Tue. Oct 22nd, 2019

These South African companies are retrenching staff in 2019

MultichoiceSomehow, South Africa’s economy and labour market will have to weather this storm. It is looking very ugly at the moment.

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Multichoice has joined the bandwagon of South African companies that are cutting jobs to stay afloat in these difficult times.

Why are these South African companies retrenching staff?

The satellite network stated that, although billions of rand in returns were reported for the 2018/2019 financial year, consumer behaviour and data on their digital self-service shows that there is less of a need for that many call centre and walk-in centre agents on their roster.

This is yet another blow for South Africa’s economy, whose GDP retracted by more than 3% in the first half of the year.

While Multichoice’s decision was brought on by pressure from the impending take-over of the fourth industrial revolution, other companies have been forced into a corner with very little choice but to sacrifice a portion of its workforce to remain financially soluble.

What impact will this have on unemployment?

This development has not complemented President Cyril Ramaphosa’s plan to emancipate our flailing economy, which is essentially a tiptoe away from plunging into a recession.

Unemployment has already soared to 27.5%, with 50% of the youth sitting without permanent employment. Ramaphosa, in his State of the Nation address (SONA 2019) promised to deliver a practical solution to unemployment — 200 000 jobs per year until 2029.

Besides the huge criticism, the implementation of this plan has already been threatened by these companies which have announced plans to retrench a portion of their workforce.

These South African companies are retrenching staff in 2019

Eskom

It was announced in 2018 that the embattled power utility, that currently sits with a multibillion-rand debt bill, would go under a restructuring process, where it would be split into three entities.

This change was in line with the state parastatal’s attempt to recover to its former glory after years of corruption and infrastructural decay.

Ramaphosa revealed at SONA 2019 that he would soon be announcing the appointment of a new CEO, as well as a Chief Restructuring Officer, a new role which will oversee Eskom’s infrastructural revamp.

In 2018, the power utility retrenched 10 of its senior executives. It was believed that the number would be much higher due to the threat of the restructuring. However, Ramaphosa has since made assurances of the fact that low-to-middle income workers were safe — for now.

Distell

Although there has not been an update as yet, in January, Distell, the distributor of alcohol beverages such as Savanna, Klipdrift and 4th Street wine, announced that it was going to retrench as many as 100 workers.

At the time, the company revealed that this was due to a necessary restructuring of processes that demanded the reduction in its staff.

“We have identified our supply chain as a key enabler of Distell’s growth ambitions, particularly in the current business environment. In our quest to build a customer-centric, sustainable and effective supply chain, we continue to explore opportunities to increase capacity utilisation, drive efficiency and extract cost benefits from our supply chain,” Distell’s supply chain director, Johan Van Zyl wrote in a statement that was published by Business Day.

No updates have been released by the beverage distributor on its plans to close down its Green Park plant in Cape Town.

Tiso Blackstar

“You will no doubt be aware that the company is proposing a broad restructuring of its editorial operations as a result of the economic headwinds facing the business in the form of lower advertising and circulation revenue.” Email sent to staff by Tiso Blackstar’s Managing Director, Andy Gill.

This is the email notification that preempted the strike Tiso Blackstar employees embarked on in May, in response to a threat of job cuts due to, once again, a necessary restructuring of the company’s processes.

“While it is unfortunate that this is likely to result in job losses, the sustainability of the division remains our most important objective. The fact is that we are operating in a much-changed operating environment which our business has to adapt to if it is to remain profitable and relevant,” Gill wrote.

According to the South African Typographical Union (Satu), workers from the Sowetan, Dispatch and the Herald received this notice, as well as threats to have Sunday World operations halted.

Other companies said to have issued retrenchment noticed in terms of Section 189A of the Labour Relations Act, Act 66 of 1995, include (please note that we do not share the views expressed in the tweets and other third-party sources embedded in our content):

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