Carol Paton Writer at Large
A man cycles past aircraft in the SAA fleet parked at OR Tambo International Airport. Picture: GETTY IMAGES
A man cycles past aircraft in the SAA fleet parked at OR Tambo International Airport. Picture: GETTY IMAGES

The eight-day strike at SA Airways is over after unions settled for the same wage offer that was made before the strike began.

Employees will get 5.9% wage increase deferred to February 2020. In the original offer made on the eve of the strike, SAA had proposed that the wage increase be deferred to April 2020. However, the wage offer and the back pay, which will date back to April 1 2019, is “subject to the availability of funding” being obtained for this purpose from SAA.

The National Union of Metalworkers of SA (Numsa) and the SA Cabin Crew Association, whose 3,000 or so members lost a week’s wages, won a small concession by persuading SAA to implement the wage increase two months earlier.

Unions also extracted a concession on the impending retrenchments, which for nonmanagement employees will now be postponed to January 2020. The retrenchment of management employees will go ahead now, the company said.  

The NTM, a third union at SAA and one that did not go on strike, secured the same agreement as Numsa and Sacca.

SAA informed employees on Thursday that it was unable to pay November salaries on schedule as it has not secured the funding it needs to continue operating. The board  told a parliamentary committee last week that it must raise a minimum of R2bn to fund operations until the end of the financial year.

Commercial banks have said they will not make new loans to SAA without a full government loan guarantee from the Treasury. A new guarantee has not been forthcoming.

SAA is in a loss-making position and is unable to generate enough revenue to cover expenses. In October it received a R5.5bn cash bailout from the Treasury to pay off short term debt and an undertaking to pay off R9.2bn of historic debt over the next three years.

The settlement agreement also includes a decision to establish a joint task team that will “identify and consider cost saving initiatives” including the insourcing of contracts. The unions say that it is wasteful and corrupt procurement contracts that is bankrupting the airline.”

“Should the task-team be able to realise savings, a percentage of the after-tax savings may be ring-fenced and paid to employees in the bargaining unit. The task-team will discuss and agree on a formula for such payment,” states the agreement.

Workers are to return to work by Saturday at the latest. SAA chief commercial officer Philip Saunders said that the airline would restore its full flight schedule in stages over the weekend.

A near-normal service is expected on Saturday and a full schedule from Sunday.

patonc@businesslive.co.za