Govt assures union role in telco talks

By Damaria Senne, ITWeb senior journalist

Johannesburg, 19 Oct 2007

Government has assured the Communication Workers Union (CWU) that the labour movement will have some role in safeguarding shareholder/worker interests in a potential transaction between Telkom and MTN, regarding Telkom`s fixed-line assets.

The Department of Communications also warned the union that government cannot interfere with the talks, as the companies are listed and guided by securities and disclosure legislation.

The department held an emergency meeting with the CWU national executive committee yesterday, at the union`s request, says spokesman Albi Modise.

The meeting followed a media statement from the department that it, in principle, supports ongoing talks between Telkom and MTN that could result in the sale of Telkom`s fixed-line assets.

CWU head of communications Mfanafuthi Sithebe says the union was alarmed that government supported the ongoing talks between the telecommunications providers, without consulting the labour movement.

In a media statement released yesterday, the CWU called for the formation of a stakeholder committee that would have some oversight role in the talks and threatened mass action if government refused.

"Any resistance to this noble call [and] CWU won`t hesitate to mobilise workers in the industry - against the planned takeover(s)," the union said in a statement.

"Quite frankly we told them upfront that we are going to continue to apply pressure," Sithebe says.

Original principles

Modise says government is in agreement with the CWU that unions should be included in the interdepartmental/stakeholder committee that is being formed to safeguard shareholder and employee interests.

"Right from the beginning, government said it would ensure the interests of the country, all the workers and those of shareholders are protected. Union involvement is key to this objective," he says.

Modise adds that union involvement will not be exclusive to the CWU, which initiated the meeting, but will also encompass other worker movements such as Solidarity and the South African Communications Union.

"We were told that the proposal for union involvement will be put to the minister [communications minister Ivy Matsepe-Casaburri] and to Telkom and MTN for final approval," Sithebe says.

Sithebe adds that the union was dissatisfied with government`s position that it could not interfere with the talks due to securities and disclosure legislations governing the listed entities.

An analyst, who spoke on condition of anonymity, previously noted that government - as shareholder in a private enterprise - should not have access to information other shareholders do not have.

"If government knew more than other shareholders, Telkom would be in breach of the requirements of the Johannesburg Stock Exchange and New York Stock Exchange," he noted.