The South African Commercial Catering and Allied Workers Union (SACCAWU) has accused Pick n Pay of sacrificing 22 000 employees rather than restructuring the pay of the retailer’s executives.
The union’s view comes after Pick n Pay informed shareholders and employees that it would embark on a consultation process that will result in some changes to staff’s salary packages, while the possibility of retrenching some staff is not off the table.
“The consultation relates to certain elements of the company’s store labour model, including scheduling flexibility and the alignment of benefits and allowances, which are not in line with market practices and peer benchmarks,” said the retailer.
Pick n Pay restructures to restore profitability
In the note to shareholders, the retailer said the consultations are part of the strategy to return Pick n Pay to profitability. The retailer was previously technically insolvent, but this changed when it listed Boxer on the Johannesburg Stock Exchange (JSE) and gained from the IPO.
“The consultation forms part of the strategic action underway to restore the company to sustainable profitability and to strengthen the long-term competitiveness of its core supermarket business,” said Pick n Pay.
“The objective of the process is not to reduce headcount, rather to improve labour flexibility and cost sustainability, while retaining jobs wherever possible and creating the conditions necessary for sustainable employment growth over the longer term.”
Store-based employees at risk
Pick n Pay said the consultation focuses on addressing labour practice that have become increasingly inflexible and costly over time and are no longer aligned with prevailing retail market practice.
The retailer added that the consultation process is to address the aforementioned matters and consider alternative options. It emphasised that the consultation does not represent a “predetermined outcome”.
“The process applies to specific store-based employees within the Non-Management Bargaining Unit and excludes head office employees and management structures which have already been part of a process over the last 24 months with a wage and salary freeze combined with a reduction in numbers due to restructuring.”
SACCAWU expresses unhappiness
The union representing most of the retailer’s workers expressed dissatisfaction with how Pick n Pay is restructuring and handling consultations.
“The S189A CCMA notices issued to employees effectively give them two undesirable choices, one is to accept retrenchments, or as an alternative to retrenchments, to accept the downward variation of their negotiated conditions of employment, which includes their agreement to cancel all their collective agreements on workers’ rights and protections,” said SACCAWU.
“Sean Summers’ decision to refer a dispute to the CCMA, before their proposals were tabled to SACCAWU, is indicative of the bad faith with which they are embarking on this process. Abusing the CCMA’s resources before SACCAWU had had sight of their proposals should be condemned in the strongest terms.”
Changes proposed
According to the union, Pick n Pay is proposing the following changes to employees’ packages and terms of employment:
- Reducing working hours from 196 hours per month to 176 hours (this is equivalent to a R2 000 reduction in wages per employee)
- Doing away with transport for employees who work late shifts that fall outside normal public transport schedules, and those who work a night shift.
- Withdrawing the negotiated 13th cheque for the Non-Management Bargaining Unit.
- Scrapping the legislated 1.5% Sunday pay, by treating Sunday as a normal working day.
- Doing away with benefits negotiated for Variable Time Employees (part-timers).
- Doing away with the Flexibility and Multi-Skilling Agreement, which was intended to create a more multi-skilled and flexible workforce.
Why not look at management?
The union has raised concerns about why the retailer doesn’t look at restructuring management’s pay and working conditions, instead of looking at the bottom.
“While Pick n Pay singles out the employees’ working conditions in the Non-Management Bargaining Unit wage bill, they conveniently do not show how much, as a percentage of the company’s wage bill, is allocated towards its executives and management structure,” said SACCAWU.
“It must be noted that Pick n Pay’s desperate strategy to attack the gains made by its workers will have the unintended consequences of deepening the economic crisis that families of workers are already facing.
“Pick n Pay management are hellbent on ringfencing their own high salaries and benefits, while deepening the levels of poverty, unemployment, inequality, and economic hardship through its large-scale retrenchment.”
Workers can’t always be sacrificial lamb
In addition, the union added that employees cannot continue to bear the burden of corporate restructuring and business challenges, while executives and shareholders are protected.
“Pick n Pay is disingenuous by laying the blame or the company’s financial and operational difficulties at the feet of its employees, and their purported high salaries, out of sync working conditions, and lack of flexibility,” said SACCAWU.
“The express purpose for agreeing a 60% Variable Time and 40% Full Time employment ratio was to ensure the company has a more flexible workforce.”
CEOs to be blamed
The union has also blamed two of the retailer’s former CEOs for the dire financial state Pick n Pay finds itself in.
“Pick n Pay also neglects to admit that its previous two CEO appointments have driven the company from a status of healthy profitability and market share into the shell of its former glory it is experiencing.
“Indicative of this is the wastage the company has suffered through Peter Boone, its former CEO’s QualiSave strategy, which was undone by Sean Summers immediately upon his appointment.”
