South African Airways Faces Strike Over Planned Job Cuts
South African Airways Faces Strike Over Planned Job Cuts
South African Airways staff will go on strike starting Friday in protest at the state-owned carrier’s plans to fire almost 1,000 workers to help stem losses and repair the balance sheet.
Cabin crew and check-in, ticket sales, head office, technical and ground staff will join the walkout, the South African Cabin Crew Association and the National Union of Metalworkers of South Africa said in a statement on Wednesday.
“There are likely to be disruptions,” they said. “We advise members of the public to make alternative arrangements if they have booked flights with SAA.”
The move shows that SAA’s highly unionized workers aren’t going to readily accept the need for job cuts as a solution to years of mismanagement that have led to eight years of losses and a dependency on the government to survive. Other South African state-owned companies -- including Eskom Holdings SOC Ltd. -- are also vulnerable to labor action as they strive to emerge from a state of near collapse.
The strike will “exacerbate rather than ameliorate our problem, and will result in a set of circumstances from which there may well be no recovery,” Acting Chief Executive Officer Zuks Ramasia said in a statement.
SAA was among state companies laid low during the scandal-hit tenure of former President Jacob Zuma, and a former CEO and chief financial officer were fired for financial misconduct shortly after Cyril Ramaphosa gained power in early 2018. They said they were doing the bidding of former Chairwoman Dudu Myeni, a friend of Zuma’s and the head of his charitable foundation, the Mail & Guardian reported at the time. Myeni and Zuma deny wrongdoing.
“While it is true that SAA is hugely in debt, we argue that this crisis has deliberately been created by those tasked with leading this institution,” the two unions said. “Maladministration, rampant looting and corruption” are the root cause, they added.
The airline has since struggled to repay debt and Finance Minister Tito Mboweni has repeatedly made clear the government doesn’t see the carrier as a priority. However, last month he approved the settlement of 9.2 billion rand ($613 million) of borrowings over the next three years, while saying a search is under way for an equity partner.
The unions are also striking over a failure by SAA to meet demands including an 8% wage increase across the board and at least three years of job security, they said. The airline has offered 5.9%, according to Ramasia.
To contact the reporters on this story: John Bowker in Johannesburg at jbowker2@bloomberg.net;Paul Vecchiatto in Cape Town at pvecchiatto@bloomberg.net
To contact the editors responsible for this story: Paul Richardson at pmrichardson@bloomberg.net, Mike Cohen, Alastair Reed
©2019 Bloomberg L.P.