Transnet CEO fired, but battle is not over
Board chair says Gama failed to make representations on why he should not be axed
Transnet has fired its embattled CEO Siyabonga Gama and will pay him out for six months.
In the notice of termination of employment letter, served on Gama on Sunday and seen by Business Day, board chair Popo Molefe said the CEO had failed to make representations on why he should not be fired by the deadline of October 15.
“As a result of your failure to make representations, the board has therefore resolved to terminate your appointment as group CE on six months’ notice,” Molefe says in the letter.
“You are not required to work out your notice period and will be paid six months’ remuneration in lieu of notice.”
Gama was paid R8.108m in the 2018 financial year, according to the latest Transnet annual report.
Gama has been in the line of fire after investigations found that he, former CEO Brian Molefe and Gupta associates may have acted unlawfully in relation to the purchase of 1,064 locomotives for R54bn. Leaked Gupta e-mails contain claims that the Gupta family received multibillion-rand kickbacks as part of the purchase.
Gama’s removal comes after several new board members were appointed at Transnet in May as part of President Cyril Ramaphosa’s drive to root out corruption at state-owned enterprises (SOEs).
The Transnet board told Gama in the letter that his last working day would be Monday, October 22 and that he was required to collect his belongings and return the SOE’s belongings, which include an iPad, cellphone, laptop and access keys.
The board reminded the embattled CEO that despite the termination of his contract he was still obliged to keep company information and anything regarding agreements he had signed during his employment confidential.
Last week Gama approached the labour court in Johannesburg in a bid to stop the board from terminating his contract. The court on Friday stayed Gama’s application and ordered that the dispute between him
and Transnet be referred to arbitration. A stay of the application means the court has put a hold on any legal proceedings, effectively postponing any ruling on Gama’s application pending the outcome of the arbitration.
However, the board was of the view that the court judgment did not prohibit it from taking a decision arising out of the failure of Gama to give reasons why his employment contract should not be terminated.
Gama’s lawyer, Nano Matlala of MSMM, held a different view.
He said yesterday he had advised Gama to write to the chair of the Transnet board informing him that the decision to terminate his contract was “unlawful and null and void” and that Gama should report for work. Matlala said they would enrol the matter in the labour court again on an urgent basis as the dismissal went against the judge’s findings.
“[The] judge makes it clear that an interdict can be granted when Transnet fails to comply with the contract of employment providing for arbitration.
“The labour court stayed our client’s application pending the outcome of the arbitration proceedings,” Matlala said.
He said he had written to Transnet’s lawyers following last week’s court judgment referring Gama’s matter to arbitration and suggested three names of arbitrators.
The Transnet board had previously also demanded that Gama personally pay back R151m in alleged overpayments to the Gupta-linked Regiments Capital. The repayment, however, was not mentioned in the official letter informing Gama that his contract had been terminated.