JOHANNESBURG – Troubled national airline SAA’s shaky business rescue somehow recovered yesterday, when pilots said they were considering the voluntary retrenchment packages on the table, only hours after trade unions gave the plan their blessing.
The development has given the carrier’s revised multibillion-rand rescue plan momentum ahead of the crucial creditors’ voting meeting next Tuesday.
The Department of Public Enterprises (DPE) described the breakthrough as the most expeditious option for the national carrier to restructure its affairs.
It said the revised plan would allow SAA’s business debts and other liabilities to be consolidated into the emergence of a new viable, sustainable and competitive airline that would provide integrated domestic, regional and international flight services.
“In supporting the plan, the government is committed to mobilise the necessary resources to fund the transition,” the DPE said. “This includes the severance packages, which meet the requirements of the Labour Relations Act, and the incentivisation of those employees at the lower rung of the [pay] scale to ensure they are compensated with minimum benefits."
On Tuesday evening, the National Transport Movement, the Aviation Union of Southern Africa, Solidarity, SAA Cabin Crew Association, Satawu and Numsa all gave the proposal a thumbs up alongside representatives of non-unionised managers and ground staff.
The DPE said it was, however, concerned that the SAA Pilots' Association had not accepted the voluntary severance packages. However, the association yesterday said it was considering the packages. “We are committed to maintaining a respectful working relationship with all stakeholders during this difficult time in our airline’s history,” said the association’s spokesperson, Thabi Ndhlovu.
The plan would see 1 000 workers retained by SAA and a further 1 000 placed on a training lay-off scheme for up to 12 months.
SAA would pay one week calculated per year of completed service, one-month 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.
The severance package per employee would see cabin crew receiving R352 588 per employee, pilots receiving more than R1.9 million, ground and support staff receiving between R351 000 and R477 000, depending on their length of service.
SAA will contribute a maximum of R4 650 towards employees’ pension, Unemployment Insurance Fund and company medical aid.
The DPE said the plan would allow for a conservative start of a new airline to recapture the market, revamp the board and management, and fill executive positions with qualified and fit-for-purpose leadership.
“This will also help prepare for the launch of the long-term operational strategy, as well as build a company that will reabsorb a significant amount of qualifying people during the interim flying period,” the DPE said.
“Projected costs were taken into consideration when determining the size of the new airline in order to allow for a proper take-off towards competitiveness.
"We therefore hope and believe creditors will be able to appreciate the work done and the sacrifices that both the employees and the shareholder were prepared to endure to bring back the competitive national carrier.”