South African Airways (SAA) employees who applied for voluntary severance packages (VSP) can expect to receive their funds by the end of January, according to unions at the airline.
The National Transport Movement (NTM) and South African Transport & Allied Workers’ Union (Satawu) have told their members that the R10.5 billion required to fund the SAA business rescue plan and to pay for the VSP has now been made available to the airline’s rescue practitioners from the Department of Public Enterprises (DPE).
This is unconfirmed as yet by government.
The funds were allocated by the National Treasury in October’s Medium-Term Budget Policy Statement but are yet to be disbursed.
In a communication to union members last week, seen by Moneyweb, NTM President Mashudu Raphetha said the VSP payments can be expected “within a few days”.
Raphetha told Moneyweb that the union is “certain” that the funds will be paid out before the end of this month.
“The money has been made available and it’s all systems go…the BRPs must just pay and certify that the company is out of business rescue,” he said.
Satawu’s national aviation co-ordinator Nelson Lamityi also confirmed to Moneyweb that the VSP funds are expected to be disbursed by the end of January. The union told its members that the funds required to fulfil the SAA rescue plan were “signed off” by National Treasury and President Cyril Ramaphosa on January 20, allowing for funds to be paid out to employees, creditors and subsidiaries of SAA.
Satawu further expects SAA rescue practitioners Les Matuson and Siviwe Dongwana to hand over the reins to the airline’s interim board once the rescue process has been concluded, given that they “have overstayed their time in the company and the amount of money they keep on milking out of SAA.”
Payments owed to SAA subsidiaries such as SAA Technical, Air Chefs and Mango are due by the first week of February, according to Satawu’s communication to its members.
By September last year more than 3 000 of 5 000 SA employees had applied for the VSPs, which are expected to cost the airline around R2.2 billion. The airline has already received R1.5 billion from the DPE that has been used for the payments to employees who accepted the three-month back-pay deal.
The rescue practitioners have told Moneyweb that 81% of the VSP acceptances and staff have accepted the back pay which was paid by the DPE.
The National Union of Metalworkers of South Africa (Numsa) and the South African Cabin Crew Association (Sacca) initially rejected the offer but have taken the DPE and the rescue practitioners to court and demanded that their members be paid the same funds as other SAA employees.
Numsa spokesperson Phakamile Hlubi-Majola said that the money is owed to its members because “in terms of the law you may not pay out one group of workers and not pay out the others.”
Hlubi-Majola did not confirm or deny that the funds required for the VSPs have now been made available by the airline’s shareholders.
She however said the VSP money should cover “all employees including Numsa and Sacca members.”
Satawu told its members that “those that have not accepted the salary settlement at SAA will have their three months salaries calculated and those [are] funds being ring-fenced so that there are no delays in distribution [of the VSP’s]”
Questions sent by Moneyweb to Treasury and the DPE were unanswered at the time of publication.