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Moneyweb reports that the staff of SA Airways’ (SAA’s) subsidiaries are bearing the brunt of the precarious financial situations of those companies. SAA has been in business rescue since December 2019, but this has not included the subsidiaries.
The SAA business rescue practitioners are therefore not legally mandated to spend any of the post-commencement finance to assist the subsidiaries. An international private equity group has been waiting nine months for Mango – the broke, low-cost subsidiary of SAA – to return two Boeing aircraft after the leases expired in July last year. The planes are stuck at SAA Technical (SAAT), another broke subsidiary of SAA, which is undertaking the work necessary to ensure compliance with return conditions. Mango has apparently been unable to pay SAAT for the work that had to be done. In May last year Public Enterprises Minister Pravin Gordhan told MPs that Mango would cut staff salaries by 50%. The staff of a third subsidiary, Air Chefs, have not been paid since the hard lockdown, while SAAT staff have only received between 25% and 50% of their salaries every month for the last year. In March, SAAT management promised to pay full salaries for the first time, but eventually only paid a portion early in April and have paid nothing since. In a message sent on 7 April, staff were encouraged to apply for shortened work hours and take paid or unpaid leave. That would “enable the likelihood of SAAT paying 100% of the worked half-time”, staff were told. Trade union Solidarity said staff at SAAT were “very close” to withholding their labour. That could result in an even deeper crisis for the airlines that depend on SAAT for technical services – including Mango.
- Read the full original of the report in the above regard at Moneyweb
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