This news aggregator site highlights South African labour news from a wide range of internet and print sources. Each posting has a synopsis of the source article, together with a link or reference to the original. Postings cover the range of labour related matters from industrial relations to generalist human resources.
In our afternoon roundup, see summaries
of our selection of South African labour-
related stories that appeared thus far on
Thursday, 5 December 2019.
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SAA to take business rescue route to avoid “a disorderly implosion of the airline” BL Premium reports that the government announced on Wednesday that South African Airways (SAA) was to be placed in business rescue. The move came after a week of speculation on the airline’s future, which is massively loss-making. Two weeks ago, trade union Solidarity filed court papers requesting, as an interested party, that the airline be placed in business rescue. Public enterprises minister Pravin Gordhan said that business rescue was the best way of avoiding a disorderly implosion of the airline. Business rescue, under the Companies Act, is an attempt to rehabilitate companies that are financially distressed by restructuring their affairs. The objective is to enable the company to continue operating while being restructured, saving some jobs in the process. Gordhan indicated as follows: “As soon as the decisions are made, a business rescue practitioner will be put in place and from that point on the business rescue practitioner will run the airline and will consider the steps that need to be taken so that the end result of the restructuring process is a viable, financially stable and operational entity.” He said SAA had, on that basis, secured the necessary funding to enable it to continue trading. These were to be announced in due course. Business rescue is certain to result in a radical restructuring of the SAA business and possibly of its subsidiaries. SAA has been without a CEO since June. It had also been attempting to attract a new chief restructuring officer, following the premature departure of the previous incumbent. Read the full original of the report in the above regard by Carol Paton at BusinessLive (paywall access only). Read too, SAA board unanimously backs business rescue, at BusinessLive Solidarity sets right SAA’s account of how business rescue decision took place BusinessLive reports that trade union Solidarity has claimed credit for the decision to place ailing state-owned South African Airways (SAA) into business rescue and has criticised the government for wanting more control over a process it was initially opposed to. SAA spokesperson Tlali Tlali said on Thursday that the decision was taken by the SAA board of directors on Wednesday night to create “a better return for the company’s creditors and shareholders, than would result from any other available solution”. He advised that the board of directors would announce the appointment of business rescue practitioners in the near future. However on Thursday Solidarity COO Dirk Hermann said the decision to go the business rescue route was “the consensus between the legal teams of Solidarity, the SAA, the minister of public enterprises [Pravin Gordhan] and the minister of finance [Tito Mboweni] during a meeting with the deputy judge president of the South Gauteng High Court”. Solidarity said that during the meeting, the airline undertook to ratify a resolution that the company voluntarily be placed under business rescue on Thursday, failing which Solidarity's business rescue application would be heard on 13 December. Hermann said it was not a voluntary business rescue process, but had been enforced by Solidarity’s application. Indicating that the government “is now trying to obtain more control over a process they had been opposed to in the past,” Hermann said they would ask other trade unions to jointly demand that organised labour have influence in the appointment of the business rescue practitioner. Read the full original of the report in the above regard by Luyolo Mkentane at BusinessLive Treasury and lenders to provide R4bn for SAA business rescue BL Premium reports that South African Airways (SAA) will get R2bn in cash from the Treasury and another R2bn loan guarantee to raise finance from commercial banks to facilitate its business rescue process. This was announced by public enterprises minister Pravin Gordhan on Thursday morning. The airline, which has been placed in business rescue by its board of directors, had been unable to raise finance from either the Treasury or lenders to continue operating. The funding will enable the company to continue operating while it is being restructured. “It must be clear that this is not a bailout. This is the provision of financial assistance in order to facilitate a radical restructure of the airline,” Gordhan indicated. The R2bn in cash would be provided in a “fiscally neutral way”, which means that the government will need to raise the money, for instance, from the sale of state assets. The R2bn bank loan will be repaid by the Treasury from future budget appropriations. The government has also given lenders a commitment that the existing debt of R9.2bn and interest will be fully repaid and will not be affected by business rescue. Read the full original of the report in the above regard by Carol Paton at BusinessLive (paywall access only) Unions demand clarity on what ‘radical restructuring’ of SAA would entail BusinessLive reports that the two unions behind the recent damaging strike at South African Airways (SAA) say they want the government to explain what the proposed “radical restructuring” of the loss-making airline would entail. SA Cabin Crew Association (Sacca) president Zazi Nsibanyoni-Mugambi and National Union of Metalworkers of SA (Numsa) spokesperson Phakamile Hlubi-Majola claimed that the unions had not been consulted on the proposed process. “We have written letters to president [Cyril Ramaphosa], finance minister Tito Mboweni and public enterprises minister Pravin Gordhan to find out what it means. We have written to the SAA board as well,” said Nsibanyoni-Mugambi. However, SAA spokesperson Tlali Tlali said that on 11 November the airline had advised unions and employees that it was considering a restructuring process in terms of section 189 of the Labour Relations Act (LRA). “Based on this provision, the communication served as a notification that the consultation process would soon get under way. To the extent we are aware, our conduct has not been inconsistent with the LRA, particularly in relation to consultation that must happen before restructuring occurs,” Tlali said. On Sunday, the government said the national airline would have to go through a “radical restructuring process” to survive as it “cannot continue in its current form.” Read the full original of the report in the above regard by Luyolo Mkentane at BusinessLive Other internet posting(s) in this news category
