Denel-manufactured RG31 MMP vehicles. File photo: Denel
Denel-manufactured RG31 MMP vehicles. File photo: Denel

Uasa accuses Denel board of abdicating its responsibilities, leaving workers in the lurch

By ANA Reporter Time of article published Feb 6, 2021

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JOHANNESBURG - The United Association of South Africa (Uasa) has accused the Denel board of abdicating its responsibilities and leaving workers in the lurch amid the coronavirus (Covid-19) pandemic.

After eight months of financial hardship, Denel employees want the state-owned arms manufacturer to take responsibility for all outstanding salaries and start paying them in full again, Uasa spokesman Stanford Mazhindu said in a statement on Saturday.

“Denel corporate decided, immediately after the first court hearing and judgment [on the matter], that each company division is on its own and must generate their own income, thereby abdicating their responsibility,” an employee was quoted as having said.

Denel workers spoke to Uasa on condition of anonymity for fear of reprisal. Some workers were cautious but hopeful that Denel may still pay them their full salaries, including backpay, even though their January salaries had not yet been paid, Mazhindu said.

However, a union leader at Denel said unless the company "gets a cash injection, there is no way they can trade themselves out of this situation".

Workers had not received their full pay since eight months ago, when the salaries for end of May last year were paid, he said.

“I am behind with my rent; I am indebted to such an extent that I have no idea how I will survive this much debt. My insurance policies are behind, my aunt, who looked after me since my mother died, is now no longer insured as I will not be able to take out a new policy for her because she is elderly. I can’t afford to buy my children the data they need for school work,” one worker was quoted as having said.

“At home in the Eastern Cape I had to release the person who was looking after my house in my absence as I could not pay or buy her groceries anymore. Since she left my house has been broken into several times,” said another employee.

Another one told how some workers lost their houses or rental homes. Others incurred huge debt by having to ask for payment holidays on bonds and policies, Mazhindu said.

The workers said they had been informed that the banks would no longer approve payment holidays. Workers who had not yet been paid for January did not have the means to travel to work and could barely feed their families. Many could not put food on the table and were asking about food parcels.

The employees said when the temporary employer/employee relief scheme (Ters) was still active, it helped them get by, but since the scheme ended they were back to receiving less than half of their pay each month although they were required to report to work every day.

“If I don’t report my boss calls me and will inform me that he needs me at work,” a worker said.

Uasa instituted contempt of court proceedings against the directors of Denel after the company did not act on a court order dated August 4, 2020 to honour all outstanding contractual and statutory obligations to Uasa members in its employ for the months of May, June, and July 2020, Mazhindu said.

In early December, the case was postponed, affording the board members further opportunity to file affidavits in response. But despite being given this second chance, the board members failed to disclose the true financial position of the company.

"On 28 January, Uasa argued in court that the directors failed to place enough credible evidence before the court to make a finding that the company was financially unable to comply with the court order of 4 August 2020, and that the board members stood indifferent to compliance and failed to do everything necessary to comply with the order. Judge Andre van Niekerk reserved judgment.

"The judgment will be emailed to Uasa’s attorneys as soon as Judge Van Niekerk has considered all the submissions. Uasa urges Denel management to comply with the judgment as soon as it is issued," Mazhindu said.


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