Moyo’s future at Old Mutual is uncertain

Old Mutual argues that a clause in Peter Moyo’s employment contract does not stipulate a “contractual requirement to follow a fair process to provide just cause or a fair reason for termination.” (Gallo/Sunday Times/Moeletsi Mabe)

Old Mutual argues that a clause in Peter Moyo’s employment contract does not stipulate a “contractual requirement to follow a fair process to provide just cause or a fair reason for termination.” (Gallo/Sunday Times/Moeletsi Mabe)

Peter Moyo’s desk at the Old Mutual offices in Sandton remains vacant after two months, despite a court order that he be reinstated as the chief executive.

In a blow to the 174-year-old company’s decision to fire its former chief executive, the Johannesburg high court ruled on Tuesday that not only should Moyo be temporarily reinstated in the position but that Old Mutual should not appoint anyone else to fill the position of chief executive. The interim order was granted pending the outcome of part B of Moyo’s application, which seeks to declare the entire 12 non-executive directors of Old Mutual as delinquent.

The JSE-listed financial giant responded to the ruling as soon as the Johannesburg court opened in the early hours of Wednesday morning, filing an urgent leave to appeal in a bid to have a higher court overturn Moyo’s reinstatement.

“It is very clear that there has been an irreparable breakdown in trust and confidence, and that any future working relationship is untenable,” Old Mutual said in a statement.

In its court papers, seen by the Mail & Guardian, the company says that it disagrees with Judge Brian Mashile’s finding that Moyo would suffer “irreparable harm” should he not return to his position. The company says that any loss of money incurred by Moyo during the process would be recovered, should part B of his application be successfully, adding that Moyo had already been paid six months of his notice pay when he was axed in June

The tensions between Old Mutual and Moyo were visible for all to see on Wednesday morning when the chief executive returned to his offices.
Instead of resuming his duties as ordered by the court, Moyo was required to meet with Old Mutual’s legal team to discuss their differences in the interpretation of the judgment.

The nearly seven hours of talks proved fruitless and Moyo walked out of the building with his lawyer, Eric Mabuza, having not reached an agreement with the company.

Moyo downplayed the tensions, saying that although no agreement was reached Old Mutual remains a “great company” to work for. Asked about his interactions with staff members at Old Mutual, Moyo told journalists that: “It was cordial as always.”

Mabuza told journalists that Old Mutual had suggested that the two parties involve their senior counsel to resolve the impasse. But the company’s spokesperson, Tabby Tsengiwe, told the M&G that it was Moyo’s legal representatives who had indicated that senior counsel should be involved. “They requested that there be a short meeting with senior counsel and unfortunately, because it was short notice, our own senior counsel was unavailable.”

Moyo was dismissed after a public spat with the board, led by Trevor Manuel, after the board said that there had been a material breakdown of trust and confidence in Moyo. This was after Moyo allegedly failed to declare a conflict of interest arising from his investments in NMT capital, in which Old Mutual holds a 20% stake.

Chartered accountant and commentator Khaya Sithole says that there that restoring relations between Moyo and the board is unlikely. “If they are able to reach a middle ground and reach concessions it will take the matter out of the public eye,” he said. “But behind closed doors there has been an element of mistrust that has developed and those types of tensions will just make the working relations completely untenable.”

On Wednesday, Moyo said that he would like to return to the company: “We’re not coming here to have settlement talks.”

Thando Maeko is an Adamela Trust business reporter at the Mail & Guardian

Thando Maeko

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