South Africa

SHUTDOWN AFTERMATH

Greyhound collapse leaves ‘shocked’ workers jobless and desperate for answers

Unions want to know whether Greyhound was indeed under 'financial distress', which ultimately led to its closure. (Photo: Greyhound)

This week, workers and unions expect to hear what options KAP Industrial Holdings considered before closing Greyhound, Magic Transfers and Mega Bus services. About 700 workers are affected. Daily Maverick spoke to two who now face a grim future.

In the lead-up to Wednesday’s Commission for Conciliation, Mediation and Arbitration (CCMA) meeting, trade unions hope to hear what alternatives KAP Industrial Holdings considered before announcing the closure of Greyhound, Magic Transfers and Mega Bus – a move that would leave hundreds of workers unemployed.

This comes after the bus operator announced on 3 February that it would be discontinuing its services with effect from Sunday, 14 February

On Monday, the Democratised Transport Logistics and Allied Workers Union (Detawu) met Greyhound management at the first CCMA-facilitated Section 189 consultation. 

The consultations require that the company be transparent with the trade unions and the workers involved and aim to “ensure the fairness of the process”, Detawu deputy general secretary Nontembeko Luzipo told Daily Maverick. 

Through the process Detawu aimed to find out whether Greyhound was indeed under “financial distress”, which ultimately led to its closure. 

According to Luzipo, Detawu views Greyhound’s closure as “very suspicious”. The company was initially “not honest in disclosing their financial distress”. 

Greyhound was forced to apply for CCMA consultation after Detawu and other unions “cried foul” following the company’s announced on 1 February that it intended to close the company in two weeks, according to a Detawu statement on 16 February. 

  Greyhound Consultation Report-Back – DeTAWU Press Release (1)

A Section 189 retrenchment process requires employers to set up consultations with staff when contemplating retrenchment. During consultations stakeholders must try to reach consensus on a number of matters, including the possibility of avoiding the dismissal and looking at appropriate measures to minimise job losses.

Section 189 (3) of the Labour Relations Act requires the employer to provide written notification to the employees or trade unions indicating reasons for the retrenchment, the alternatives to dismissal that were considered and the reasons they were rejected, severance pay and the number of employees likely to be affected.

Detawu attended last week’s CCMA consultation “with the sole aim of saving jobs and raising pertinent legal questions”.

Other labour formations, including the National Union of Metalworkers of South Africa (Numsa), Transport and Omnibus Workers’ Union (Towu), Togetherness Amalgamated Workers’ Union of South Africa (Tawusa) and the South African Transport and Allied Workers’ Union (Satawu), were also present at Monday’s consultation, Luzipo said

Unions had asked a number of questions during the meeting, including:

  • Why did Greyhound not consider business rescue when it noticed that its business was distressed?
  • Why did KAP Industrial Holdings not consider selling Magic Transfers and Mega Bus since there are plans to transfer 167 revenue-earning vehicles to the operation in Mozambique?
  • Has Greyhound been receiving a subsidy from the government?

The company agreed to respond by close of business on 17 February, according to the union. 

Greyhound responded on 17 February, but Detawu was “not satisfied”, said Luzipo, who added that questions remained, and the union had thus secured an appointment on Tuesday with their lawyers. 

Detawu would decide how to proceed following the second CCMA consultation on 24 February, which would again include Greyhound and the other unions.

As of Monday, Detawu was in possession of the company’s financials, which its finance department was scrutinising.  

Gavin van der Merwe, KAP Industrial Holdings’ industrial investor relations and sustainability executive, declined to comment, saying the company was committed to the CCMA process: “I don’t want to have a Section 189 process through the press.”

Greyhound is owned by KAP Industrial Holdings, a subsidiary of Unitrans Passenger. 

Numsa general secretary Irvin Jim said: “Unitrans Passenger employs more than 3,000 employees from its various passenger divisions. About 693 employees will be affected by the contemplated closure of the companies Greyhound, Magic Bus and Megabus Midrand.”

Greyhound, a luxury bus company that had been operating since 1984, had routes from Johannesburg to Bulawayo in Zimbabwe, Maputo in Mozambique and Pretoria. It had carried more than 1.4 million passengers over 25 million kilometres. 

Workers’ strife 

One of those affected by the closure is James*, who worked as a coach operator for Greyhound for eight years. He has been unemployed since the start of February and says he was devastated by the company’s  “unexpected” shutdown. 

Around the middle of 2020 it became clear the company was struggling with revenue, facing “many challenges” as a result of adhering to stringent Covid-19 lockdown restrictions, James told Daily Maverick. 

Early in February, KAP expressed “deep regret” at having to close down Greyhound and Citiliner operations, blaming it on “declining passenger numbers and poor regulatory compliance” leading to both brands suffering operating losses for years. 

Covid-19 and the lockdown accelerated the demise of the company, added KAP subsidiary, Unitrans Passenger.

James said he’d expected the company to downsize because of travel restrictions hindering passenger demand, but he never expected the business to shut entirely. 

As the family breadwinner, James is concerned about the four children he has to support.

“Job opportunities are very scarce in South Africa, especially now during Covid-19. It might take a long time before one finds a job again.” 

*Khutso, a Greyhound bus driver, was also “shocked” when he was informed about the closure. “I’m a shop steward and they hadn’t communicated anything to us. I only found out on 1 February around three in the afternoon.” 

With lockdown regulations restricting travel and bus occupancy, Khutso said it was difficult to make ends meet. “During lockdown we got money from the UIF temporary employee relief scheme [Ters] fund, but even with that we struggled to get our money. The last time I got anything from UIF was last year in June and that was tough for me and my family,” said Khutso, who also supports his four children. 

The scheme was introduced as a relief mechanism for businesses that temporarily laid off their employees, placed them on unpaid leave, or can only afford to pay a portion of their salaries due to the lockdown.

A number of employers and employees said they struggled to access UIF’s Ters benefit, citing issues with the website and paying on time, if at all. DA employment and labour spokesperson Michael Cardo said in 2020 the online application process was “plagued with gremlins and obstacles”. 

Khutso, who worked for Greyhound for six years, said the future looks uncertain. “At the moment I just want to follow the consultation process [between KAP Industrial Holdings and the trade unions], then I’ll see.” DM

*Real names have been withheld to protect their identities.

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