Nehawu members are set to protest outside the SARB offices in Durban against the liquidation of Ithala Bank and non-payment of bank employees’ salaries. Picture: File
EMPLOYEES of Ithala Bank are reeling in anger about the non-payment of their salaries this month, which they have linked to the central bank freezing all the bank’s accounts.
The employees, who are caught in the battle between their employer and the South African Reserve Bank (SARB), said the issue of liquidation has messed up the bank’s operation to an extent that even service providers have not been paid this month.
This journalist understands that depositors, who use bank cards for withdrawals, have been deprived of access to their money.
Johan Kruger, who was appointed by SARB’s Prudential Authority (PA) as the repayment administrator (RA) for Ithala, has been blamed for the non-payments.
SARB spokesperson Mahlatse Mahlase declined to answer questions due to two pending Pietermaritzburg High Court matters concerning the liquidation.
The National Education, Health and Allied Workers’ Union (Nehawu) has threatened to approach the court if the salaries are not released immediately.
One employee expressed his dissatisfaction at living in poverty when, as a parent, he should have been spending money to help his children get back to school.
“We don’t know when we are going to be paid because the administrator (Kruger) shut down everything; therefore, Ithala does not function. Even service providers have not been paid,” said the employee.
He said only Kruger could decide when to release the funds for the payment of salaries.
“You guys don’t understand the impact of this thing (freezing accounts and liquidation process) because there is a man who sits at Ithala and does as he pleases and Ithala has no control over him,” he said.
The senior employee said Kruger was breaching a previous court ruling that he should not interfere with the day-to-day operations of the bank.
“Staff salaries are part of the administration issues that should be handled by Ithala management.
“Those are the issues that would be heard in court on Tuesday (January 28) in which Ithala is asking the court to enforce its previous ruling,” said the employee.
Ithala has approached the Pietermaritzburg High Court seeking to interdict Kruger from interfering with the bank’s operations, and the matter is expected to be heard on Tuesday.
The same court would on Thursday also hear an application by the PA for the bank’s provisional liquidation and Ithala is opposing it.
In both matters, Ithala would be supported by the Provincial Treasury, Ithala Development Finance Corporation (IDFC), and the Department of Economic Development, Tourism and Environmental Affairs (EDTEA).
Nehawu, which claimed to have 350 members at Ithala, will stage a “Save Our Ithala Campaign” outside the SARB offices in the Durban CBD on Wednesday against the non-payment of the employees.
“The union is now taking this matter to court,” said the union on Facebook.
Provincial EDTEA Portfolio Committee chairperson Mafika Mndebele said the committee, which has no authority to force Kruger to release salaries, would be fully behind the Nehawu court case.
“That is why we will go to court to oppose action imposed by the RA because the non-payment of salaries in time has implications for workers whose bonds, car instalments and other creditors will be affected.
“Immediately you don’t pay, there are penalties, but beyond that, this would affect your credit score.
“Failure to pay salaries is one of the worst things you can ever think of,” said Mndebele.
He said Kruger was the only one currently with control over the bank’s accounts.
He said the committee has no power to engage Kruger, who reports directly to the PA, which reports directly to the national Parliament’s Standing Committee on Finance.
He said the provincial committee had approached Standing Committee’s chairperson Dr Joseph Maswanganyi, who said he would respond “as soon as they (Parliament) come back from recess”.
“This matter is urgent and we want to sit down with him,” said Mndebele.
EDTEA provincial spokesperson Sinenhlanhla Mthembu said the department would not comment on the matter that is in court.
“We are now waiting for Tuesday (Ithala’s court application hearing) as the way forward will come on 28 February (Tuesday).
“MEC (Musa Zondi) and I do not have answers about the salaries,” said Mthembu.
bongani.hans@inl.co.za