StanChart, retrenchees clash over forex packages

At least 31 former Standard Chartered Bank of Zimbabwe middle managers are demanding their retrenchment packages in foreign currency in line with the settlement reached between the parties at the time, two years ago.

The retrenchees who have all along been getting their payment in hard currency approached the High Court for intervention after the bank switched to paying them in local currency.

The Statutory Instrument SI-33 of 2019 was promulgated to give effect to currency changes announced in the Reserve Bank of Zimbabwe (RBZ)’s Monetary Policy Statement in February last year.

Also known as the Presidential Powers (Temporary Measures) (Amendment of Reserve Bank of Zimbabwe Act and Issue of Real Time Gross Settlement Electronic Dollars (RTGS Dollars) Regulations, 2019 prescribed “that every enactment in which an amount is expressed in United States dollars shall, on the and after effective date, be construed as reference to the RTGS dollar, at parity with the United States dollar, that is to say, at a one-to-one rate.”

The provisions of SI 33 of 2019 are now codified in section 22 of Finance Act No 2 of 2019.

The bank allegedly stopped payment of retrenchment packages from January 24 last year to date.

An attempt to engage the bank authorities through their lawyers Warara and Associates yielded nothing, as the bank made it clear that the 31 had access to the United States Dollars under the multi-currency environment that was prevailing then.

“The respondent is now trying to run away from its obligation by claiming that payment can be done in any currency and is using changes in monetary policy as an excuse yet the agreed position remains that it is obliged to pay retrenchment package in United States Dollars in terms of the settlement that was reached on 9 August 2018,” said Ms Jacqueline Manduna, who deposed to an affidavit in the class action.

She said the bank relied on foreign facility that was only designed to cater for retrenchment packages of the retrenchees.

“The respondent applied for foreign currency outside Zimbabwe for the purposes of paying the retrenchees their packages,” she stated.

Further, the retrenchees are accusing the bank top executives of diverting the money that was meant to cater for the retrenchment packages of the retrenchees to other uses.

Stanchart Bank Zimbabwe head of legal and corporate secretary Mr Charles Kamba, argued that the bank fully discharged its obligation to each of the applicants upon payment of the retrenchment packages.

He said the relief sought by the retrenched managers was legally untenable.

“There was never an agreement between the parties that at all material times and not withstanding  legislative changes the respondent would pay the retrenchment packages in United State Dollars,” said Mr Kamba.

He said the introduction of the SI33 of 2019 meant that all liabilities which the bank had towards the retrenched managers were automatically converted to that newly introduced RTGS dollar by operation of the promulgated legal instrument. – Herald