Over 8‚000 Transnet jobs on the line

In a year where more than 113‚000 jobs have been shed across South Africa‚ according to Statistics South Africa’s latest quarterly jobs figures‚ unions at Transnet are up in arms.

Although the company this week denied it was embarking on another round of voluntary severance packages‚ TimesLIVE has seen an internal communications plan which suggests that an earlier round of voluntary severance packages (VSP) in March did not yield even 10% of the targeted 9‚022 employees.

The company had wanted to reduce its R25-billion labour costs by R4-billion‚ according to the plan‚ which was drafted at the beginning of this year.

Transnet’s intention to re-introduce VSPs and look at forced retrenchments next year was confirmed by several Transnet employees as well as others close to discussions.

According to reliable sources‚ the company approved only 655 applications for voluntary retrenchments - 209 management level and 446 juniors - out of 1‚791 applications.

Previous media reports on the issue suggested a second round was opened in May‚ but the move was thwarted by Minister Lynne Brown.

Transnet did not respond to requests from TimesLIVE to confirm the numbers of employees who left in March. Spokesperson Molatwane Likhethe said the company had embarked on “an intervention to improve organisational efficiency”.

“The VSP process was completely voluntary and was considered in line with business and operational requirements. “There were no specific targets set. The numbers you refer to were part of an earlier working document which was shared with certain key stakeholders. Transnet is continuously considering different cost saving initiatives‚ including reducing travel and accommodation costs‚ among others‚” he said.

Several Transnet insiders this week said the company was considering forced retrenchments in the next financial year if the target was not met.

According to an internal document‚ Transnet spends an average of 36% percent of its revenue on its 58‚800-strong labour force.

“Current labour costs have to be reduced to reflect a ratio of 31% of total revenue‚" said the March document.

“A labour cost saving of R4bn will reduce the ratio to 31% (excluding the cost of the VSP payment).

“It is against this backdrop that Transnet requires a R4bn saving in labour costs through the reduction of 9‚022 employees. The cost of voluntary severance packages for 9‚022 employees is estimated at R4bn which will be provided for in the new financial (2017/18) year.

“Other initiatives to reduce the labour costs include forced leave which saved the company R1-billion in the current financial year‚” the document said.

But unions at the company have decried the proposal.

Worker representatives questioned why a company which ended the previous financial year with a R2.8-billion profit and R6-billion cash in its bank account should want to retrench.

“Transnet has been recklessly awarding tenders‚ even to the Gupta family‚ without having looked at the company's financial viability. In the process they’ve hurt the company and we’re saying all those executive managers who made those myopic decisions should be suspended and dismissed for negligence‚” said National Transport Movement general secretary Ephraim Mpahlelele.

“This cannot be passed onto the workers. [They cannot be] punished for what they had no control over. We have been opposed to these retrenchments‚ voluntary or otherwise‚ on those grounds.”

Steve Harris‚ general secretary for the United National Transport Movement‚ another union on Transnet’s bargaining council‚ said although the union had not yet been informed of the intended VSPs‚ it made sense.

“I don’t think they met their targets after March because they opened a second round but then quickly closed it‚” he said.

“On a whole it is very concerning to us‚ particularly if you look at all the other jobs that are lost in other sectors. Remember‚ when one worker loses his job it is not just only him. Those who depend on him are also affected. So you always multiply that by at least eight people‚" he said.

The South African Transport and Allied Workers Union did not respond to questions.