Photo: Siphiwe Sibeko/Reuters
Photo: Siphiwe Sibeko/Reuters

Denel under pressure to pay salaries, debt

By Mwangi Githathu Time of article published Jul 29, 2020

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Cape Town - Cash-strapped state-owned arms manufacturer Denel says it needs more time to secure outstanding funds owed to it by debtors in order to pay salaries and its suppliers.

This comes after trade unions Solidarity and Uasa announced plans to take legal action against Denel in the Labour Court over non-payment of salaries.

Uasa spokesperson Stanford Mazhindu said: “The team working with the Denel matter has told me they are not aware of any extension. The only thing we know for certain right now is Uasa will be in court on August 4 taking on Denel over the non-payment of salaries.”

Denel spokesperson Pam Malinda said: “The company has requested the unions to be patient as it moves to finalise a solution that is acceptable to all parties by the latest on August 31.

“These are extremely difficult times and Denel remains committed to its employees and is counting on their support during this trying and uncertain period. The organisation will ensure the payment of salaries as soon as monies are available.

“Denel’s resolution is not to oppose the court application. Denel remains committed to finding a mutually acceptable solution together with organised labour outside of court. The company has stated that its representatives, supported by Denel’s board and shareholder, will avail themselves to further engage with the trade unions.”

“As a state-owned company, Denel has requested financial support from the government, its sole shareholder, and is doing everything in its power to pay all outstanding salaries and related statutory obligations,” added Malinda.

“Denel is seeking more time to secure outstanding funds owed to it by debtors in order to pay salaries and its suppliers, which it is determined to do.

“The implementation of the Denel turnaround plan is progressing steadily and Denel remains a valuable national asset.

“The turnaround plan is focusing on disposing of non-core assets and seeking strategic equity partners that will contribute towards skills upliftment, access to markets, investment in technology and research and development, as well as funding skills.”

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