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SAA Restructuring Under the Spotlight

July 13, 2020

Department of Public Enterprises

The public enterprises department has informed the South African Airways Pilots Association (SAAPA) that their proposals on South African Airways (SAA) restructuring cannot be accepted.

In a statement, the department expressed concern that “pilots are seeking benefits, which are far more costly, more lucrative and financially rewarding for the pilots than any other class of employees at SAA”.

According to the department, in the latest Voluntary Severance Packages (VSPs), the 600 SAA pilots will get more than R1 billion out of the R2.2 billion proposed budget for the VSPs.

SAAPA proposals include retrenching 1 548 employees and retaining 3 099 employees – 2 000 for the start-up of the new airline, 435 on a temporary layoff scheme, and 664 on furlough (furloughed employees are retrenched but can be called in as required); reducing the number of retrenched employees from 3 647 to 1 548, excluding the 664 on furlough; retained workers to be kept on a part time basis of 75% and paid accordingly and a further cut in salaries of the pilots (20%) and employees (10%).

“The department does not believe that the SAAPA proposal is in the best interest of SAA, its employees, creditors and other stakeholders and has informed SAAPA that its proposal would exacerbate a prolonged economic recovery in a post COVID-19 era.”