Construction firm Aveng has announced looming job cuts. However, the company’s announcement that it will cut 120 jobs differs starkly to the statement issued by the National Union of Mineworkers (NUM), which said it had received a section 189 notice that 2,863 workers would be laid off at the Aveng Grinaker-LTA business unit.

Aveng job cutsThis follows thousands of retrenchments by Aveng over the past three years, and Aveng has specified that the latest job cuts will only affect 120 permanent positions. A company spokesperson described the NUM numbers as “crazy”, as the 2863 number quoted in the statement was the total headcount of wage-earning employees in Aveng Grinaker-LTA, not the number of employees affected by the retrenchment process.

“Aveng Grinaker-LTA has been formally engaging with its representative unions, being the NUM, Numsa (National Union of Metalworkers of South Africa) and Amcu (Association of Mineworkers and Construction Union), since October 2017, in a CCMA-facilitated Section 189 retrenchment process in terms of which 120 permanent positions in the Aveng Grinaker-LTA Building business unit are affected,” the company said.

“We would like to call on Aveng Grinaker-LTA to rethink its position to retrench. They must create opportunities for job creation rather maximising profits at the expense of the poor construction workers who earn poverty wages,” NUM spokesman Livhuwani Mammburu says. “Aveng Grinaker-LTA said it was retrenching due to most of its projects coming to an end and no future projects awarded to the company.”

The retrenchment announcement may be part of a larger restructuring planned by the company since late last year. A strategic and operational review was announced in September, aimed at improving liquidity and returning the business to profitability.

Aveng’s group turnover fell from R33.7 billion 2016 to R23.5 billion 2017. Measures that could be taken to improve profitability were noted as selling non-core assets; identifying a number of products to export to different markets in order to enhance profit; cutting underperforming contracts; reorganising production capacity, and simplifying organisational structures.

Image credit: https://twitter.com/mammburu


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