Statement on the South African Airways and retrenchments in the economy

7 February 2020

The statement released on Thursday, 6 February 2020, by the joint business rescue practitioners (BRPs) on job cuts at SAA is untenable in several ways. The approach being followed by the BRPs must be rescinded as a matter of urgency, in favour of following due process, ensuring that the rights of workers are fully protected and pursuing a turnaround of the South African Airways (SAA). In our labour law, for instance, there is a prescribed process that must first and foremost be followed to consider alternatives and avoid retrenchments. In this regard, consensus-seeking, meaningful consultation with labour is essential.

It is utterly unfair for workers in South Africa and other parts of the world where SAA has stations and operations to learn, via a media release, that except for a mere, for that matter meaningless formality, it is water under the bridge, that they have effectively lost their jobs. This is inconsiderate and completely unacceptable.   

The statement by the BRPs is devoid of details on the alternatives that were considered and turnaround strategy, programme and plan for SAA. This blatant display of aviation industry experience appears to be bordering on commercial sabotage of SAA, unwitting as it might seem. A number of factors and implications clearly appear to have not been taken into account. Just to mention a few, firstly SAA is a network carrier. Secondly, it is not a point-to-point carrier. Thirdly, it is inconceivable that SAA will thrive in serving the remaining international destinations without serving its own domestic market except for only one route, Johannesburg to Cape Town.    

Cancelling SAA flights on the domestic routes between Johannesburg and Durban, Johannesburg and Port Elizabeth, and Johannesburg and East London, is to start off on a wrong foot altogether. It is tantamount to dismantling SAA in its own domestic market, South Africa. This approach is no doubt giving way to private profit interests, such as SA Airlink, to capture the market, the routes that SAA is being forced abandon. The decision sows the seeds for the national airline to find it extremely difficult to re-establish itself as part of its desired turnaround on these domestic routes.

An alternative approach anchored in turning around SAA’s passenger load factor, that is to fill the seats, should have been chosen. Rather than to abandon the domestic market except for one route, the correct decision should have been to reduce the flight schedule on the affected routes while concomitantly promoting SAA, making improvements and the national airline affordable towards its desired turnaround.

On international routes, alternatives should have been sought for SAA to thrive, taking into account, among others, that it is a network carrier.

The BRPs should not be given the veto, right to have the final say. It is important to take into account the fact that placing SAA into a business recue process, as the government said when it announced the decision, was voluntary. The government cannot behave as if it is all of a sudden non-existent while things are heading in a wrong direction, clearly spelling out the dismantling of SAA. There must be an intervention by government in the national interests.  

The SACP will engage with its Alliance partners as a matter of urgency and the trade union movement in pursuit of a way forward on the pathetic approach being followed by the BRPs. We are further calling upon progressive trade unions at SAA to unite behind a common programme to turnaround the national airline, and will work together with them, too.  

Retrenchments in the economy

Last month Samancor, second largest company in world ferrochrome production, announced its intention to retrench 2 439 workers in South Africa.

DionWired of Massmart, a subsidiary of Wal-Mart, a United States-based global retailer, announced an intention to retrench 1 144 workers in South Africa.

Telkom, a state-owned telecommunications corporation with Public Investment Corporation and private shareholding, announced an intention to retrench 3 000 workers.

Aspen, largest pharmaceutical manufacturing company in Africa announced an intention to retrench 219 workers in South Africa.

These and many other retrenchments pushed in our economy without first exploring alternatives and minimising them have one thing in common. While the economy is in crisis, but not just in South Africa but as a surrounding global atmosphere, the pursuit of profit maximisation at all costs, especially without regard to the circumstances of, and impact on the affected workers, is behind the unemployment creation through the jobs bloodbath.

The alternatives considered to avoid the retrenchments altogether, taken into account in a meaningful consultation process with labour to seek consensus, must be made available for public scrutiny.

The SACP is calling on the progressive trade union movement to unite against the jobs bloodbath and behind the objective interests of workers. We pledge our solidarity and support with the workers and will deepen our programme to forge broader working class unity as well as build a popular Left front as one of the forms of that desired working class unity. 

Issued by Alex Mohubetswane Mashilo, Central Committee Member: Head of Media & Communications, SACP, 7 February 2020