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NRZ clears salary bill

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NATIONAL Railways of Zimbabwe (NRZ) has managed to clear its over $80 million salary debt and has started paying full salaries to its employees after going through cash flow challenges in the past years.

In 2016, the parastatal had a prolonged strike that went on for three months as staff downed tools due to outstanding salaries.

NRZ which was one of the country’s largest employer now has a staff complement of 4 500 from around 12 000 workers during its peak.

“Because of the cash flow challenges we started paying people 30 percent of the workers’ salary, then as we received more money, pay another 30 percent then 40 percent until we would have liquidated salary for that month,” said NRZ general manager, Engineer Lewis Mukwada.

The company continued on this cycle by paying salaries within four weeks but the situation worsened until NRZ lapsed payments into the fifth or sixth week.

“Eventually NRZ was now paying one month’s salary in the period of six weeks or eight weeks and as we were falling behind, we were accumulating arrears so we ended up picking arrears of 13 months. But the way the situation was now reading seemed as if NRZ had gone for 10 months or 12 months without paying workers yet each month we would have fallen more and more behind. Cumulatively, if you added the amount owed to workers it was now entering 3 months’ worth of salary,” the NRZ boss explained.

Due to the inconsistency of their pay, workers suggested that the NRZ pay whatever it could afford within one month but do so consistently.

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“Workers said their pay date was so unpredictable and it could be better if NRZ whatever little it had consistently so we then adopted that. What we could pay at the time was 50 percent of peoples’ salaries. In 2016, we started paying 50 percent consistently and there was now an element of predictability,” said Engineer Mukwada.

In 2017 as business rose, NRZ went up from the 50 percent to 60 percent while the lower earning workers received 70 percent.

“2018, we went to 80 percent to 90 percent. This year January, we are now back to 100 percent as the business continues to go up. We just hit 100 percent but prices have gone up in terms of commodity prices so staff are now talking about cost of living adjustments and so on but we are trying to tackle that,” he noted.

In terms of revenue, NRZ made $87 million in 2017 while in 2018 it went up to $95 million.

“For 2019, we are projecting revenue of $125 million but now it depends on how the economy behaves because if there’s high inflation those figures certainly may change,” said the NRZ boss.

Meanwhile, NRZ was designed to move a capacity of 18 million tonnes, while the best it moved was 14.4 million in 1980 to 1990s.

Before the economic downturn, NRZ moved 12million tonnes in 1999 to 2.6 million tonnes in 2009, which was the lowest tonnage ever moved. — CITE

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