South African Parliament calls for urgent government intervention to stop massive retrenchments by retailer giant

Consumer Confidence
(FILES)-- A file photo taken on March 20, 2014 shows shoppers at the new South African retail giant Shoprite outlet in Kano, northern Nigeria. Nigeria has overtaken South Africa as the continent's largest economy with a GDP of $453 billion in 2012, officials said on April 6, 2014. The figure is based on a long-overdue rebasing of Nigeria's gross domestic product to reflect changes in the structure of production and consumption, and compares with South Africa's 2012 result of $384 billion. AFP PHOTO / AMINU ABUBAKAR

South Africa’s Parliament on Wednesday urged the government to urgently intervene in efforts to stop retailer giant Massmart from laying off hundreds of employees.

“It is not ideal to have (the) government interfere in business, but the severity of the pending retrenchments necessitates that there must be a collaboration of minds,” said Mandla Rayi, Chairperson of Parliament’s Select Committee on Trade and Industry, Economic Development, Small Business Development, Tourism, Employment and Labor.

This came after media reports indicated that Massmart had already started a consultation process, which will see 34 stores closed in South Africa, a move that will impact negatively on about 1,400 jobs. As one of South Africa’s biggest retailers, Massmart owns the chain of stores that include Game, Makro, Builders’ Warehouse and Jumbo. “Losing over 1,000 job opportunities will be catastrophic not only for job creation, but also for the families of those who will be affected,” Rayi said.

It is critical that the planned retrenchments be suspended until a meeting with government departments has happened, and all the avenues have been explored to avoid the retrenchments, he said.”It was not ideal to begin 2020 by laying off workers with no alternative sources of income,” said Rayi. “Such an action, no matter the amount of consultation, will frustrate government’s objectives of creating over a million job opportunities.”According to Rayi, it would be preferable if Massmart considered ways of accommodating the labor force in other business units, or even expand operations to rural provinces where their footprint is not prevalent.

Rayi expressed the view that South Africa is still friendly to business, and foreign investments and opportunities are there for business to exploit. Delivering the ruling African National Congress (ANC) policy statement on Saturday, President Cyril Ramaphosa said job creation remains at the center of the economic agenda of the party.”The most direct and effective way to reduce inequality is to create employment and economic opportunities, particularly for young people and women,” the president said.

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