Helicopter pilot spraying crops dies after crashing in KZN News24 reports that a person was killed on Thursday after a helicopter crashed in Eshowe, north of Durban, paramedic services have said. "Unfortunately, the pilot of the light aircraft sustained fatal injuries and was declared deceased on arrival by IPSS paramedics," IPSS spokesperson Paul Herbst indicated. He said the pilot was believed to be crop spraying in his R44 helicopter when "it got into difficultly and allegedly struck power lines". Local community members pulled the pilot from the burning aircraft, despite him showing no signs of life. Read the original of the above report by Kaveel Singh at News24. See too a report at TimesLIVE Other internet posting(s) in this news category
SA cricketers to meet on Friday to decide whether to take industrial action TimesLIVE reports that the SA Cricketers’ Association (Saca) will meet on Friday with the possibility of all the players going on strike high on the agenda. Saca represents all professional men and women cricketers in the country and a strike would have devastating consequences on the incoming England tour later in December. Relations between Saca and Cricket SA (CSA) have soured over the restructuring of the domestic game‚ a matter that is now before with the South Gauteng High Court. Saca CEO Tony Irish said the deteriorating relationship between the two parties had led to the need to discuss the possibility of the players “taking some form of industrial or protest action.” Saca recently lodged a dispute with Cricket SA over unpaid commercial fees from 2018’s Mzansi Super League (MSL) and now they have sent the embattled organisation a letter to address a demand in relation to the unlawful use of player commercial rights in the ongoing MSL 2.0. CSA spokesperson Thami Mthembu confirmed that they had received the letter, were studying the contents and would “engage Saca in relation to attempting to resolve this matter.” Read the full original of the report in the above regard by Khanyiso Tshwaku at BusinessLive. Read too, Player strike on cards as cricket ‘war’ intensifies, on page 3 of The Citizen of 5 December 2019. And also, More woes for CSA as players threaten to strike, at The Star
Mining companies struggle to live up to community demands, says Minerals Council BL Premium reports that Minerals Council SA (MCSA) officials said on Wednesday that ailing municipalities were leaning heavily on mining companies for infrastructure projects, diverting spending away from investments and fuelling strife around mines. In the latest flare-up of tensions around mining operations as SA’s economy falters and unemployment grows, Rio Tinto shut its Richards Bay Minerals operation after an employee was shot and wounded in community unrest. There were an estimated 330 community unrest incidents recorded by mining companies in the first six months of 2019 compared to 260 incidents during the whole of 2018, according to data collected by the MCSA (previously called the Chamber of Mines). Protests have brought mines to a standstill as communities demand jobs and the right to supply mining operations with services and materials. In revealing the compliance levels of 32 MCSA member companies with the now defunct second Mining Charter replaced at the end of 2018, the MCSA’s Tebello Chabana conceded that the reasons for community unrest were manifold. A key problem was that municipalities signed off mining companies’ social and labour plans as the legal representative of communities, using mining companies to ease pressure on their finances and devolve responsibility. The consequences of “dysfunctional” municipalities focusing on mining companies to provide basic services was that it was unlikely there would be sustainable businesses in those communities once mining of finite resources had ended, Alex Khumalo, the council’s head of community relations, pointed out. Read the full original of the report in the above regard by Allan Seccombe at BusinessLive (paywall access only)
Fedusa parts ways with long-serving general secretary Denis George Business Report writes that the Federation of Unions of SA (Fedusa) on Wednesday officially parted ways with its long serving general secretary Dennis George through a settlement in which he would get no compensation. In a statement, the parties announced they reached the agreement through a CCMA process. The terms of the agreement will remain confidential. George, who has now set his eye on entrepreneurial ventures in the tech space, said his decision to purchase shares in AYO Technology Solutions had been to warehouse the shares in Difeme Holdings on behalf of Fedusa. He stated that he, for his part, did not receive any financial gain of a personal nature from the purchase and that the warehoused shares were purchased with the aim to empower trade unions, workers and rural communities. Fedusa put George on special leave in February, which turned into cautionary suspension, while a law firm investigated the matter. He was fired in May on claims that he might have personally benefited through the acquisition of AYO shares through his company Difeme Holdings. Fedusa has constantly maintained that it never gave any “mandate for the acquisition of shares from any company in the name of the trade union”. The federation dismissed what it called an attempt to link it to Difeme Holdings. Read the full original of the report in the above regard by Banele Ginindza at Business Report Other internet posting(s) in this news category
