Eskom is said to extend job cuts beyond top tier of management

Eskom will extend its strategy of trimming top executive positions to include lower ranking managers and finally the general workforce as South Africa’s cash-strapped power utility looks to cut costs, according to a person familiar with the plans.

The state-owned company last month reduced its highest executive structure to nine positions from 21 by regrading and combining roles.

The next phase is to cut a 600-strong layer of managers - known as E-band employees - by at least 70%, according to the person who requested anonymity because the information isn’t public.

The latest notice on job cuts "is only limited to executive level," Eskom spokesman Khulu Phasiwe said in a text message. He didn’t comment on cuts for other managers or staff.

President Cyril Ramaphosa replaced Eskom’s leadership last year to help root out corruption and graft that contributed to the unsustainable financial state at the utility that supplies almost all of the nation’s electricity.

While that management has taken measures to increase transparency, a turnaround plan for the business has been delayed. The president on December 14 appointed a panel to advise the government on how to resolve the producer’s operational, structural and financial challenges.

A World Bank study in 2016 found that South African utilities pay workers more than double the norm in 35 other countries on the continent, and that Eskom is potentially 66% overstaffed.

At least 10 000 people on Eskom’s payroll of 48 600 could lose their jobs, according to the people. This will include natural attrition, and the broader reductions won’t likely occur until after South Africa’s presidential election in about May this year, they said.


ZAR/USD
16.76
(-0.05)
ZAR/GBP
21.18
(-0.23)
ZAR/EUR
18.94
(-0.09)
ZAR/AUD
11.65
(-0.04)
ZAR/JPY
0.16
(+0.04)
Gold
1798.11
(+0.03)
Silver
18.69
(+0.17)
Platinum
824.50
(+0.30)
Brent Crude
43.14
(+2.10)
Palladium
1961.36
(+0.61)
All Share
55417.89
(-0.66)
Top 40
51154.08
(-0.74)
Financial 15
10472.31
(+1.28)
Industrial 25
76134.69
(-1.67)
Resource 10
52483.78
(-0.20)
All JSE data delayed by at least 15 minutes morningstar logo
Company Snapshot
Voting Booth
Please select an option Oops! Something went wrong, please try again later.
Results
I'm not really directly affected
18% - 1968 votes
I am taking a hit, but should be able to recover in the next year
23% - 2579 votes
My finances have been devastated
34% - 3826 votes
It's still too early to know what the full effect will be
25% - 2757 votes
Vote