Inside the Zambia Airways Scandal

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Inside the Zambia Airways Scandal
Inside the Zambia Airways Scandal

Africa-PressZambia. Allegations of gross abuse of worker’s rights by Zambia Airways Chief Executive Officer, Bruk Edeshaw and rampant commercial and financial irregularities at the yet to be launched airline have emerged.

And investigations have shown that the Zambian Government through the Industrial Development Corporation has since has so far made a capital contribution of over US$4.5 million and has been paying Ethiopian Airlines $240,000 per quarter as Expert Fees even before the airline takes off.

Documents seen have shown gross abuse of worker’s rights, glaring commercial and financial irregularities which have seen the IDC paying legal fees for Ethiopian Airlines to resolve the issue of aircraft leasing because the airline would like to lease aircrafts to Zambia Airways which do not belong to them and the leasing company has not accepted their proposal.

Board Chairman Bonaventure Mutale confirmed in a phone interview that a Committee has been set up to investigate the allegations against the CEP and that the outcome of the investigations will be availed later.

According to a source with full knowledge of the matter, the work environment at Zambia Airways is allegedly a toxic, one-man show coupled with abusive and derogatory language from Mr Edenshaw.

The source revealed that since commencement of operations in 2019, Zambia Airways has not availed any written conditions of service to employees, disciplinary code or code of conduct to its employees. The situation has since seen an over 50% average employee turnover rate at Zambia Airways in the past two years.

The majority of workers have since resigned and those that have remained have written to the Board of Directors informing the Board of the insults they are subjected to and passed a Vote of No Confidence in Mr Endeshaw’s leadership.

The Board has since constituted a team to investigate the allegations. The workers also wrote to the Ministry of Labour to air their grievances. As the investigations against the CEO are ongoing, the HR and General Services Supervisor was fired last Friday.

Investigations also revealed that since commencement of operations in 2019, Zambia Airways has not availed any written conditions of service to employees, disciplinary code or code of conduct to its employees. The work environment at Zambia Airways has been described as toxic by people familiar with the matter who spoke on condition of anonymity.

“The workers are not allowed to act professionally but are rather coerced into carrying out directives. All those that attempt to resist are either fired or frustrated into resignation. There are no management meetings but only one to one sessions in which staff are given directives to follow. The general feeling among Zambia Airways staff is that their CEO does not have their welfare at heart. Officers use their personal vehicles to carry out company duties. There is no provision for company vehicles or staff loans to acquire vehicles. Zambia Airways offices are located at KKIA, the distance is too long and depleting the little income staff are paid,” a leaked internal document shows.

Further inquiries shave shown that the income gap between ET seconded staff and Zambia Airways staff is huge and may need to be realigned to address pay inequalities and the current organization structure of Zambia Airways Limited does not provide for a clear succession plan with a deliberate focus on knowledge transfer to local officers.

A detailed investigation has revealed that even before the airline could take to the sky, the Zambian Government through the Industrial Development Corporation has so far made a capital contribution of over US$4.5 million and has been paying Ethiopian Airlines $240,000 per quarter as Expert Fees even before the airline takes off.

And documents seen have shown that the IDC paying legal fees for Ethiopian Airlines to resolve the issue of aircraft leasing because the airline wanted to lease aircrafts to Zambia Airways which do not belong to it and the leasing company has not accepted the proposal to release the aircrafts to Zambia and now the IDC Is paying huge sums in legal fees to resolve this very strange decision.

There are number of commercial irregularities that have been unearthed at Zambia Airways beginning with the Commercial Contract signed between Ethiopian Airlines and Zambia Airways which was structured to favor E.T in all aspects and this contract is valid for 5 years.

In this Joint venture, the total expected capital is $30 million. The is expected to raise $16,500,000 while Ethiopian Airlines is expected to contribute $13,500,000 in the form of leasing the aircraft.

For instance, Ethiopian Airlines (E.T), according to the shareholders agreement is mandated to appoint a CEO despite E.T. being a minority shareholder.

E.T. is mandated under the commercial contract to provide consultancy services to Zambia Airways such as P.R, Marketing, Branding etc. at a contractual sum of $240,000 per quarter in the first 2 years, and $1,200, 000.00 in the subsequent years.

The contract also stipulates that ET shall provide Commercial support and trainings and yet Zambia Airways is made to pay extra such as Simulator training at $18,046.52, Pilots training at $85,000.00 and Cabin crew training at $1,535,312.50.

Investigations also show that the quarterly amount of $240,000 which Zambia Airways has been paying is way above the legal threshold for the CEO to authorize, nevertheless payments have been done and there are some pending invoices as E.T has continued billing Zambia Airways.

Furthermore, the flight schedule has also been designed to support E.T. as if Zambia Airways was a subsidiary of E.T. E.T. has been appointed as G.S.A (Ground Sales Agents) in Harare and Johannesburg.

And plans to contract a local PR and Marketing Agency to help with timely roll out of marketing activities and branding works for Zambia Airways offices and the Trade have been unsuccessful.

The procurement process for this was conducted by IDC and an offer sent to a local Agency but Zambia Airways CEO refused to engage the Agency, which was charging an amount of $11, 000 and opted for $240, 000 fee to ET.

This has meant long turnaround times for tasks requiring feedback from ET Marketing Team and the substandard work being done by ET in branding and the lack of creativity which can be seen in the Zambia Airways logo and branding which are below standard despite the huge payment to ET.

The source is calling on President Hakainde Hichilema’s administration to immediate dissolve Board and put the entire Zambia Airways project on hold and restructure the shareholders agreement.

There is also an appeal to the government to remove Mr Edenshaw from his post as CEO or send him on leave pending review of the operations of the airline.

A source also revealed that there is a meeting for staff of Zambia Airways at Mulungushi International Conference Centre on Monday morning at which workers are expected to face disciplinary procedure for airing out their grievances.

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