FILE | A man walks past a branch of African Bank in Cape Town. Image Credits : Reuters
The Congress of South African Trade Unions (COSATU) says it will oppose African Bank’s proposed retrenchments, warning that South Africa cannot afford to lose more jobs.
This after the bank announced that it has begun formal consultations with finance union, South African Society of Bank Officials (SASBO).
It says the consultations are over a restructuring process that could see the closure of 90 branches and the cutting of 1 200 jobs.
The labour federation’s national spokesperson, Zanele Sabela says, “I mean we all know our unemployment rate is sitting at 43.7% currently. We just can’t lose any jobs and so as COSATU, we will do our utmost to support our affiliates, SASBO to make sure that those jobs are saved. On average, one job supports about seven people and so when you look at that, you see how devastating it will be to lose those 1 200 jobs and therefore, we cannot do that. We will not allow that happen.”
PODCAST | COSATU opposes African Bank retrenchment plans:
Cosatu has slammed employers who fail to pay over workers’ pension fund contributions, putting about 590 000 workers’ lives at risk. (Supplied)
Union federation warns against workers falling into poverty retirement
THE Congress of South African Trade Unions (Cosatu) has slammed employers who fail to pay over workers’ pension fund contributions, saying the growing crisis puts about 590 000 workers’ retirement savings at risk.
According to the latest Financial Sector Conduct Authority report, the number of employers, who have defaulted on pension fund contributions, has climbed to 16 556 by the end of February 2026, up from 15 521 recorded in September 2025.
The total amount owed has also ballooned by R1,04 billion to R8,33 billion, with late payment interest now making up 43,5% of the total arrears.
Cosatu said despite recoveries of R1,01 billion since the FSCA first started reporting on the matter in June 2022, the outstanding amount remains unacceptably high.
“The total arrears are still far too high and risk plunging more than half-a-million workers into poverty retirement.
“More than an injustice, this is a crime against workers whose sweat of the brow is toyed with by these unscrupulous employers,” said the union federation.
Cosatu expressed particular concern over municipalities, saying they deducted R1,7 billion from workers’ salaries but failed to transfer the money to pension funds.
The federation said municipal workers have also been forced to endure unpaid salaries for months while their pension contributions remain in arrears.
“When pension fund contributions are in arrears, workers’ death and disability benefits become void with devastating consequences for the workers and their families,” it said.
The federation reminded employers that failure to pay pension fund contributions is a violation of Section 13A of the Pension Funds Act, which requires contributions to be paid within seven days after month-end.
Those not complying are breaking the law and if prosecuted, will be liable for a fine and can even be jailed. They are thieves, plain and simple
— Cosatu
While welcoming measures by National Treasury and labour inspectors to improve compliance, Cosatu said stronger action is needed.
“This crisis will, however, not end until delinquent employers are charged and prosecuted for the theft, fraud and corruption that this mass looting is.
“Cosatu will engage unions of affected workers to begin laying charges with the police,” said the federation.
It added that it will intensify efforts to report defaulting employers and ensure all outstanding pension contributions, including interest, are recovered.
The Department of Employment and Labour has committed to strengthening collaboration and expanding outreach programmes to improve ex-mine workers’ access to social security and compensation benefits, including an estimated R10 billion in outstanding claims.
Acting Director-General Jacky Molisane said the department will intensify efforts to improve access to services provided by the Unemployment Insurance Fund (UIF) and the Compensation Fund (CF), while working closely with partners to ensure former mine workers receive the dignity, support and benefits they deserve.
“The Department of Employment and Labour, through the Unemployment Insurance Fund and the Compensation Fund, continues to implement interventions aimed at improving access to social protection and compensation benefits for workers, including former mine workers,” Molisane said.
Molisane was addressing an ex-mineworkers’ stakeholder session held at Port St Johns, Eastern Cape. The meeting sought to resolve outstanding issues relating to compensation claims and access to social security benefits for former mine workers.
The session brought together the Department of Employment and Labour, the Eastern Cape provincial government led by Premier Oscar Mabuyane, the Compensation Fund, Rand Mutual Assurance, the National Department of Health, the South African Medical Association, and various stakeholders.
The initiative forms part of a coordinated intervention to address historical injustices experienced by ex-mine workers. Discussions focused on strengthening coordination and mobilising resources for the Ex-Mineworkers Intervention Programme.
The stakeholders’ session concluded a week-long multidisciplinary government outreach campaign that brought services directly to communities in Port St Johns and surrounding areas.
Services included workplace inspections, processing UIF and Compensation Fund claims for occupational injuries and diseases, career counselling and the registration of workseekers on the Employment Services of South Africa (ESSA) system.
The Medical Bureau for Occupational Diseases (MBOD) and the Compensation Commissioner for Occupational Diseases (CCOD), Barry Kistnasamy, said an estimated R10 billion in compensation claims remains unpaid to ex-mine workers nationwide.
