The SA Post Office (Sapo) business rescue practitioners have paid the first tranche of severance packages to 4,512 retrenched employees earlier than the initially envisaged end-June.
The figure of 4,512 retrenched workers is lower than the 6,000 originally planned of the total staff complement of 11,038. The number of job cuts was reduced after consultation with unions at the CCMA.
“All retrenched staff will therefore see the first tranche of their severance packages reflect in their bank accounts from next week”, business rescue practitioner Anoosh Rooplal said.
Tranche two and three payments of the severance packages will be made in September and November, respectively, as agreed with labour.
In a statement Friday, Rooplal and his fellow business rescue practitioner, Juanito Damons, said Sapo had fully paid up contributions to the Unemployment Insurance Fund, from which retrenched employees could apply for benefits.
The SA Revenue Service has been paid its first dividend of 12c in the rand, amounting to about R70m.
Rooplal and Damons said they had completed all the necessary administration requirements regarding the payment of the first tranche of severance packages to retrenched employees, including receiving all the required tax directives from Sars.
The retrenchments were made in a bid to right-size the organisation and place it on a more sustainable financial footing as employee costs have, in the past, accounted for 150% of revenue. It paid out R1.50 in salaries for every R1 of revenue
Sapo entered business rescue in July 2023 after the intervention by government to avoid its liquidation.
The total retrenchment package will amount to slightly less than the originally estimated R600m, which will be paid by using the R2.4bn that the Treasury gave the business rescue practitioners in 2023.
Rooplal said in April the conclusion of the retrenchment payments was dependent on the Treasury providing R3.8bn in additional funding. Without it, he said, the plan to rescue the business would be at risk, adding that the business rescue practitioners were still in talks with Treasury about that. The funds would also be used to invest in assets.
The rescue plan also involves closing down branch offices.
The Sapo business rescue plan published in 2023 showed Sapo incurred R19bn in losses by September of that year, after being having been unprofitable for over a decade. The state-owned enterprise has debts of about R4,5bn, R3,9bn of which is owed to Postbank and about R400m in rental arrears.
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