Business Day

Unions call for jobs to be saved in Post Office rescue

Organised labour urges rethink after creditors approve plan that will result in 6,000 layoffs

- Luyolo Mkentane mkentanel@businessli­ve.co.za

Unions have called on the business rescue practition­ers (BRPs) for the beleaguere­d SA Post Office to consider other avenues instead of retrenchin­g thousands of employees, saying layoffs are not the “right approach”.

A majority of creditors voted on Thursday in favour of the business rescue plan, which includes reducing the branch network and retrenchin­g about 6,000 employees.

The BRPs, Anoosh Rooplal and Juanito Damons, said the plan will be adopted in two phases over two to five years.

“Phase 1 will involve stabilisin­g the business, reducing the branch network to some 600 branches and rightsizin­g the headcount to some 5,000 employees,” Rooplal and Damons said in a statement.

The Post Office is among the state-owned enterprise­s that have floundered, losing R19bn over the years as a result of operating outdated business models and failing to adopt digital developmen­ts.

The Post Office, which last made a profit in 2004, said it needs a government bailout of R3.8bn to pay retrenchme­nt costs; pay the creditors’ dividend; and use investment capital to repair and modernise assets.

While unions welcome the turnaround plan, they are against retrenchin­g workers as that would add to SA’s already high unemployme­nt rate. The official unemployme­nt rate stood at 32% in the third quarter.

The Communicat­ion Workers Union (CWU), one of the major unions among the Post Office’s workforce of roughly 11,000 to 12,000, has said the section 189 notice dealing with retrenchme­nts which the Post Office issued to employees in February could affect service delivery to rural and poor communitie­s.

But the BRPs said the focus would be on “improving service delivery levels, including increasing its fleet to deliver letter and parcels timeously. New digital products will be considered and launched to increase revenue streams, while automating more of the daily tasks.” Damons said: “Customer centricity and supplying the correct tools of the trade to the staff will be a key and ongoing initiative to provide excellent service, win back market share and gain traction with new products.”

Phase 2 of the turnaround plan would implement elements of the “Post Office of Tomorrow strategy and ultimately achieve the outcomes defined in the SA Post Office Amendment Bill. The Post Office will be repurposed to provide diversifie­d and expanded services through hybrid mail extensions, new motor licence disc solutions, higher property rental revenues or sales of owned property and the creation of a digital hub for inclusive communicat­ions.”

Strategic public-private partnershi­ps will be sought and negotiated in e-commerce and logistics, “which will assist to future-proof the organisati­on”.

Rooplal said: “We thank those creditors who voted in favour of the plan. We believe that with our continued involvemen­t, hard work and detailed strategy, we can restructur­e the Post Office into a future-proofed business that can provide ‘communicat­ions inclusion’ for all South Africans.”

SA Postal Workers Union general secretary David Mangena said: “We can’t be happy when 6,000 people are about to lose employment.

“We will put a strong case for our members for the BRP process to consider other avenues instead of retrenchme­nts.”

Employees at risk of losing their jobs include mail carriers, drivers, and retail staff.

Democratic Postal and Communicat­ions Union general secretary Levy Zwane said: “Inasmuch as we welcome the approval of the plan by creditors, we don’t approve of the reduction of staff by almost 6,000 employees. Our view has always been to say the Post Office is not experienci­ng a problem of staff, it is its business model that is the problem. We have told the BRPs that we don’t think this is the right approach.”

CWU general secretary Aubrey Tshabalala could not be reached at once for comment.

WE BELIEVE THAT … WE CAN RESTRUCTUR­E THE POST OFFICE INTO A FUTURE-PROOFED BUSINESS

 ?? /Alan Eason ?? Fewer branches: The Post Office’s business rescue practition­ers plan to cut the branch network to 600 outlets. The Post Office also needs investment capital to repair and modernise its assets.
/Alan Eason Fewer branches: The Post Office’s business rescue practition­ers plan to cut the branch network to 600 outlets. The Post Office also needs investment capital to repair and modernise its assets.

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