Rea Vaya employees object to paying tax on bonuses as BRP uncovers serious irregularities

The Johannesburg bus rapid transport service Rea Vaya's work stoppage on Wednesday, which saw employees stop buses leaving the depot, is because of a dispute about an annual bonus payment being split into two tranches and it being taxed.

PioTrans, which operates the service in partnership with the City of Johannesburg, was placed in business rescue in December. 

PioTrans business rescue practitioner (BRP) Mahier Tayob said the strike was unprotected and he intended to go to court to end it.  

“I am appointed to do the job and I will do so without fear. I will engage any party [with] a vested interest in PioTrans, including our commuters. However, I cannot negotiate and engage when I'm held [to] ransom, when the buses are blocked and the entrances are being blocked. That is sabotage.”

Tayob said he had instructed legal counsel to urgently approach the courts “for appropriate relief, as the courts are best suited for the ventilation of these issues that are in dispute”.

He is also seeking a summons to be issued for damages the entity has sustained.

“Those who have caused us prejudice, I will sue for the damages and it is an important step to take,” Tayob said, adding a culture of impunity and lawlessness would not be tolerated under his watch.

On the bonus dispute, he said he had told trade unions and employees he intended to pay them in two tranches, with the first on January 8 and the second on January 31.  

“This will allow me to balance the cash flow. In addition I am not yet in possession of the banking account because it is in its migration stage and the reason I did that is because PioTrans information was being shared with third parties. I blocked access to safeguard the confidentiality of our information.”  

He said the account would probably be fully migrated on Friday.  

“I have also been informed the employees are concerned that bonus payments will attract tax deductions, which led me to [suspect] prior payments were inflated without tax deductions.”

Thirteenth pay cheques, or bonuses, are subject to tax.

Tayob took over as BRP after PioTrans was placed in business rescue in December in the wake of a court application by its creditors who alleged maladministration due to outstanding debts.

He had been hopeful that employees would support the turnaround process, though he expected some pushback as he demanded accountability, improved systems and proper corporate governance.

He also demanded performance agreements be signed and automated cameras and biometrics be implemented and enforced.  

He has found many irregularities, including:

• inflated payments for spare parts;
• doctored time sheets; and
• buses being taken out of service for minor repairs. 

“The deeper I delve into this entity, the more [irregularities] I unearth. There must be repercussions and those allegedly responsible must answer to the public.

“I am going to do everything in my power within the confines of the law to make sure this rescue works.”  

Tayob intends to include an investigative report in court papers, “because it will [then] be in the public domain, it will become public knowledge”.

The first meeting with creditors is scheduled for January 17 when he will ask for an extension of his appointment.

“It is an ongoing process and I do not foresee it going longer than between 30 and 60 days for the investigation report to be made public.”

The contract between the City of Joburg and PioTrans ended in January 2023, but Tayob said a deviation contract was issued for another two years. “We are still within the contract period.”

City of Joburg transport directorate spokesperson Benny Makgoga said they were in contact with PioTrans to establish the cause of the labour dispute.  

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