NUMSA (National Union of Metalworkers of SA) is the third labour organisation to take legal action against Denel for non-payment of salaries and employee benefits and the third to have the courts rule in its favour.
Denel employees at Denel Dynamics, Denel Land Systems, Denel Pretoria Metal Pressing, Denel Aeronautics and Denel Vehicle Systems have not been paid since mid-last year. The State-owned defence and technology conglomerate resorts under Public Enterprise Minister Pravin Gordhan and has reportedly also not made employee contributions to pension funds and medical aids.
Centurion-headquartered Solidarity and the United Association of SA (UASA), on Gauteng’s West Rand, also successfully turned to court in efforts to ensure members working at Denel are paid as per their employment contracts.
Yesterday’s order by the North Gauteng High Court in Pretoria stipulates Denel has 10 days to come up with the necessary funding to meet its employee commitments in full.
Denel is seemingly mired in financial mismanagement and, in addition to not meeting employee obligations (said to be in the region of R650 million), owes suppliers a further R900 million.
NUMSA general secretary Irvin Jim is quoted as saying: “Many staff has not been paid since May last year, while operational activities are significantly below capacity at 20 to 30% in most divisions”.
“Revenue is 60% behind the year-to-date budget it was revealed this week.”
Jim said each division was paid a percentage of salary, dependent on revenue generated.
“Sometimes they get 50%, 20% or nothing, but are still expected to work daily,” said Jim.
Finance Minister Enoch Godongwana, presenting his first medium term budget policy statement (MTBPS) last week, saw fit to give Denel a further R2.9 billion. It is believed the majority of this funding will go to pay debt the Irene, Centurion, headquartered State-owned enterprise (SOE) has racked up.