SAA rescue team wins permission to appeal retrenchment decision

SAA’s business rescue practitioners have been granted leave to appeal against a labour court judgment that said the two were not entitled to retrench employees before finalising the business rescue plan.

SAA has been in business rescue since December 5, but business rescue practitioners Siviwe Dongwana and Les Matuson have not yet produced a final business rescue plan. In April, after being informed by public enterprises minister Pravin Gordhan that the government had no more money available to restructure the airline, Dongwana and Matuson issued notices of impending retrenchments at the airline.

The notices were set aside by judge Andre van Niekerk after an application by the National Union of Metalworkers of SA and SA Cabin Crew Association.

But Matuson and Dongwana contended that “given the disputes of law, ... there is a reasonable prospect that the facts would receive a different treatment by the labour appeal court”. They also argued that “the matter is of significant public interest and importance and that the judgment in the labour court is in conflict with an earlier judgment of the same court.”

In other instances of business rescue, retrenchments have occurred before the acceptance of a final rescue plan.

“Our position in seeking leave to appeal on the basis that another court may come to a different decision has been accepted by this ruling. We will seek an urgent date for the matter to be heard by the labour court,” they said in a statement on Monday.

The decision to appeal has angered both Gordhan and trade unions as the court action will cost SAA a substantial amount of money, just as its resources for restructuring and paying retrenchment costs dwindle. Gordhan and the unions have also accused Matuson and Dongwana of poor management of the R5.5bn government provided for post-commencement funding of the business rescue.

Gordhan says that large amounts have been spent on consultants and accountants with little return for the airline or the taxpayer.

With no new funding in place, the business rescue practitioners say they will finalise a plan to wind down SAA by June 30. This is also a point of contention with Gordhan and unions who together are working on a business plan for a restructured SAA or a new state-owned airline.

patonc@businesslive.co.za