SAA staff have until Friday to seal deal
● Retrenchment agreement will allow more time to explore funding options
SAA employees have until Friday to confirm whether they will sign the retrenchment agreement proposed by the ailing state-owned airline’s business rescue practitioners, in a bid to buy more time to see if a funder can come to its rescue.
Les Matuson and Siviwe Dongwana, the joint business rescue practitioners, said in a letter to unions that public enterprises minister Pravin Gordhan had indicated that he and the department were exploring funding options for SAA, which included the discussion with unions about starting a new airline in the future.
The practitioners said Gordhan had asked them to give employees a further extension to sign the retrenchment agreement put forward, but warned that it was likely to be the final extension.
This would allow more time to explore the funding options, and whether there was “any immediate and guaranteed funding that would permit the business rescue practitioners to reconsider the possibility of a restructured SAA or the possible sale of the business or SAA assets to another party”.
The airline was placed in business rescue earlier this year, but the practitioners appointed to implement a plan have faced an uphill battle, which included a refusal by the government to put any more money into the broke airline.
SAA is insolvent as its liabilities outweigh its assets.
While the global aviation industry has been brought to a halt as a result of the Covid-19 pandemic, SA has indicated that it would create a new airline.
The practitioners, in their letter to unions, said retrenchments might now only take place on or after Tuesday next week.
They said that in the event of further funding being obtained, those who had collectively or individually accepted the termination and severance packages would have their positions safeguarded by a socalled “escape clause”. The escape clause provides that if further funding is acquired and the restructuring of the airline is able to proceed, employees will be re-employed.
Last week, the government announced it would create a new airline despite the practitioners indicating that there were only two options for SAA — a structured winding down that entails the retrenchment of all staff or liquidation.
The public enterprises ministry on Friday said a “leadership compact” was signed with the unions represented at the airline.
National Union of Metalworkers of SA (Numsa) spokesperson Phakamile Hlubi-Majola said the unions represented at SAA had agreed to the process of restructuring the airline.
She said Numsa and the SA Cabin Crew Association wanted the government to still be involved in the airline, but they were open to the possibility of equity partners.
National Transport Movement (NTM) president Mashudu Raphetha said the NTM would sign the retrenchment agreement and participate in the formation of the new airline.
SA Airways Pilots’ Association chair Captain Grant Back said the union was committed to the process and would be working extensively over the next week with Gordhan and labour “to do what is necessary to allow SAA V2.0 to emerge leaner, meaner and ready for the post Covid-19 aviation landscape”. —