Denel fails to pay full salaries
25 June 2019
Liberated Metalworkers Union of South Africa (LIMUSA) is highly concerned with the ongoing crisis in Denel predominantly caused by its Executives. Workers were only informed via work email at 20:09 p.m. on the evening of the 24th of June 2019 that they will only be paid 85% of their salaries on the 25thJune 2019 but that has not materialised, even to the promised FNB Account holders as per the communication at time of issuing this statement.
There is no Denel employee who has been paid their salary and an employee-employer contract has been breached because it is stipulated on their contract that employees will be paid on 25th of each month.
This recent development is not only unlawful but also irresponsible and unprofessional on part of Denel Management to have failed to timeously inform workers on the possible short pay in salaries as per their promise to communicate by the 14th of each month.
It is our considered view that this crisis, self-inflicted by Denel Board and Senior Management, as it is alleged that Group CEO Mr Du Toit to date, besides his monthly salary, has received R600 000 relocation fee, R1.5 Million (R750 000 in Mid-February and R750 000 in Mid-April) and it is also alleged that he is expecting approximately 50% (= approximately R 2.5 Million) of his Annual Income in June as per his KPAs, set by the Denel Board.
These exorbitant and unjustified millions are spent on a Group CEO which has nothing to show in terms of turning the organisation around, stabilising the financial challenges facing Denel and holding any Denel Executive or Senior Manager accountable especially those implicated in the Zondo Commission Investigation. Yet, the aforementioned Executives or Senior Managers are still holding their respective Executive or Senior Management positions and influencing company decisions.
We also are informed that millions been spent on companies like; Altimax (Pty) Ltd Chartered Accountants & registered auditors, Bowman Gilfillan Attorneys, PwC (PricewaterhouseCoopers), Mr. Wim de Klerk (“Volunteer” CFO) and Mr. Willem Nel (Interim Group Supply Chain Specialist).
It is once again alleged that the Company procurement policies and procedures as well as the PMFA (Public Finance Management Act) and Regulations has been breached in appointing the above mentioned companies and persons.
Denel should take responsibility for any cost implications to workers as a result of irresponsible and unprofessional last minute notification. Denel must pay all incurred costs or penalties due to unpaid debit orders, all the costs to employees and we also expect them to pay the interest accrued on the 15% salary balance as Section 75 of the BCEA. We shall seek commitment as to when the remaining 15% of worker salaries will be paid.
It is very suspicious and concerning that Denel doesn’t even have a Company Secretary and/ or it hasn’t been advertised as stipulated in the Company’s Act.
We further want to call on the Denel Group CEO to take responsibility for having failed on his duties to effect a turnaround strategy which has now resulted in the non-payment of salaries. Due to his dismal performance, Denel Group CEO, Mr. du Toit should render his resignation with immediate effect. Furthermore, the Denel Board is expected to account for the wasteful expenditure.
Issued by Mawonga Madolo, Deputy General Secretary, LIMUSA, 25 June 2019
