- A deal between SAA and the SAA Pilots Association has finally been sealed.
- This follows a in-principle agreement put forward a few weeks ago.
- SAA sees this as an important milestone towards taking to the skies again.
SAA announced on Friday evening that it had reached an agreement with the SAA Pilots' Association (SAAPA), which marks another significant milestone towards resuming operations.
The deal was signed and ratified on Friday. This follows the in-principle agreement reached on 6 July, with member pilots voting with a 94.9% majority in its favour during a ballot process that closed on 11 July. For SAA's interim CEO Thomas Kgokolo, this is a "new and important chapter in SAA's proud history".
"It has always been our fervent wish that all employees, including all our pilots, become part of the journey as we travel towards new horizons," he said. The negotiations have taken more than ten months. The agreement sees SAA retaining 88 pilots from the total of 268 remaining pilots.
"Our pilots will now receive all monies due to them. We have already started the process to make payments that do not require tax directives," said Kgokolo.
"We have achieved an optimal balance between vital experience required in the cockpit as well as addressing the company's transformation objectives. Our next step now is to accelerate the last stage of preparation for the airline to return to the skies."
SAA went into business rescue on 5 December 2019 and pilots have not received salaries since March 2020 as the embattled airline remained grounded.
SAA's business rescue practitioners then locked SAAPA members out of SAA from 18 December 2020. This meant that, from that date, SAA was not obliged to pay their salaries and other benefits. This was an attempt by SAA to get SAAPA to agree to cancel its long-standing regulating agreement and accept the new terms of employment.
The business rescue practitioners wanted SAAPA to accept a new agreement in terms of which salaries of all pilots will be reduced by 50%. Their allowance per day will also be reduced. Back in December 2020 the biggest bone of contention was that SAAPA, which represents at least 90% of pilots at SAA, demanded that its members be retrenched on their existing terms and conditions of employment.
SAAPA was willing to cancel its long-standing regulating agreement, but wanted to avoid a situation where it was cancelled, then new terms and conditions implemented and then retrenching pilots at those new lower salaries and benefits. When SAAPA went on strike earlier this year, it demanded to have the regulating agreement cancelled and all its members retrenched at existing terms and conditions of employment.
SAA made a new offer to the pilots last week and about 95% of SAAPA members voted in favour of an in-principle settlement agreement. In terms thereof, SAAPA members will now be retrenched according to their current salaries. Overall, SAAPA members will be retrenched at below what they would be entitled to under the regulating agreement.
In general, the agreement involves SAAPA agreeing to terminate the regulating agreement, accepting new salary scales for captains and first officers, and retaining the proposed selection criteria for the 88 pilots to remain in the employment of SAA. The selection criteria stipulates that the 88 pilots should demographically be 34% black, 9% coloured, 14% Indian and 43% white. Going forward the demographics of the pilot group will be determined by and employment equity plan.
More than 200 SAA pilots have already taken voluntary severance packages during the airline's business rescue process. SAAPA expects that about 290 will have to still be retrenched in order to leave the 88 envisioned in terms of the rescue plan.
Retrenched pilots will get severance pay of one week for each completed year of service, two months' notice pay, and three months' back pay in settlement for the period 1 April to 30 November 2020. All accumulated and accrued leave at full value, except for the period of lockout. Pilots will also get their 13th cheques due for 2019 and that of 2020 and payment of their salary from 1 to 18 December 2020.
The deadlock with SAAPA was one of the so-called legacy issues that the Department of Public Enterprises (DPE) and SAA had to deal with before the Takatso consortium, SAA's selected strategic equity partner, takes over. Takatso has been clear that it won't be taking on any legacy issues.
Public Enterprises Minister Pravin Gordhan told Parliament a few weeks ago that the aim is to try to get SAA off the ground again by August this year. His department is currently busy with due diligence into Takatso, and Takatso will also do due diligence on SAA.