National Blankets, workers negotiate exit package

Textile company National Blankets Limited has opened negotiations for exit packages for 132 workers it has identified for retrenchment, with workers demanding six months' salary for every year served.

In an interview, National Blankets legal advisor Mr Vonani Majoko of Majoko and Majoko Legal Practitioners said there were ongoing discussions taking place between the company and the workers concerning the amount to be given to each worker and an agreement was yet to be reached.

"The workers are demanding a package that is near to impossible for them (company) to pay. Workers are demanding six months' salary for every year worked and if that is calculated by 132 workers to be retrenched it is quite a lot and the company said it can not afford considering that the payments will be backdated to a time when the company was not earning any foreign currency," he said.

He said the retrenchment exercise was meant to cut on operational costs as labour had been the company's biggest expense.

The company has installed state-of-the-art machinery that would need less workers, hence the shedding off manpower.

Mr Majoko said the initiative by the company was meant to avoid a situation whereby it would spend much on workers' salaries and enable the maximisation of production.

The retrenchment was not voluntary but was initiated by the company after realisation that there was a need for efficiency.

Last year a total of 121 workers were retrenched on a voluntary basis.

"The company realised that there was over employment and currently a downsizing of the staff is going on. Areas where there has been overstaffing have been identified. Demand for blankets is seasonal and it slows down when the winter season is over and workers should take this into consideration when making their demands for packages," said Mr Majoko.

He said the company was working on reclaiming its 70 percent market share it used to enjoy and anticipated that next year there would be improved sales.

"The company has received tremendous support from different institutions among them department stores, police and the army. The next year would see a significant improvement in terms of sales because product range would be improved tremendously owing to the availability of good quality of yarn. At the moment the industry is no longer servicing the market it used to service because of new entrants," he said.

Mr Majoko said for fair competition on the market the Government should consider providing for the sector access to raw materials and cheap finance.

The company was recently placed under care and maintenance and is expected to resume operations next week.