Union in Labour Court for claim on Denel money

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Trade Union UASA (United Association of SA) wants a share of what it expects to be a R1 billion pay-out to embattled Denel from its medical benefit trust.

To this end the Florida, Gauteng, labour organisation today (Tuesday, 5 April) brought an urgent application to the Labour Court asking the court to rule in its favour on three issues.

They are for Denel to honour all outstanding contractual obligations and pay UASA members at the State-owned defence and technology conglomerate full remuneration from August 2020 to date; deduct and pay all statutory and other contributions deductible in terms of employment contracts and relevant legislation for the same timeframe and execute payment within 14 days of the date of the court order.

“UASA seeks the court’s intervention in the light of the expected R1 billion pay-out Denel will receive from the Denel Medical (Benefit) Trust Fund. On 24 February this year, the High Court ruled a variation of the fund deed allows for excess trust funds to be allocated to Denel.

The UASA application comes three weeks after Pretoria attorney Ipeleng Motshegoa obtained a warrant freezing a Denel bank account to settle R4.7 million worth of outstanding salaries and employee benefits for an unnamed group of current and past Denel employees. He told defenceWeb the outstanding amounts were settled “in full” following intervention by the Sheriff.

“The state-owned enterprise owes workers almost R830 million in unpaid salaries it is logical the money be used to pay all outstanding salaries,” UASA’s Abigail Moyo said.

UASA members cannot obtain IRP5s or tax compliance certificates from SARS (SA Revenue Service) because of unpaid taxes. Some have paid medical expenses from their own pockets due to non-payment of medical fund contributions by Denel.

Moyo “urges” Denel to put employees out of their misery and pay what is due.

“UASA members survive on a hand-to-mouth existence; some lost properties and vehicles due to financial strain while other employees haven’t been able to pay children’s school fees.

“Denel is acting unlawfully and thousands of employees and their dependants suffer daily.”

“Denel’s contractual and statutory obligations breaches cause UASA members harm and hardship on an ongoing basis,” she said, adding, “It has been almost two years since they last received full remuneration. Despite these excessive hardships UASA members still continue to work”.

UASA, Moyo said, had no alternative but to approach the Labour Court for relief.

At the same time she explained UASA’s use of “judicial supervision” rather than “contempt” in its legal dealings with Denel.



“‘Judicial supervision’ or ‘Judicial oversight’ instead of ‘contempt of court’ is used on UASA statements about Denel because when UASA started with this case against Denel, it was contempt of court where the outcome of the case would have been the same as a criminal court sanction, where the Denel CEO would have been detained or paid a hefty fine. The court found Denel was not in wilful contempt, thus the Labour Court decided to keep the case as ‘judicial oversight’. This is when Denel was ordered to explain to the court on several occasions as set by the court on progress with the process, payments made, and how far they are in fully complying with the court order. Hence the term ‘judicial oversight’.”