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Felex Share Harare Bureau
Zesa employees are demanding $117 million in salary arrears arising from a collective bargaining agreement in 2012 which management ignored. While conceding to the bungling, Zesa argues that implementing an arbitral award granted by retired Supreme Court judge Justice Ahmed Ebrahim and Professor Emmanuel Magade would have a heavy bearing on electricity consumers as a six percent tariff increase must be effected to cover the additional $5.6 million on its payroll.

Zesa Holdings is now offering the workers $21 million, spread over four months, arguing that their demands were “unrealistic.”

For the past three years, management has unsuccessfully contested the collective bargaining agreement (CBA) which came out as a result of Statutory Instrument 50 of 2012.

The dispute is also likely to cost Zesa another $5 million in tax liabilities, according to calculations by the Ministry of Energy and Power Development.

The CBA agreement provided for Zesa to effect a minimum increment of $275 and 12 percent grade differentials, 2,5 percent step (notch) differentials, non-pensionable allowance (30 percent of basic salary), $70 transport allowance and $23 canteen allowance (grade 1 to D2) with effect from January 2012.

In their ruling, the two arbitrators said the power utility should honour the CBA and conduct a re-grading exercise.

It said Zesa should start paying employees according to qualification and seniority.

“The claimants should comply with the National Employment Council salary scales arising from the 2012 CBA,” reads the ruling.

“The claimants should, consequently, conduct a re-grading exercise so that all their employees are placed in their correct grades in the NEC salaries scales, according to each employee’s qualifications, date of entry into service and any other relevant factors, irrespective of the grade such employee currently occupies under the Zesa scales.

“This exercise should be back-dated until the date on which SI 50 of 2012 came into effect and any salaries and benefits should be calculated from that date, and should be completed within six months of the date of this award. Any back-payment should be paid within that period.”

No employee, the ruling stated, should as a result of the re-grading exercise receive salary or benefits lower than he or she currently received.

Eliab Chikwenhere, the Zesa head of finance, argued that Zesa was in a “parlous financial situation” and their liabilities exceeded their assets.

In any case, he said, Zesa needed to raise tariffs but was prevented from doing so by regulatory authorities.

The arbitrators, while acknowledging Zesa at the moment was “not fully delivering what it ought to”, it had created legitimate expectations among the workers and should honour that.

Reads the ruling: “Whilst it is true that public policy dictates that an award which has the effect of driving the employer into insolvency should not be made, it is equally true that where an employer has entered into an agreement with his employees he creates legitimate expectations amongst the workers. Public policy becomes something of an unruly horse which gallops in multiple directions.”

Responding to the ruling yesterday, a Zesa senior executive said any compliance with the award meant an increase in tariffs.

He said they were prepared to part with $21 million and not to burden consumers.

“The demands by the workers are unrealistic but we’ve come up with a concessionary figure which reflects what the business can pay,” he said.

“We admit we signed an agreement and we’ve to comply but as a gesture of goodwill this is what we can afford.

“First and foremost, before any considerations, Zesa should be able to generate electricity and that’s why we have $21 million as our maximum figure.”

Added the senior executive:

“Implementing the award will require a six percent tariff increase to meet the $5.6 million additional figure per month of the current payroll. This will burden the already overburdened consumer as well as impacting negatively on service delivery.”

According to the Ministry of Energy and Power Development, the least paid worker is owed $1,628 while the highest paid (skilled) worker should get about $2,418. But workers, through the Zimbabwe Energy Workers Union, claim the liabilities to be $5,607 and $37,102 respectively.

The power utility has more than 7,000 workers countrywide.