ZESA Holdings says it will not increase tariffs to cover salary arrears, dismissing earlier media reports of an imminent increase as incorrect.

BATANAI MUTASA
OWN CORRESPONDENT

In a statement yesterday, Zesa Holdings said it was not mulling an increase in electricity tariffs by 6%. “Electricity tariffs charged by Zesa are approved by the Zimbabwe Electricity Regulatory Authority and no such application has been tendered.”

A local media group had reported that the power utility indicated it would have to increase tariffs to cater for salary arrears of $117 million arising from a gazetted collective bargaining agreement which the company ignored.

However, in yesterday’s statement, Zesa said it had reached a deadlock with the unions in the 2012 collective bargaining exercise after which the matter was referred for arbitration.

The standoff over salaries between Zesa Holdings and its employees dates back to 2012 when the company allegedly refused to offer its employees’ wages based on Statutory Instrument 50/12 which was a result of collective bargaining between the power utility firm and the Zimbabwe Energy Workers’ Union and the National Energy Workers’ Union of Zimbabwe.

The Statutory Instrument sanctioned a basic salary of $275 per month for the least paid worker in the energy industry.

“The outcome of the award was such that Zesa could not afford to implement the award without posing a serious threat to the going concern of the business,” reads the statement.

It said industry norms in the electricity sector dictated that staff costs would not exceed 30% of revenue in the interests of better service delivery.