{"id":621628,"date":"2026-01-14T10:59:08","date_gmt":"2026-01-14T08:59:08","guid":{"rendered":"https:\/\/mybroadband.co.za\/news\/?p=621628"},"modified":"2026-01-14T11:00:15","modified_gmt":"2026-01-14T09:00:15","slug":"south-african-telecoms-company-under-fire-over-retrenchments-and-salaries","status":"publish","type":"post","link":"https:\/\/mybroadband.co.za\/news\/business-telecoms\/621628-south-african-telecoms-company-under-fire-over-retrenchments-and-salaries.html","title":{"rendered":"South African telecoms company under fire over retrenchments and salaries"},"content":{"rendered":"\n

Telecoms service provider Echo International retrenched South African staff two weeks before the Covid-19 lockdown and has allegedly failed to comply with court orders to reinstate them with back pay.<\/p>\n\n\n\n

The trouble began with Echo Group’s acquisition of Gondwana Investments Management (GIN) in October 2019.<\/p>\n\n\n\n

GIN’s companies included iWay Management Services, which was previously owned by Telkom until 2013. <\/p>\n\n\n\n

The company provided centralised management and support services for all the operating companies within GIN, including firms in Ghana, Kenya, Namibia, Tanzania, Zambia, and Zimbabwe.<\/p>\n\n\n\n

After the acquisition by Echo, iWay’s employees were transferred to Echo International Management Services (EIMS).<\/p>\n\n\n\n

Early the next year, Echo’s directors decided that each operating company in its portfolio had to own or obtain relevant services within their own markets and that EIMS was therefore economically unviable.<\/p>\n\n\n\n

Echo filed for liquidation of EIMS on 6 March 2020, three weeks before the Covid-19 lockdown began. Staff at the company were notified of the decision on the morning of 12 March 2020.<\/p>\n\n\n\n

Echo’s CEO allegedly arrived with armed guards at EIMS’s Parow office to evict staff and take possession of company property.<\/p>\n\n\n\n

During that same month, another company in the Echo Group \u2014 Africa Online Operations Mauritius Ltd (AOOML) \u2014 started providing the same services as EIMS with six key EIMS employees.<\/p>\n\n\n\n

One of the retrenched staff members alleged that all these employees were based in Gauteng. “None of the activity was actually being conducted out of Mauritius,” they said. <\/p>\n\n\n\n

The retrenched staff members launched an application in the Labour Court calling for a declaration that their contracts of employment had been transferred to AOOML from 1 March 2020.<\/p>\n\n\n\n

On 22 July 2022, the Labour Court found in their favour, ruling that the function rendered by AOOML constituted a business and that there had been a Section 197A transfer of business from EIMS to AOOML. <\/p>\n\n\n\n

The court found the liquidation of EIMS did not disrupt the continuation of the retrenched staff’s employment contracts as there was continuity of business. <\/p>\n\n\n\n

AAOML was ordered to reinstate the employees with full back pay without any loss of benefits. <\/p>\n\n\n\n

Legal appeals<\/h2>\n\n\n\n
\"\"<\/figure>\n\n\n\n

AAOML appealed the judgment, but a full bench of the Labour Appeal Court concurred with the first order in a ruling handed down on 31 January 2024. <\/p>\n\n\n\n

The appeal judgement criticised the Echo International CEO at the time of providing \u201cluminously evasive evidence.\u201d <\/p>\n\n\n\n

In transcripts of the hearings, the judge labelled him “a pathological liar” and questioned “whether anyone could believe anything he says”.<\/p>\n\n\n\n

The company nonetheless applied for leave to appeal the matter in the Constitutional Court, which was denied in a judgment on 5 August 2024.<\/p>\n\n\n\n

Despite exhausting legal recourse up to the highest court in the land \u2014 and with significant cost implications for the affected employees \u2014 Echo and AOOML have allegedly failed to abide by the court order.<\/p>\n\n\n\n

One of the retrenched staff members told MyBroadband that the issue has had a profound personal impact on the staff, who lost their salaried jobs just as Covid-19 hit.<\/p>\n\n\n\n

“Most were unable to find new steady income sources until well after lockdown ended,” they said. “Some never found financial stability again.”<\/p>\n\n\n\n

He believes that Echo’s actions have led to the suicide of one of his former colleagues, who had been blacklisted and never recovered financially from the impact of the unlawful dismissals.<\/p>\n\n\n\n

Affected workers are concerned about reported Echo sale<\/h2>\n\n\n\n
\"\"
Echo International offices in Kenya<\/figcaption><\/figure>\n\n\n\n

The staff members are concerned about what will happen if Echo’s majority shareholder, Ethos, exits its investment in the company after the initial five to seven\u2013year investment window draws to a close.<\/p>\n\n\n\n

“Ethos\u2019 latest financial report indicates that Echo may now be liquidating its African assets, which will again thwart any opportunity for the staff to receive their backpay and legal fees,” the staff member said.<\/p>\n\n\n\n

“Echo is rumoured to be engaging with another private equity partner for a management buyout, but buyers beware, Echo has a long-standing legal obligation to settle with its past staff.”<\/p>\n\n\n\n

The affected staff’s in-house legal counsel, Leon Nel, previously contacted Ethos’ ethics committee regarding the staff matter. The company allegedly told him it was not their concern. <\/p>\n\n\n\n

“Despite having a Social Ethics Committee charter, clearly not honouring a legal court ruling does not seem to bother Ethos as an investor,” they said. <\/p>\n\n\n\n

“Echo and its Ethos shareholders fail to honour what should be the simplest form of contractual trust between employee and employer to honour salary and benefit payments, especially when enforceable by a court action.”<\/p>\n\n\n\n

MyBroadband contacted Echo and Ethos Capital for comment, but neither had responded by the time of publication. <\/p>\n","protected":false},"excerpt":{"rendered":"

Telecoms service provider Echo International retrenched South African staff two weeks before the Covid-19 lockdown and has allegedly failed to comply with court orders to reinstate them with back pay.<\/p>\n","protected":false},"author":341042,"featured_media":621716,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[41906],"tags":[14473,102529,102531,64432,102532,102530,12463,102150,61683],"class_list":["post-621628","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business-telecoms","tag-constitutional-court","tag-echo-international","tag-echo-international-management-services-eims","tag-ethos-capital","tag-gondwana-investments-management-gin","tag-iway-management-services","tag-iwayafrica","tag-labour-appeal-court","tag-labour-court"],"_links":{"self":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts\/621628"}],"collection":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/users\/341042"}],"replies":[{"embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/comments?post=621628"}],"version-history":[{"count":18,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts\/621628\/revisions"}],"predecessor-version":[{"id":624998,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts\/621628\/revisions\/624998"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/media\/621716"}],"wp:attachment":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/media?parent=621628"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/categories?post=621628"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/tags?post=621628"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}