Hundreds of US-based cabin crew face loss of welfare benefits as Cathay Pacific halts payments
Hong Kong airline says that as a non-American company it is not eligible to make the contributions to social security and health insurance programmes
Cathay Pacific faces unrest and deep discontent among its US-employed cabin crew after halting contributions to their social security and health insurance “medicare” programmes.
As a result more than 400 people based in Cathay bases in New York, San Francisco and Los Angeles face the loss of government retirement payouts and post-retirement health care insurance protection.
The airline says that for several years it had mistakenly contributed to a benefits scheme provided by the US government. Now Cathay has told the employees that it is exempt from such payments as it is a non-American employer with staff working on non-American registered aircraft.
“We understand that we have no alternative but to comply with the US tax law and regulation,” the airline told staff in a letter.
The company unilaterally, without notice, made this decision for the cabin crew, permanently jeopardising their retirement
And in a response to the Post, a spokeswoman said contributing to the scheme would not be lawful.