Denel employees facing short time and lower salaries

09 April 2018 - 11:51 By Katharine Child
The staff received letters on Friday‚ saying the short time was a “result of the financial state over the last three years”.
The staff received letters on Friday‚ saying the short time was a “result of the financial state over the last three years”.
Image: Gallo Images/Thinkstock

Hundreds of employees at state-owned Denel subsidiary Denel PMP have been told they will be put on short time.

This is a legal way to employ people for fewer days in order to pay them less in a bid to avert retrenchments.

Staff were sent letters on Friday afternoon from PMP CEO Phaladi Petje‚ saying short time would start within five days.

PMP makes small-scale ammunition‚ including bullets‚ as well as mining drill bits.

An employee who did not want to be named said staff had been told they would now only have a four-day work week. Rumours are circulating that there will not be money to pay salaries at the end of the month.

Solidarity deputy general secretary Deon Reyneke said about 900 employees were affected.

“We represent 120 of them.”

The staff received letters on Friday‚ saying the short time was a “result of the financial state over the last three years”.

The letter states: “We trust that we all understand the circumstances of the company and the need to take such action.”

Reyneke said: “There are cash flow problems and no orders [being placed].”

In December‚ PMP staff were told they may not receive their salaries. But a loan from Treasury was organised at the last minute and staff were paid days before Christmas.

Some Denel staff were paid their 13th cheques a month late‚ even though the 13th cheque was actually money they had put aside monthly from their salaries in a forced savings scheme that allows a bonus in December. This money was not available until Treasury stepped in and they were paid bonuses late.

Reyneke said that the whole of Denel was facing cash flow problems and is believed to only have enough money to pay its roughly 4‚000 employees up until May.

Denel did not respond to queries but it announced that Minister of Public Enterprises Pravin Gordhan is to address the media on Monday afternoon to discuss its issues after meeting with trade unions.

Last month Denel chairman Daniel Mantsha resigned.