PnP sackings ‘a sign of trouble’

A labour law analyst says the retailer’s high-level retrenchments are a sign of things to come.

A labour law analyst says the retailer’s high-level retrenchments are a sign of things to come.

CAPE TOWN - Retrenchments at Pick n Pay's head office is an indicator of what is happening at some of South Africa's other major companies, a labour law analyst said on Thursday.

In April, the retail giant indicated a 30 percent decline in full year profit.

In a bid to save costs, voluntary severance packages were offered, but only a few middle management employees put up their hands.

The few hundred who did not volunteer to leave were retrenched and most left their posts a few days ago.

One redundant Cape Town head office employee told Eyewitness News many retrenched staff members left the building last Friday without a farewell.

At the same time, founder Raymond Ackerman's son Jonathan said he's still conducting exit interviews in both Cape Town and Johannesburg.

Labour law expert Michael Bagraim says Pick n Pay's culling of some of its top earners is exactly what many South African companies are doing in order to survive.

He predicts the next year will be bleak for the retail sector and there could be many casualties along the way.

Bagraim warns employees to value their jobs.

"No one's job is safe in any industry at any time, people can face retrenchments - it doesn't matter what your contract says."

Efficient Group chief economist Dawie Roodt says the retrenchments were kept under wraps as senior staff members hardly ever belong to a union.

"Middle management is seen as part of the bosses and they're actually part of the enemy. I think quite often, trade unions aren't interested in top earners."

Roodt also says Pick n Pay may be hesitant to speak about the retrenchments and restructuring process for fear of a public backlash.

But he says the retrenchments are probably exactly what the company needs to reinvent itself.

Roodt said company restructuring is essential for growth.

"It is important for a company to continually restructure its personnel and everything it's doing to ensure it remains at the fore-end of whatever it is they are in."