Denel cannot pay salaries in full

Solidarity serves demand: Denel to take legal action

Solidarity  served a demand under section 165 of the Companies Act on Denel to take legal action against individuals who were responsible for, or who were party to the financial predicament the company finds itself in.

This comes after various irregularities were brought to Denel’s attention in Solidarity’s Denel File provided to Denel in April 2018. This led to several dismissals at the institution.
According to Solidarity’s Head of Legal Services, Anton van der Bijl, under this section of the Act Solidarity can demand that Denel investigate irregularities and take legal action within 60 days after such demand was served on them.

This case is unique in the sense that from now on, government officials working at state-owned enterprises could possibly be held directly liable for malpractice committed at such companies.
“If the alleged irregularities are not investigated, and/or if no legal action is taken because of the proven irregularities, we may take legal action against the responsible persons in Denel’s stead. The time has come to hold people accountable for their wrongdoing and to bring them to book.

According to Solidarity General Secretary Johan Botha, the recent salary issues at Denel and the consequent references by Mr Danie du Toit and Minister Pravin Gordhan to the influence of state capture on Denel, make it clear that there is indeed compelling reason to take this action.