Jet store.
Jet store.

Union says Jet workers 'hoodwinked' with VSPs

By Dineo Faku Time of article published Sep 16, 2020

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JOHANNESBURG - About 4200 employees at Edcon’s Jet stores had accepted voluntary severance packages (VSPs) following an agreement with management, the South African Commercial, Catering and Allied Workers’ Union (Saccawu), said yesterday.

Saccawu’s head organising, campaigning and collective bargaining, Khulekani Ngubane, said the employees received the VSPs without the involvement of the union.

Ngubane claimed that the recipients were hoodwinked by management. “They were not informed properly about the VSP, and the company negotiated directly with the workers, and there was no union involvement in the VSPs,” said Ngubane.

In June, Edcon served about 22000 employees with section 189 notices, which were an invitation for consultation on the company's restructuring.

The group’s business rescue practitioners (BRPs) earlier said the section 189 process was on track and would be finalised this month but could not provide further details.

Edcon concluded a sale-of-assets agreement with The Foschini Group (TFG) for parts of the Jet business, and the Competition Commission approved the sale of parts of the Edgars business to the Durban-based Retailability Group. The BRPs said all the Edgars stores that had not been transferred as part of the Retailability transaction had been closed.

“On the Jet side, the stores not going across to The Foschini Group (TFG) are in the process of being closed,” said the BRPs.

“The closing of the transactions is targeted for September 2020. The business rescue process will continue into 2021. We will update all stakeholders as we move forward in the plan,” said the BRPs.

In July, TFG proposed the acquisition of 371 Jet stores for R480million, saying it was a unique opportunity, which previously was not possible at an attractive price. Ngubane said the union thought that Jet would be sold to one employer without any job losses.

“There are other workers who have lost their jobs at Jet, and the same applies to Edgars stores,” Ngubane said, adding that the union had reservations about the business rescue process.

“They (BRPs) failed to rescue Ellerines. The way Ellerines died a slow death, it was sad to see workers lose their jobs.”

Edcon, the 90-year-old retailer, filed for business rescue in April, saying that between March and April it had lost R2bn in sales and had problems collecting what it was owed from customers. The BRPs embarked on an accelerated process of Edcon’s subsidiaries Edgars, Jet and the loyalty programme Thank U in a bid to salvage the business.

BUSINESS REPORT

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