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Business Times reports that retrenched staffers at embattled construction company Group Five are living from hand to mouth because they have yet to be paid out their severance packages.
According to the business rescue practitioners (BRPs), who took over the reins of the company in March in an attempt to trade it out of financial trouble, there is simply no money to pay them and they do not know if, or when, there will be. But a group of seven are challenging this in an urgent application before the labour court, claiming they are being treated unequally because those who took voluntary retrenchment were paid. Collectively, they are apparently owed more than R1.5m in retrenchment pay and bonuses. The group has accused the BRPs of "unilaterally deciding which creditors must be paid, and, more egregiously, which employees were entitled to be paid and which weren't". The response has been that those who had volunteered for retrenchment had been paid because they agreed to less than the statutory severance payment. Bradley Workman-Davies, the attorney for the BRPs, indicated that the application would be opposed because of the "breathing space" provided by the Companies Act – that no company under business rescue could be sued. He said payment would be made as soon as funding was available. A business rescue plan was supposed to be published in June, but the practitioners have asked for an extension until the end of August.
- Read the full original of Tania Broughton’s Sunday Times Business Times report on the above at BusinessLive (paywall access only)
Get other news reports at the SA Labour News home page