Sweet deal for former textile workers

Sweet deal for former textile workers

MASERU – WHEN a textile company, Peter Blond, shut down its operations in February last year, the 980 workers were caught by surprise. They had bills to settle and mouths to feed at home. Surprise soon gave way to anxiety as they tried to figure out how to cope with their sudden loss of employment. But what worsened their situation was that they were still owed salaries and other benefits and the employer had not made any plan on how he was going to settle. Peter Blond was a textile company based in Maputsoe, about 70km north of the capital Maseru. Its biggest client was Woolworths.

The company collapsed after it ran into serious financial problems. Now 14 months after the company shut down, Peter Blond’s former workers will starting next week finally smile all the way to the bank, thanks to a deal with the company’s liquidators. Trade unions, working closely with the Lesotho National Development Corporation (LNDC), have over the last 14 months been pushing to have the company’s assets go under the hammer so that creditors could be paid. The LNDC was the preferred creditor, which means it had the right to be paid first because its payment was deemed more important than others.

The LNDC as a preferred creditor however forfeited its share and decided to give priority to the workers. On Monday, there will be a final meeting if creditors before the liquidators, Webber Newdigate, allocate payments. The former textile workers will be paid first. The LNDC boss, Mohato Seleke, told thepost last week that enough funds had been raised to ensure that all workers are paid. Seleke however declined to reveal how much the liquidators had raised. He also declined to reveal how much the workers will be paid. Seleke however said the workers will share slightly over a million maloti. He said the biggest bidder during the auction, Jonsson Manufacturing (Pty) Ltd, is now expanding the factory to allow it to hire 500 workers. Seleke said two investors had expressed an interest to take over the factory.

“The first investor (Jonsson) is the one who has already absorbed most of the workers after they lost their jobs,” Seleke said. “He is expanding and will hire 500 employees.” He said a second investor will start operations in June after the completion of the maintenance on the factory shell. Jonsson is only waiting for electricity to be functional and will start operations very soon, Selete said. He said the liquidators have successfully raised the necessary funds to pay the creditors because they made sure that they sold to the highest bidder. “It is not in most cases where all creditors are paid in liquidation cases, let alone where preferred creditors forfeit their precedence and give it to workers,” Seleke said.

Seleke lashed out at some trade unions who were peddling falsehoods that the former factory workers will not be paid. “I have asked them to approach other preferred creditors like WASCO and LRA to ask them to go to the back of the line and wait till the workers have been paid but even today they have not given me any feedback yet they are accusing the LNDC of corruption and asking the DCEO to intervene this issue,” he said. “Among creditors is a Basotho owned security company that was owed over M300 000,” Seleke said. He said the LNDC did all that was in their power to ensure that it delivered the promises made to Peter Blond’s workers when it closed shop.

One of the important promises was that workers would be given the first priority when a new investor came through. Sam Mokhele from the National Clothing Textile and Allied Workers Union (NACTWU) confirmed to thepost that the CEO of LNDC had asked them to approach parastatals and ask them to go to the back of the queue so that workers terminal benefits could be paid first. However, he said they suggested that the CEO should be the one communicating with those other parastatals as they already have a working relationship. Mokhele said the reason they went to the media about the Peter Blond issue is because they wanted workers and the public to know that they were not the ones who were blocking the payments.

“We had agreed and indeed we were consulted in several meetings up to a point when we told them that an investor had been found,” Mokhele said.

“We then agreed that former Peter Blond employees would be given a priority when the investor started hiring because they already knew the work.” He said they were surprised later to find out that LNDC found a new investor who already has a lot of companies in Maputsoe and is looking to expand. “This to us said that former Peter Blond employees would no longer be a priority as agreed because the investor already has his own employees,” Mokhele said.

“If he is to hire he will only take a certain number to increase his work force unlike the first investor who was going to hire most of them,” he said. Mokhele said he is not happy because the LNDC had not disclosed the amount of money that was due to workers and the amount it was forfeiting to see if indeed all workers would be compensated.

Lemohang Rakotsoane

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