DSA retrenches 85

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Denel Saab Aerostructures (DSA) has retrenched 85 employees as delays with the Airbus Military A400M strategic airlifter programme and a thin order book continue to hurt the specialist business.

The trade union Solidarity says the retrenchments would originally have led to the sacking of nearly 17% of employees (about 141 employees) at the company.

DSA says the workers left the company’s employ on April 9.
“After more than five months, Solidarity and the other trade unions involved in the retrenchment process were able to ensure that the eventual number of forced retrenchments will be limited to only 85 – including voluntary severance packages,” Solidarity spokesman Jaco Kleynhans says. “Of the employees affected by forced retrenchments, only 16 are Solidarity members. Another five members have taken voluntary severance packages.”

In terms of the Section 189 notice issued to Solidarity in September, DSA’s management blamed the planned retrenchments on the high cost structure, insufficient income, the global recession and the delay of the A400M project.

Solidarity maintains that now, following the retrenchment process, the company must take the trouble to motivate the company’s employees. “During this current upswing in the economy, the company has a golden opportunity to manage the entity successfully, improve profitability and utilise the expertise at the company to best advantage of DSA,” Kleynhans said.

The notice period for employees affected by the retrenchments will end on 9 May, Solidarity said.

DSA adds that in an effort to minimise the impact of these retrenchments the company is implementing a social plan to assist the retrenched employees with individual training on business skills, entrepreneurship and job search skills. This training will be provided through accredited service providers. Further assistance to employees and their families will include financial and emotional counselling through the company’s “wellness at work” programme. The government funded lay–off scheme that was launched by President Jacob Zuma is also being explored to further assist the affected employees.

The retrenchments form part of a broader project of rationalisation of DSA’s operations, the full extent of which will see a general reduction in operating costs of up to 15%. The company has described the cost-cutting as critical in sustaining the ongoing momentum of its turnaround strategy, enabling it to become the reliable African link in the global aerostructures supply chain and continue to provide on-time service, quality and value to its customers as the company integrates seamlessly into their supply chains.

DSA has cited several contributing factors in the rationalisation, including the global economic recession, reduced orders on programmes such as the Gulfstream G150, as well as significant delays on the Airbus A400M programme. DSA staff have been kept informed of developments since November 2009, and affected employees are receiving appropriate support from the company.

Solidarity has welcomed the company’s assistance to employees during the retrenchment process. Among other things, the company has been making psychological support available to employees since last week.