South Africa: Cosatu Pained Workers At Daybreak Foods Remain Vulnerable

The Congress of South African Trade Unions (COSATU) and its Affiliates, the Southern African Textile and Clothing Workers Union (SACTWU) and the Agricultural Food and Allied Democratic Workers Union (AFADWU), are distraught that a contractual dispute between the business rescue practitioner (BRP) of Daybreak Foods and a service provider is delaying the payment of workers' salaries.

Last week workers at the chicken producer took to the streets because their June salaries had not been paid. Daybreak went into business rescue after it run out of money to pay workers and buy feed for the chicks in May. The company became headline fodder after the SPCA was forced to put down 350 000 starving chicks, many of which had resorted to cannibalising each other to survive.

The PIC which controls 100% of the shares in Daybreak Foods on behalf of the Government Employees Pension Fund, Unemployment Insurance Fund and the Compensation Fund, intervened and injected R76 million in working capital to pay workers and buy feed. It also agreed to the business rescue as the best way to save the company and secure the 3 000 jobs.

Now workers' salaries for June have been delayed because the service provider responsible for payroll, Altron, is not prepared to disburse the salaries until it is paid monies owed to it by Daybreak Foods. It is important to stress that what Altron is demanding is illegal, because the BRP cannot favour one creditor above all others. Due to this, the BRP is forced to approach the court to either force Altron to pay the salaries or hand over the database, so the BRP can contract another payroll company to pay the workers. Altron is not prepared to pay the workers or hand over the database until it is paid monies owed to it.

The PIC injected a further 150 million into Daybreak Foods last week to ensure workers would be paid. COSATU, SACTWU and AFADWU are hoping that sense will prevail and that Altron will realise what is it demanding is illegal and simply cannot pass. What pains us most is workers remain vulnerable to the whims of unscrupulous service providers who think nothing of making illegal demands.

COSATU and its dedicated Affiliates whole-heartedly support the BRP and want Daybreak Foods to emerge from the process more successful with workers' jobs secure and will stop at nothing to ensure this happens.

Read the original article on COSATU.