Steel merchandiser and distributor Macsteel has confirmed that 39 employees, or 1.4% of its total workforce, received formal notices of retrenchment on August 18, while 253 employees have accepted voluntary severance packages.
Several vacant positions were also filled internally, which substantially reduced the number of employees affected by the company’s restructuring efforts, the company said in a statement on August 21.
The severance packages provided were compliant with the Labour Relations Act and aligned with the Main Agreement of the Metal and Engineering Industries Bargaining Council for scheduled workers, it added.
Macsteel had initially contemplated retrenching 13% of its workforce, but this figure was significantly reduced through a “rigorous” consultation process, it said.
The company started a retrenchment process on May 23, which was initiated with a formal notice outlining the potential retrenchment of 360 employees.
“This difficult decision was driven by the sustained contraction of the South African manufacturing and engineering sectors, which is an industry-wide challenge that has placed immense pressure on operational sustainability,” Macsteel said.
After starting the retrenchment process, the company embarked on a facilitation and consultation process that extended over 87 days, which is well beyond the legally prescribed 60-day period, it pointed out.
Macsteel expressed “deep regret” over the necessity of any retrenchments and emphasised that it was taking every possible measure to minimise impact.
NUMSA STRIKE
Meanwhile, on August 20, trade union the National Union of Metalworkers of South Africa (Numsa) said its members employed at Macsteel would embark on strike action from 06:00 on August 22.
The union said consultations with the company had not been exhausted and that the union also did not accept that the retrenchments were justified. 
