AS the Zimbabwe dollar continues to lose value due to hyperinflation and the near dollarisation of the economy, labour unions are pushing for employees to be paid in hard currency.
Paying workers in hard currency, unions and labour analysts say, will cushion them from spiralling prices of goods and services because foreign currency is not susceptible to high inflation like the local dollar.
Over the past four months services such as education, health, rentals and transport, among other things, have been dollarised yet the majority of employees are paid in local currency.
Last year, teachers and health workers downed tools demanding to be paid in foreign currency and fears abound that employees in other economic sectors could follow suit this year – further crippling the already struggling industry and commerce sectors.
The president of the Zimbabwe Congress of Trade Unions (ZCTU), Lovemore Matombo, said wage negotiations this year should be in hard currency.Â Â
He said the umbrella labour body’s general council had resolved that ZCTU “affiliates and the generality of the workforce” should negotiate wages in terms of the US dollar, “failure of which the sector will withdraw its labour”.
The move to pay workers in foreign currency, Matombo said, was precipitated by the near dollarisation of the economy.
Government last September licensed selected manufacturers, wholesalers and retailers to sell goods and services in foreign currency, but almost everyone in the country is now trading in hard currency.
Foreign currency is even demanded on commuter omnibuses.
While goods and services are now being paid for in foreign currency, the majority of workers in both the formal and informal market are still getting their wages in local currency.
Government, the largest employer in the country, has since paid soldiers and teachers their January salaries in local currency amid reports that it has insufficient hard currency to pay the workers.
Morale is low in the army, while teachers have vowed not to return to work when schools open on Tuesday unless they are paid in hard currency.
The move to pay civil servants in local currency was met with heavy criticism by the ZCTU. Â
“Awarding salary increments in local currency is no longer an option given the dollarisation of the Zimbabwean economy,” the ZCTU said. “Workers from all industries will soon join teachers, nurses and doctors in national action as the situation has become unbearable. The ZCTU demands that all wages be paid in foreign currency or the foreign currency shops are done away with, forthwith.”
Progressive Teacher’s Union of Zimbabwe secretary-general Raymond Majongwe said the near dollarisation of the economy has rendered salaries in local currency unsustainable.
He said: “We are not going to apologise for asking for salaries in foreign currency. Civil servants, especially teachers, have been denied meaningful salaries for a long time.” Â
Majongwe said the US$2 300 teachers are demanding is justified considering how foreign currencies have been devalued in the country.
“Zimbabwe is the only country in the world where US$100 buys nothing,” he added.
Zimbabwe Teachers Association spokesperson Sifiso Ndlovu said workers could no longer survive on salaries paid in local currency.
“We are asking for salaries in foreign currency because we are operating in an economically abnormal situation where you can no longer use the local currency to buy goods or access essential services,” Ndlovu said.
When asked why teachers in Zimbabwe were asking for salaries much higher than what their counterparts were getting in the region, Ndlovu said they were simply responding to market price distortions where one requires more than US$500 to buy groceries for a family of six.
In South Africa and Namibia teachers are paid between US$500 and US$1 300, while in Zambia they get US$300.
The education sector has been severely affected by a skills flight as a result of low remuneration. Pupils at all government, mission and private schools have not been going to school since last year.
Last week the Zimbabwe Independent revealed that the country’s sole examinations body, Zimbabwe Schools Examinations Council (Zimsec), was yet to recruit teachers to mark the 2008 public examinations.
Zimsec advertised that it urgently requires teachers to mark the 2008 Grade 7, Ordinary and Advanced level examinations.
President of the Hospital Doctors Association, Kudzai Chimedza, said junior doctors would also not be going to work until government starts paying healthcare workers in foreign currency.
“Government had proposed that the least paid worker be paid US$50 while the highest paid gets US$850, but the money is too little considering that everything, including rentals, are now being paid in foreign currency, ”Chimedza said.
Chimedza said it was appalling that government had allowed hospitals to offer their services in foreign currency, which is way beyond what health workers earn.
“We don’t enjoy watching people suffering but the government has to understand our situation: US$50 is not even enough to pay rentals for a room in the high density areas.”
Major hospitals including the largest referral centre, Parirenyatwa, were last year forced to close down after healthcare staff downed tools in protest at poor salaries and working conditions.
The workers demanded salaries in foreign currency in tandem with their counterparts in the region.
The strike coincided with a cholera outbreak which has claimed more than 1 600 lives.
However, normality is expected to return to hospitals after the United Nations Children’s Fund last week intervened and unveiled a US$5 million fund to pay health workers.
Journalists have also said they should be paid in hard currency with effect from January or they would go on strike.
In a statement to media houses this week, Zimbabwe Union of Journalists president Mathew Takaona said: “The ZCTU general council at its special meeting of January 17, 2009 made a resolution that all salaries and wages be paid in foreign currency. For the compelling reasons cited by the general council, it is instructive that all works councils comply and all workers be now paid in foreign currency.”
The demand for salaries and wages to be paid in hard currency was prompted by the refusal by manufacturers, wholesalers and retailers to accept the local currency as payment.
Even landlords in towns and residential suburbs are demanding rentals in foreign currency.
A room in the high-density areas is being charged at US$30 while urban transport operators are charging R5 for a single trip into town.
A snap survey by the Independent in the central business district of Harare revealed that most supermarkets were no longer accepting local currency.
A 20kg bag of mealie meal is being sold at US$15, beef US$5 per kg, a bar of soap US$1,50, a loaf of bread US$1 and a 2kg packet of rice US$3.
Schools have set their fees from US$100 to US$2 500 a term although government is yet to approve payment in hard currency.
BY LUCIA MAKAMURE