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SAA warns there may be 'no recovery' from strike

Nov 13 2019 15:38
Carin Smith

If their demands are not met, the "mother of all strikes" will start at South African Airlines and SAA Technical on Friday morning, unions warned at a media briefing in Johannesburg on Wednesday. 

The National Union of Metalworkers of South Africa and the South African Cabin Crew Association said the strike would begin a 4am on Friday morning. Earlier on Wednesday SAA leadership confirmed it had received a strike notice. 

According to the unions, who say they represent more than 3 000 workers at the airline, a 48-hour notice to strike had been submitted. Cabin crew, check-in staff and technical staff will be involved. They suggested that members of the public who are set to travel on SAA from that date make alternative arrangements, as the strike will likely cause disruptions. 

The unions and the struggling state-owned airline are deadlocked over the demand of an 8% across-the-board wage increase. Unions also want to have job security for at least three years and the in-sourcing of services like security, cleaning and ground handling. 

According to Numsa and SACCA, SAA pilots recently received a 5.9% increase. The two unions said their members were simply demanding increases as well, which should be higher than pilots as they earn less.

SAA has pointed out that the 5.9% salary stems from a 5-year salary agreement after an arbitration process to which the airline is legally bound.

In response to the intended strike action, SAA said late on Wednesday afternoon to any strike would endanger the future of the airline and threaten jobs.

The group's acting CEO Zuks Ramasia said the airline had offered the unions a 5.9% salary increase subject to the availability of funds. 

"We have made repeated overtures to the unions to acknowledge the severity of the situation in which we find ourselves in and to work hand in hand with us to try and avert a worsening situation," said Ramasia in a statement. "The strike is going to exacerbate rather than ameliorate our problem, and will result in a set of circumstances from which there may well be no recovery."

SAA announced on Monday that it is embarking on a restructuring process which may affect 944 jobs - almost a fifth of its employees. The restructuring excludes SAA subsidiaries SAA Technical, Mango Airlines and Air Chefs.

Numsa general secretary Irvin Jim said at the briefing on Wednesday that he regards the retrenchment notice by the airline as a "decoy".

"We are grounding that airline on Friday. It must not move. This is an indefinite strike. If they think we are playing, they have got it coming."

He did add later that the unions are still open for discussions with SAA management before the strike commences. 

Jim said Numsa will approach the South African Federation of Trade Unions to see if the SAA strike can be expanded to a wider basis. "We are sick of investment conferences. Workers must now turn to the state and demand that it intervenes in the economy."

Deon Fredericks, the interim chief financial officer of SAA, said at a media briefing on Tuesday afternoon that any industrial action would endanger the existence of South African Airways, and could destroy every job at the state-owned airline as well as related industries.

Fin24 understands that SAA is currently under pressure to secure R2bn in working capital, which it needs before November 20, which may have is added impetus to the restructuring.

Government has said it does not want to extend further support to state-owned entities. Finance minister Tito Mboweni announced last month that any further financing will be in the form of loans, that will have to be repaid with interest. Over the past 13 years, the flag carrier has incurred over R28bn in cumulative losses.

Dr Azar Jammine, director and chief economist of Econometrix, told Fin24 on Wednesday afternoon that industrial action would likely make banks even more cautious about lending money to SAA.

"A strike could spell the end of SAA and the loss of employment for all its workers and workers in downstream activities dependent on the airline," he cautioned.

"Are you now going to book to fly SAA, knowing that there's going to be a strike some time? The threat (of a strike) is already likely to have inflicted untold damage."

saa  |  richard branson  |  strikes  |  aviation  |  airlines
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