Publication: Business Report Issued: Date: 2004-06-14 Reporter: Roy Cokayne

Denel Managers in the Firing Line



Business Report

Date 2004-06-14


Roy Cokayne

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Pretoria - A total of 26 managers, including six senior executive managers, were currently under suspension at Denel, the arms parastatal, said Johan Pieterse, the general secretary for metal industries of trade union Solidarity, at the weekend.

The managers have apparently been suspended as part of a wide ranging investigation into financial irregularities within Denel.

However, some Denel employees have claimed the suspensions formed part of an orchestrated campaign to avoid costly retrenchment packages as it tried to make space for its employment equity drive.

Pieterse was unable to confirm if there was any truth in this allegation.

However, a Solidarity document in the possession of Business Report states that Denel's management was too white to conform to the objectives of the Employment Equity Act and the company was acting to rectify this.

It adds: "It would, however, be unfortunate if Denel were to employ disciplinary proceedings against management members to create an untenable situation for white managers as a means of implementing affirmative action."

A list of 13 questions related to the suspensions was sent to Denel by Business Report on Friday.

Sam Basch, the group manager of promotions at Denel, confirmed that "a number of Denel employees have been suspended pending internal investigations".

However, Basch said, Denel was "not at liberty to elaborate in the media on internal procedures, particularly regarding specifics and individuals".

Basch stressed that Denel operated in accordance with all relevant South African legislation, and the company's disciplinary procedures were transparent and made provision for suspensions "if any staff member is suspected of contravening the policies and regulations".

It has been independently confirmed that Louis Dirker, the group executive director of Denel Land Systems, and five general managers of Denel companies have been suspended in the past year.

Other senior managers suspended include: Jan Mulder, the general manager of Irenco, who later resigned while under suspension; Johan Barnard, the general manager of SPP; Ernest Langer, the general manager of Denel Aviation; Carel Wolhuter, the general manager of PMP; and Org Ehlers, the general manager of LIW.

Pieterse said the case against Langer, who had been suspended for more than a year, was likely to be concluded within the next two weeks.

"A disciplinary hearing has already been held and we are waiting for the ruling," he said.

Pieterse said it was estimated it was costing Denel about R2 million in salaries for all the suspended managers who were "sitting at home".

He confirmed that some of the secretaries of suspended managers were also sent home on special leave.

Some had returned to work but not in their previous positions, he said.

Pieterse also expressed concern about the size of Denel's corporate office, which had doubled in the past six months, at a time when the company was apparently experiencing cash flow problems.

With acknowledgements to Roy Cokayne and the Business Report.