Bus company, Putco, has halted planned job cuts, saying it will now implement cost cutting measures to save jobs.
Last month Putco announced that it plans to cut 214 jobs, citing financial constraints caused by the COVID-19 pandemic. But labour unions disputed this, and instead accused the government subsidized bus company of financial mismanagement.
Now Putco has changed its mind, confirming it has reached an agreement with unions on Monday and will instead implement cost cutting measures.
“After the recent announcement of the high unemployment rate in the country, Putco decided to implement various cost cutting measures in order to save jobs. This includes to reduce the cost of overtime, terminating fixed contracts, freezing vacancies and allowing surplus staff to reduce through natural attrition. We also approved early retirement applications and after all these initiatives, we have decided withdrawing section 189 notices,” said the company's businesses development and marketing executive, Matlakala Motloung.
The National Union of Metalworkers of South Africa (NUMSA) said it is “vindicated” because job cuts were unnecessary.
“There is ample evidence that Putco can save millions in revenue and retain jobs, simply by stopping mismanagement and wastage. We have noted that management has acknowledged that this is a fundamental weakness, and therefore, it will be taking concrete steps to update the ticketing system, in order to generate more revenue," said Numsa spokesperson, Phakamile Hlubi-Majola.
Hlubi-Majola said Numsa is happy that Putco employees will be working normal hours again.
“Job rotation is a burning issue for our members because it meant they worked reduced hours, and this meant they earned less. We are pleased that going forward management has committed to reinstating full hours and full shifts,” she said.
The bus company confirmed it is receiving 65% subsidy from government.