The chairperson of Parliament’s Select Committee on Trade and Industry, Economic Development, Tourism Employment and Labour on Wednesday called for their respective departments in the executive to intervene in planned retrenchments at Massmart.
The retail giant announced on Monday that it may cut some 1400 jobs as it plans to close 34 DionWired and Masscash stores. Massmart owns major brands like Game, Builder’s Warehouse and Makro. Masscash comprises cash and carry outlets like Jumbo and Rhino.
The select committee’s chair, Mandla Rayi, said in the statement that while he was aware of the implications of state intervention in a business’ internal affairs from government departments, the loss of that many jobs was a far worse fate.
“It is not ideal to have government interfere in business, but the severity of the pending retrenchments necessitates that there must be a collaboration of minds. Losing over 1000 job opportunities will be catastrophic not only for job creation, but also for the families of those who will be affected,” said Rayi.
Rayi recommended that all planned job cuts be put on ice until the company had tried and exhausted all other alternatives at saving money and boosting revenue.
“Such an action, no matter the amount of consultation, will frustrate government’s objectives of creating over a million job opportunities. It is the view of the committee that SA is still friendly to business, and foreign investments and opportunities are there for business to exploit,” Rayi said.
Rayi said the select committee would prefer it if Massmart considered ways of accommodating the labour force in other business units, or expanding operations to rural provinces, “where their footprint was not prevalent”.
On Tuesday the South African Commercial, Catering and Allied Workers Union said it would opposed the plans by Massmart to consult about job cuts in terms of section 189 of the Labour Relations Act, which allows an employer to negotiate retrenchments, if they are justified.