Carol Paton Editor at Large
Picture: BUSINESS DAY
Picture: BUSINESS DAY

The majority trade union alliance at SAA has called on members not to sign voluntary severance agreements until the department of public enterprises can show them it has the money.

The department negotiated generous voluntary severance packages for which 3,110 out of 4,661 employees applied. But there has always been uncertainty over where the funding for these would come from. The overall cost is estimated to be R2.2bn.

In July, the Treasury agreed that the department could go ahead and “mobilise funding” for the restructured SAA, but also said it could not provide any resources from the fiscus. The overall price tag, including retrenchments, is R10.1bn. Commercial banks, which were approached by the Treasury and the department earlier this month, have declined to provide SAA with further credit. However, the department has said it has interest from a growing number of private investors, to which it is looking as a source of funding.

The future of SAA was discussed in the cabinet on Wednesday but the matter was not concluded. Minister in the presidency Jackson Mthembu said the cabinet will continue its discussion on Saturday.

The ANC’s national executive committee is also expected to discuss SAA at its meeting this weekend.

Should union members decline to sign the voluntary severance agreements, the business rescue practitioners can go ahead with the process to begin forced retrenchments, should they choose to. However, the unions are concerned that if they agree to voluntary termination they will exit the company without a payout.

“We are concerned that if workers sign these agreements without any confirmation of funding, they will be effectively terminating their relationship with the employer, with no guarantee of income,” the unions said in a statement.

The National Union of Metalworkers of SA (Numsa) and the SA Cabin Crew Association (Sacca) also claim that SAA management is attempting to deviate from the agreed business rescue plan to cut the number of employees at the restart of SAA to 400. The plan states that 1,000 workers will be retained.

The unions say the request to cut the number of jobs has come from SAA management.

SAA spokesperson Tlali Tlali said he could not comment on this as the company is still in the hands of the business rescue practitioners. The practitioners are unable to return the company to management until start-up capital is received from the department of public enterprises.

patonc@businesslive.co.za

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