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PIC workers picket over capped bonuses

Oct 03 2019 22:45
Lameez Omarjee

Staff at the Public Investment Corporation have raised concerns over corporate governance failures at state financial institution.

General secretary of the National Union of Public Service and Allied Workers, Yongama Mabece, told Fin24 on Thursday that members working at the PIC had embarked on a demonstration at head offices in Pretoria. The PIC staff held the demonstration against poor governance and leadership of the organisation, mainly related to incentives as per the organisation's remuneration policy.

The union claims Treasury has been interfering in the implementation of the remuneration policy, by issuing a directive that bonuses should be capped. Fin24 reached out to Treasury, which did not want to comment on the matter.

Mabece told Fin24 by phone that normally a cap on bonuses would be acceptable if the PIC had been underperforming, but this is not the case. The PIC reported a profit of R300m for the financial year ended March 31, 2019. It paid a dividend of R80m, to its shareholder – Treasury.

Mabece said that failing to implement the remuneration policy is a failure of corporate governance. "The minister is sticking to his guns and still applying the directive," he said.

Incentive scheme

In terms of the PIC's remuneration policy, a short-term incentive scheme allows for employees to be rewarded a bonus annually, if they meet the minimum requirement of performance.

"The PIC performance level is a trigger for incentives to be paid out, thus the PIC corporate performance targets have to be met and exceeded, and all governance requirements have to be observed through the PIC board and shareholder," the 2019 annual report read.

Deon Botha, head of PIC's corporate affairs, confirmed in an emailed response to Fin24 that the demonstration by staff happened at lunchtime, but operations at the PIC were not affected.

"The PIC Board and management have engaged the shareholder (Treasury) on the remuneration policy and agreed on a programme of action. The outcome of the meeting and steps to be taken to resolve performance bonus issues have been communicated to the employees," he said.

"The PIC Board and management continue to engage all the stakeholders to amicably resolve this matter and are making progress in this regard," he added.

pic  |  tito mboweni  |  demonstrations  |  protest
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