Pula Steel employees held CEO hostage
Onalenna Kelebeile | Friday February 3, 2017 15:59
They also ordered the CEO to resign with immediate effect.
The enraged employees have not received their December salaries in full as well as those for January. What irked them the most was that the CEO wrote them letters assuring them of payment of all their dues on the last day of January, but that did not happen.
They abandoned the plant and stormed the company offices where they held Virma hostage from morning until law enforcement officials came to his rescue at around 3pm.
During the hostage situation they had a plain paper in which they wanted Virma to write down a resignation letter to the board of directors and effect their wages immediately.
When Mmegi arrived, the employees clad in work suits had surrounded the CEO in a tightly packed room.
“You are not going anywhere because we also have nowhere to go. Our houses are locked for lack of rental payments and we have got no food. Our children are suffering. We are sleeping here with you,” one of Virma’s captors told the CEO.
Pula Steel has been marred by challenges shortly after it commenced production. Last year it was closed down for about two months for failure to comply with the pollution control standards. Its fleet has been impounded by sheriffs for failure to pay some local suppliers, a debt over P1 million while Botswana Power Corporation(BPC) disconnected its power supply to the plant in November last year.
It is understood that the bill runs into millions of pula and there has been no production since the power disconnection up to date. It is also believed that the country’s only steel manufacturing plant owed BCL several millions of pula for the scrap metal it has been using for its production.
Employees said during the hostage situation that Pula Steel problems lie with Virma and his son hence they should be relieved of their duties with immediate effect to save the company.
They complained that the Virma family continues to mistreat and abuse employees leading to them being forced to accept pay cuts.
“There is no transparency and no adherence to employee conditions of service as well as violation of labour laws,” one of the workers said.
They cited an incident in which one employee who got injured on the job and had three fingers amputated was compensated with a paltry P6,000.
They demanded to know where the company’s proceeds have been going because they fully understand that nothing was paid to BCL for scrap metal supply as well as to other suppliers of other goods. They said all their efforts to engage the labour department have not yielded much and that a case has long been registered with the Industrial Court, but has never been heard.
“We are all going to sleep and eat at the Virmas’ house today,” the worker said.
On the other hand Virma explained that there had been financial challenges because the company does not have working capital and that they are still waiting for CEDA, which is one of the shareholders, to release some funds. He said there has been a delay by CEDA.
“We have a lot of liabilities. We tried to operate the plant, but BPC switched off power in November,” he said.
Employees could not buy the explanation and said there was no way shareholders or any investors can start operations without a working capital.
“You misused the money and that is why we want you to resign to save your investment and the country’s economy,” the worker said.
The CEO explained that he has got no problem stepping down, but he has a legally binding agreement with the employer as entailed in the key man‘s contract.
“I cannot resign on my own, but only the Pula Steel board can decide. I cannot just opt out of the contract without notice therefore it would be illegal on my part to resign just like that,” he said.
Virma suggested to employees to write the letter themselves and that he would endorse it and said only when the board can make that decision would he step aside. It took the intervention of senior police officials to have Virma released and driven to the police station.
It also took the intervention of the CEDA CEO, Thabo Thamani who was accompanied by his deputy, Andrew Madeswi for employees to return to the plant yesterday morning after he held a meeting with them. Virma was not available at that meeting.
Thamani dismissed the statement by Virma that there are funds expected from CEDA and confirmed that all shareholders have paid their dues.
“It is not true. Any money from CEDA would be for production, not salaries,” he said. He noted that the process to recruit is still ongoing as the company wants to come up with a new management team. He said the issue of wages has been resolved and they will soon get their dues. Thamani explained that their issue with BPC is about tariffs on peak and non-peak power usages that resulted in the plant overpaying.