Trade union UASA will institute contempt of court proceedings against Denel after the state-owned defence firm failed to honour a labour court order to pay all outstanding contractual and statutory obligations for the months of May, June and July 2020, UASA has announced.
Denel was last week ordered by Judge Andre van Niekerk to settle outstanding salaries for employees by no later than Friday 7 August and at the same time ensure payments were made for tax, medical aid and pension funds among others. Denel was also ordered to pay the costs of the application brought by unions to get Denel to pay salaries.
“Our client has instructed us that, as indicated previously, it is unable to comply with the court order today,” Denel’s lawyers wrote in a letter to unions last week, adding Denel would aim to give an update by no later than the end of this week. “Our client requests your clients grant it an indulgence to enable it to work on measures to raise funds,” the letter said.
Consequently, “UASA will proceed with the enforcement of the Court Order. UASA urges government as the only shareholder in the State-Owned Entity to intervene and find an urgent solution to the liquidity crisis to ensure our members get their outstanding salaries as well as full future salaries,” it said.
Denel’s wage bill amounts to around R150 million a month.