SAA can continue to retrench managers, CCMA finds

A retrenchment process at managerial level at South African Airways (SAA is set to continue on December 3 this year, Derek Mans, the union Solidarity’s representative at the state-owned airline told Fin24 on Monday afternoon.

This was after various unions, including Solidarity, attended a consultation at the CCMA during the day in this regard.

SAA recently announced a restructuring process which could put about 944 jobs at risk.

The National Union of Metalworkers of South Africa (Numsa and the South African Cabin Crew Association (Sacca secured a 5.9% wage increase from SAA last week after a week-long strike, which led to various flights being cancelled. The cash-strapped airline previously said the strike was costing it about R52m a day.

A task team, facilitated by the CCMA, must furthermore find the cost savings needed for the airline to make up the remaining 2.1% of the effective 8% wage increase for Numsa and Sacca members. SAA has cautioned that its ability to pay in terms of the agreement will be subject to availability of funding.

The aim of Monday’s meeting at the CCMA by the remaining unions represented at SAA was to establish whether the Section 189 retrenchment process in terms of labour law could continue in the light of a deal made by a bargaining unit consisting of Numsa and the Sacca.

In terms of this deal, the bargaining unit’s restructuring consultation has been deferred to January 31 next year. Numsa and Sacca did not negotiate about jobs at managerial level.

One of the views argued on Monday was that the S189 process could not continue as the current notification letter, which had already been issued in terms thereof, included employees no longer involved in the process due to the Numsa and Sacca deferment agreement. The CCMA, however, found on Monday that the process could continue at managerial level.

Fin24 reported last week that Parliament’s Standing Committee on Public Accounts (Scopa had lambasted SAA for continued failure to present its 2017/18 and 2018/19 financial statements. Earlier in November, Fin24 reported that SAA had been scrambling to obtain R2bn before the end of the month. Last week SAA even warned of the possibility that it might not be able to pay salaries scheduled for November.

SAA has over the past 13 years incurred over R28bn in cumulative losses and is in the process of implementing its long-term turnaround strategy. It expects to break even by 2020/21. This year, Treasury approved a R5.5bn capital injection for SAA for the 2019/20 financial year.

Solidarity announced last Friday that it had served papers on SAA and the ministers of finance and public enterprises, asking a court to put the airline in business rescue. The union said it has requested an urgent court date to hear the case. In the view of Solidarity’s chief operating officer, Dirk Hermann, the airline is “hopelessly insolvent” and nearing “total collapse”.