Cosatu says RCL using spat to open retrenchment talks

IN KWAZULU-Natal, Cosatu has accused JSE-listed company RCL Foods of taking advantage of the spat between the trade union federation and former affiliate Food and Allied Workers Union (Fawu) by initiating talks about retrenchments.

However, RCL has cited the effects of chicken imports and drought on its operations as the reason behind its decision to initiate a retrenchment process that could affect up to 1,500 workers.

RCL Foods, which owns Rainbow Chicken, said on Tuesday that it was looking to restructure its commodity chicken category in response to current market conditions.

The company said operating conditions have deteriorated as a result of the increased level of dumped chicken products in the market. On average, 27,500 tonnes of chicken imports enter SA monthly, a 43% spike from 2015.

RCL Foods confirmed it has started consultations with all affected employees and unions.

“Once this has been concluded, RCL Foods will assess the impact on job numbers,” the company said.

However, Cosatu in KwaZulu-Natal accused RCL Foods of taking advantage of internal fighting between it and Fawu, which has disassociated itself from Cosatu, by the company initiating restructuring talks.

Cosatu said employees at Rainbow Chicken were desperate for a workers’ organisation to intervene in the possible retrenchment process.

RCL Foods CEO Miles Dally said the group’s chicken business had operated at a loss for the past five years.

“Without immediate relief on the horizon, we have to consider a restructure of the commodity chicken component of our business,” he said, stressing that RCL was not exiting the chicken business but rather down-scaling.

Rainbow Chicken workers are organised under Fawu. August Mbhele, the Fawu organiser in KwaZulu-Natal, said RCL Foods had indicated it would restructure but no section 189 process had started yet.

Mbhele said the industry was starting to buckle under a lot of pressure stemming from drought, cheap imports and high feed costs.

RCL Foods would not be the only company making this call — “we expect a lot more poultry-producing companies to restructure”.

Fawu was surprised by Cosatu’s statements, he added.

“This is an attempt to confuse workers under Fawu,” said Mbhele.

The possible restructuring will affect all RCL Foods workers, not just those at Rainbow Chicken.

Cosatu said of the 500 workers on chicken farms, the company intended to retrench 300. Of the 1,500 workers in processing plants, Rainbow Chicken would lay off almost 900 workers.

Cosatu’s general secretary in KwaZulu-Natal, Edwin Mkhize, said it entered the fray as a matter of principle.

“We are not going to let infighting among affiliates overshadow the workers’ plight. If workers feel they are not protected by anyone, [Cosatu] should step in.”