Sovereign Chicken’s full statement

IN response to The Herald’s undercover investigation into working conditions at Sovereign Foods, the company released this statement:

AS a significant employer, one of the largest in the Metro, we would like to reiterate that our people are vital resources in helping the company remain successful in very difficult and trying economic times.

 At Sovereign Foods, we have standards to ensure that all employees are treated with respect and dignity, are working under their own free will, and are being properly compensated for their effort.

We have 2460 people employed via labour brokers throughout the business. Over the last 5 years we have invested over R750m in more than doubling our turnover which has resulted in the creation of over 1200 full time and permanent jobs. All of these are a part of our standard complement and are for specific positions.

The challenge of sourcing the best people as well as the enormous administrative challenge means that labour brokers have and continue to fulfil a vital role in helping us drive this rapid growth trajectory. As a result we have been able to intentionally utilise labour intensive processes and have also developed products that create as many jobs as is economically possible.

 We fully support the governments’ mandate of substantial job creation as vital for the long term sustainability of the South African nation. Contrary to industry norms and many of our competitors who have pursued a strategy of automation we chose to create employment by being partially automated.

Our business does have a seasonal element which requires us to have a flexible workforce. However, in our conduct toward our staff who are provided through our labour broking partners we treat them as permanent staff and encourage them at all times to think in the same manner.

Compensation paid to workers complies with all applicable wage laws, including those relating to minimum wages, overtime hours and legally-mandated benefits such as UIF, Skills Development and Workman’s Compensation. Working hours are limited to what is acceptable by legislation.

A poultry business is a 24/7 operation and needs to be staffed accordingly. We make use of a rotating shift system to facilitate operating hour coverage. This is mostly applicable in the processing plant where staff would work on day shift for one week and then switch to night shift for another week.

There is a small minority of workers that are on a permanent night shift and these receive a night shift allowance. All other staff receives an attendance allowance for each day that they are on site. This is in excess of 10% of their daily rate in all instances. We implemented a system aimed at ensuring that workers on a night shift always have transport available at the end of their shift.

We strive at all times to maintain good communication channels with all of our employees through companybased information and consultation procedures. We have several processes instituted to ensure a two-way communication channel.

Our workforce, supplied by the labour broker, is a significant source of talent and potential. There are numerous success stories where people have gone from labour broker employees to permanent Sovereign employees.

We have employed approximately 105 people in this way recently and are committed to creating a career path for any talented individual at Sovereign. We are currently the process of integrating a further 70 labourers who have been promoted into supervisory roles onto the Sovereign payroll.

We are committed to maintaining diversity in our working environment. There are many very exciting people development processes that we have created at Sovereign Foods in order to address the enormous skills shortages that exist in our country as well as to help talented people who did not have the benefit of a formalised education. Some of the initiatives are as follows:

l Sikhula Kunye (Together we Grow) is an accelerated development program open to both Sovereign and Labour Broker employees alike. There have been 152 participants in this program over the last two years with a substantial total investment.

lEngineering Development Institute. This is designed to address the critical artisan shortage in the country. We currently have 91 employees engaged in a registered apprenticeship program.

 We are committed to continue this process by taking an additional 40 people into this program on an annual basis. Workers who demonstrate the aptitude are identified and are given the preferential opportunity to participate in a bridging process that will enable them to enter the apprentice program.

lExperiential Learning is an important part of any individual’s life. As such we have a graduate development program designed to fast-track qualified tertiary institution leavers. We currently have 30 candidates enrolled

lWe run a Hatchery School to teach Incubation Biology to 20 people

lThe Sovereign Computer School is open to all interested employees and runs courses 5 days a week for up to 20 people at a time. We have trained over 2000 people since 2009 the majority of whom are from the labour force.


While we appreciate the concerns around labour broking our primary objective remains to continue to create sustainable employment in the community in which we operate and at all times to create job security in the working relationship. This will ensure that we proactively contribute to the eradication of the scourge of poverty, unemployment and crime.

We endeavour at all times to provide our employees with a safe environment where they are protected from hazards of the job. Workers are provided with the necessary safety equipment as appropriate to the job being performed. Workers are provided with ready access to clean toilet facilities, potable water and sanitary food preparation, storage, and eating facilities.

Procedures and systems are in place to manage, track and report occupational injury and illness. Emergency response procedures are also in place.


Unfortunately, accidents can still happen and the case you mentioned was a tragic one. The details are as follows:

? The incident occurred on 17 March 2006 and was reported to the Department of Labour in terms of section 24 of the OHS Act. The incident resulted in the death of Mr Sicelo Shadrack Katsi and the hospitalisation of Messrs. Befanlela Josela and Bonile Jafta, both who have since fully recovered.

? In terms of the General Machinery Regulation 8 of the OHS Act an internal investigation into the incident was conducted.

? The equipment in question was immediately isolated and access prohibited. This has subsequently been replaced with a vertical stainless steel tank with no human access.

? Sovereign Foods is cognisant of its duty to provide employees with a safe and healthy working environment as per section 8 of the OHS Act, in particular section 8(2)(d) and conducted extensive risk assessments of the plant including the offal plant where the incident occurred. This was done with the assistance of reputable Risk Assessors and Approved Inspection Authorities.

We are committed to creating safe and healthy working conditions to minimise the risk of injury or disease to all of our employees, to prevent the loss of property and to maintain our precious environment.

We believe that such an approach will generate and sustain significant environmental, social and financial benefits contributing to our objective of long-term sustainability.


Sovereign Foods has an Environmental, Health & Safety Policy that prescribes best practice and aims to ensures that the company:

? Conducts its business in compliance with Environmental, Health & Safety laws and all relevant

legislation as well as codes of good practice pertaining to the poultry industry.

? Regards its staff members as its most important asset and provides a safe and healthy environment

for all employees, contractors and visitors to its facilities.

? Trains, develops and engages employees to understand their safety, health and environmental

responsibilities and ensures accountability across all levels of the organisation.

? Maintains all plant, machinery and equipment to the highest possible standards to prevent pollution

and minimise the impact of its operations on the environment.

? Strives to minimise the impact of its operations and continuously assesses the environmental impacts and health and safety risks of its operations and implements risk mitigation measures to eliminate or control these risks to an acceptable level.

? Sets clear standards for continual improvements through setting of environmental, health and safety targets for each operating division and constantly reviewing performance against these targets.

? Maintains and continuously improves its risk management systems including conducting external assessments of such systems.

? Prides itself on open communications with employees, shareholders, customers and other stakeholders and regularly reports to these parties on the enterprise’s risk performance.

Employees who violate or ignore the Environmental, Health & Safety Policy are investigated and disciplinary action taken where necessary. Only by adopting a consistent zero-tolerance approach to safety violations, with consistent consequences, can Sovereign Foods effectively protect the lives of employees.

Currently the Poultry Industry, which is the largest single contributor to agricultural output in South Africa, is under serious threat as a result of ever increasing import volumes brought into the country mostly from South America. Volumes have risen by over 40% year on year and threaten the food security of the country as well as future expansion and job creation which is essential at this present time, particularly in the Eastern Cape!

As a result of the pricing, these imports are currently under investigation by the authorities in terms of antidumping legislation. In a time of serious food inflation poultry prices are substantially lower than they were 2 years ago, whilst all other commodities have increased considerably.

All South African industries have experienced a dramatic reduction in their cost competitiveness with their global competitors as a result of the huge electricity and other utility price hikes.

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