Comair can't afford full salaries during lockdown, asks staff to take leave

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Comair, which owns airlines kulula.com and British Airways, has asked staff to either take leave or unpaid leave for the extended lockdown period, as it cannot afford to pay employees their full salaries.

The group is among numerous businesses and the rest of the aviation industry whose operations have been interrupted by government's efforts to respond to the Covid-19 crisis. But the National Union of Metalworkers of South Africa (Numsa) is not convinced that the group's approach to the Covid-19 is acceptable.

Numsa, in a statement issued on Saturday, said Comair forced workers to take leave. Those without leave were to take unpaid leave, it said. "We would categorically like to state that as Numsa we are in full support of government's effort to curb the spread of Covid-19, but we are appalled to realise that some managers, including the management of Comair, are using the Covid-19 pandemic and lockdown to advance their barbaric and brutal behaviour of cutting costs," the union said.

Prior to the lockdown, Comair in March announced a restructuring process. This after the business reported a half-year loss of R564 million for the six-months ending December 2019. Although it reported a 3% growth in revenue, this was not enough to sustain additional costs of 14%, the group previously said.

Comair expected 10% of its workforce, or 200 employees to be affected. The first phase of a retrenchment process has been completed, with the group now having a smaller executive structure that will result in R23 million in savings, Comair said in an emailed response to Fin24. The Commission for Conciliation, Mediation and Arbitration will facilitate the rest of the process whereby Comair will engage with unions.

Covid-19 has added to its woes, creating "commercial and operational challenges", it said. Comair said its decision to ask staff to take leave are in line with the provisions of the Basic Conditions of Employment Act. It added that other employers had also taken this approach.

"Comair was of the view that, given that employees receive their full remuneration during their leave, requiring employees to take leave was more beneficial to them than recovering only partial payment of their remuneration through UIF benefits," it said.

Comair's obligation to employees is such that it pays for services by employees as they are tendered. However, most employees cannot tender their services during the lockdown, and are not entitled to remuneration, the group said. "As a consequence, Comair required employees to take compulsory annual leave during the lockdown. Staff whose annual leave had been exhausted were required to take unpaid leave where Comair undertook to cover 40% of basic salary (of unpaid leave) for the initial lockdown period," it said.

But Comair is not in a position to pay the 40% basic salary for unpaid leave during the extended lockdown period. The company, however, has undertaken to pay its full contribution to medical aid for April.

While Comair cannot afford to pay employees their full salaries, it is seeking assistance from government's Temporary Employer-Employee Relief Scheme.

Delayed salary

Furthermore, Comair had informed employees on 24 March 2020 that it would be paying April salaries on the last working day of the month, and not the 25th. Numsa accused Comair of not giving employees chance to prepare for the "sudden change" which will add financial strain. "No consideration was given whatsoever of the possible devastating impact and financial burden which will be incurred by employees through unpaid fees from the bank and returned debit orders because of this careless decision," said Numsa.

Comair, however, is of the view that it gave employees enough notice for the new payment date to make the necessary arrangement for debit orders and financial commitments. Comair said the delayed payment in salaries is meant to help the group maintain liquidity.

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