Unions demand clarity on ‘radical restructuring’ of SAA
Numsa and Sacca seek clarity after the government says ‘radical restructuring’ of the airline is the only way forward
The two unions behind the recent damaging strike at SAA say they want the government to explain what the proposed “radical restructuring” of the loss-making airline would entail.
SA Cabin Crew Association (Sacca) president Zazi Nsibanyoni-Mugambi and the National Union of Metalworkers of SA (Numsa) spokesperson Phakamile Hlubi-Majola said unions had not been consulted on the proposed process.
“We have written letters to president [Cyril Ramaphosa], finance minister Tito Mboweni and public enterprises minister Pravin Gordhan to find out what it means,” said Nsibanyoni-Mugambi. “We have written to the SAA board as well.”
However, SAA spokesperson Tlali Tlali said on November 11 that the airline had advised unions and employees that it was considering a restructuring process in terms of section 189 of the Labour Relations Act (LRA).
“Based on this provision, the communication served as a notification that the consultation process would soon get under way. To the extent we are aware, our conduct has not been inconsistent with the LRA, particularly in relation to consultation that must happen before restructuring occurs,” Tlali said.
Department of public enterprises spokesperson Richard Mantu refused to comment on the issue.
On Sunday the department said the national airline would have to go through a “radical restructuring process” to survive. SAA has just emerged from a crippling eight-day wage strike that is said to have cost the airline more than R50m a day.
The department said the strike by Numsa and Sacca over wages and proposed job cuts “caused immense damage to the reputation, operations and the deterioration of the finances of SAA”. The unions rebuffed the claims, saying they were an “opportunistic attempt to deflect attention” from the SAA management and board failures.
The airline, which has received R5.5bn from the Treasury in 2019 and now needs a loan guarantee of at least R2bn for it to continue trading, is insolvent with liabilities exceeding assets by about R15bn.
The airline “therefore cannot continue in its current form. The airline group will now go through a radical restructuring process, which will ensure its financial and operational sustainability. There is no other way forward,” the deparment’s statement said.
SAA was see to be left with three options: liquidation, business rescue or radical restructuring. The break-up of the SAA group, which includes the low-cost carrier Mango, airline SA Express, catering business Air Chefs and aircraft maintenance division SAA Technical, has become a growing possibility.