'Unforeseen challenges' prevent SAA Technical from keeping promise to pay full salaries

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Minister of Public Enterprises Pravin Gordhan recently told Parliament that SAA's subsidiaries are also in need of restructuring to find their feet. (Supplied)
Minister of Public Enterprises Pravin Gordhan recently told Parliament that SAA's subsidiaries are also in need of restructuring to find their feet. (Supplied)
  • Last week the management of SAA Technical promised employees that they will pay 100% of salaries on 1 April.
  • That did not happen and employees have been informed that attempts are being made for partial payment.
  • Unlike its parent company SAA, SAAT is not in business rescue.

"Unforeseen challenges" prevented the management of SAA Technical (SAAT) from honouring an earlier commitment to pay employees' March salaries in full on Thursday 1 April.

According to SAAT management, this was beyond its control. SAAT is a subsidiary of SAA but, unlike its parent company, not in business rescue.

"The leadership team continued to explore other means towards paying salaries to our employees. March 2021 salaries will be paid as follows: 50% nett pay for low income levels; 25% nett pay for the remainder of the bargaining category and management," the company told Fin24 on Friday.

"Management remains committed to have the March 2021 salaries topped-up to 100%, as soon as funds become available for this purpose. The leadership has done everything in their power to secure payment of these salaries. We apologise for inconvenience caused to employees and their families."

On 26 March, the company indicated that arrangements were in place to have 100% of nett March salaries paid on 1 April. 

In a document sent to staff and seen by Fin24, SAAT interim CEO Terrance Naidoo indicates that this was on the back of the undertaking and effort from the board to have the required funds made available.

"Unfortunately, these much anticipated funds have not been paid to SAAT due to unforeseen challenges experienced, and SAAT EXCO was notified of this unfortunate development today, 1 April 2021. This development is beyond our control, and regrettable," said Naidoo. 

"The leadership team continued to explore alternative means towards enabling payment of salaries to employees."

According to the letter, the partial payments would be made from funds available on 3 April and should reflect in employees' bank accounts as from Tuesday due to the public holidays.

The question has been raised in the past how SAAT employees can be expected to work if they are not paid.

The Department of Public Enterprises hopes to obtain a special allocation from Parliament, which is currently in recess, in order for R2.7 billion of the R10.5 billion provided for SAA in the mini-budget in October last year, to go to the airline's subsidiaries SAAT, Mango and AirChefs.

Public Enterprises Minister Pravin Gordhan recently told Parliament that, although SAA's subsidiaries were not in business rescue, they were also in need of restructuring to find their feet.

In the view of Phakamile Hlubi-Majola, spokesperson of the National Union of Metal Workers of South Africa (NUMSA), it is "utterly disgraceful" that workers at SAA's subsidiaries continue to suffer. 

"We have instructed our attorneys to take the necessary action to try and claim this money for workers at SAAT, especially since they have been working throughout. They have been tendering their services. SAAT has a contractual duty to pay them," she said.

"It is unclear when Parliament will make the R2.7 billion available for SAA's subsidiaries. Until then it means workers at SAAT and all other SAA subsidiaries are in limbo. For us this is a direct reflection of how poorly the business rescue process has been run by the DPE. No plans were made to cushion workers in this process."

She pointed out that workers at SAA subsidiary AirChefs have not been receiving salaries and the last TERS payment they received was in October last year.

Nelson Lamityi, spokesperson on aviation of the South African Transport and Allied Workers Union (SATAWU), also raises the plight of employees at AirChefs.

"This is unacceptable in any democratic state. We are not happy with government on the manner in which it dealt with these issues [regarding SAA's subsidiaries].

* This article was updated with comment by NUMSA and SATAWU.

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