This preview shows page 1. Sign up to view the full content.
Unformatted text preview: and had
filed a Section 77 notice (a legal requirement in terms of the Labour Relations Act) that it
would protest against the entry. COSATU further attributed the announcement by a
Massmart competitor, Pick ‘n Pay, it would be retrenching about 3000 workers, as a
response to Wal-Mart’s entry.
COSATU’s concerns are shared by SACCAWU. SACCAWU warned of a “waterbed
effect” – the spiral effect and the creation of monopoly or buyer power if Wal-Mart was
allowed to enter the South African market. They argued that it would reverberate
throughout the supply chain – manufacturing, food, agro-processing, clothing and textile,
chemical and transport. Like COSATU, SACCAWU believes Wal-Mart’s entry will
displace local jobs. It pointed to a contradiction between Wal-Mart’s claims of
empowering Massmart to continue setting the direction for the company and trumpeting
the merged entities’ access to Wal-Mart’s business model, practices, strategies and
55 skills. “…This merger should not be treated as an ordinary case given the size, notor ious
business practices and foreseeable adverse impact of Wal-Mart entry into South
Africa…” SACCAWU “welcomes responsible foreign investment in South Africa”. “It does
not, however, support Wal-Mart’s investment in South Africa because of that firm’s
specific business model and practices, and their adverse consequences for the South
African economy”. “SACCAWU would not hold the same attitude to the proposed merger
if the primary acquiring firm were another international retailer.”
SACCAWU further pointed to Massmart’s growing animosity towards the union
coinciding with its talks with Wal-Mart about the take-over. They cite an example where
Massmart by-passed the union and negotiated directly with workers about retrenchments at a store level, in violation of a recognition agreement which requires
such negotiations to be handled by the union at a national level. They believed such a
development was not merely coincidental but a “Wal-Mart effect”. SACCAWU also
alleged the retrenchments were in fact linked to Wal-Mart, and that Massmart was
undertaking pre-merger restructuring in preparation for a take-over by Wal-Mart. They
argued for the reinstatement of the workers who were retrenched prior to the take-over.
SACCAWU believes that Massmart positioned itself to be bought by Wal-Mart and as
part of this positioning restructured itself, leading to retrenchments.
SACCAWU complained that Massmart management “misled the public” by claiming it
had consulted with trade union leadership about Wal-Mart’s entry when it fact it sent a
text message an hour before a public announcement was made. The union viewed this
as an attempt to drive a wedge between the union and workers.
Mr Mbongwe contends that Wal-Mart workers in the US are not unionised because of
Wal-Mart’s anti-union attitude. He pointed to correspondence between Wal-Mart and 56 Massmart where Wal-Mart encourages Massmart to relook at the recognition agreement
it has with SACCAWU.
They pointed to some countries, states and municipalities, where Wal-Mart has been
prevented from entering because of its labour practises.
NUMSA shares the same sentiments as other trade unions and pointed to the potential
loss of manufacturing jobs in the value chain if Wal-Mart were to enter the country. Its
Secretary General, Irvin Jim, argued in parliament; “I think we want to say that where we
organise [metal and automobile] as a union we have got many multinationals who have
invested in this country, they were not here in order to loot, they were not here in order
to destroy the very jobs that this country desperately needs. This deal cannot be
supported because of its nature and character as stated above but also because of WalMart’s global notorious disrespect for workers’ rights, the firm specific business model
and practices that will have a disastrous impact on the South African economy ”. In its
submissions in parliament, NUMSA called for a commission of inquiry to look at the
effects of the entry of Wal-Mart into South Africa.
FAWU agreed with other unions and claimed the likely impact of Wal-Mart on the value
chain would affect its members. Its Secretary General, Katishi Masemola argued in
parliament that the low prices that were being bandied around would come at a huge
cost to South Africa. 57 SACTWU
SACTWU pointed to the negative impact that Wal-Mart’s entry would have on
manufacturing in South Africa as a result of Wal-Mart’s global sourcing capabilities, and
especially the impact on clothing and textiles.
Most media articles carried sensational headlines, including a “War between Wal-Mart
and the trade unions…”, “Unions fear loss of jobs, workers’ rights”; “Wal-Mart thinks it’s
over but it’s not”; “Mother of all boycotts if Wal-Mart / Massmart deal is approved”; and
“Unions fire first salvo in battle with Wal-Mart bully”.
5.2.2 Relationship with Government
Massmart, Grant Pattison
View Full Document
This document was uploaded on 01/24/2014.
- Winter '14