Business

Labour Court clears SAA to restructure

Labour Court clears SAA to restructure
JOHANNESBURG - The business rescue practitioners (BRPs) of South African Airways (SAA) will be forging ahead with their plan to restructure the cash-strapped airline after the Labour Court in Johannesburg on Friday dismissed an application by workers’ unions to halt job cuts earmarked in the rescue plan.

Judge Graham Moshoana dismissed the application by the National Union of Metalworkers of South Africa (Numsa) and the South African Cabin Crew Association (Sacca) to halt looming job cuts.

Judge Moshoana said the unions’ bid against the SAA rescuers was dismissed because the cancellation of 11 domestic and international flights did not mean workers would be dismissed.

He said the troubled national carrier had not indicated the intention to start Section 189 consultations, meaning the unions had no reasonable grounds to anticipate retrenchments.

“It is this court’s conclusion that SAA has not contemplated dismissal and the duty to consult within the contemplation of section 183 (1) of the Labour Relations Act (LRA) did not arise,” Judge Moshoana said.

“Since the duty to consult has not arisen, the powers of this court to compel a fair procedure and or interdicting and restraining SAA are severely circumscribed. For all the above reason’s the application must fail.”

Numsa and Sacca, which together represent about 3000 SAA workers, approached the court to job losses that would come as a result of the airline terminating domestic routes and want the rescuers to comply with the provisions of the LRA.

The unions were also seeking an order from the court that the rescuers must be directed to comply with the terms of the wage agreement signed in November for retrenched workers be placed on the training lay-off scheme.

Two weeks ago, SAA’s joint rescuers Les Matuson and Siviwe Dongwana announced the closure of domestic routes - except for Joburg-Cape Town - by the end of the month and said job losses could not be avoided.

They said these initiatives, among others, would support the airline’s transformation into a sustainable and profitable business.

Labour law specialist Michael Bagraim of Bagraim Attorneys said the unions had pre-empted the rescuers’ plans to lay off staff, and the courts do not entertain applications done piecemeal.

Bagraim said the unions had to wait until the rescuers began the Section 189 proceedings before they could go to court to challenge workers’ dismissals.

“The courts did not even have to look at the actual application. The courts said SAA hasn’t retrenched yet, they haven’t even embarked on the process yet,” Bagraim said.

“What this court did, and I think quite rightly so, is they said that it looks like SAA is going to retrench people, but they haven’t done it.

“No one really lost the case on the merits, but the unions lost the case on the basis of procedure. And I think the unions are out of line, because SAA in their reply said they will follow the Labour Relations Act.”

Numsa spokesperson Phakamile Hlubi-Majola said it was “outrageous” that the Labour Court believed that SAA was not contemplating retrenchments when it is reducing routes.

“The Labour Relations Act is very clear that business rescue practitioners cannot proceed on any retrenchment process outside the act,” she said.

“So the fact that the BRPs have already done this, for us, is completely unacceptable. But what is deeply saddening is that the Labour Court actually agrees, in spite of the evidence to the contrary.”

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