Get the app today! Download iPhone App Download Android App

SUBSCRIBE

South African Airways Receives $346m To Help Make Severance Payments

Published on Feb 22 2021 1:09 PM in General Industry tagged: South African Airways / SAA

South African Airways Receives $346m To Help Make Severance Payments

South African Airways (SAA) has received five billion rand ($346 million) from South Africa's Department of Public Enterprises to help make severance payments to laid-off staff as part of its rescue plan, administrators of the plan have said.

SAA entered a local form of bankruptcy protection in December of 2019 after approximately a decade of financial losses, with its fortunes worsening after the COVID-19 pandemic grounded flights.

The government committed to providing 10.5 billion rand to bail the airline out in October's mid-term budget.

The business rescue practitioners (BRP) hired to restructure the airline said that they have received 7.8 billion rand from the government including the latest payment.

Voluntary Severance Packages

The administrators, who have proposed a plan which includes reducing the airline's staff by aproximately two-thirds, said that the money allows them to pay cabin crew and ground staff that had accepted voluntary severance packages in August.

More than 3,000 SAA employees have accepted severance packages, while 1,300 are still in negotiations, the administrators said.

The administrators stated, "The payment [to staff] follows the receipt of a further tranche of R5 billion from the Department of Public Enterprises on 12 February, which has further allowed the BRPs to confirm the second payment on 19 February."

News by Reuters, edited by Hospitality Ireland. Click subscribe to sign up for the Hospitality Ireland print edition.

Share on Facebook Share on Twitter Share on LinkedIn Share via Email