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TimesLIVE reports that Edcon Holdings has served 22,000 of its employees with section 189 (retrenchment) notices.
In March, the retailer announced that it was in business rescue, explaining it was unable to pay its suppliers for the March and April month-ends. Edcon, which owns Edgars and Jet stores amongst others, is now seeking buyers. On Thursday, Edcon's 22,000 workers were served with retrenchment notices by the company's business rescue practitioners (BRPs). The notices, dated 10 June, were addressed to all employees, as well as the SA Commercial, Catering and Allied Workers’ Union (Saccawu). “The company's financial position has recently become distressed due to the following; poor sales ... the recession in the South African economy, exacerbated by frequent load-shedding which disrupted purchasing patterns,” Edcon indicated. It also said its business plan had suffered due to the initial 45-day hard Covid-19 lockdown period that had prohibited trading of non-essential products. Saccawu's Lucas Ramatlhodi pointed out that the company had received a cash bailout from the PIC in the very recent past, but “we still haven't received feedback in terms of how the bailout had assisted in terms of turning the company around.” Their concerns have been raised with trade and industry minister Ebrahim Patel. BRP Lance Schapiro said the intention was to sell the entire business, which would result in a significant number of jobs being saved, but a sale of parts of the business would result in job losses.” However, “no binding offers have been received and therefore we cannot predict which parts of Edcon will be successfully sold”, so it was considered to be prudent to start section 189 consultations with all employees.
- Read the full original of the report in the above regard by Isaac Mahlangu at TimesLIVE
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