Government Employees Pension Fund hit by R7.4bn in write-offs in 2017/18 financial year BL Premium reports that the Government Employees Pension Fund (GEPF), which manages the savings of government employees, has written off two of its most controversial investments at a cost of R5.3bn. The fund, which has assets of about R1.8-trillion, had R7.4bn in impairments for the 2017/18 financial year, compared with R995m the previous year, according to its annual report tabled in parliament on Monday. A R4.3bn investment in Steinhoff’s empowerment shareholder, Lancaster, which is partially owned by Pepkor Holdings chair Jayendra Naidoo, was rendered worthless after a 2017 accounting scandal wiped off about R200bn of the furniture retailer’s value. The GEPF also wrote off about R1bn of loans and investments in companies controlled by Iqbal Surve, the owner of Independent Media. Also included in the GEPF’s impairments was the R375m investment in VBS Mutual Bank, which collapsed in 2018 amid allegations of massive fraud that saw directors steal about R2bn, as well as R492m in Afgri Poultry. The fund reported that its assets managed by the PIC grew by 8.3%. The PIC invests more than R2-trillion on behalf of the GEPF and other social funds, and is the largest single JSE investor. Read the full original of the report in the above regard by Linda Ensor at BusinessLive (paywall access only) Exposure to SA economy slowed GEPF investment growth in 2018/2019 BusinessLive reports that the Government Employees Pension Fund (GEPF) saw the growth of its investment portfolio grind to a halt for its past financial year, because of its exposure to the SA economy. On Thursday, the fund published its annual report for the year ending March 2019, which showed that its portfolio only grew by 0.88% to R1.818bn during the year as poor returns from the JSE weighed on its equity. “We need to find other sources of income and return. This is related to the question of the diversification of the GEPF [into international assets]. If we are exposed to the SA economy ... then our portfolio hits a plateau,” said principal executive officer Abel Sithole. The small increase in the portfolio was largely due to the difference between contributions from members and investment income being greater than the benefits paid to members, essentially meaning the value of the portfolio remained static during 2019. Read the full original of the report in the above regard by Warren Thompson at BusinessLive
Old Mutual says it is open to settlement with axed CEO Peter Moyo to end damaging dispute BL Premium reports that Old Mutual and its former CEO Peter Moyo were back in court on Wednesday, with the insurer reiterating that it had no trust in Moyo, which meant that a court ruling that he be reinstated was “impossible” to implement and therefore should be overturned. Moyo’s lawyers, in turn, accused the insurer of imposing a corporate “death sentence” on him by accusing him of conflict of interest and then dismissing him without subjecting him to a disciplinary inquiry. Old Mutual has been embroiled in a bitter feud with its former CEO since May, when it suspended, and later fired, him over alleged conflicts of interested related to NMT Capital, of which Moyo is one of the founders and Old Mutual was a 20% shareholder. Old Mutual spokesperson Tabby Tsengiwe indicated on Wednesday that it would “take years” to undo the reputational damage caused by the saga, and reiterated that Old Mutual remained open to settlement negotiations with Moyo. The former boss has sued Old Mutual for R250m for breach of contract and harm to his “dignity, esteem and self worth”. In the meantime, though, the company is appealing against Judge Brian Mashile’s July order that it reinstate Moyo and hold back on appointing his permanent replacement. It is also seeking the judge’s recusal from the contempt of court application launched against it and its nonexecutive directors by Moyo. Moyo’s lawyers have argued that the interim interdict granted by Mashile cannot be appealed. Read the full original of the report in the above regard by Karyn Maughan at BusinessLive. Read too, Peter Moyo v Old Mutual battle continues, at Business Report
Nullified Equality Court judgment against BLF leaders paves way for criminal case, says Solidarity News24 reports that trade union Solidarity says that although Black First Land First (BLF) leaders have been saved from punishment in the Equality Court over remarks made about the Hoërskool Driehoek tragedy, the court's judgment has laid the foundation for a criminal case. In February this year, four Driehoek pupils were killed and 26 others injured when a concrete slab linking two buildings at the school fell on them. In the wake of the incident, BLF spokesperson Lindsay Maasdorp said their deaths meant future problems had been eliminated, adding the incident was God responding. Judge Ratha Mokgoatlheng found Maasdorp guilty of hate speech and ordered him and the BLF's deputy secretary-general, Zwelakhe Dubasi, to pay R50,000 in damages to each of the affected families of the dead children, which would have amounted to R200,000. However, due to a recent ruling by the Supreme Court of Appeal (SCA), which found that the current definition of hate speech was unconstitutional and invalid, Judge Mokgoatlheng was forced to nullify his ruling. Solidarity then announced that a criminal case could still be pursued, notwithstanding that the SCA had ruled part of the Promotion of Equality and Prevention of Unfair Discrimination Act to be unconstitutional with the outcome that Maasdorp and Dubasi could not be punished using that legislation. Solidarity’s head of legal services Anton van der Bijl said the Equality Court judgment was the perfect platform to launch a criminal case to ensure justice was served. Read the full original of the report in the above regard by Alex Mitchley at News24
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