Amended SAA business rescue plan offers employees a better deal

Thu, 06 Aug 2020

Amended SAA business rescue plan offers employees a better deal

News24
09 Jul 2020, 05:10 GMT+10

| More unions at SAA agree to severance packages as vote on airline's future approaches

"SAA will contribute a maximum of R4 650 per month towards each employee's pension, UIF and company medical aid in respect of the employees placed on temporary or training lay-off," the document said.

This provision was not part of the previous plan.

The South African Cabin Crew Association has advised members to accept severance packages. About R2.2 billion has been put aside to fund these severance packages, according to the business rescue plan.

The revised plan further states that employees who are retrenched will be in a "better financial position than in a liquidation" as they will receive full payment of their post-commencement claims. The retained employees will continue to be employed and receive their respective salaries.

In terms of creditors' claims, lenders will exercise their right to utilise the government guarantee scheme if no payment takes place by 31 August 2020, according to the plan. No assets of the airline would be are made available to pay creditors' claims in terms of the business rescue plan.

SAA went into business rescue in December 2019 following years of losses and repeated state bailouts.

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