Union calls on Denel CEO to resign due to unpaid employee salaries

Liberated Metalworkers Union of South Africa (Limusa) called on Denel’s chief executive officer (CEO) Danie du Toit to resign after the state defence firm failed to pay their employees for May amid the Covid-19 pandemic.

Denel said last month that it was struggling to pay salaries for May while wages for June and July were at risk.

“Limusa condemns the ongoing failure by Denel to pay salaries that were due to workers on 25 May 2020. This unilateral action by the employer of failing to pay salaries has resulted to no income for all Denel employees during this time of need in the light of Covid-19 pandemic,” the union said in a statement on Sunday.

The union said they were disappointed on the “reckless” manner in how the matter was being handled by Denel management and Du Toit “as there was no proper consultation with organised labour on the matter”.

Denel had failed to apply on time for Covid-19 Temporary Employer/Employee Relief Scheme (TERS) as it only started to apply on 15 May 2020 which could have assisted in the situation according to the union.

“We are vindicated on what we described in June 2019 as a self-inflicted crisis by Denel executives led by Du Toit in his capacity as CEO.

“While we concede that Denel has liquidity issues, but some of those operational divisional executives and senior management who were part of the causes of this current liquidity issues are still Denel employees and no consequential management has been enforced,” the union said.

Limusa further said they were disturbed that the Du Toit failed to respond to a letter written by the union on 20 May 2020 regarding the non-commitment by Denel on payment of salaries for May, June and July.

“As the union, we still waiting for the response and committed to engage on the matter,” it said.

The union also called on Minister of Public Enterprise Pravin Gordhan to intervene on the matter and further find a lasting solution to the Denel crisis.

“It is also our concern that government hostility measures has a direct impact in sustainability of Denel, this was evident on the report tabled Parliament portfolio committee on defence and military veterans on 27 May 2020.

“This ongoing action by Denel is in fact unilateral change in conditions of employment and as such constitute unfair labour practice.

“Having taken to account section 32(3) of Basic Conditions of Employment Act, we demand that Denel management to pay the overdue salaries to all worker by no letter than 2 June 2020 or the union shall explore appropriate legal recourse on behalf of our members.

“We reiterate our call for Du Toit to resign because he continues to fail to bring about any positive results in turnaround Denel,” the union added.

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