Vodacom opposes order to pay former employee billions of rands

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28th February 2024

By: Bloomberg


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Vodacom Group has approached South Africa’s Constitutional Court to ask for leave to appeal a ruling that it pay a former employee billions of rand in compensation for an idea he proposed more than two decades ago.

The SCA ruled earlier this month that Kenneth Makate should be compensated within a range between R29-billion and R55-billion, according to calculations by local online news outlet, MyBroadband.

A previous order by the Constitutional Court said Vodacom’s CEO Shameel Joosub should work out fair compensation - which Joosub calculated at R47-million at the time. The latest move by Vodacom will put a pause on the pay out order by the Supreme Court.

The ruling by the SCA contained aspects “which do not accord with the spirit of the law and that the judgment and order are fundamentally flawed,” the company said in a statement on Wednesday. The “orders are unintelligible, incomprehensible, and vague rendering them incapable of implementation and enforcement,” Vodacom said.

The case has gone back and forth for many years as Vodacom and Makate wrangle over compensation for the ‘Please Call Me’ calling service idea he proposed to the company’s product-development team when he was a member of the finance division in the 2000s.

Vodacom, a unit of Vodafone in London, said the impact of the payout outlined in the SCA judgment, should it be upheld, would be vast and wide-ranging on both its operations in South Africa and the Vodacom group, as well as the attractiveness of South Africa as an investment destination.

“It would negatively impact our employees, shareholders and Vodacom’s contribution to public finances,” the company said. “It would also have an impact on our network investment, coverage, and social programmes.”

Edited by Bloomberg



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