Citizen Reporter
Reporter
2 minute read
15 Nov 2021
11:21 am

Court orders ailing Denel to pay staff their outstanding salaries

Citizen Reporter

It's understood that Denel owes suppliers and workers R900 million and R650 million, respectively.

The Denel offices in Irene Centurion. 19 May 2021. Picture: Jacques Nelles

The North Gauteng High court has ordered Denel to pay staff their outstanding salaries.

The National Union of Metalworkers of South Africa (Numsa) took the state-owned aerospace and military technology conglomerate to court because workers have not received their full salaries since May 2020.

Numsa represents about 800 staff members at Denel Dynamics, Denel Land Systems, Denel Pretoria Metal Pressing, Denel Aeronautics and Denel Vehicle Systems.

It’s understood that the entity owes suppliers and workers R900 million and R650 million, respectively.

“Many staff have not been paid since May last year, while operational activities are significantly below capacity at 20%-30% in most divisions, said Numsa’s general secretary Irvin Jim.

“Revenue is 60% behind the year-to-date budget, the Department of Public Enterprises [DPE] revealed this week.”

Jim said each division was paid a percentage of their salaries, which depended on how much revenue that department generated.

“Sometimes they get paid 50% or 20% or nothing at all, but they are still expected to go to work daily,” said Jim.

Denel received an extra R2.9 billion in the 2021 medium-term budget to cover the debt, while the South African National Defence Force (SANDF) received an additional R700 million, mostly to cover the response to the July unrest.

Numsa said it had reason to believe that Denel executives continued to receive their full salaries.

“As Numsa, we have tried to get answers on this, but HR refuses to disclose whether the executive management is receiving their salaries,” added Jim.

“They have not published the amounts that executives are getting since January 2021. Denel has not made regular payments to medical aid, UIF, retirement funds, or any statuary contributions.”

The union had sent Denel a letter of demand on 25 June, but there was allegedly no response, which prompted the court action.

The situation remains dire for many workers who are battling to support their families.

“Our members are enduring extreme financial hardship. Some have had their homes repossessed by the banks or have been evicted,” said Jim.

The matter was heard on an urgent basis last Wednesday, 10 November.

“The judge agreed with us and granted the order. Denel will now have to pay all outstanding money and benefits,” said Jim.

The union said it would follow up with Denel executive management during this week to ensure that members received all that is due to them.

Compiled by Narissa Subramoney

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