The Congress of South African Trade Unions (COSATU) notes the decision by the board of Daybreak Foods to enter the company into business rescue but warns that workers’ rights must not be compromised.

COSATU and its Affiliate representing workers at Daybreak Foods, the Southern African Clothing and Textile Workers’ Union (SACTWU) engaged the Public Investment Corporation (PIC), urging it to intervene when the chicken producer run out of money to pay workers and purchase feed for the chicks earlier this month. The SPCA was forced put down 350 000 starving chicks, many of which had resorted to cannibalising each other to survive.

The PIC which controls 100% of the shares in Daybreak Foods on behalf of the Government Employees Pension Fund, Unemployment Insurance Fund and the Compensation Fund, provided R76 million working capital funding to enable the payment of salaries and purchase of feed. Now the PIC has agreed that entering business rescue is the best way to save the company and secure the 3 000 jobs it provides.

COSATU welcomes the decision with caution, because in the past workers have been the ones to bear the brunt of the challenges wrought on by the business rescue process. Previously we have seen workers being retrenched, or carry on for months without salaries, some have suffered from depression due to financial hardships and in some cases, workers have been unable to access their unemployment and pension or provident fund benefits.

It is for these reasons that we call on the board of Daybreak Foods and the PIC to ensure that workers are not made to suffer unduly and that their rights are not compromised as the business rescue process unfolds. The Federation also hopes that the company will emerge from business rescue with its governance challenges that resulted in the company having four CEOs in five years resolved. COSATU and SACTWU will monitor the process closely regardless of who is chosen as the business rescue practitioner to ensure that workers’ rights are protected as the rescue unfolds.

Issued by COSATU

Zanele Sabela (COSATU National Spokesperson)

Mobile: 079 287 5788 / 077 600 6639

Email: zaneles@cosatu.org.za