Unions at South African Airways (SAA) say they are currently engaging with the Department of Public Enterprise (DPE) regarding proposed retrenchments and severance packages for employees.

The National Union of Metal Workers of South Africa (Numsa) and the South African Cabin Crew Association (Sacca) say they are engaging on the way forward for SAA.

Numsa, Sacca and the SAA Pilots Association rejected severance packages that the government offered SAA employees.

On Monday, the government called on all unions at SAA to convene their own bilateral engagements on the proposed retrenchments at the airline.

The department says it is not in a position to accede to the unions’ demands for further benefits. 

The unions say they will be attending a meeting between the Business Rescue Practitioners (BRPs) and creditors, which is scheduled to take place next week Tuesday, and hope this will shed more light on the way forward.

The DPE says it has made it clear to all the unions that R2.2 billion has been budgeted for the voluntary severance package and is the best that can be made available.

However, concerns raised by the three major unions centers on the number of people to be retrenched and the value per employee on the proposed packages.

The voluntary severance package includes one week calculated per year of completed service, one-month notice pay, accumulated leave paid out, a 13th cheque and a top-up of severance packages calculated on a back-dated 5.9% wage increase.

In the video below, SAA business rescuing plan to cost R10 billion: 

Lasy week, the Department of Public Enterprises withdrew from the Leadership Consultative Forum that was established to facilitate employee engagement to develop a business and operating model for a restructured SAA.

In a statement, the department said it felt the forum was not serving its intended purpose.

In terms of a leadership compact that was signed between the two parties, the forum was among other things, responsible for presenting an agreement to SAA’s Business Rescue Practitioners in support of the business rescue plan for the airline.

It was also tasked with making joint submissions to the BRPs on voluntary severance packages for SAA employees who are going to be retrenched and to ensure that SAA can resume flights as soon as possible.

The DPE said participants in the forum had breached the conditions of the compact by among others leaking confidential information. It also issued public statements and supported SA Airlink’s resolution to adjourn the creditors meeting that was scheduled for last week.

The Department says their actions have put severance benefits for employees and the retention of 1 000 jobs at risk while putting SAA on a path towards possible liquidation.

In the video below, embattled South African Airways’ future remains bleak: 

SAA was put under business rescue in December 2019 after years of financial challenges.