NUMSA and SACCA relieved that the business rescue process at SAA is at an end

14 July 2020

The National Union of Metalworkers of South Africa (NUMSA) and the South African Cabin Crew Association (SACCA) have noted the outcome of the SAA Creditors Meeting today and the approval of the Business Rescue Plan. Although we are not entirely satisfied with the plan and will deal with the shortcomings in due course, we are relieved that the drawn-out and rather wasteful Business Rescue process is now coming to an end. We have fought very hard to prevent the liquidation of the airline and we are relieved that this strategic State Owned Entity (SOE) which plays such a crucial role in the aviation and tourism sector, has been saved from total collapse. 

However, crucial to the success of a restructured SAA is a complete break with the past especially with respect to past management and executives who were ultimately responsible for SAA's demise.  We have noted that Philip Saunders has been appointed as interim CEO of the airline. Philp Saunders is currently the Chief Commercial Officer at SAA and therefore a member of the current executive management at the airline.  He is part of the very same disastrous management team which brought the airline to the brink of collapse. This is why we are reiterating our demand that that individuals who are appointed to management and the board, must have had no connection to past boards or executive management at SAA. We need fresh ideas and visionary, dynamic leadership without the baggage of the past, if we are to succeed in turning the airline around. We need to have a permanent board and executive management appointed as soon as possible.

Furthermore, Mr. Saunders has not been a CEO of any significant organization. His experience has been as an executive of smaller single airport airlines such as Air Malta, nothing close to the complexity and scale of SAA. His lack of experience is likely to fail him and he will also fail the airline, an eventuality we cannot afford. We however understand that he is appointed on an interim basis, and we demand that DPE must come up with a transparent process of appointing a competent GCEO with the necessary expertise, experience and knowledge to lead the airline.

It remains our expectation that the DPE will honor the principles agreed upon in the consultative agreement to have a new board that excludes all the current board members, and that a new team of senior executives will be appointed through a transparent process.

Labour must form part of new SAA board

It is also crucial that labour must have representation on the board. For too long, employees at SAA have seen the airline run down by shareholder ministers, and the boards and executives are never called to account for their actions at the airline. Today at least 2600 employees are at risk of losing their jobs to pave the way for a restructured airline, caused by years of deliberate and systematic maladministration and corruption, and neither the current board, nor the executive management, not even the DPE as the shareholder intervened to stop the rot. Instead, workers are always offered up as sacrificial lambs to cover up for these failures and they are ones who always face the brunt of poor leadership.  This must change and it can only happen if labour has a voice on the board, in order to protect the interests of all stakeholders, and to guarantee good clean governance.

SAA has been restructured several times in the past, and with each and every restructuring, workers lose their jobs, but there are no consequences for executives and board members for failing the airline. This has been a consistent demand from us as NUMSA and SACCA because it is our members who have put everything on the line to expose these issues and to demand change.  Today workers are facing uncertainty and massive unnecessary job cuts, because those who were appointed to look after this State Owned Entity (SOE) failed dismally in their duty to do so.

The Department of Public Enterprises (DPE) has promised to secure the amount of R26.7 billion which is required to fund the rescue plan, as well as to raise the funding required for the Voluntary Severance Packages which may be taken up by some employees. The real work to ensure SAA is indeed a new sustainable, effective and profitable airline lies ahead and NUMSA and SACCA are committed to positive engagement going forward. 

Issued by Phakamile Hlubi-Majola on behalf of NUMSA and SACCA, 14 July 2020