The Sunday Mail
LISTED hospitality concern Rainbow Tourism Group’s plans to shed a sizeable chunk of its 1 000-strong workforce, especially at a time when the group is fresh from reporting its first profit after dollarisation, has left most of its staff mortified. Although the number of workers to be affected could not be ascertained by the time of going to print, market rumours suggest that more than 100 workers will lose their jobs.
The hotelier believes that by downsizing, it will be able to contain costs and realign its operations.
Information gathered last week indicates that the axe is likely to be wielded in those departments that do not directly affect services.
Employees that will face the chop have already been identified.
RTG board chairman Mr John Chikura confirmed the retrenchments in an interview last week, noting that the initiative is meant to realise shareholder value.
“We are looking at right-sizing because it is good for the business. It’s in the light of improving the performance of the organisation with a view to meeting the objectives of the shareholders and realising some dividends for shareholders.
“I can’t tell the number of employees who will be affected by the exercise, but, ideally, we wouldn’t want anyone to know until we conclude downsizing, but you guys (journalists) are always ahead of us, but for the record those are the figures we are still working on.
“As a board, we feel quite happy that the company has turned around and we have had improved relations with the board and shareholders. There is harmony within the group so we feel shareholders should get some return,” said Mr Chikura.
Sources, however, maintained that there is also likely to be a staff restructure meant to add oomph to the company’s current recovery.
“There has been a lot of contact among shareholders with an agenda of wanting to do away with the bloated structure that is in place.
“They feel it is the time to focus on new challenges, which require new strategies, as in any business process or re-engineering programme the restructuring entailed the abolition of some posts, creation and or expansion of others.
“We are going to see the reassignment of some individuals based on their proven strengths and versatility.
“Most employees are going to be fired under the guise that it is a retrenchment exercise which will affect most employees,” said a RTG staffer who chose to remain anonymous because of the sensitivity of the subject.
It is believed that many staffers, unaware of their fate, are currently fretting on what is likely to befall them.
Many are aggrieved and feel that the company is abandoning them after they have contributed to the group’s improved profits.
RTG currently commands 26 percent of the market, which is marginally above its target of 25 percent.
The group is trying to optimise its structure by reducing its gearing, including lowering its average cost of debt to 7 percent from the present 11 percent.
With a portfolio that includes the flagship Rainbow Towers, New Ambassador Hotel, Kadoma Hotel and Conference Centre, Bulawayo Rainbow, Victoria Falls Rainbow and A’Zambezi River Lodge, the company is bullish of its future prospects.
Local companies have resorted to downsizing their workforce in order to contain their costs, particularly in the current dollarised environment.
Business lobby groups have been actively urging Government to soften labour laws to reflect the current economic situation.
Businesses believe the current legislation favours labour at the expense of business.
The Zimbabwe Congress of Trade Unions (ZCTU) recently revealed that more than 9 500 workers lost their jobs last year.
RTG will hold its annual general meeting (AGM) on Wednesday June 11.
