Photo: Twitter/DefenceWeb

Unions file court papers after Denel misses staff payment deadline

Unions Solidarity and UASA are going back to the Labour Court to file contempt of court papers against Denel, who are yet to pay their staff.


Photo: Twitter/DefenceWeb

After state-owned weapons and defence manufacturer Denel failed to abide by the Friday 7 August deadline to pay its staff, as per a court order handed down by the Labour Court last week, unions Solidarity and United Association of South Africans (UASA) are heading back to court to take the company to task. 

The unions are preparing to file contempt of court papers after the state’s arms manufacturer missed a deadline to pay the May, June, and July salaries it has thus far failed to bestow on its employees. 

Denel miss deadline  

UASA’s Frik van Straden said that the over 3 000 employees of the embattled company can no longer wait to be remunerated for their services.  

“We’ve requested some information from Denel to enable us to quantify the claim we will proceed with contempt of order and obviously, the relief we want is that Denel adheres to the court order,” he said. 

Despite asking for an extension to Friday’s deadline, Denel say that they still need more time to try and raise the millions of rand in funding to pay their staff. 

Some staff have received only 20% of their salary since May, with others getting up to a maximum of 60% of their salary in June and July. Medical aid payments and all pension, life insurance and other amounts have not been paid for the past three months.

Outgoing CEO Daniel Du Toit told parliament in June that the monthly salary bill of R144 million was a bridge too far for the company, who report an annual revenue of approximately R2.8 billion.

Company trying to raise funding to pay staff 

In a highly apologetic letter to staff that was distributed on Friday, Denel said that they are “relentlessly working to resolve the short-term challenges” in a bid to raise the funds and pay their workforce. 

“Denel remains committed to meeting its obligations and to ensuring it is able to honour the judgment at the earliest opportunity,” they wrote. 

Speaking ahead of last Wednesday’s virtual court hearing at the Labour Court, Solidarity’s aviation and defence sector co-ordinator Helgard Cronjé said that Denel had been given ample opportunity to remedy the situation but had failed at every turn to make good on their promises and the court orders they are held to. 

“Any number of turnaround plans were previously submitted by management but the board and the minister are not prepared to accept responsibility and provide the financial assistance required,” he said. 

“Solidarity has no choice but to continue with legal action,” he said