DPE favours business rescue plan over liquidation for SAA
In a statement on Thursday morning, the Department of Public Enterprises stresses that if SAA was to be liquidated, it would potentially lead to even more financial implications for employees.
JOHANNESBURG - The Department of Public Enterprises is warning South African Airways (SAA) employees, labour unions and creditors that a business rescue plan will be a better option for the airline than liquidation.
In a statement on Thursday morning, the department stresses that if SAA was to be liquidated, it would potentially lead to even more financial implications for employees.
"All SAA stakeholders who are in a position to either support or reject a business rescue plan for SAA should realise that business rescue provides a better outcome than liquidation and should be supported for their collective interests."
It added that: "For employees, the liquidation of SAA means they would receive a maximum of R32,000 per staff member, regardless of years of service, to the extent that there are funds available. They will only receive payment once the final liquidation and distribution account has been approved, which can take up to 24 months."
Last week, a creditors’ vote on the controversial business rescue plan was postponed to 14 July.
The rescue plan states that 15 July is the deadline for government to find more than R10 billion to fund the ailing airline to prevent it from being liquidated.
One of the unions representing SAA staff, Numsa, is opposed to the rescue plan.
The union’s spokesperson Phakamile Hlubi-Majola said: “We disagree with what the department is saying and think it’s actually being unfair. When the draft plan was released to the public, the department came out and said it was not good enough and now the same department wants to impose a defective plan on workers.”