NEWS & ANALYSIS

SA Express: Payment of salaries must be prioritized – NUMSA & SACCA

Organisations once again repeat the demand for board members to be fired

NUMSA and SACCA responds to non-payment of salaries at SA Express

25 March 2020

The National Union of Metalworkers of South Africa (NUMSA) and the South African Cabin Crew Association (SACCA) are concerned about the situation at SA Express. The executive management of SA Express issued a communique to all employees advising that it cannot pay salaries by today because it has no money available. This is deeply distressing for our members, especially on the eve of a National Lockdown caused by the rapid spread of the Coronavirus.

Last year both NUMSA and SACCA participated in the section 189 process to restructure SA Express and this was concluded in December. Both NUMSA and SACCA worked together with the executive management at SA Express to devise a turnaround strategy and to create a clear plan for the long term sustainability of the airline.  Unfortunately, the progress we made was undermined when Ziegler SA, fueled by opportunistic self-interest, took the decision to place SA Express under Business Rescue in January this year, and they did so without any turnaround strategy. Now as a result of their recklessness SA Express faces liquidation.

Ziegler claims that SA Express owes it over R11 million but that is disputed by the airline. Ziegler should have resolved this dispute first, instead of rushing to place the airline under business rescue in order to claim this money back. Notwithstanding that we had our own dispute with the board, for allowing the airline to be grounded on more than two occasions under their tenure, without providing proper solutions as to how to rescue the airline. This has also destroyed the credibility of the airline in the industry and it is unable to maintain its fleet, due to a lack of re-capitalization from government the shareholder.

The situation is worsened by the current board of SA Express which has failed dismally to run any airlines, as some of its members have been recycled from SAA. Some of the board members which were responsible for running SAA to the ground, are also running SA Express, and some of the same board members at SA Express are also recycled and used as board members at SAA Technical. We should therefore not be surprised that SA Express, SAA and SAAT are in crisis. These board members are so incompetent that they have destroyed all these entities, and in the case of SAAT the maintenance department has been run to the ground because corruption was allowed to run rampant. This is why NUMSA has had to apply to the South Gauteng High Court for the SAAT board to be declared delinquent directors. Both NUMSA and SACCA have consistently called for these boards to be dissolved and re-constituted with people with aviation experience, and representatives from labour but these calls have been ignored. Once again we repeat the demand for these board members to be fired.

Ziegler application jeopardizing turnaround of SA Express

Ziegler’s application has jeopardized the turnaround process which was in place to restructure and save the airline in the long term. The goal of the strategy was to ensure that the airline breaks even and for it incorporated into SAA as a subsidiary at a later stage.

At this point in time our members do not have any guarantee that their salaries will be paid. The BR Practitioners and the Department Public Enterprises have deadlocked over this issue and this stalemate does not serve our interests as South Africans and it is jeopardizing jobs at SA Express and also all jobs along the Aviation value chain.

What is to be done?

The payment of workers’ salaries must be prioritized and we demand an urgent resolution to this. It is completely unacceptable that SA Express can inform employees at the last minute that it is unable to honor salary payments. The lockdown is imminent and workers have no income in order to make preparations for themselves and their families’. They did not create the crisis at SA Express and they should not have to suffer for it. We are of the view the that the application for Business Rescue was filed prematurely and demand that it must be immediately withdrawn. Government as the shareholder and executives must continue to implement the turnaround strategy which was distracted by the premature Business Rescue Process.

 Aluta continua!

The struggle continues!

Issued by SACCA and NUMSA, 25 March 2020