SAA’s rescue men fly in defiance

SAA’s business rescue practitioners were cautioned against announcing the possible reduction of the airline’s workforce before publishing the restructuring plans for the state-owned airline.

Two days before it was announced that restructuring would take place at SAA, Cloete Murray, a member of the airline’s employment committee, raised his concerns about the plan that had been put before it by the business rescue practitioners, Les Matuson and Siviwe Dongwana.

Murray warned the two in an email that the proposed plan was more of a “labour restructuring plan than it is a business restructuring plan”.

“For us to understand the reasons for the labour force reduction we need to understand the overall plan and whom the plan will impact on all levels of employees, including the management,” the email reads.

The plans announced by Matuson and Dongwana on February 6 includes the closure of three domestic and more than 20 international and regional routes at the end of February. The business rescue practitioners are also considering selling some of the airline’s assets and reducing the number of employees.


In the email, Murray said that any plans to reduce the workforce should comply with section 189 of the Labour Relations Act (LRA). The legislation requires that employees are consulted should there be any plans of job cuts.

“Any section 189 process must [be] in compliance with the LRA. We cannot consent to a shortened, non-compliant process …” he said.

Murray said the rescue practitioners should consider the “gorilla in the room”, which is corruption in SAA and the people implicated in it. He said that to take the airline out of financial distress, the rescue practitioners should consider looking into cancelling “unlawful” contracts at the airline as well as into its supply chain processes.

The release of the restructuring plan on February 6 led to the National Union of Metalworkers (Numsa) and the South African Cabin Crew Association (Sacca) launching a court bid to force the airline to consult workers on any planned retrenchments.

Numsa and Sacca’s bid was shot down by the labour court last week when it ruled that the rescue practitioners have not served workers with a formal notice of job cuts in line with the (LRA) and therefore had no duty yet to consult employees.

Under the Companies Act, the rescue practitioners are required to consult the airline’s stakeholders, including creditors, workers and the shareholder, before publishing the business rescue plan.

Public Enterprises Minister Pravin Gordhan told Parliament’s standing committee on public accounts this week that the rescue practitioners have until March 6 to table a draft plan. While not giving details of the total amount that the airline would save as a result of its restructuring plans and closure of routes, Gordhan told Parliament that it would be correct to assume that the routes closing at the end of February are unprofitable.

As the day for the ceasing of flights to Port Elizabeth, Durban and East London looms, unions say they have been left in the dark regarding the employment status of their members come March 1.

Solidarity’s organiser at SAA, Derek Mans, said that although the union had not been consulted about job cuts since the airline was placed under business rescue in December, it did expect its members to be served with retrenchment notices soon.

“However, Solidarity does have any objection should SAA offer voluntary severance packages, as long as the offer is within a formal LRA 189 process,” he said.

Zanele Sabela, spokesperson for the South African Transport and Allied Workers Union, said: “We have written several letters requesting to meet with them [the rescue practitioners], to no avail. However, we are sure they know how imperative it is to consult stakeholders, given the fallout that resulted when they announced the cancellation of domestic routes without consultation.

“That announcement was made after a meeting with the employee committee, which consists of all employees, including unionised and non-unionised workers, plus executives.

“We hope the BRPs [business-rescue practitioners] are not so misguided as to believe that is the same as consulting organised labour.”

Two days before it was announced that restructuring would take place at SAA, Cloete Murray, a member of the airline’s employment committee, raised his concerns about the plan that had been put before it by the business rescue practitioners, Les Matuson and Siviwe Dongwana.

Murray warned the two in an email that the proposed plan was more of a “labour restructuring plan than it is a business restructuring plan”.

“For us to understand the reasons for the labour force reduction we need to understand the overall plan and whom the plan will impact on all levels of employees, including the management,” the email reads.

The plans announced by Matuson and Dongwana on February 6 includes the closure of three domestic and more than 20 international and regional routes at the end of February. The business rescue practitioners are also considering selling some of the airline’s assets and reducing the number of employees.

In the email, Murray said that any plans to reduce the workforce should comply with section 189 of the Labour Relations Act (LRA). The legislation requires that employees are consulted should there be any plans of job cuts.

“Any section 189 process must [be] in compliance with the LRA. We cannot consent to a shortened, non-compliant process …” he said.

Murray said the rescue practitioners should consider the “gorilla in the room”, which is corruption in SAA and the people implicated in it. He said that to take the airline out of financial distress, the rescue practitioners should consider looking into cancelling “unlawful” contracts at the airline as well as into its supply chain processes.

The release of the restructuring plan on February 6 led to the National Union of Metalworkers (Numsa) and the South African Cabin Crew Association (Sacca) launching a court bid to force the airline to consult workers on any planned retrenchments.

Numsa and Sacca’s bid was shot down by the labour court last week when it ruled that the rescue practitioners have not served workers with a formal notice of job cuts in line with the (LRA) and therefore had no duty yet to consult employees.

Under the Companies Act, the rescue practitioners are required to consult the airline’s stakeholders, including creditors, workers and the shareholder, before publishing the business rescue plan.

Public Enterprises Minister Pravin Gordhan told Parliament’s standing committee on public accounts this week that the rescuers have until March 6 to table a draft plan.

As the day for the ceasing of flights to Port Elizabeth, Durban and East London looms, unions say they have been left in the dark regarding the employment status of their members come March 1.

Solidarity’s organiser at SAA, Derek Mans, said that although the union had not been consulted about job cuts since the airline was placed under business rescue in December, it did expect its members to be served with retrenchment notices soon.

“However, Solidarity does have any objection should SAA offer voluntary severance packages, as long as the offer is within a formal LRA 189 process,” he said.

Zanele Sabela, spokesperson for the South African Transport and Allied Workers Union, said: “We have written several letters requesting to meet with them [the rescue practitioners], to no avail. However, we are sure they know how imperative it is to consult stakeholders, given the fallout that resulted when they announced the cancellation of domestic routes without consultation.

“That announcement was made after a meeting with the employee committee, which consists of all employees, including unionised and non-unionised workers, plus executives. We hope the BRPs [business-rescue practitioners] are not so misguided as to believe that is the same as consulting organised labour.”

The rescue practitioners told the Mail & Guardian that they intend to consult with all unionsed and non-unionised workers should the airline consider retrenchments.

“We are not sure yet of savings that can be achieved after the restructuring process  as the final business plan will be able to give us  [the ] steer. It all depends on the post commencement funding,” they said.

“We hope the BRPs [business-rescue practitioners] are not so misguided as to believe that is the same as consulting organised labour.”

Thando Maeko is an Adamela Trust business reporter at the M&G

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Thando Maeko
Thando Maeko is an Adamela Trust business reporter at the Mail & Guardian

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