The Eastern Cape Premier called for improved information sharing. “I cannot accept excuses that databases cannot be accessed when we are trying to alleviate the suffering of our people. It is unfortunate that the rewards of workers’ efforts have not followed them home,” the Premier said.
Molisane acknowledged the contribution of the Office of the Premier, Rand Mutual Assurance, the Thubelisha Project, organised labour, community structures, and all stakeholders for their continued efforts to address challenges facing ex-mine workers.
She reiterated that the Compensation Fund remains a critical pillar in supporting workers who suffered occupational injuries and diseases in the course of their employment, while the UIF continues to provide unemployment, illness, maternity, dependants’ and other qualifying benefits.
“The fund’s outreach programmes have been instrumental in taking services closer to communities and ensuring vulnerable citizens are not excluded from accessing their rights,” she said.
Despite progress, Molisane said significant challenges remain, including incomplete documentation, historical employment records, benefit tracing and limited access to services.
“These challenges require a collective response from government, social partners and community stakeholders,” she said.
According to Molisane, the Eastern Cape has contributed approximately 370 000 ex-mine workers to the national total of about one million since 1965, making it one of the provinces most affected by the legacy of labour migration.
She said many former mine workers had been exposed to occupational hazards such as silica dust, resulting in high rates of tuberculosis, silicosis, coal workers’ pneumoconiosis (black lung disease), other occupational lung diseases, workplace injuries and fatalities.
Since 2019, the UIF has paid R16.7 million in benefits to 5 625 former mine workers, Molisane said. – SAnews.gov.za
Betrayed workers demand answers as savings disappear
Picture: iStock
After 40 years of service to a Mpumalanga municipality, a 60‑year‑old line manager now fears retirement may bring ruin instead of deserved rest.
His worry is simple but devastating: the council has failed to pay over millions in employer and employee pension contributions, leaving him – and thousands of other municipal workers – uncertain of their futures.
Municipalities owe R1.7 billion in unpaid pensions
Finance Minister Enoch Godongwana recently confirmed municipalities nationwide have withheld more than R1.7 billion in deductions, exposing workers to a bleak retirement and raising urgent questions about accountability, governance and justice.
The municipal employee said he believed thousands of rands had been deducted from his salary over two years and not paid over to the retirement fund. He was not sure whether the employer contributions had similarly disappeared.
“Most of my former colleagues who already retired did not get enough money and they are challenging the municipality to have the matter investigated.
The employee said he approached the pension fund adjudicator for assistance, and the municipality was requested to submit the supporting documents detailing why the money was not transferred.
“It’s about a month now; we are still waiting for them to give details of why the money was not transferred,” he said. “I am one of the employees who used to work for the apartheid government, and we were told that the money would be transferred to the democratic government. But by the look of things, something went wrong because some of my former colleagues did not receive what they were due.
“Before retiring, I need to make sure that the issue of the missed contributions for two years is sorted out and also double-check whether the municipality would be able to pay me all that is due to me.”
A 72-year-old granny, who had worked at the financial department of the government from 1985 until 2019, said after retiring, she was only paid R600 000 and a monthly stipend of about R10 000.
“Most of the former longest-serving employees only received less than R1 million, mostly about R500 000,” she said. “We are not happy, and some of us reported the matter to our former unions to investigate.”
One of the secretaries at the same municipality said she has only 10 years of service, but her pension fund is about R700 000.
“If I am at that figure now, why does a person who started working here when I was only three years old receive the same amount as mine when they retire?”
Call for municipal managers to be charged
Cosatu parliamentary coordinator Matthew Parks said what happened to the workers was an abomination.
“Until we begin charging managers and employers for stealing workers’ pension funds, this mass theft will continue unabated,” he said. “Cosatu remains extremely concerned by the lack of a comprehensive package of interventions to stabilise and rebuild the alarming number of financially distressed municipalities.”
Parks said the federation notes tentative progress with 42 delinquent municipalities responding to National Treasury’s temporary withholding of their equitable share grants and the staggered release of these payments to them.
“The absence of plans to respond to Treasury’s call for actions from the remaining 17 municipalities is staggering,” he said. “Equally worrying is the seemingly pedestrian approach from the South African Local Government Association to the deterioration of municipal governance and even the collapse of basic services in countless municipalities under its lacklustre watch.”
He added that Cosatu appreciated the need to instil financial discipline in these errant municipalities, in particular to ensure that they honour their payment obligations to workers’ salaries and pension funds, Eskom, water boards and other third parties.
“We are, however, deeply worried about the unintended potential consequences of withholding payments to municipalities, with 21 of them so financially cash-strapped that this action may cause some basic services to grind to a halt and leave many municipal workers unpaid once again.”
Johannesburg, South Africa – The Congress of South African Trade Unions has vowed to fight African Bank’s plans to retrench 1,200 workers and close around 90 branches. COSATU says South Africa simply cannot afford to lose more jobs at a time when unemployment remains painfully high and many families are already struggling to survive.
