Cape Town - There is serious concern that Walmart will use
its muscle to pursue its "anti-union philosophy" if its merger with
local retailer Massmart Holdings [JSE:MSM] goes ahead in its current form, the Competition Appeal
Court heard on Friday.
Senior counsel Paul Kennedy, representing the SA Commercial,
Catering, and Allied Workers' Union (Saccawu), said that despite undertakings
by the merging parties, there were concerns about employment, protection of
worker benefits, and protection of the right to representation by their union.
"There is serious concern that Walmart uses its muscle
to pursue its anti-union stance," Kennedy said.
Walmart had a reputation and its approach could minimise
rather than advance jobs, he said, adding that 1.3 million Walmart workers in
the United States were not unionised.
Walmart's approach and philosophy was a problem and the reason why structural intervention was appropriate, he said.
Structural remedies had to be put in place to protect
workers.
Judge Denis Davis said Walmart employees were unionised in Chile. He said South Africa's labour laws guaranteed the rights of workers.
"Why do you have so little confidence in your client's
ability to organise," he asked.
Walmart and Massmart resumed their merger battle against three government departments and a union in the court on Friday.
Earlier Davis grilled Kennedy over whether it was possible
for the merged company to have information about the effect the transaction
would have on manufacturers in South Africa.
Davis has asked the government, unions, and the merging parties to consider what remedy they would accept to allow the merger to go ahead.
Solution sought
"There is no need to send it back to the tribunal if we can find a solution," Davis said.
"What remedy would be most expeditious? What relief can
we bring about that will meet everyone's interest?"
Davis said the court had the option of refusing the appeal, changing the conditions attached to the tribunal's approval, or agreeing to a review of the proceedings - which would involve a new hearing by the tribunal.
"Sending this back to the Competition Tribunal causes me some anxiety," he said.
There was no real evidence about what would happen after the
merger.
"None of us has the foggiest idea about what the
ultimate total welfare is after the merger," he said.
The Competition Tribunal ruled on May 31 that Walmart, the
world's biggest retailer, could proceed with the deal on condition no jobs were
cut for two years and the companies set up a R100m fund to assist local
suppliers.
The government said the conditions were inadequate and would
result in a massive influx of imports that would undermine manufacturing
output.
The appeal against the tribunal's decision was brought by the departments of economic development, trade and industry, and agriculture, forestry, and fisheries - as well as Saccawu.
Saccawu has filed a separate appeal against the approval of
the takeover of Massmart on the grounds that the tribunal failed to take
adequate consideration of the public interest.
Walmart paid R16.5bn in June for a 51% stake in Massmart, South Africa's biggest food and general goods wholesaler.
The company said the deal would create 15 000 jobs in South
Africa within five years. Most of the R60bn it would spend on buying food and
consumer goods would be sourced from local suppliers.