Zimbabwe’s platinum mining giant, Zimplats Holdings Ltd, is facing a double whammy of a declining global market for platinum and a deteriorating economic situation in Zimbabwe, forcing them to begin voluntary retrenchments today.
This decision comes as the Zimbabwean economy experiences renewed currency volatility and surging inflation, leading to widespread company closures and downsizing.
Platinum prices have also been on a downward trend in the global market in recent years due to a confluence of factors affecting both supply and demand.
This decline in revenue, coupled with the economic downturn in Zimbabwe, has created a “difficult operating environment” for Zimplats, according to CEO Alex Mhembere.
The mining house, listed on the Australian Stock Exchange, will prioritise voluntary employee departures before resorting to compulsory retrenchments, with the ultimate approach depending on the effectiveness of the voluntary program.
“We have been communicating through our usual platforms about the difficult operating environment that we face. PGM prices remain very weak and this situation is projected to last for the next 12-18 months.
“We have been working with all teams across the board in implementing various cost containment and cash preservation programmes. I wish to thank all team members for diligently rallying behind our efforts in this regard.
“I am confident that as a team we will successfully navigate through the headwinds,” Mhembere said in a notice to employees.
“While our cost containment and cash preservation programmes yield expected results, the company’s situation remains difficult and therefore additional measures still need to be undertaken..
“One of the measures that the company will implement is a voluntary retrenchment exercise for all employees wishing to be considered. If successful, this will mitigate the need for a compulsory retrenchment.
“Those wishing to be considered for the voluntary retrenchment package should approach the respective Divisional HR Department for the application form beginning Tuesday 19 March 2024. The completed forms must be submitted to the respective HR Department by 22 March 2024.
“It is important to point out at the outset that management reserves the right to approve or decline any application based on business requirements and this is not subject to an appeal process.”
The voluntary retrenchment package will include two week’s pay for every completed year of service, one-month notice pay and a minimum guaranteed package of three months for employees whose retrenchment package is less than three months.
The company said all statutory requirements will be paid out together with the package.
Approved applicants will receive a voluntary retrenchment agreement detailing the terms and conditions of the retrenchment, including all payments due.
Zimplats said employees who proceed on voluntary retrenchment will be considered good leavers and will be eligible for re-employment in the future whenever suitable new opportunities arise.
Zimplats Holdings Limited, a Guernsey-registered mining company, extracts and processes platinum group metals (PGMs) and other minerals from Zimbabwe’s Great Dyke. Listed on the Australian Stock Exchange, they operate mines in Ngezi and processing plants in both Ngezi and Selous.
Their subsidiary, Zimbabwe Platinum Mines, runs the five underground mines feeding the three concentrator modules.
Zimplats holds mining rights for two key areas: Ngezi for mining and processing, and Hartley for concentrating and smelting operations. The company sells white matte, a product containing various precious metals.
