Unions want SAA business rescue team audited

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Unions want SAA business rescue team audited
Unions want SAA business rescue team audited

The business rescue practitioners have allegedly charged exorbitant fees and made questionable commercial decisions, unions say

Majority trade unions at SAA say they have lost faith in the business rescue practitioners, who have allegedly charged exorbitant fees and have made highly questionable commercial decisions, which have worsened SAA’s financial position.

The unions — the SAA Pilots Association (Saapa), the SA Cabin Crew Association (Sacca) and National Union of Metalworkers of SA (Numsa) — also want a forensic audit of all expenditure since the appointment of the practitioners, a reduction of legal and consulting fees and an immediate cessation of the court appeal they launched last week.

Like public enterprises minister Pravin Gordhan, the unions also oppose a wind-down of the company and want to see a business plan for a new or restructured airline.

“If they are not willing to categorically support the vision of a new national airline, [the unions call for] the resignation of the business rescue practitioners and withdrawal of their legal advisers,” they said in a statement.

Les Matuson and Siviwe Dongwana, the company’s business Rescue practitioners, have not yet responded to a request for comment.

SAA has been in business rescue since December 5 and although the Companies Act states that a business rescue plan should be finalised within 30 days, the business rescue team has been granted several extensions by creditors. But in April, after being told by Gordhan that there would be no further funding to recapitalise a restructured SAA, Matuson and Dongwana said they had no option but to liquidate or wind down the company.

A wind-down entails the disposal of assets, as businesses where possible, and the payment of liabilities with the proceeds. Gordhan, who says that a state airline is a matter of national interest, wants to ring-fence the liabilities of the old SAA and start a new airline.

From May 1, employees will not receive salaries. Those who had paid leave in hand were paid for April, but this did not include the entire workforce. The unions are angry that an offer to take a 49% salary cut earlier in the process would have put SAA in a better position to continue to pay salaries.

“We have offered to cut our pay by up to 49% for two months (with the higher earning Saapa members willingly taking the highest pay cuts and, understandably, lower pay cuts for Numsa and Sacca members and other lower earners, who will be further cushioned through the UIF Ters scheme),” the unions said.

“However, inexplicably, the business rescue practitioners have rejected our offer of a salary cut and, in doing so, have reneged on their previous commitment to accept it. This pay cut — to the tune of R82m — was designed to buy enough time to restructure, right size and reform SAA.”

The unions also say that top and senior executive management at SAA remain on full pay and have not made any sacrifice in the interest of the airline.

BusinessLive

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