Minister wrangles with unions over SAA plan

The department of public enterprises announced its withdrawal from a panel that was established to facilitate talks with the troubled airline’s workers about its planned overhaul, accusing three labour unions of undermining its work and putting jobs at risk.

South African Airways (SAA) was placed in business rescue six months ago after a succession of managers failed to restore it to profitability and Finance Minister Tito Mboweni urged an end to repeated bailouts.

Administrators this month published a rescue plan that would stave off the carrier’s liquidation by securing it at least R26.7 billion in additional state aid, a first step toward laying the groundwork for a viable carrier.

The National Union of Metalworkers of South Africa, the South African Cabin Crew Association and the SAA Pilots Association reacted furiously to a provision that the airline workforce be reduced by 80% to 1 000 people.

SA Airlink, a rival domestic carrier that says SAA owes it R700 million in ticket revenue, also objected to the plan, and a June creditors’ meeting to vote on it was adjourned to 14 July.

By supporting a delay to the vote, the three unions had “contradicted the letter and spirit” of a compact agreed by the consultative panel’s and created uncertainty for creditors and potential investors, the department said in a statement. “Instead of creating conditions for attracting investment and skilled South Africans, three unions have put SAA on a path towards possible liquidation.”

The department urged the unions and their members to accept generous voluntary severance packages being offered by SAA, and focus on a plan that would equip them to get other jobs.

Those that accepted the packages would be entitled to apply for jobs in the new restructured airline as it expanded, it said.

Numsa and Sacca maintained their opposition to the plan to cut more than 3 700 jobs and want the government to ensure that the airline resumes operations in July. The unions are also urging the government to offer a stimulus package to the aviation sector so it survives the effects of the global coronavirus pandemic, they said in a statement yesterday.

“We remain firm that SAA must take to the sky in 2020,” they said. – Bloomberg