Clothing Sector Agrees Pay Deal

10 Aug, 2014 - 06:08 0 Views
Clothing Sector Agrees Pay Deal

The Sunday Mail

Wages linked to production
New entrants to get 20% paycut

The clothing sector hopes that the new pay deal will improve the industry - Picture by Prudence Mpofu

The clothing sector hopes that the new pay deal will improve the industry – Picture by Prudence Mpofu

THE clothing sector, which has been reviewing its wage structure, has agreed on a final pay package where the current level of wages will remain unchanged.

However, all companies are now expected to introduce a performance related bonus system within the next 12 months.

The lowest paid employee in the sector takes home about US$165 per month.

It has also been agreed that all future wage reviews will be related to inflation, whilst consideration will be given to other changes in circumstances in the industry and basic principles of negotiation as laid down by International Labour Organisation (ILO).

The next review of wages will be in mid-2015. At its peak, the local clothing industry, which now has about 6 000 workers, used to employ more than 35 000 workers.

Efforts that have been made by stakeholders have led to a marginal increase in employment numbers over the past year.

Identified as a priority sector in the Industrial Development Policy 2012-2016, the industry is a key player in the cotton value chain and experts believe that it could help spur value addition and beneficiation in the country’s economy.

Zimbabwe Clothing Manufacturers Association (ZCMA) chairman Mr Jeremy Youmans said the pay deal with help maintain the workers current standard of living while at the same time giving scope for growth in the sector.

“This is a great step forward towards enhancing our competitiveness as a sector. We took a long time to finalise the package and, although most of the items were agreed between us, there was need to go through an arbitration process to finalise the whole package. We wanted to try to maintain our current employees’ standard of living, whilst also making incremental employment more feasible. Our members also now have an ability to make medium term decisions with some level of certainty on what costs will be. Too many of our policies focus on a short term effect which makes investment decisions riskier and less attractive.”

ZCMA have been very proactive in promoting the industry.

The Association has since launched annual Clothing Indabas in Harare and Bulawayo – the country’s two biggest cities – as a platform for stakeholder interaction and awareness.

The next event, which is scheduled to be held in Bulawayo on September 25th and 26th will include the official launch of the Zimbabwe Cotton Strategy, a draft position that was put together by stakeholders along the production chain such as farmers, ginners, oil expressers, textile and clothing.

Mr Youmans added, “We believe this strategy to be the most progressive work that has been done in this country to maximise the benefits of our cotton chain. Clothing will play a key role in implementing the strategy and our agreement on wages paves the way for further competitiveness enhancements.”

National Union for the Clothing Industry (NUCI) general secretary Mr Joseph Tanyanyiwa said whilst they were disappointed at the level of wages for the sector, there was a desperate need to resuscitate the industry.

He bemoaned the lack of support for the sector from Government, parastatals and municipalities.

“These people all take some of the little monies our members get, and yet they take it, and spend it, by employing people who pay them nothing in return. They are exporting our jobs and it needs to be changed.”

Similarly, the president of the Clothing Industry Workers Union, Mr Jacob Gwavava, complained about the lack of local support.

“Zimbabweans must work together and support their own industries”, he said.

He also complained about the high level of corruption which added to the costs of all commodities and therefore made the low-income earner even poorer.

An influx of low-priced clothing items that are often imported without paying the correct duties have emerged as a formidable challenge for the local clothing sector. Zimra has even suggested that duties should be lowered to make smuggling easier to deal with.

Industry players maintain that they do not want any increase in duty rates for imported clothing items as the current rates of duty at 40 percent are in sync with those agreed by member states of the Southern African Development Community (SADC).

Conversely, the clothing industry in neighbouring South Africa is well protected and subsidised. Through the Preferential Procurement Policy Framework Act , 75 percent of procurement is done locally. Pretoria presently levies 45 percent on imported clothing and spends billions of rands in incentives for both the clothing and textile sectors.

In addition, the public procurement policy ensures that there is a market for products from the industry.

Analysts say while the accord has crippled some local companies that were exporting to South Africa — Zimbabwe’s biggest trading partner — that country’s local industry would benefit immensely from the arrangement given that local companies exported R1,4 billion worth of goods. However, imports onto the local market rose to R15,1 billion.

But local industry players have been trying to nudge Government into implementing strategic reforms that could help to rehabilitate the local sector.

Currently, clothing companies are pushing Government to craft a policy that compels parastatals and local authorities to purchase corporate wear and any other regalia from local companies so as to save the few jobs that remain in the struggling sector.

Recently, Zimra Commissioner-General Mr Gershem Pasi told a Parliamentary Portfolio Committee on Budget, Finance and Investment that top textile retailers such as Edgars, Topics, TM Supermarkets, Greatermans and Truworths have splashed US$2 million in the first quarter of 2014 on importing clothes instead of raw fabric to make textile products.

Parastatals and local authorities have been blamed for contributing to the death of local clothing companies by importing products that can ideally be supplied by local companies.

Statistics obtained by The Sunday Mail Business show that between December 2013 and March this year, the clothing sector has shed 2000 jobs, making a strong case for the need to adopt a procurement quota in Zimbabwe.

Since the beginning of 2009, the industry has seen 145 companies shutting down and 5 700 employees losing out.

Out of the 95 companies that were operational in Harare as at December 2013, only 65 are still open, while the number has been halved in Bulawayo to 40.

Last week, Buy Zimbabwe held a procurement conference that was designed to ensure that locals understand the need to buy local goods and services.

Share This:

Survey


We value your opinion! Take a moment to complete our survey

This will close in 20 seconds