Econet Prepares Another Massive Retrenchment

We recently published the possible imminent exit of Nkosinathi Ncube from Econet Wireless Zimbabwe and while recently they confirmed to have laid off 100 employees  , but now close sources confirmed that a massive retrenchment is brewing at Econet.

Last year, Econet Wireless Zimbabwe went through a laying-off exercise, with 29 employees hitting our headlines which then saw the 100  Econet employees losing their jobs in the recent madness of companies retrenching workers on three months salary packages.   

By Digital Ancestor 

The diversified telecommunications group will embark on a massive retrenchment exercise as it streamlines its operations in the face of a tough operating environment, reported the Zim Ind

Econet is the country’s largest provider of telecoms services in mobile and fixed wireless telephony, internet access and payment solutions.

“The job cuts, according to workers who spoke to businessdigest this week, will be across the board. Funding for the exercise has been approved”, they said.

Although the number of employees to be affected by the job cuts could not be ascertained at the time of publishing, sources say the figure could run into hundreds.

“It is true that there will be retrenchments and the funding has been approved,” a senior official at the company said.

“Some of us are operating in an exit mode. Our chances of avoiding the chop this time after surviving the three months dismissals are slim.”

A staff meeting was reportedly held recently and management is said to have told workers of the impending exercise.
According to the amended Labour Act, companies who embark on retrenchment exercises must pay the statutory three months’ notice and a package of two weeks’ salary for every year served.

Asked to comment on the planned retrenchments, Econet spokesperson Sure Kamhunga said: “I’m saying that Econet is not aware of the planned cuts that you say have been mentioned by your sources.”

He added that the true position will be reflected by the CE of the company.

According to the Postal and Telecommunications Regulatory Authority of Zimbabwe, Econet’s subscriber market share stood at 55,8% in the first quarter of 2015 before dropping to 55,5% in the second quarter of the year. Econet’s market share went down 1,6 percentage points in the third quarter of 2015 to 53,9% before sliding further to close the year at 52,5%.

econet ceo

The Econet Wireless Zimbabwe CEO: Mr Douglas Mboweni

The development comes at a time when the Grain Marketing Board has applied to the Retrenchment Board to lay off 90 workers. An informed source at the Board told businessdigest that they will soon sit and consider the application.

“We have received the application by GMB to retrench 90 workers,” the source said.

If the plans to retrench go ahead, it will add to the estimated 30 000 workers who were dismissed last year using the July 17 Supreme Court ruling which allowed employers to dismiss workers on three months’ notice without paying a retrenchment package.

A Retrenchment Board member said this week that they are yet to exempt any organization from paying a retrenchment package.

“We cannot exempt anyone to the extent of not paying workers anything. It is a very stressful experience sitting on the Retrenchment Board,” the board member said.

Retrenchments have been on the increase as companies struggle to stay afloat amid a plethora of challenges that include a debilitating liquidity crunch, lack of affordable funding and a low capacity utilisation of less than 35%.

Source: The Independent

Marvelous Chibagidhi

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