Econet and TelOne slash wages in cost-cutting programme

24 Aug 2015

The Zimbabwean telcos TelOne and Econet Wireless have proceeded with their planned cost-cutting measures which include slashing salaries and stopping bonus payments, but both firms say they are trying to avoid large-scale redundancies. Econet has cut wages by 20%, in a move which it says has helped to reduce costs by around USD70 million, but insists there have been only 46 employees laid off rather than the ‘hundreds’ mentioned in local press reports. According to a report from The Source, meanwhile, TelOne has cut wages by 15%, is ending annual bonuses and has suspended overtime payments. TelOne has reportedly opted not to take advantage of the recent Supreme Court ruling which allows companies to terminate jobs on notice without having to pay any severance packages.

Econet’s chief executive Douglas Mboweni told The Source: ‘We have cut costs by almost USD70 million to date and restored strength and stability to our cost structure. We are ready to weather any storm as a company.’ Zimbabwe’s telcos are struggling to cope with government-decreed voice tariff cuts and taxes on airtime and mobile handsets. Privately-owned Econet is the country’s largest cellular operator by subscribers, while state-backed TelOne dominates the fixed line sector.

Zimbabwe, Econet Wireless Zimbabwe (incl. ZOL, Liquid Telecom), TelOne