The federation has thrown its full support behind Sasbo, the union that represents bank workers, in opposing the proposed cuts. COSATU leaders have warned that every job lost adds to the heavy burden already carried by working-class communities across the country.
COSATU Vows to Oppose African Bank’s Retrenchment Plans
COSATU has made it clear that it will use every available tool to stop the retrenchments. The federation says it will stand shoulder to shoulder with Sasbo during negotiations and will not accept any process that leaves thousands of families without income.
Union leaders argue that African Bank’s plans come at the worst possible time. With the economy still recovering from years of slow growth, load shedding, and high living costs, further job losses in the financial sector would hit ordinary South Africans hard.
The union has called on the bank’s management to explore other options before moving ahead with mass retrenchments. These options include reskilling programmes, early retirement packages for those who want them, and finding ways to keep branches open in communities that need them most.
Details of the Proposed Job Cuts and Branch Closures
African Bank has indicated that it needs to restructure its operations to remain competitive and financially sustainable. The bank plans to cut 1,200 positions and close approximately 90 branches as part of this overhaul.
The proposed cuts would affect staff across different levels, from tellers and branch managers to back-office workers. Many of those facing possible retrenchment have worked at the bank for years and have families who depend on their salaries.
Branch closures would also have a wider impact. In smaller towns and townships, African Bank branches often serve as the main or only place where people can access banking services, apply for loans, or receive social grants. Closing these branches could force customers to travel long distances or turn to more expensive alternatives.
Impact on Workers and Their Families
For the workers who may lose their jobs, the news has brought fear and uncertainty. Many have mortgages, school fees, and medical aid payments that depend on their monthly salaries. Losing a job at African Bank would not only affect the individual but entire households.
COSATU has highlighted how job losses in one sector quickly ripple through communities. When a breadwinner loses their income, families cut back on food, transport, and other essentials. Children may be forced to drop out of school, and health problems can go untreated because of a lack of money.
The union says it has already begun engaging with affected members to provide support and information about their rights during the retrenchment process. It has also called on government to step in and help protect jobs in the financial sector.
Broader Economic Context of Rising Unemployment
South Africa’s unemployment rate remains one of the highest in the world. Millions of people, especially young people and those living in rural areas, struggle to find work. Every new round of retrenchments adds to this crisis and makes it harder for the economy to recover.
The financial sector has not been immune to these pressures. Banks have faced rising bad debts, higher operating costs, and increased competition from fintech companies. Some institutions have responded by cutting costs, often through job reductions.
COSATU argues that retrenchments are not the only solution. It says companies should look at sharing the pain more fairly, perhaps by reducing executive bonuses or finding efficiency savings that do not involve mass dismissals.
The federation has also pointed out that when banks close branches in poorer areas, they often leave communities without access to financial services. This can push people towards loan sharks and other risky options that deepen poverty.
Union’s Call for Alternatives to Job Losses
COSATU and Sasbo are pushing African Bank to consider alternatives before finalising any retrenchment plans. These include voluntary severance packages, early retirement options, and training programmes that could help workers move into new roles either inside or outside the bank.
The unions have also called for meaningful consultation with workers and their representatives. They say any restructuring must be transparent and must take into account the human cost of job losses.
In addition, COSATU has appealed to government to use its influence to protect jobs. It wants the Department of Employment and Labour and other relevant bodies to engage with African Bank and explore ways to minimise the number of retrenchments.
The federation believes that protecting jobs in the banking sector is not just about the workers directly affected. It is also about maintaining stability in communities that rely on these jobs and the services the bank provides.
Government and Public Response Expected
Government has not yet made an official statement on African Bank’s plans, but pressure is likely to grow for intervention. With unemployment already a national crisis, any large-scale job cuts in a major bank will attract political attention.
Civil society groups and other unions are also expected to weigh in. Many South Africans have personal experience of retrenchments and understand the pain they cause. Social media has already seen an outpouring of support for the workers facing possible job losses.
Public anger about rising living costs and job insecurity could turn this into a wider debate about how companies treat workers during difficult economic times. COSATU is hoping to use this moment to push for stronger protections against unfair retrenchments across all sectors.
What Happens Next in the Dispute
The next few weeks will be critical. Sasbo and COSATU will continue to engage with African Bank management in an attempt to reduce the number of job losses or find alternatives. If talks fail, the unions have indicated they are prepared to take further action, including possible protest action or legal challenges.
For the workers whose jobs are on the line, every day brings more anxiety. Many are hoping that public pressure and union support will force the bank to reconsider its plans.
COSATU has made it clear that it will not stand by while thousands more South Africans are pushed into unemployment. The federation says the fight to save these jobs is part of a bigger struggle to protect the dignity and livelihoods of working people across the country. As the process unfolds, all eyes will be on African Bank and whether it chooses the path of mass retrenchments or finds a more humane way forward.
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The Department of Employment and Labour has committed to strengthening collaboration and expanding outreach programmes to improve ex-mine workers’ access to social security and compensation benefits, including an estimated R10 billion in outstanding claims.
