Ladysmith KZN: Sumitomo Dunlop respond to strike action
In line with the Labour Relations Act and various collective bargaining agreements, Sumitomo Dunlop held 4 consultation sessions with employee representatives
The union representing workers being retrenched at Dunlop, outside Ladysmith, was picketing at the factory earlier today (October 12) as part of a strike action against the employer.
The Ladysmith Gazette approached Sumitomo Dunlop for a comment on the matter, with a statement being released by Sumitomo Rubber South Africa CEO Riaz Haffejee.
The statement says that only 32 employees have been retrenched, with 47 employees agreeing to take a voluntary severance package and others being absorbed within the business.
The statement reads as follows:
Flexibility of operations key for recovery
Sumitomo Rubber South Africa (Pty) Ltd (Sumitomo Dunlop), manufacturer of the Dunlop tyre brand, has recently undergone a re-organisation and restructure to its operations at the Ladysmith factory. The South African economy, in a recession since quarter four of 2019, is projecting record negative growth for 2020.
The domestic replacement tyre market, the largest market segment for Sumitomo Dunlop, has seen a decline in sales over the previous three financial years (2017, 2018 and 2019), with sales contracting by nearly 8% in 2019 vs the previous year.
Read initial story: Ladysmith KZN: Dunlop workers all set to strike
The declining market, coupled with the current impact of Covid-19, has resulted in the decrease of demand for tyres and has required that the company undergo a Section 189A process in order to protect the livelihoods of the majority of employees and position the company for future sustainability.
In line with the Labour Relations Act and various collective bargaining agreements, Sumitomo Dunlop held four consultation sessions with employee representatives, facilitated by a CCMA-appointed Commissioner. In these sessions, the company presented its proposal of a headcount reduction and a Flexible Operations Matrix.
The company proposed to reduce headcount by 122 employees across the Ladysmith production facility (115), Central Distribution Centre in Durban (6), and Jet Park Sales in Johannesburg (1).
Voluntary severance packages were offered, thereby reducing the number of affected employees to be retrenched from 122 to 32, with 47 employees agreeing to take the voluntary severance package and others impacted being absorbed within the business.
The Flexible Operations Matrix proposed will allow the company agility with regards to its working arrangement, in order to align production with market demand. Paramount to the long-term sustainability of the Ladysmith factory is the flexibility of factory operations, hence the need for the Flexible Operations Matrix.
Sumitomo Dunlop seeks to ensure that the factory is a sustainable world-class facility and is committed to drive recovery for the future.
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