* COVID-19 exacerbates SAA’s longstanding woes * Some staff haven’t been paid in 8 months * Government, unions argue over solution * Dispute could end up in court JOHANNESBURG, Dec 11 (Reuters) - South Africa’s government and trade unions are at loggerheads over unpaid salaries at South African Airways (SAA), which could lead to a messy court battle that may further complicate efforts to rescue the struggling airline. State-owned SAA has not made a profit in almost a decade and was already under bankruptcy protection when the COVID-19 pandemic struck, exacerbating its woes. It halted all but repatriation and cargo flights in March before suspending all operations in September. Some employees have not been paid since March. The ministry responsible for SAA wants workers to accept three months of unpaid wages totalling 600 million rand ($40 million) as it pushes to get the national carrier back in the air next year. But unions say their members are due more: five months’ salary for those who accepted voluntary severance packages before a September deadline and eight months for those still in layoff talks. That would be in addition to the severance packages themselves, which have yet to be paid. Out of SAA’s roughly 4,500 staff when it entered administration in December 2019, around 3,200 have accepted severance terms and 1,300 are still in layoff consultations. Kgathatso Tlhakudi, director-general of the Department of Public Enterprises, said on Friday the government could not accept unions’ stance. “Eight months cannot be justified on the basis that this airline for the better part of that eight months was not operating,” he said in an audio clip the department sent to reporters. “These are public funds that we are dealing with and we need to deal with them with the prudence they require.” Some unions, including Solidarity, NTM and NUMSA, have made a counter-proposal to the DPE for workers to be paid three months’ salary now, with the remainder deferred until the airline gets a promised bailout from the government and a restructuring plan can be implemented. The SAA Pilots’ Association (SAAPA) has taken a harder line, rejecting the government offer outright and sending a letter to the DPE telling it to “cease and desist”. The law dictates SAA’s administrators should be the ones negotiating with labour and they should allocate funding in line with the restructuring plan approved by creditors in July, SAAPA says. SAAPA has given SAA’s administrators until close of business on Monday to undertake to pay its members a 13th cheque from last year that should have been paid in April and to ringfence sufficient funds to cover unpaid salaries from this year. If these undertakings are not made, SAAPA will approach the courts, its chairman Grant Back said. ($1 = 15.1495 rand) (Reporting by Alexander Winning, editing by Louise Heavens)