NUMSA and SACCA joint press statement on SAA
13 November 2019
The National Union of Metalworkers of South Africa (NUMSA) and the South African Cabin Crew Association (SACCA) have served South African Airways (SAA) and SAA Technical with a 48-hour notice to strike. What this means is that we will be embarking on the mother of all strikes at all SAA and SAAT operations nationally, beginning on Friday morning on the 15th November at 4 AM. Participating in the strike will be members of SAA Cabin crew, check-in, ticket sales, head office, technical staff, and ground staff. There are likely to be disruptions and therefore we advise members of the public to make alternative arrangements if they have booked flights with SAA. Together NUMSA and SACCA represent more than 3000 workers at SAA across all categories mentioned above.
The strike certificate is in relation to wages. We have deadlocked with the employer over our wage demands, which include the following:
1. An 8% across the board wage increase
2. Job security for at least three years
3. Insourcing of all services which are outsourced, and which SAA has the capacity to fulfill, eg. security, cleaning, IT, ground-handling, and logistics
Pilots received a 5.9% increase and SAA agreed to pay them. Our members are simply demanding their increase as well. Our members earn much lower than pilots which is why the demand is 8%.
In response to these demands, SAA management served us with an intention to retrench and restructure the airline. They claim that they cannot meet our demands because there is not enough money and that the dismissal of 944 workers will save the airline R700 million, and ensure its survival.
We reject their explanation. It is our view that this is nothing more than an attempt to force workers to drop their demands for an increase, which they deserve and have worked very hard for. The SAA board and executive management is responsible for the current crisis affecting the airline. Through their actions, they have deliberately destroyed what used to be one of the worlds’ best airlines, because of maladministration, rampant looting and corruption. In 2015 workers were retrenched and the same reasons were given. That process has clearly failed to deliver on results because four years later, management is retrenching once again.
Below we give reasons for the true causes of SAA’s crisis:
SAA Board and Executive Management are a total failure
Whilst is it true that SAA is hugely in debt, we argue that this crisis has deliberately been created by those tasked with leading this institution. The board of SAA must be removed because they are at the heart of the crisis. They failed in their fiduciary duties to ensure that the airline operates profitably. Eight Long Term Turnaround Strategies (LTTS) have been designed for the airline, and none of them have been implemented. The LTTS was designed to ensure that the airline returns to profitability and to improve sales and revenue, and optimize SAA’s business. The executive leadership together with the board have failed to fulfil this simple aspect of their responsibilities, and this is why we say the entire board must be fired.
We reject the claim made by the board that the strike is intended to collapse the airline, so that it can be placed under liquidation. Workers have been at the forefront of trying to save SAA and make it viable. Our members have been fighting against corruption, some, were even fired for doing this, and yet, the same cannot be said for the executive management and the board. It has consistently been an obstacle in rooting out corruption at the airline. Several executives have been exposed in corrupt activities through costly forensic investigations, nine in total, but none have been disciplined, or suspended or fired. To date, not one red cent has been recovered from monies which were stolen through acts of corruption and looting.
Failure to deal with and review evergreen and bloated contracts
SAA has failed to review all erroneous contracts and correct those matters by renegotiating the pricing and making it more competitive and cost effective. SAA currently spends R25 billion per annum on procurement. It is done on a global basis, as opposed to normal SOE’s the airline competes aggressively with other world class airlines. The bulk of this procurement spend is done in foreign currencies and this has a direct impact on its revenue. We believe that there are certain services which can be procured locally, and this has been highlighted, in the Ernst and Young forensic report.
It talks about the unacceptably high fuel, ground handling, and cargo costs which SAA is paying for. The report was completed in December 2015, and the shareholder at that time was the National Treasury under Pravin Gordhan the then minister of Finance. He is now currently the minister of Public Enterprises. The report also red flagged ever green contracts with inflated pricing such as Swissport. When you analyse the cost of Mango ground handling services for example, versus the cost for the same service at Swissport, the difference is a whopping 150%! It is difficult to understand why this relationship continues when it is clear the airline is being grossly overcharged.
SAA frequently depends on consultants to do work which it has the capacity to fulfill. For example, Tata consultancy, an Indian company who are responsible for revenue management. They operate as accountants at exorbitant costs to the airline. It boggles the mind why SAA cannot employ locals to do this work.
They are currently looking for an international CEO to run the airline. This will no doubt have a massive impact on the staffing costs. This reminds us of the time when Peter Davis from the UK was appointed to be CRO Chief Restructuring Officer at a cost of R20 million per annum. He also used to fly regularly between the UK and SA at a cost to SAA.
Another example is they hired Accenture to do the organizational design, which has not yet been concluded, at a cost of R30 million. SAA wants to proceed with restructuring, when its organizational design is incomplete. It is this type of wastage that that we reject, because it is used as a barrier to prevent workers from getting their increases.
Corruption and looting of the airline and its assets
In the last three years, as unions, we have done everything in our power to force SAA to clean up and root out corruption. We have held frequent marches, campaigns, and pickets. We have gone to court at great expense to ourselves, and we have had to defend frivolous court cases, and even opened criminal cases in an attempt to force the board and management to act in the interests of SAA and South Africa and run the airline profitably. Unfortunately, the board and management have done everything in their power, including frustrating a very capable GCEO, Vuyani Jarana in order to collapse the airline. We are now left with no choice, but to resort to this drastic course of action, by withdrawing our labour, and hoping on strike. Our goal is to #SaveSAA and to save jobs. It is unacceptable that eleven thousand workers must sacrifice their livelihoods for the failures of a corrupt board and incompetent management.
Our members are ready to defend SAA and we call on all other workers to join us in this protected strike.
Aluta continua!
The struggle continues!
Issued by NUMSA and SACCA, 13 November 2019
