Wage freeze, leave reduction on table to save SABC jobs

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A general view of the South African Broadcasting Corporation (SABC) offices in Durban, South Africa.
A general view of the South African Broadcasting Corporation (SABC) offices in Durban, South Africa.
Darren Stewart
  • Wage freezes and a reduction in annual leave and sick leave days are among four proposals that could save the SABC money as opposed to retrenchments.
  • The number of potential retrenchments have since been reduced from 600 to about 303, according to the board, but this could be even fewer as there are 170 new placements to be made.
  • The SABC launched a section 189 process last year as part of the restructuring of the national broadcaster, which has been facing financial difficulties.


There are certain tradeoffs that will have to be made to reduce the number of possible retrenchments at the South African Broadcasting Corporation (SABC), members of Parliament heard.

The Portfolio Committee on Communications on Tuesday was briefed on the 2019/20 annual report of the state broadcaster. Apart from the executive team and board chairperson Bongumusa Makhathini, who attended the virtual briefing, Deputy Minister of Communications and Digital Technologies Pinky Kekana also weighed in on the section 189 process launched at the SABC last year as part of its restructuring.

The department had intervened after a deadlock was reached between unions and the broadcaster's management – the board thus made four proposals which led to the reduction of potential job loses from 600 to 303, Fin24 previously reported.

"If the unions will not accept [the four alternatives] we will go back to square one with 600 retrenchments," Kekana warned.

The alternatives include a wage freeze over the next three years which could see the SABC save over R300 million. Other options are to reduce annual leave from 35 days to 28 days - which affects employees at management level. Sick leave will also be reduced from 30 days per year to 36 days over a three-year cycle - in line with the Basic Conditions of Employment Act. The board also wants the practice of cashing out of leave days to be discontinued, Kekana told Parliament.

The fourth option is a section 197 process in terms of the Labour Relations Act – which involves a business transfer that will affect its call centre and TV licence operations, according to Dr Mojaki Mosia, group executive for human resources. The section 197 would require a consultation process and the new service provider would have to keep employees on their current terms and conditions. The alternative would be people not having a job, Mosia explained.

Mosia similarly highlighted that accepting the four alternatives will be critical in the SABC's turnaround. "What is important as the deputy minister indicated is the acceptance of the four alternatives," he said. It is up to labour to respond to these proposals.

"We did not reach a consensus or receive acceptance in principle from organised labour with regard to those alternatives put on the table. Unfortunately they remain alternatives … we hope ultimately they [unions] will come to the party," said Mosia.

Mosia noted that the SABC was one of the top-paying companies in the country. He also highlighted that National Treasury and the department of communications had issued a directive that departments should factor in zero-increases going forward. He expects the board to take heed to the directive – as it would go towards reducing the SABC's bloated salary bill.

He also expects management to "do the right thing" and accept the leave day cuts.

More than 40 consultation sessions have been held with unions over a period of six months. Referring to the Labour Court's decision to dismiss the Broadcast, Electronic, Media Allied Workers' Union's leave to appeal the section 189 process, Mosia highlighted that the consultation process had been fair.

The SABC in November launched a social plan to assist employees with various needs: in collaboration with the Department of Employment and Labour, it provided psychosocial and financial intervention to workers.

He added that the potential retrenchments could be even fewer than 300 as 170 vacancies will have to be filled through the restructuring process. According to Mosia, a number of workers had opted for voluntary severance packages and early retirement. 

TV licences

Revenue for TV licence fees declined by 18% to R791 million in 2020. Currently, the SABC relies on an internal team for TV licence fee collections. The organisation bills up to R3 billion in TV licence fees per year – but it has been collecting far less. Over the past five years, collections have been short of a billion, according to its annual report.

Kekana said that a possible solution is for other broadcasters such as MultiChoice - that reach a threshold of subscribers - to collect TV licences. This could be considered a quick win among efforts to turnaround the SABC.

Overall revenue took a 12% dip to R5.7 billion due to declining advertising revenues, which was a trend across the industry, said group CEO Madoda Mxakwe. He said the group had a solid revenue-generation plan, which involved in investing in "exciting, compelling and cutting-edge" content.

He highlighted that the SABC suffered a net loss of R511 million, which was 6% were that the previous year's performance, but still 20% better than the budgeted performance.

Mxakwe noted that the Covid-19 pandemic impacted the broadcaster's short-term financial sustainability. He said that despite the difficult year, the SABC was focused on implementing its turnaround plan "with purpose and commitment". He said the SABC is also working on implementing its new operating model, which would make the broadcaster more "agile" and "fit for purpose". 

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