SAA, Jarana impasse turns nasty with probe into leaked resignation letter

Resigned SAA CEO, Vuyani Jarana. (Reuters/Siphiwe Sibeko)

Resigned SAA CEO, Vuyani Jarana. (Reuters/Siphiwe Sibeko)

The impasse between resigned SAA chief executive Vuyani Jarana and the airline’s board has turned nasty with revelations that Jarana is now under investigation for possibly leaking his resignation letter over the weekend.

The Mail & Guardian has established that Jarana, who is currently serving out his notice, has written another letter to the board, this time expressing his displeasure at being the focus of a forensic investigation into how his resignation letter was leaked to the media.

Jarana resigned last Thursday at an SAA board meeting.
However, news of his resignation only broke on Saturday, taking the board — which had asked him to rework his letter — by surprise. As a result, the now irate board ordered that Vusi Pikoli, the new SAA head of risk and compliance, investigate whether Jarana is responsible for the leak.

In his letter to the board dated June 5, Jarana takes exception to the investigation, which he only learned of from Pikoli, saying it smacks of a ploy to “tarnish my reputation, defame my character, and injure my dignity”.

“It is in violation of my constitutional rights and the rule of law. My right to seek legal advice on the board’s unlawful and unconstitutional conduct remains reserved,” he wrote, adding that the board’s conduct fell into the category of constructive dismissal.

SAA’s board had asked Jarana to tone his letter down out of concern for negative perceptions with lenders.

“They asked him to make it a one page letter that said either he was sick or wanted to spend time with his family,” a source close to the situation said.

Another source said: “He should have been more considerate in his wording. His letter has created anxiety and turmoil with lenders and service providers because it gave indications that the turnaround plan is in trouble and SAA needs to be put into business rescue.”

An amicable parting was in both parties’ interests, sources said, because Jarana allegedly wants an easy return to corporate and the board wants to avoid the perception of instability at the national carrier.

However, Jarana’s letter included references to a lack of support from government and the board, blurred reporting lines and operational interference, as well as details of financial difficulties at the airline. These included three separate occasions where the airline came close to failing to pay salaries.

READ MORE: High-level turbulence rocks SAA

In November last year, the M&G reported that Jarana had asked Public Enterprises Minister Pravin Gordhan to intervene in an impasse between him and the board. Jarana was reportedly frustrated that red tape was making it hard to implement his long-term turnaround strategy.

“One of the areas of concern is the speed of decision-making. It is impossible to succeed in the turnaround with the current level of bureaucracy we have to go through to implement the strategy,” Jarana wrote in his resignation letter.

“Currently SAA must obtain approval from DPE [department of public enterprises] and National Treasury to implement some of the key decisions . it takes away the agility required for an entity in financial distress, an ICU case.”

This is a developing story and will be updated as more details emerge.

Sabelo Skiti

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