JOHANNESBURG - The final bid to restructure the struggling national carrier SAA entered into deeper turbulence on Friday after the government accused the pilots of greed and rejected their demands.
The Department of Public Enterprises (DPE) hit back at 600 pilots’ voluntary severance packages (VSPs) demands, describing them as unreasonable and unaffordable ahead of the crucial creditors meeting to vote on the airline’s turnaround strategy on Tuesday.
The move came after the restructuring process gained a major breakthrough this week when unions such as the National Transport Movement, the Aviation Union of Southern Africa, Solidarity, SAA Cabin Crew Association, SA Transport and Allied Workers Union and National Union of Metalworkers of SA, alongside representatives of non-unionised managers and ground staff, gave the proposal a thumbs up.
However, pilots hold more influence in SAA and are the highest paid with more benefits.
The department dismissed the SAA Pilots Association’s (Saapa) demands for more benefits from the proposed R2.27 billion rescue plan despite six other unions and representatives of non-unionised managers and ground staff endorsing the VSPs.
It said the benefits sought by Saapa were far more costly, lucrative and financially rewarding for the pilots than any other class of employees at SAA. “For example, in the latest VSPs, the 600 SAA pilots make up 13 percent of SAA staff, and they consume 45 percent of the wage bill,” the DPE said.
“The lowest of SAA’s 170 senior pilots earns R3.6 million a year, excluding benefits and incentives. Of the R2.2 billion proposed budget for the VSPs, pilots will get more than R1 billion.”
The SAA rescue plan would see workers paid one week calculated per year of completed service, onemonth notice pay, accumulated leave paid out, a 13th cheque and a top-up of severance packages calculated on a back-dated 5.9 percent wage increase. Saapa wants SAA to retain 3 099 employees against the 2 000 workers who would be kept for the start-up of the new airline. The association also wants an improved VSP to incentivise senior pilots while SAA is offering more than R1.9m for pilots.
Saapa spokesperson Thabi Ndhlovusaid the association was in negotiations with the DPE to resolve the impasse.
“The pilots and their legal advisers are currently locked in a meeting to find a solution to their demands. As soon as there is a new development in that regard, we will then release a statement,” Ndhlovu said.
The DPE said Saapa’s proposal would exacerbate a prolonged economic recovery in a postCovid-19 era. “Saapa’s proposals seek to retain a much larger number of employees than the airline can afford.
“This goes against the stated goal of ensuring a new, restructured, viable and competitive airline that must emerge from a business rescue process for SAA. “Accordingly, the DPE has informed Saapa that their proposals cannot be accepted nor will they accede to any further unreasonable and greedy demands from sections of union leadership for additional benefits.”