The acting CEO of Eskom – Mr Phakamani Hadebe – tried to fire Matshela Koko yesterday afternoon. Koko told him to go and fly a kite. And yes – Koko is right. Because whether you like Koko or not is between you and your ancestors. It has nothing to do with the employment contract between Matshela Koko and Eskom. The integrity of an employment contract is one thing we must protect at all costs. Lord knows we’ve already lost enough through this State Capture saga!
Let me elaborate.
Last weekend, the Presidency issued a statement penned by the Deputy President of the country and the current President of the ANC – Mr Cyril Ramaphosa. In the statement, 13 names of the new board of Eskom were published. This was supplemented by the name of Mr Phakamani Hadebe who was named as the acting CEO. In addition, this board was asked to immediately remove current Eskom executives that are implicated in allegations of state capture. Specifically the statement mentioned Matshela Koko and Anoj Singh, whose ability to remain entrenched at Megawatt Park had threatened to outlive Styrofoam itself.
The statement was also issued at the end of a weekend that included the NEC meeting and the Lekgotla. Naturally everyone got excited by these developments and declared a new sheriff was in town. The problem of course is that this is not how South Africa works.
Firstly the status of the board itself is subject to debate. In the way it conducts itself, the ANC prefers to appoint an executive member of the Cabinet (in this case Lynne Brown) who undertakes the process of identifying individuals who might be members of the board (in consultation with other stakeholders). Once such names are in existence then they are submitted to Cabinet which then ratifies the new board.
The board itself is then responsible for the appointment of executives – the CEO and CFO being the most crucial ones.
This multi-layered process is structured to ensure governance processes have integrity and avoid interference. And that is how it should be.
Last week’s statement also mentioned that the new board was subject to ratification by Cabinet. Unfortunately from the moment the statement was released, it does not appear that there has been a Cabinet sitting. Such meetings are held on Wednesday mornings. When the statement was released the President was still scheduled to go to Liberia for the inauguration. The Deputy President was scheduled to go to Davos alongside some Ministers. So I suspect that there was no Cabinet meeting scheduled for this week to begin with.
We all know that the statement itself also served as a PR exercise for the Davos group who needed to be able to say to investors that we are finally doing something about corruption. This was confirmed by Cyril Ramaphosa this week who said that they did indeed give Jacob Zuma the ultimatum along the lines of ‘We need to act on Eskom or simply cancel Davos altogether.’
This was indeed a masterstroke for the PR angle. But if it comes at the expense of our governance systems then we might have a problem.
So why do we have a problem?
Well for a start, until the ratification of the board happens, it is essentially what you might call a board-elect. Whether such a structure has the legal authority to take decisions that would bind Eskom is subject to debate. My gut feeling – not a legal opinion – is that they can’t act until ratified. Which is why the Presidency statement specifically had to mention the ratification still needs to be done.
Then it get complicated. Phakamani Hadebe was mentioned as the new CEO. This is not making sense. Only a board – and not the NEC of any political party – can appoint a CEO. So we have this extraordinary situation where a board that had not been ratified and definitely had not met last Sunday, had a CEO in place who could not have been appointed by anyone as there was no board in place. So unless the board met on Sunday and approved the appointment of Hadebe I have to ask – who on earth hired him?
Another key issue is that the NEC cannot legally fire anyone who works at Eskom. That is simple. So their views here are merely political and have no standing in a matter of this nature.
The new board on the other hand – are compelled to honour the employment contract that exists between Matshela Koko, Anoj Singh etc and Eskom the company. In other words, unless there is a violation of the contract committed by the employees in question, there is no obvious indisputable basis for firing them.
Take Matshela for example. He was previously suspended (he has a habit of this). Then there was a disciplinary hearing. Its bizarre processes and surprising outcomes notwithstanding, that process found him innocent. Then the previous board reinstalled him. As they should have.
So in the absence of pending charges against him Eskom cannot unilaterally fire him. So when Hadebe asked him to resign yesterday or get fired he was within his rights to resist. Hadebe should have then explained the reason for firing him which – regardless of what you and I think – doesn’t exist. If the thinking is that he is implicated in corruption and state capture then Eskom must go ahead and press charges. Even then it doesn’t mean he is dismissed as such charges have to be tested.
Anoj Singh and Prish Govender decided to resign. Had they decided not to resign then firing them would have been as complicated as the Koko scenario.
Which leads us to the question of how it all became so complicated in the first place.
Well it is simple really, South Africans have this wonderful habit of being driven by mass hysteria. Of course we all think Koko has a lot to answer for. But as it stands, the Eskom employment contract cannot react to our hysteria. He has to be charged with something before we can proceed. If Eskom doesn’t have any charges to lay against him then he has to ask why they want to fire him. At this stage, in the absence of a clear answer from Eskom, we have a deadlock. Koko will keep going to work. And we don’t have to like it.
So next week there will obviously be a Cabinet meeting. The board of Eskom will be ratified. Then they will legally and formally appoint Hadebe who will finally become CEO. If he then decides to fire Koko, then he needs to find proper reasons to fire/suspend him. This could range from anything – lack of trust, insubordination, misconduct etc – which will have to be legitimate. If it is not, Koko will simply launch an appeal at the Labour court.
Why are our labour laws so complicated?
Well naturally, it is all about the historical context. Long ago when the National Party was in charge, employment relations between employers and employees were very tenuous in nature. One example is the job reservations policy. Under this policy, high skill jobs were reserved only for white people. Black employees could only do the jobs that white people did not want. But more importantly, in times of recession then white employees would suddenly be available for the low-skill jobs which meant that employers had to be able to lay off the black workers for any random reason. The design of the current labour regime then is a direct response to this historic discrimination against primarily black employees.
There are other examples of course. The Mine and Works Act of 1911 ( Summary: it is illegal for black workers to be allocated to skilled work in the mines). The Native Building Workers Act of 1951 (Summary: It is an offence for Africans to perform skilled building work in so-called white areas being the towns, cities and industrial areas where most of the major building work is done). Clause 77 of the Industrial Conciliation Act which was titled ‘Safeguard against interracial competition’ (Summary: enabled the Minister of Labour to declare any industry, trade, occupation or class of work to be reserved for workers of a specific race – whenever he felt like it). The Native Labour Regulation Act of 1911 (Summary: Reinforcement of the pass law system and deeming the lack of possession of the right dompas as a criminal offence and lack of dispute resolution mechanisms for black workers). This went on for decades.
So people of the South, if all of you now want to undermine the integrity of the labour legislation regime because you hate Matshela Koko then go ahead. Just don’t expect all of us to sign up for that nonsense.
By Khaya S Sithole