MEIKLES STORES says it will lay off 55 workers in Harare and Gweru as the retail giant continues making losses since the advent of dollarisation four years ago.
But the process could run into problems as management and targeted retrenchees are differing on packages. Meikles Stores chief executive Ms Belinda Shapels confirmed the retrenchment saying the exercise was meant to save the business from collapse since it has been making losses.
“By retrenching staff members we hope to save 300 jobs, and so far we have transferred some staff members to our sister companies – TM, Barbours and Greatermans,” she said.
However, workers at the companies have expressed concern over the proposed packages.
“The package proposed by the management is an insult to the workers and the matter is now under the jurisdiction of the Retrenchment Board,” said one of the employees.
Negotiations lasted from July 4-20 and the parties reached a deadlock.
A letter seen by this newspaper indicates that the management is not prepared to budge from its position.
“Please be advised that the management has not moved from their last position of the negotiations as per our discussion in our meeting held on July 20, 2013,” read part of the letter.
An official said the division has been posting losses since dollarisation and the executive decided to diversify in terms of business through downsizing the concept of department stores resulting in retrenchment of workers.
“The division has posted losses since dollarisation and has total borrowings of US$25 million,
which accumulated due to the accumulation of losses, low sales and high operating costs,” said the official.
“As a result of the decline in business, Meikles Harare has closed to rationalise business.”
One of the letters explaining the reasons for retrenchment read: “Gweru has been downsized from 2 500 square metres to 500 square metres.
“It is critical that members of the staff are reduced to ensure the business can return to viability on a smaller operating base.
“The department store concept is slowly being overtaken by events globally, hence our need to downsize by reducing trading space in our stores and trimming staff as well.”