Bosses' group criticised for 2.5pc proposal Cathay Pacific staff will receive a pay rise of 4 to 5 per cent, the airline said yesterday - prompting criticism of an employers' group that recommended a 2.5 per cent cap on increases. The increase, which takes effect on January 1, will be Cathay's biggest since the handover. A spokeswoman said stable passenger growth and an increase in the airline's network of destinations had contributed to the company's good performance this year. All office personnel, ground handling staff and cabin crew will benefit. Junior staff will receive an increase of 5 per cent, while employees at middle to senior level will get an extra 4 to 5 per cent. Pilots are not included in the package because they are governed by a different pay structure. A local newspaper reported that HSBC would reward staff with an average pay rise of more than 4 per cent in the coming year, but a bank spokeswoman declined to comment. She said an internal circular illustrating the overall adjustment policy would be distributed within the bank soon. It is understood the bank will announce a pay rise in the circular but link salary increases to individual performances. Edmond So Wai-chung, general manager of Besteam Personnel Consultancy, said the pay rise at Cathay Pacific was in line with proposals of many corporations. He said it was a reflection that the robust economy meant people were able to change jobs easily. 'Many of the large corporates plan to give pay rises of about 5 per cent, which is slightly higher than the estimated upcoming inflation rate of 3 per cent.' Mr So said the recommendation made in October by the Employers' Federation of Hong Kong to cap salary increases at 2.5 per cent was too conservative. 'Companies may find themselves facing a loss of staff if they remain too prudent on the pay-rise scale.' The federation's chairman, James Ng Chi-ming, justified the suggestion by saying that the economic environment across the Pacific was not too good and that the US home price index had sunk to a 10-year low. Its vice-chairman, Brian Renwick, said business leaders should protect their companies against economic downturns. Legislator Wong Kwok-hing welcomed the pay rise proposed by Cathay Pacific, saying the increase could help workers feeling the effects of rising inflation. 'The airline should also consider giving bonuses to staff with good performance to boost their morale.' Mr Wong also commented on the recommendation by the Employers' Federation, saying it was simply too mean. 'The announcement by Cathay Pacific yesterday showed that the federation's recommendation is unreasonable. It is not even enough to write off the extra expenses from inflation.' Hong Kong's 155,000 civil servants were given a pay rise of about 4 to 5 per cent in July.