Unions have vowed to “cripple” operations at SA’s biggest dairy producer Clover ahead of the busy festive season after a deadlock with management over above-inflation wage increases, retrenchments, and other conditions of employment.
The General Industries Workers Union of SA (Giwusa) and the Food and Allied Workers Union (Fawu) — both affiliates of the SA Federation of Trade Unions (Saftu) — downed tools last Monday and embarked on an indefinite strike for a wage increase of 10%.
The company initially proposed a wage increase freeze but subsequently revised its offer to 4.5%, which the unions rejected.
The 10% wage increase demand is double the 5% consumer price inflation recorded in September and October. The lowest-paid employee takes home R6,500 a month.
The leaders of Giwusa and Fawu said the two unions represented about 5,000 workers at Clover, which was delisted from the JSE after a takeover in 2019 by the Milco consortium, led by Israel’s leading manufacturer and distributor of beverages Central Bottling Company (CBC).
CBC is a privately owned international food and beverage group whose subsidiary companies serve more than 160-million consumers worldwide.
Giwusa president Mametlwe Sebei told Business Day that one of the conditions competition authorities had imposed on the takeover by Milco was that there “must be no retrenchments at Clover until October 2022”.
“Now they are going against that condition and are retrenching over 1,400 workers nationally. They are also planning on closing some of their factories as well.”
Clover angered unions when it announced plans in June to relocate SA’s largest cheese maker from Lichtenburg in North West to KwaZulu-Natal due to poor service delivery in the North West municipality. The unions said at the time the decision was reckless as it would lead to job losses in the company.
Sebei said Clover has refused to accept the workers’ wage demands, saying Covid-19 had affected its balance sheet. The pandemic destabilised the SA economy, which declined 6.4% in 2020 and led to a loss of about 1.4-million jobs.
Fawu general secretary Mayoyo Mngomezulu told Business Day that employees were given a choice to either agree to a 20% wage cut or be retrenched.
“They were given a deadline of November 26. The non-unionised workers signed the ultimatum and went back to work. But the union members refused and elected to go on strike,” he said.
“We are saying these retrenchments are illegal and we are going to fight them through the court process. In the meantime, the strike continues. It’s indefinite, actually.”
Sebei said workers were also unhappy that the company wanted to make working on public holidays compulsory; introduce a six-day working week (from five days), and implement a one driver, one assistant policy, instead of two assistants at present.
“Previously a driver had two assistants to help with loading and offloading trucks, now they want the driver to do two jobs: to drive the truck and also help with the loading and offloading duties,” said Sebei.
He vowed that the strike, as it enters its second week, “will cripple Clover’s operations across the country”.
“It’s a matter of time before supermarkets run out of Clover’s products. I don’t think there will be any Clover products in stores in the coming day,” he said.
In a company statement on Monday, Clover said it had been “undergoing a national restructuring process including a Section 189 consultation process that aims to consider all possible avenues to minimise potential retrenchments”.
“The ... Commission for Conciliation, Mediation and Arbitration (CCMA) facilitated the consultation process which was run in accordance with all legal requirements and concluded on November 25 2021 with the implementation currently being finalised.”
Clover said the decision to restructure the business was not arrived at “lightly and follows a comprehensive strategic review of all aspects of the business”.
“Clover’s business has been subject to a difficult trading cycle for a number of years, where costs have generally been rising above inflation and consumer spending has been negatively impacted by poor economic growth and increasing unemployment. Covid-19 has added to these pressures and created much uncertainty, specifically around the economic outlook.”
Clover said it had been engaging representative bodies regarding the annual wage review since April 2021. “On November 9 2021, Clover made a final offer of a backdated 4.5% increase in wages effective July 1 2021, but this was rejected. Negotiations on both matters subsequently broke down and unionised employees embarked on a national strike on November 22 2021.”
The company said it had put contingencies in place to limit the effect of the industrial action on its operations. “A prolonged strike will however result in unavoidable disruptions to supply as the festive season is a traditionally high demand period.”
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.