Numsa and Sacca’s application over SAA settlement agreement dismissed

The urgent application brought by the National Union of Metalworkers of South Africa (Numsa) and the South African Cabin Crew Association (Sacca) to have the South African Airways (SAA) settlement agreement declared unlawful or unfair has been dismissed by the Labour Court.

Judge André van Niekerk’s decision has dealt a blow to Numsa and Sacca’s bid to compel the SAA business rescue practitioners and the Department of Public Enterprises (DPE) to pay their members a lump sum comprising an agreed-to 5.9% increase backdated to April 2020, as well as an equivalent pro-rata contribution towards a 13th cheque.

This is the settlement offer that four other unions at the airline accepted, but which Numsa and Sacca declined in December.

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They argued in court in January that their members are entitled to the same payments made to members of the other four unions – but that their members should not be forced to waive their rights in terms of the balance of salaries owed.

The airline – which has been under business rescue since December 2019, and has been granted a R10.5 billion government bailout, R1.3 billion of which it received in late January – claims that it cannot afford to pay its workers the full amounts it owes them.

The unions have declined to comment, saying they are still studying the judgment.

Back to the drawing board

In the judgment handed down on Monday, Van Niekerk noted that: “SAA does not dispute that those employees who have not accepted the settlement offer (and in particular the members of the applicant unions) remain entitled to claim their outstanding remuneration in full, and that their right to do so has not been prejudiced or otherwise affected by the settlement agreement.”

However, he said the unions’ application does not fall within the Labour Court’s jurisdiction and that the application should rather be heard at the High Court.

“The claim relates both to the conduct of the business rescue practitioners … and the conduct of SAA as the employer,” according to the judgment.

“In the former case, this court has no jurisdiction to consider the lawfulness of the actions of the business rescue practitioners, only because they have not taken these actions as an employer.”

According to Van Niekerk, the unions failed to substantiate their claims that SAA as an employer acted unlawfully or unfairly when it did not pay their members the settlement offer paid to members of other unions.

Discrimination not evident, says judge

Considering that SAA is under business rescue and that the settlement offer to pay three months salaries as part of a compromise was extended to all employees, Van Niekerk said he fails to understand how it could be said that there is any discrimination against those employees who refused to compromise their claims.

“They [employees] remain in a position to enforce their claims in due course to the full amount of arrear salaries owed to them subject, of course, to the provisions of Chapter 6 of the Companies Act,” reads the ruling.

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“There is nothing improper or unlawful about any agreement to compromise a claim for remuneration.”

The court further ordered Numsa and Sacca to pay the legal costs of Public Enterprises Minister Pravin Gordhan, who had applied to be an intervening party in the matter – with the judge describing the union’s opposition to Gordhan’s application as “misguided” and “bordering on the frivolous”.

Gordhan ought to have been cited as one of the respondents in the first place, said Van Niekerk.

“I fail to understand why the taxpayer should ultimately be saddled with the costs of the application to intervene,” he says.

This article first appeared on Moneyweb and was republished with permission.

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