Aspen reduces retrenchments by half

Aspen Pharmacare’s production facilities in Port Elizabeth.
JOB LOSSES: Aspen Pharmacare’s production facilities in Port Elizabeth.
Image: Eugene Coetzee

Retrenchments at Aspen Pharmacare’s production facilities in Port Elizabeth and East London have wrapped up —  with the expected number of  job losses reduced by half.

A Section 189A notice was issued to staff in December, with 219 jobs on the line as the company sought to remain globally competitive.

However, Aspen Pharmacare’s executive head of pharm finished dose form operations, Grant Swart, said that this figure had dropped significantly after the Commission for Conciliation, Mediation and Arbitration (CCMA) hearings.

The first hearing at the CCMA took place in January and was completed in March.

“The number of impacted employees has reduced from 219 to about 100 across the Eastern Cape manufacturing sites,” Swart said.

“The involuntary separations complete the primary phase of the SA operations’ transformation journey to transition into a globally competitive, technologically advanced and long-term sustainable pharmaceutical powerhouse.

“This ambitious transformation enables the business to access and lead in several niche therapeutic opportunities globally while proudly rooted in the Eastern Cape.”

He said the process was not something that the company took lightly and was the last resort.

“It was a journey that has been transparent, involving employees and trade unions, and having valued their input throughout,”  Swart said.

Aspen employs about 2,500 people in the Eastern Cape.

Details of the severance package show that those who opted for voluntary retrenchment received two weeks’ pay for every year of service, two months’ notice pay for less than 10 years of service, three months’ notice pay for more than 10 years of service and all annual leave days paid out.

The involuntary retrenchment package included 100% medical aid cover for up to three months, two weeks’ pay for every year of service, two months’ notice pay for less than 10 years of service or three months’ notice pay for more than 10 years of service and all annual leave days paid out.

Those  who took voluntary early retirement were offered provident fund backpay compensation, annual leave days paid out, one month’s notice pay, and 50% of remaining retirement contribution.

All three groups were given a tertiary financial support waiver on any courses enrolled in with no obligation to repay the company and relocation assistance for moves more than 100km from their residence.

Employees were also offered counselling, financial advice and career guidance.

In a notice to staff, Swart said: “The global economic uncertainty, caused by the Covid-19 pandemic, makes it even more imperative to secure the long-term viability of our business.”

He said the company remained committed to producing competitive, affordable, high-quality medicine.

“The more we produce locally in these challenging times, the more we can future-proof our business.

“We have redesigned the manufacturing business to eliminate inefficiencies, drive cost-effectiveness across the value chain, and institutionalise technology in our manufacturing processes.”

On those who lost their jobs, he said: “We are grateful and indebted to these colleagues for their service.

“Involuntary separation is not something that Aspen takes lightly and represents the last resort.”

Meanwhile, the steroid hailed as a major breakthrough around the world in Covid-19 treatment is manufactured and packaged in Port Elizabeth with Aspen Pharmacare — which owns the rights to dexamethasone — outsourcing the manufacturing of the injections to Fresenius Kabi.

The factories for both pharmaceutical giants are situated next to each other in Holland Park near the North End Lake.

The low-cost, widely used steroid treatment reportedly cuts the risk of death by a third for patients on ventilators and a fifth for those on oxygen.