Oliver Kazunga Senior Business Reporter
NEWZim Steel will tomorrow send an undisclosed number of its workers on three-months unpaid leave as the firm seeks to cut down its ballooning wage bill. The Redcliff-based steel manufacturing company, formerly Ziscosteel, owes the workers over $200 million cumulatively.
In 2011, an Indian conglomerate Essar Global signed a $750 million deal to acquire the country’s steel producer and revive operations that were suspended in 2008 at the height of economic meltdown.
Industry and Commerce Minister Mike Bimha has said the government is still working with the investor on the implementation plan.
Implementation of the Essar deal has taken longer than expected due to squabbles over mineral rights and other technicalities.
The government and the new investor are re-visiting the implementation process in light of some changes such as fluctuations of steel prices on the international market that have taken place since the deal was signed.
Some of the NewZim Steel employees told this paper that they had been forced to go on three months unpaid leave from October 1 to end of December.
“We’ve been told that the company is forcing us to go on three months unpaid leave starting October 1 to December 31 this year.
“We’ve been informed that the company is trying to cut down on employment costs.
“We’ve also tried to negotiate that at least the company give us something as we go on unpaid leave but we’re yet to get the company’s position in that regard,” said one of the workers who preferred not to be named.
Since the Essar deal was signed, the workers, who have been getting part of their salaries, are not being consistently paid.
“About 70 percent of the workers at NewZim Steel will be going on unpaid leave for the next three months starting October 1.
“We’ve also been told that the leave could be extended depending on the situation that’ll be prevailing at that time,” added another employee whose unpaid leave is starting tomorrow.
Another employee said the workers’ representatives held a meeting with management yesterday to negotiate that the workers get “at least something” as they go on leave but to no avail.
“Our workers’ representatives convened a meeting with management today to negotiate that the workers get at least something as they go on leave but nothing fruitful has come out of the meeting,” said the worker.
In a separate interview, Minister Bimha said, “Issues like that are management issues and not ministerial.”
The company’s chief executive officer Engineer Alois Gowo could not be reached for comment by the time of going to print as he was said to be in a meeting the whole day.
At its peak, Zisco, which is a strategic firm for Zimbabwe’s economy, employed over 4,000 workers producing about 750,000 tonnes of steel per annum.