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Denel job cuts must proceed - official

Jan 23 2013 17:30

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Johannesburg - The termination of a contract between the defence department and Denel was correct because it had previously been declared irregular, an official said on Wednesday.

"[Media] reports, without exception, fail to appreciate the correctness of the South African Air Force's (SAAF) termination of a contract which was declared irregular by the Auditor General," defence spokesperson Lt-Col Ronald Maseko said in a statement.

"The contract dates back to a period (1986) where the current governance regime did not exist."

Maseko said the auditor general found the contract did not comply with the Public Finance Management Act and National Treasury Regulations.

"Since then, the Auditor General has consistently referred to this irregularity and the SAAF's notice of termination dates back to 2011."

Denel Personnel Solutions (DPS) said on January 15 that as a result of the termination, 523 Denel aircraft specialists would be retrenched.

"Because DPS has no contract or order cover beyond this date [of the end of the contract] the company has no other option but to proceed with the retrenchment of the entire DPS/AMG workforce," it said in a statement.

"The parties will focus on finding ways to minimise the negative impact of the retrenchments and Denel has committed to assist with seeking job opportunities for the affected employees."

Jack Loggenberg, spokesperson for trade union Solidarity, said at the time there was a possibility the SAAF would attempt to recruit some of the employees individually after their retrenchment.

"The Air Force probably wants to end the Denel contract because it is very expensive," he said.

"If the Air Force were to take over some of the contracts of employment [before the retrenchments], a section 197 would have to be issued."

According to section 197 of the Labour Relations Act, employees' conditions of service and remuneration must be kept on the same level when their contracts of employment are transferred to another company.

"It is therefore our suspicion that the Air Force, in order to save money, will wait until all the employees have been retrenched before possibly appointing some of them, on a lower salary, to do the same work," Loggenberg said.

Solidarity represents 208 specialists out of the 523.

denel  |  job cuts



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