Bassie travel company in equity scandal

2018-07-08 11:52
Basetsana Kumalo

Basetsana Kumalo

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A travel company whose directors include renowned television producer Basetsana Kumalo is facing litigation for allegedly operating without a transformation plan.

Sources within the department of labour told City Press this week that Travel With Flair (TWF), which has allegedly been contracted by the department of labour to facilitate travelling arrangements for its officials for a decade, had had its contract extended without renewing its employment equity plan.

But TWF, whose chief executive is Kumalo’s sister Johanna Mukoki, is not the only company facing court action for allegedly breaking transformation rules.

Other companies – including Burger King, Spanjaard Limited and Grand Parade Investments – have been taken to court by the department for either operating without an equity plan or ignoring recommendations and notices from the department to comply.

Last week, City Press reported that the labour department took 72 JSE-listed companies on review in 2017/18, for failing to adhere to their own employment equity plans, according to sources in the department.

The department issued 60-day notices for them to comply. Most responded positively, including the JSE itself.

Of the 72 firms, nine were about to be served with court processes. Five of them settled out of court and each paid a fine of nearly R1.5m.

Sources in the department told City Press this week that officials were shocked to learn that TWF had operated without a plan to enforce transformation during the past five years of its contract with the department.

“They were contracted by the department as a travelling agency for five years, but their contract was extended when the initial contract had expired. It was at the end of the extended contract that it was found that they had not complied,” one source said.

“Unfortunately at the time, the department had already extended the contract and it was at the end. In the first five years of their contract there were no issues and they were reporting, but the problem was the last five years in which they operated without a plan.”

TWF national human resources manager Ulene Mitchell would not comment on questions about the court action and specific questions relating to the details of their contract with the department.

“As for employment equity, TWF is fully compliant and should there be any reason for TWF to engage with the respective authorities in this regard, these engagements will be entered into on request with said authorities,” she said.

When pushed to comment about allegations that they did not comply in the last five years of their contract with the department and were taken to court for this, Mitchell referred questions to the department.

According to reports from the Parliamentary Monitoring Group (PMG), a nongovernmental organisation that records Parliamentary proceedings, TWF had secured contracts with several departments.

In 2018, according to records, TWF had received R343 656.30 from the department of labour to organise travel and accommodation, and R2 324 988.64 from the SA Social Security Agency for travel services since their contract began on October 1 last year.

PMG records also show that the SA Police Service had been using the services of TWF since 2001.

Information submitted by the police ministry as requested by Parliament shows that between 2001 and November last year, the following amounts were paid to TWF, which bought on the police’s behalf:

• R8.2m for air charter services;

• R1.5m for motor vehicle leases;

• R97.6m for domestic accommodation;

• R31m for domestic air transport;

• R2.3m for domestic road transport;

• R22.8m for foreign accommodation;

• R100.2m for foreign air transport;

• R101 458 for foreign road transport;

• R253 605 for venues and facilities; and

• R10 315 for laundry services.

Spanjaard chief executive Kentin Welgemoed said their matter was “sub judice and we are not in a position to respond in detail as to the merits of the matter. Suffice to state that the company is defending the application.”

Welgemoed, however, denied the department had issued recommendations which were allegedly not complied with. When asked what the company was defending in court, he did not respond to follow-up questions.

Grand Parade Investments Limited’s legal department and Burger King did not responded to requests for comment this week.

Labour department spokesperson Teboho Thejane confirmed that Burger King had been taken to the labour court in Cape Town for operating without an employment equity plan.

“Burger King opposed the application because they were made to believe by their erstwhile HR manager that they [were] complying until the department’s inspector raised concerns in respect of the information contained in the employment equity report,” he said.

“It is then at this stage that Burger King offered to settle the matter through their attorneys and paid a penalty by agreement with the department.”

Thejane did not respond to questions relating to the other companies, including TWF.

Burger King group marketing executive Ezelna Jones said there was an issue raised with the department “insofar as our compliance was concerned, but the matter was dealt with by the department of labour accordingly and has been settled”.

Read more on:    basetsana kumalo  |  transformation

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