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FEDUSA Calls For a Moratorium On Retrenchments Amidst Unchanged Level 3 Restrictions

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FEDUSA Calls For a Moratorium On Retrenchments Amidst Unchanged Level 3 Restrictions

13th January 2021


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The Federation of Unions of South Africa (FEDUSA) welcomed the re – imposition of Level 3 restrictions announced by President Ramaphosa in his address to the nation on 11 January 2021. Largely considered as a bitter – sweet move by FEDUSA in light of  the hardships experienced by members organized in the tourism, personal care, entertainment, and hospitality sectors, a move towards strengthening the lockdown levels would have certainly spelled ultimate and certain death to sectors engaged in level 4, still reeling in the losses and permanent closures encountered. 

Amidst the jobs bloodbath that has categorized the COVID 19 pandemic in 2020, FEDUSA demands that Government shows decisiveness in its effectivity and efficiency as a capable state by demonstrating and implementing collaborative, uninterrupted, unconstrained and theft – proof measures to rollout the vaccine. Collectively with its social partners, Government must lead the country from crisis to construction and eventual economic conversion, in order to restore the dignity of workers and employers who have been left financially paralysed by the pandemic.  


Statistics South Africa (Stats SA) recorded 2.2 million job losses in the second quarter of 2020, leaving just 14.4 million employed people in both the formal and informal sectors. Government’s Stimulus package has failed to deliver the silver bullet that many had put their hopes on, with inadequate results. According to the Quarterly employment statistics (QES) survey released by Statistics South Africa (Stats SA), formal sector jobs decreased by 616 000 in the third quarter, year on year. Employment losses were reported in the business services, transport and mining industries with    7 000, 5 000 and 2 000 jobs respectively.

Business services and trade industries reported annual job losses of 163 000 and 162 000 employees in September 2020 compared with September 2019, followed by the manufacturing industry with 92 000, construction industry with 80 000, community services industry with 61 000 and transport industry with 42 000. Further annual losses in employment were reported by the mining industry with 13 000 jobs. 


FEDUSA therefore calls call for a moratorium on all retrenchments and future potential processes, as the Federation believes that all possible avenues must be considered instead of continuously using workers as scapegoats. Finance Minister Tito Mboweni’s Budget speech in February 2021 is not expected to bring about any joy, considering the October 2020 MTBPS outlook - budget deficit is 15.7% of GDP and gross debt is 81.8% of GDP. 

The SA Reserve Bank needs to apply the same amount of conviction in 2021 to continue to catalyse the soft – landing, stability and liquidity to assist workers entrapped in debt due to the lockdown. Although the SARB was very instrumental in the process, it needs to continue on this trajectory, as the Loan Guarantee Schemes (LGS) and tax relief measures have yet to deliver the results that were promised, considering that only a meagre R15 billion of the R200 billion capacity relief to SMME’s were provided. 

Albeit the elephant in the room, FEDUSA will unreservedly continue to vocalise its calls for economic justice for workers, as the recoveries of funds due to state capture and looting will undoubtedly create some of the liquidity required, whilst reassuring ratings agencies of the renewed confidence in the State and its governance capabilities. Similarly, the NPA must fast track their efforts and execute their mandate by fast tracking investigations with vigilance to convict these alleged criminals, and ultimately recover and reallocate the stolen funds. 

Issued by FEDUSA


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