Pick n Pay’s drastic restructuring plan aims to overhaul its labour model amid significant financial pressures and competition in the retail sector. The company has launched a Section 189 process to address employee conditions for 22,000 store workers.
The restructuring focuses on several key changes. The company plans to cut costs by reducing Sunday pay and adjusting work rosters. Currently, Pick n Pay pays double the hourly rate for Sunday work, while the industry norm is time-and-a-half.
CEO Sean Summers emphasizes that the current labour practices do not align with prevailing retail market norms. He noted, “If we are to compete on an equal footing in an increasingly constrained marketplace, we can no longer sustain structures that are materially above market norms, especially while trying to return the business to profitability.”
The consultation process will last approximately 60 days and will be facilitated through the Commission for Conciliation, Mediation and Arbitration (CCMA). The group aims to retain jobs where possible while creating conditions for long-term employment growth.
Pick n Pay has faced financial challenges, including a 1.4% decline in turnover despite a 2.9% increase in like-for-like sales earlier this year. The company has also frozen support staff salaries for two years and closed dozens of under-performing stores.
The restructuring process is not primarily about job cuts, but risks remain under the Section 189A framework. Some employees will now be required to work on weekends as part of these changes. Summers stated, “Some of them will now be required to work on Saturdays and Sundays. But that’s retail.”
The exact number of potential job losses remains unclear as negotiations with the South African Commercial, Catering and Allied Workers Union (Saccawu) continue.
