Strike power struggles do not benefit anyone in the country

Published Jun 3, 2014


The power struggle playing itself out between the management of the major platinum and other mines and the Association of Mineworkers and Construction Union does not bode well for job creation or even sustainable employment in the country.

The mine bosses have already indicated that retrenchments are inevitable because of the prolonged strike in the sector – and the longer the dispute continues, the more dire the consequences for South Africa’s mining industry and economy.

An almost four-week strike at the Port Elizabeth manufacturing plant of Continental Tyre South Africa (CTSA) over weekend pay rates provides some insight into what can happen when a union makes demands that are not supported by a corresponding increase in productivity and, ultimately, profits for the company to enable it to afford the higher overhead costs brought about by the higher wages.

The National Union of Metalworkers of SA (Numsa) was successful in getting CTSA to change its weekend pay rates but at the possible cost of the jobs of about 120 workers because changes to the shift pattern resulted in the tyre manufacturer having excess labour.

In a country with an already absurdly high unemployment rate, this settlement hardly seems to be in anyone’s best interests. It is also difficult to comprehend how any union can sell this sort of settlement to its members, particularly those who were later retrenched.

With rare exceptions, the harsh reality is that only increasingly profitable companies and employers can afford to significantly improve the wages and salaries of their employees.

Pick n Pay

The Ackerman family is feeling bullish about its family retail business, Pick n Pay, especially with the former chief executive of Tesco, Richard Brasher, at the helm.

In his address during the company’s annual general meeting (AGM) yesterday, the chairman, Gareth Ackerman, said: “I am, for the first time in some years, delighted to be opening this AGM this morning.”

As always, he stressed the importance of the family-owned business and its successes. The family control issue, which was raised at last year’s AGM, was revisited.

“First, the comment was made that family control dilutes shareholders’ rights and upholds a high dividend pay-out relative to peers in the retailer sector,” Ackerman said.

Shareholders were told that the dividend policy was reviewed in October 2013 and a board resolution was passed.

He added that over the years, there had been a definite shift from Pick n Pay being family-run to being family-controlled and professionally run.

“The truth of it is that Pick n Pay has not been family-owned for decades. Both Pick n Pay Stores and Pikwik are listed companies with substantial holdings by institutions and individuals,” he pleaded.

He added that the family should be given credit for recruiting one of the finest retailing chief executives in Brasher.

Another delight that he shared with the meeting was Pick n Pay’s ability to invest more than R2.6 billion and the projection that it would invest an additional R7bn over the next five years.

Last year, it purchased goods and services amounting to about R800 million from qualifying black-owned enterprises. The retailer also managed to create 5 000 jobs as a result of new stores opening.

Ackerman was also happy to announce that the board had asked him to stay on as chairman for a further five-year term.

Edited by Peter DeIonno. With contributions from Roy Cokayne and Nompumelelo Magwaza.

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