 billion as fewer cattle were available for slaughter.
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Despite the drop in revenue and slaughter numbers, Meatco reported a profit after tax of N$40.5 million and said it had strengthened its cash position and reduced accumulated losses.
The company has also faced questions about its internal controls. In February, The Namibian reported that about 900 head of cattle were missing and that about N$2.5 million in cash reconciliations in the livestock procurement department could not be accounted for.
Meanwhile, Independent Patriots for Change shadow minister of agriculture, fisheries, water and land reform Michael Mulunga yesterday said the closure of the European market has placed greater financial constraints on the entity.
"Although the temporary reduction in the salaries of Meatco has a negative impact on the livelihood of Meatco employees, we believe this is a step in the right direction to avoid total job loss and income for Meatco employees," he said.
"We call on the Ministry of Agriculture, Fisheries, Water and Land Reform to assist Meatco in navigating these difficult times," he said.
The union did not respond to questions by the time of going to print yesterday.
