Shoprite in ‘slave wages’ furore

By Tileni Mongudhi

WINDHOEK-WHEN news of Shoprite chief executive officer Whitey Basson’s R100-million a-year pay broke a fortnight ago, workers in South Africa took to the streets in protest of what they feel is an obscene amount.

The workers gathered in Johannesburg for a march organised by the Congress of South African Trade Unions (Cosatu), to complain about Basson’s handsome remuneration while they live in squalid conditions and are subjected to near slave wages.

South Africa’s Shoprite workers were upset that Basson’s remuneration included R49.7million in basic pay for the 12 months to June, in line with the previous year‚ and a once-off R50 million performance-related bonus. This was for trading profit growth of 15 percent‚ above the internal target of 11 percent‚ the retailer was reported as having said.

In Namibia, Shoprite’s 3,000-strong workforce does not have the luxury of taking to the streets in protest, despite being subjected to the same or even worse working conditions as their South African colleagues.

While the South African workers took to the streets last Friday, about 130 of their colleagues, in Namibia, were facing disciplinary charges for protesting their poor working conditions and demanding a living wage last year.

Shoprite Namibia, which is a wholly owned subsidiary of Shoprite Holdings, decided to dismiss the 130 employees for going on an unsanctioned strike last year. The company managed to get a court interdict preventing the workers from downing tools. The workers wanted to express their dissatisfaction with the company’s unilateral decision to only increase their meagre wages by R200.

“The decision was not fair and it was not done procedurally, because management informed us that they are going to increase our wages by R200, without consulting us or negotiating with the unions,” explained a 32-year-old employee who is also facing the chop.

The mother-of-one said the workers took to the streets to protest the R200 increase because the cost of living is much higher in Namibia than in South Africa.

She explains that as a cashier, she has worked at Shoprite for over ten years and earns a gross income of R2,600. She added that the company deducts about R400 which goes towards her meal benefits. She is allowed to take groceries worth that amount monthly. Then the company deducts money for her pension and mandatory Social Security contribution, leaving her with R2,000 to take home.

She rents a shack in the Ombili informal settlement on the outskirts of Namibia’s rapidly growing capital city, Windhoek. The shack costs R1,000 monthly, leaving her with only R1,000 to pay for her other needs, including transport to work and paying for a child-minder.

Namibia’s property and rental prices are among the highest in the world, and owning property has become an unattainable dream even for the middle classes in recent years. In 2014, FNB Namibia Holdings said at a median price of R774,000, households must earn at least R23,000 per month to afford an average property.

The workers complained that other large supermarket chains like Spar and Pick n Pay at least provide their workers with transport to and from work. This eases the pressure on the workers who often live more than 25km from the capital’s major shopping centres and malls.

The Southern Times calculated that based on where the majority of these workers live, conventional public transport will cost a worker about R50 a day, which they cannot afford.

Union Recognition

At the heart of the current fight between Shoprite Namibia and its employees is the arrival of a new trade union, the Namibia Commercial Catering Food and Allied Workers Union (Naccafwu), on the scene.

Naccafwu was established in 2013 and the new union became popular among the workers, threatening to unseat the already existing Namibia Food and Allied Workers Union (Nafau).

Nafau is an affiliate of the National Union of Namibian Workers (NUNW), the largest trade union federation in the country and a wing of Namibia’s ruling party, Swapo.

Nafau was recognised as the sole bargaining agent by the company, but the Shoprite employees accused the union of failing them and being in bed with the company’s management.

The majority of the 130 workers facing the axe are members of Naccafwu and the company has, since 2014, been trying to intimidate those employees who belong to the new union.

The Southern Times has seen a copy of a letter, written by Shoprite human resources manager Karen Smith, dated July 30, 2014. In the letter, she informed the Naccafwu members that their union is not recognised and that its members at Shoprite will not receive their annual salary increments.

“Your employer also told the union that it would give the increments if all of the employees agree thereto, and or if the employee informs the employer that they are not members of Naccafwu,” read Smith’s letter, giving the workers an ultimatum which is a clear violation of the Namibian Constitution, which guarantees freedom of association.

Smith’s letter was also accompanied by templates of how the workers’ letter of resignation from Naccafwu should look like. In the templates, provided by Smith, the workers would also admit that the company did not unilaterally decide on the salary increments, a claim which the workers disputed. They insist that Shoprite did not consult them when deciding on their salary adjustments.

An official in the Labour Commissioner’s office also called the move illegal stating that even in the event that Naccafwu is not the recognised bargaining agent at Shoprite, the union still has the right to have or recruit members at the company and represent its members.

Smith did not respond to detailed questions sent by The Southern Times. She responded to the emailed questions saying: “At this point in time we cannot comment on any of the questions, due to the hearing that is still ongoing.”

The protracted hearing started in October last year and continues to drag on, while the company claims it has been losing money as a result. In its submission to the hearing, Shoprite claims it spends over R65,000 a day on paying for the wages and transporting the affected workers from their workstations to the hearing venue. Legal costs and cost of the venue is not included in this figure.

The 130 workers are being represented by Uno Katjipuka-Sibolile of Nixon Marcus Public Law Office. The firm is representing the workers for free on a pro bono publico basis.

Both the Namibian and South African examples show how Africa’s largest supermarket chain continues to make billions in profits on the back of workers who are subjected to slave wages. Like in Namibia, the march in Johannesburg last week yielded no results for the workers demanding a living wage.

According to the Shoprite’s annual report for the period ending June 2016, the company’s South African supermarket operations had a turnover of R98,1 billion and a trading profit of R5,8 billion. In the rest of Africa, the group supermarket business had a turnover of R22,2 billion and a trading profit of R1,2 billion. All of the profits are shipped to South Africa.

Namibian shareholding in Shoprite is only 4.8 percent. The Government Institutions Pension Fund (GIPF) holds a 2.17 percent of that share. The company also owns the OK Bazaars and Sentra line of supermarkets in Namibia as well as the Hungry Lion fast-food outlets.