Workers from Subsidiaries of South African Airways Likely to Join Strike

The strike by employees of South African Airways (SAA) has escalated with unions deciding to involve workers from its subsidiaries and related companies in the industrial action. This decision was taken after a meeting with the management on Saturday, November 16, held under the auspices of the Commission for Conciliation, Mediation and Arbitration (CCMA). The meeting failed to resolve the dispute.

The strike began on Friday with nearly 3,000 SAA employees taking part. This was following a deadlock in negotiations with the management. The unions are demanding a wage hike of 8% and a halt to the retrenchment plans which could see over 900 workers lose their jobs.

The National Union of Metalworkers of South Africa (NUMSA) and the South African Cabin Crew Association (SACCA), which together represent over half of SAA employees, are also demanding the insourcing of all workers, including the staff involved in security, cleaning, IT, ground-handling, logistics etc.

Insourcing, the unions argue, will save significant costs for the debt-ridden national airline, because the private companies to which contracts are outsourced have massively inflated the bills.The money that can thus be saved will make the retrenchments unnecessary, and provide for the finances required to raise the salaries of its employees.

The management argues that its finances does not allow the national airline to afford an 8% hike. However, the industrial action has been costing it R52 million per day. The unions have pointed out that meeting their wage demands will cost R100 million annually, which is less than two days of costs incurred by the company for having to cancel hundreds of flights.

On Friday and Saturday, all domestic regional and international flights operated by SAA were cancelled and the check-in counters were deserted. While some international flights resumed on Sunday, domestic and regional flights will remain grounded till Monday, the SAA management has said.

However, workers have not indicated any intention of returning to work after Monday, and have vowed to continue the strike until their demands are met. After yesterday’s meeting, NUMSA released a statement on Sunday about its decision to expand the strike action.

“NUMSA is in the process of consulting workers for a secondary strike in aviation. We have begun consultations on this process in the various [related] entities: Civil Aviation Authority (CAA), Mango airlines; SAfair; SA Express; Airports Company South Africa (ACSA); Reshebile security, Morena cleaning, Vizini, (maintenance company), Azda, Swissport, Bidair services and Comair. We are also consulting Airline catering companies such as Airchefs, Food Direction, LSG SkyChefs, and Dnata.”

At the last meeting before the strike, the company had offered a “5.9% wage increase to be paid in March 2020 and the back pay to be paid in installments beginning April 1st 2020,” the two unions had said in a joint statement.

“We have rejected this proposal in favor of.. [an] 8% wage increase across the board to be paid on the 13th of December 2019, and 50% of the back pay to be paid with the increase on the 13th of December 2019. The remainder of the back pay to be paid on the 27th of January 2020.”

Company Dithers

With regard to insourcing, the unions complain that the SAA is dragging its feet by arguing that a task team be created and its terms of reference agreed upon before the process can begin.

“We do not have the luxury of time and this needs urgent immediate action,” the statement reads. The cost of paying for the “grossly inflated” profit margins of the private players to whom contracts have been outsourced has been “crippling SAA’s finances”.

“Ernst and Young forensic reports outline in detail major contracts which must be urgently revised because of their impact on SAA’s balance sheet. They have already done the work for SAA”, the unions argue. They point out that the setting up on another task force will only duplicate this work.

Bidair services, Swissport, Saphosethu, Reshebile, Morena, Azda, Checkport and Mehlomahle are among the companies whose contract prices, the unions claim, are heavily inflated. Aircraft cleaning, ground handling, security, maintenance, baggage handling, passenger aid services and ramp, bussing and document verification are among the services which have been outsourced to these companies.

Unions are demanding an immediate cancellation of these contracts and insourcing of the workers providing these services. “If this action is taken today, with the urgency that it deserves, this will immediately create funding for the airline. This money is desperately needed in order for it to operate, and, to pay for wage increases.”

Recently, SAA technical, one of SAA’s subsidiaries, cancelled KWE’s contract of R22 million per annum for warehousing. After insourcing the workers, the company has been saving around R11 million a year.

“This was because of pressure from the unions. This is why we cannot accept their explanation that this is a long process which requires a task team with terms of reference. We demand decisive action, because we simply cannot afford for these contracts to continue. They are.. bleeding SAA dry every day,” the unions said.

The Socialist Revolutionary Workers Party (SRWP), in a statement of solidarity with the strike action, said, “SAA spends a whopping R25 billion on procurement, and it is a fact that much of its procurement spending is based on corruption. Many of the companies it outsources services from have grossly inflated their prices and this adds to the debt levels of the airline.”

Instead of addressing this systematic problem, the SAA management has decided to save R700 million by retrenching 944 workers. “Their actions have resulted in the airline being bankrupted and now workers must pay through job losses for the greed and corruption of the board and some of its senior executives,” the unions added.

“What is happening at SAA is an example of capitalism at its worst. A once viable State Owned Entity is deliberately being hollowed out through theft and rampant looting. This is being done to collapse the airline, so that the capitalist cronies, connected to the ANC government in the form of the Rothschild family, can benefit from its collapse, and they can buy the airline at a vastly reduced price,” said SRWP’s General Secretary, Motebang Oupa Ralake.