South African Airways was hit even before the Corona crisis. Now you are threatened with the end. There is already a proposal to lay off all employees.
South African Airways has been under creditor protection since last December. But the really bad news came last Tuesday (April 15th). Then the government rejected the request of the special administrators to help with another ten billion rand or the equivalent of 490 million euros. The state, which has ensured the survival of the national airline for years, has other priorities in the corona crisis.
Now the liquidation of the airline is getting closer. On Friday (April 17), the South African media released a letter from the special administrators to the management and unions of SAA. The plan is to lay off all around 4,700 employees. In return, they should receive: for each year of service a weekly wage, plus a monthly wage, pro rata a 13th monthly wage and remuneration for outstanding vacation.
Is there any money left for severance payments?
The cabin crew union Sacca, which represents around 60 percent of South African Airways employees, said last weekend that it believed the letter to be illegal. Many of the unions listed were not contacted at all. The workers’ representative group also fears that if the airline is liquidated, other debtors will be given priority service and that no money will be left to make the payments to the employees.
As the sole shareholder in South African Airways, the government must approve the plan to fire all employees. Given the unpopular measure, she is still cautious. The Ministry of State Enterprises said at the weekend that all jobs would not be cut immediately. They are still consulting with unions about a new business model.
Government report
The special administrators would also be in negotiations with the government, unions and lenders. A government report on the situation at South African Airways is expected on Monday (April 20). Apparently the airline only has money for two weeks.
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