Denel employees win urgent bid for R13.2m in unpaid wages

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Arms group Denel has been struggling to pay employees for two years.
Arms group Denel has been struggling to pay employees for two years.
Reuters
  • A group of Denel employees have won an urgent court bid to have their unpaid salaries paid.
  • The state-run arms company has been unable to pay full salaries to its employees for the past two years. 
  • Denel has been allocated around R3 billion to settle interest payments, but this cannot be used to pay employees. 

The North Gauteng High Court in Pretoria has ordered state-owned arms manufacturer Denel to pay R13.2 million in outstanding salaries to 42 un-unionised current and former employees. 

The struggling defence group has been unable to pay its roughly 2 800 employees their full salaries since May 2020.

Unions including Solidarity and the National Union of Metalworkers of South Africa (Numsa) have already won court orders directing Denel to pay their members their full salaries.

Now, a group of employees who were not part of a union have won their case in a private court action.  

READ | Too broke for school fees, emergency surgery: Court orders Denel to pay desperate workers R4.3m

On Tuesday, the court ruled that Denel must pay 42 current and former employees between R55 000 and R700 000 within 10 days of the ruling. The employees are owed a combined R13.2 million in unpaid wages for the period between May 2020 and April 2022. 

The group's legal representative, advocate Michael Matlapeng, told Fin24 that while his clients are hopeful Denel will "find their senses and pay", they are ready to approach the court to enforce the order. 

This is the second time that Matlapeng and colleagues have represented Denel workers seeking salaries. In February, he represented 14 Denel employees who were awarded R4.3 million in unpaid wages. 

After Denel failed to make the payment, the group approached the court the enforce the order. The 14 employees were paid in March after a Denel account at RMB was attached. 

Interest payments vs salaries 

While Matlapeng is confident that his clients will be paid, it's unclear where the money will come from. 

Denel had been allocated around R3 billion to settle ballooning interest payments by the national government. 

Minister of Public Enterprises Pravin Gordhan announced in March that this money cannot be used to pay staff salaries as it has been ring-fenced for debt repayments. 

Denel did not respond to a request for comment. 

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