Shane Andile Matika was only 28 when he died last year. After being dismissed from his job he was left without access to Unemployment Insurance Fund payments as well as his provident funds, and he was destitute at the time of his death.
Matika’s former colleagues, Uzebekile Mani, 56, Simphiwe Kwazi, 45, and Kwazi Khumalo, 35, say that Matika’s family was left in such financial hardship after he lost his job in 2017, that they had to collect money from members of their community to pay for his funeral.
Matika, Mani, Kwazi and Khumalo are part of a group of seven people who were hired at the Nelson Mandela Bay branch of the national company Reinforcing Steel Contractors (RSC) in 2015. RSC has several other offices in South Africa.
The group of workers assumed RSC was their employer. But when they got their first payslip, it was from a Cape Town-based company called “Johnie Steel”. They say when they queried why they were being paid by an unknown company, they were told by their line manager, Douglas Small, not to worry and that their employment was safe with RSC. The workers were advised that Harlinco, a small administration company, was RSC’s Human Resources partner. Small remained their line manager for the two years the group was employed on the RSC site.
The workers’ payslips reflected a weekly payment of R70.56 to a pension fund. “We were worried about the pension fund contributions that were being deducted from our salary,” says Mani. “It was almost impossible to reach Johnie Steel. One time the owner of Johnie Steel, Johnnie Simani, answered the phone and he told us our pension funds were safe with RSC and Harlinco but nothing more.”
Johnie Steel’s owner ‘dies’
On 4 February 2016, the workers received a letter from one Zipho Simani saying that Johnny [sic] Simani, the owner of Johnie Steel, had died and that Zipho had changed the company name to Simani Steel and was now responsible for running operations.
“There is no reason employees should worry because operations are still the same as before,” Zipho Simani wrote.
However, Mani, Kwazi and Khumalo say that none of the workers had ever met Johnie or Zipho Simani, and that Douglas Small ran daily operations at their RSC worksite.
A deeds search shows that “Johnie Steel” was registered to Zipho Simani and that Simani Steel was registered to Mbafana Johnnie Simani, who Zipho Simani said had died at the end of 2015.
“We were so concerned when we got that letter from Zipho Simani. We approached the Metal Industries Bargaining Council to check which pension fund we belonged to, but they had no record of us,” says Mani. The group says they had no choice but to continue working, as they needed to earn a living.
On 2 November 2016, the group received a letter from Zipho Simani saying that the company named Johnie Steel was “disbanding”. This was “due to its financial status, resulting from the abscondment of its owner”. Yet Zipho was the owner of Johnie Steel and the workers had supposedly been transferred to Simani Steel earlier in the year. The workers allege that they were transferred without their consent to another company, which then claimed it had never received them onto its books.
“No severance packages will be paid out to staff, as all staff members employed by Johnie Steel, will be offered alternative employment with Harlinco Pty Ltd. Note that an official new offer of employment to follow in due course,” wrote Zipho Simani.
Harlinco is a registered company directed by Linda Abrahams, which conducts “small business solutions and admin”.
Khumalo remembers: “We were sceptical when Linda said she was hiring us steel workers herself as we know her company only does administrative work.” Their scepticism was well-founded – on 26 January 2017 Abrahams dismissed the workers, blaming the government.
“There is practically no work available currently at the site,” said Abrahams in a letter. “The core reason for this is that government is currently delaying funding for anticipated projects. It is therefore that we are unable to provide everyone with employment contracts … in this unfortunate situation, we have to inform you that you are one of the candidates that didn’t make the selection.”
“We foresee that as soon as government has its act together in a few months time, then we would give you the opportunity to apply again for employment,” Abrahams wrote. However, this never happened, and the seven steelworkers were dismissed.
When the group went to claim Unemployment Insurance Fund repayments at the Department of Labour, they were told that no Unemployment Insurance Fund contributions had ever been paid by their employer. When they tried to trace their pension fund contributions, they were also unsuccessful.
Fraud or not?
The group approached the police to open a case of fraud against RSC but were turned away because their payslips showed they were employed by Johnie Steel. They then sought help from their union, the National Union of Metalworkers of South Africa (Numsa), which said it would take a case of unfair dismissal by their new official employer, Harlinco, to the Labour Court. Because Numsa was two days late in bringing the case, it had to apply for condonation – or leave to bring a case of unfair dismissal outside the 90 day cut-off period. Numsa succeeded in its condonation application on 3 December 2019, which means it can now take a case of unfair dismissal to the Labour Court, three years after the workers were dismissed.
When contacted for comment Small, the line manager at RSC, claimed that the workers were never employed by RSC but only ever with “Johnie Steel/Simani Steel”, claiming that the letter from Simani announcing the name change of the company from Johnie Steel to Simani Steel was proof of that.
“It seems in desperate times the guys lie to try get their way,” says Small, adding that a stop order form allowing Simani Steel to deduct union subscription fees from the workers’ wages to pay to their union, Numsa, was further proof that the workers knew they were working for Simani Steel and not RSC.
But Kwazi is adamant: “We just went to RSC for work and Douglas Small said ‘sign here’. We didn’t ask to be moved to many different companies and lose everything. We have families to support but no work.”
Where is the money?
Mani says, “These companies are all friends, robbing people. We did nothing wrong. They have stolen our UIF contributions and provident funds and nobody wants to say where the money is.”
Zipho Simani says he was the owner of Simani Steel but when asked what had happened to the workers’ pension monies said: “No man! I never worked in PE. I worked in Cape Town. You must have the wrong number.”
When Mani himself called Zipho Simani, Simani claimed no involvement in the disappearance of the pension contributions but when Mani passed the phone to New Frame, Simani again said it was the wrong number.
Abrahams said she was not involved in the vanishing pension monies as she had never been the employer. In court papers, she places the blame on Simani Steel, saying “should the law allow a delinquent former employer get away with walking away from his employees and flouting all laws and legal responsibilities and subsequently allow a new and different employer to take the blame and be punished for what others has done, then one can’t call it justice.”
Numsa is now asking the Labour Court to decide whether the business of Johnie Steel/Simani Steel was transferred to Harlinco as a going concern or not. If not, the group of workers are likely never to see justice because both entities, Johnie Steel and Simani Steel, are currently being deregistered for failing to submit annual returns.
In court papers Numsa contends that Harlinco “continued the work performed by Johnie Steel (Pty) Ltd without interruption and assumed responsibility for contracts previously secured by Johnie Steel. The respondent (Harlinco) operated from the same premises as those previously utilised by Johnie Steel.”
Numsa pointed out that Harlinco had failed to issue a retrenchment notice to the workers and had subsequently employed new people, and not the dismissed workers.
Sydney Moshoaliba, educator for the Casual Workers Advice Office, says: “Many workers come to us and show us monies are being deducted from their pay slips. Often they don’t know the name of the company or the rules of the fund. Our advice is that the workers approach the fund directly. The fund must send one of their officers to come and explain to the workers.
“In many cases though, the workers find out that no fund exists. The boss is simply deducting money for his own pocket. We tried to get the police to open fraud cases but they refuse. They say it is a labour relations issue and we must go to the Department of Labour. The department does nothing.”
The newly established complaints unit at the Office of the Pension Funds Adjudicator (OPFA) says the workers would need to lodge a complaint for it to investigate.