POLITICS

Attempted Comair fee increase rejected – NUMSA

Union says employees at airline have not been paid their salaries since the end of March

NUMSA rejects attempts at BRPs at Comair to secure a fee increase

19 July 2020

The National Union Metalworkers of South Africa (NUMSA) is dismayed that the Business Rescue Practitioners (BRPs) at Comair, Shaun Collyer and Richard Ferguson, are requesting an increase on their hourly rate from R2000 to a staggering R4000 per hour. What is even more shocking is that this request is made whilst employees at Comair have not been paid their salaries since the end of March. The BRPs have delayed the process of the UIF Temporary Employee Relief Scheme (TERS) Application and their distribution of payment to employees was highly irregular and resulted in workers being short paid their salaries for the month of April. We accordingly reject this request with the contempt it deserves, and we demand that employees at Comair must be paid all their outstanding salaries in full!

Shaun Collyer and Richard Ferguson are also directors of Redford Capital, a corporate financing company and they now want Comair to conclude an agreement with Redford Capital with the following terms:

- A monthly retainer fee of R250,000 (VAT exclusive);

- A “success” fee calculated at 1% (VAT exclusive) of the gross funding raised for Comair in the course of the Company's business rescue proceedings.

Such transaction will be a clear conflict of interest. It is shocking that the BRPs are so brazen in their request that Comair procure directly from a company where they are also directors.

The BRPs claimed that Comair is in financial distress and therefore cannot fulfil its legal obligations to pay employees, hence they have suspended operations until November, pending any Post Commencement Finance. In the midst of their resolute stance, Comair through the BRPs, has acquired 50% of the IT Group, Nacelle. This entity was purchased whilst the airline was under business rescue for an amount of R100 million. At the same time, workers at Comair are facing the threat of mass retrenchments after the airline served workers with section 189 notices. Furthermore, they have outsourced the HR function of the airline to an external Company when Comair has an HR team within it. They refuse to disclose the name of the company, or the monies which have been spent for these services and when we tried to seek explanations, we only received vague explanations and no clear answers.

Comair recently disseminated a communication to all employees confirming receipt of Post Commencement Funding from an undisclosed institution.  They adamantly maintain that the finance is neither adequate to commence operation nor sufficient to fulfil their legal obligations to pay their workers, and they refuse to disclose the name of the financier. Their behaviour can only be described as shady and we have good reason not to trust them. They have deliberately subjected workers and their families to unnecessary suffering by refusing to pay salaries during the lockdown, and at the same time, threatening job cuts. They are shamelessly pursuing self-enrichment whilst workers and their families face misery and poverty. The ultimate goal is to force employees to accept retrenchment packages whilst hiding behind the covid19 pandemic. This is unlawful and immoral and they must be stopped!

This clearly confirms the sentiment of the former CEO Erick Venter, who publicly expressed his concerns and characterised the move to enter into Business Rescue as rather dramatic. Comair has clearly been misleading its employees, South African Society and the world.

There is a meeting taking place on Monday the 20th of July where creditors will vote on whether the BRPs can be granted an increase. We call on them to refuse. We urge them instead to support us in demanding a forensic investigation into the activities of this pair of BRPs whose actions thus far, seem to suggest that the airline is being looted, instead of being rescued. 

Aluta continua!

The struggle continues!

Issued by Phakamile Hlubi-Majola, NUMSA National Spokesperson, 19 July 2020