South African Airways insists it cannot meet wage increase demand

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South African Airways (SAA) said it does not have the financial capacity to meet workers’ eight-percent salary increase demand.

The airline said it could only pay 5.9 percent from March 2020, assuming funds will available at that time.

The strike at the South African Airways is entering its sixth day, due to a dire financial situation. The airline had initially said the action cost $3.4 million a day, though that figure came down as some canceled flights resumed. The resumed flights were to Accra, Lagos, Lusaka, Maputo, Windhoek and Harare.

On domestic flights, the airline worked with Mango Airlines to accommodate as many customers traveling on domestic services and refunding passengers their flights or travel with other airlines. It promised to resume domestic flights, one between Cape Town and Johannesburg and another one between Johannesburg and Durban.

“We call on all our employees to return to work for the sake of our customers and the company. After all, our customers contribute to our salaries and it is only through their confidence and custom that we can secure the future for SAA and ensure our essential contribution to the country’s economy. We are also very mindful of the contribution made by taxpayers to our sustainability,” said SAA’s acting CEO, Zuks Ramasia in a call for employees to return to work.

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Striking unions and SAA engaged in talks on Tuesday, which ended without agreement and with the unions working to follow through on a threat to shut down South Africa’s entire aviation sector through a secondary strike.

Since 2011, the airline has not turned a profit and is reliant on state bailouts casting doubt on the survival of the airline.

SAA’s future is uncertain with no end in sight to the costly strike. The government has said there is no more money in public coffers to save the airline again.

On Wednesday, board member Martin Kingston said the airline had no cash in the bank and the action was accelerating its end. He added that they do not have time or the money to consider industrial action.

“Unless we are able to secure guarantees from national treasury – and we’re in discussions with them as you and I speak – then the board will have to recommend to the government that actually it is placed in liquidation,” Kingston said on news channel SABC.

Also Read: South African Airways projects $416 million loss in 2018/19 FY

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