Unions file urgent court bid to have Mango placed under business rescue

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Unions from the South African Cabin Crew Association (Sacca), the National Unions of Metal Workers (Numsa) and the Mango Pilots Association on Monday filed an urgent court application with the High Court in Johannesburg to place Mango under business rescue. 

Unions say Mango workers forced them to take this action as they have been working without pay for more than two months.

The Department of Public Enterprises has not been financing Mango, a sub-subsidiary of the South African Airways (SAA), despite promises having been made by government and the shareholder. As a result of the delay, a liquidation application has been filed by one of Mango’s creditors, Aergen Four Aircraft and Aergen Five Aircraft LTD.

Unions say the liquidation process was initiated by workers and not SAA as initially claimed.

Unions, representing Mango Airline workers, have had enough and have taken government to court.  They say the move is to save the company and its member’s livelihood. The unions further served papers on all stakeholders over the weekend.

“We have no choice but to unite and fight with a common vision and to fight for the survival of another state-owned entity and an asset that is being destroyed by the department of public enterprise, it is expected that the application will be heard on the third of August 2021,” says Numsa spokesperson, Phakamile Hlubi-Majola.

Unions estimate that as many as 10 000 people, both directly and indirectly depend on Mango Airlines for income. This is in addition to the 3 000 direct jobs that have already been lost at SAA in the last 18 months and the estimated 1 200 jobs that will be lost in the coming months at SAA Technical.

Numsa says they have repeatedly offered a joint business rescue process with the shareholder in order to expedite the process to allow funding to flow for salaries. In addition to the last two months unpaid salaries, Mango employees are already owed six months’ salaries from the company.

“Workers have gone for two months without salary so basically they have been working for two months for free to try and save the airline. We have been having meetings with DPE for a while now basically trying to find each other on how we can sort out the issue on how we can solve the salaries at Mango but unfortunately nothing has happened and just promises that we have been getting promises and no money for the workers. “says Sacca’s Christopher Shabangu.

National Treasury approved a R2.7 billion funding for SAA business rescue. Some of that money was also meant to be allocated to its subsidiaries. Of that, R819 million is due to Mango.

Aviation expert Guy Leitch estimates that Mango will need about three to R6 billion to keep it going. He also says Mango is facing stiff competition from other airlines serving the local routes.

“Final push to put Mango into business rescue is long overdue.  Government allocated R860 million or so to the rescue of Mango but it required a plan before it could be released. It is essential that the business rescue practitioner have a business rescue plan. The problem is ever since Mango was founded twenty years ago, we have never really had a proper sight of Mango finances because it’s been a division of SAA and has been buried in SAA profits or losses. I think the many fear people have is that the business rescue process will be another SAA round two.” says Leitch.

Discussions are still on going with the shareholder and both government and unions hope they can reach a consensus and get staff paid.

Passengers stranded after suspension of Mango flights: