Cathay, Dragonair to ask staff to take unpaid leave, but won't force it
All Cathay Pacific and Dragonair staff will today be asked to take weeks of unpaid leave as part of cost cuts aimed at helping the sister airlines through the economic crisis.
Flights are also expected to be trimmed as part of the measures that will be outlined to staff in briefings today after Cathay Pacific, the bigger of the two airlines, last month announced its first loss in 10 years in 2008.
At today's briefings, staff will be asked to accept different levels of unpaid leave, from a fortnight upwards, according to rank.
Senior executives are expected to set an example to all staff by agreeing to longer periods.
'The unpaid leave is not mandatory, but we do hope to persuade all staff to take it,' a company source said. 'It is much more comprehensive than the voluntary unpaid leave scheme at Cathay Pacific a few months ago. Top executives will lead the way.'
Unions representing pilots and cabin crew said they were assured yesterday in talks with executives including chief executive Tony Tyler that the leave would not be mandatory. However, the unions have been asked to persuade as many of the airlines' 20,000-plus employees as possible to accept the move.
Sources said the airline was also likely to announce a reduction in flights on less popular routes to offset the effects of the anticipated steep rise in staff leave.
A Cathay Pacific spokeswoman said the talks between management and unions had been 'open and frank' and they had discussed the measures which would be outlined to staff today.
'All airlines, including Cathay Pacific, have been hit hard by the downturn in business brought on by the international financial crisis. We are asking staff and the unions to support us through these difficult times ... to preserve the long-term sustainability of the business,' she said.
Referring to reports that the leave scheme would be mandatory - a move the unions described as 'illegal and unacceptable' - the spokeswoman said: 'Any measures taken affecting staff would be strictly in compliance with Hong Kong law.'
John Findlay, general secretary of the Hong Kong Aircrew Officers Association, said after yesterday's talks: 'I am pleased the union has been able to confirm that management accepts they cannot force unpaid leave on their staff.'
He said talks would continue today over the proposed cost cuts between management and the unions, which have not yet decided whether to endorse the measures. 'The consultation process we started last week is ongoing.'
More than 1,000 Cathay Pacific cabin crew agreed to voluntary unpaid leave of at least two weeks at the end of last year, but the uptake from pilots was relatively low, with only 200 applying.
Cathay Pacific last month announced a record loss of HK$8.55 billion last year, its first loss since the Asian economic crisis of 1998. The airline made a profit of HK$7 billion in 2007.
