Exclusive | HK Express pilots face pay cuts, non-flying staff asked to take unpaid leave, as budget carrier battles to stay afloat
- Airline’s CEO reveals she and senior directors will take 15 per cent drop in pay
- Pilots facing up to 40 per cent loss in income in new take-it-or-leave-it contracts
Simon Wu, director of operations at HK Express, told pilots in an internal memo their salaries would be reduced by 25 to 40 per cent when they were not flying, and by “an estimated” 8 to 14 per cent if average flight times were 70 hours monthly.
In appealing for employees to help out, Mandy Ng Kit-man, the airline’s CEO, told staff in the memo that the carrier still had a long way to go, “with many challenges ahead of us, and regrettably, what we have done so far is not enough to secure our future”.
She added: “This is not something I ask from you lightly. The past year has been a real test of our resilience.”
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Cathay Pacific Airways announces its largest job cuts in history
Ng said she would take a 15 per cent pay cut through 2021, while senior directors would take a reduction of the same amount for the first six months of next year.
HK Express has around 200 pilots, and more than 1,000 employees in total.
HK Express is expected to play an even bigger role in serving Asia, filling the void created by the closure of Cathay Dragon. It mainly flies to Northeast Asia, notably Japan, and a handful of Southeast Asian routes.
HK Express took at least HK$28 million in government wage subsidies on the basis it would not lay off staff. It has since applied for a second round of support.
Pilots at Cathay Pacific suffered pay cuts of between 40 to 60 per cent, with the more experienced ones hit hardest, while the airline said cabin crew had been asked to take as much as a 29 per cent cut.
HK Express pilots will no longer get paid for at least 50 flying hours a month in productivity pay, and will instead receive a basic salary, wages for actual flying hours and allowances.
A captain with more than 3,000 hours of experience will see basic pay fall to HK$57,000 a month from HK$75,000. Allowances will be trimmed to HK$22,000 from HK$24,000 and the removal of the 50-hour productivity pay will save the airline HK$33,000 per captain each month and HK$22,000 for junior pilots.
A captain will see his total pay fall from HK$132,000 to HK$79,000 a month.
Pilots were asked to give “consent” by November 30 for the new contracts, which would take effect from January 1 next year.
Wu added: “Your support in consenting to the Cockpit Crew [contract] 2021 and commitment to HK Express will make all the difference.
“We remain committed to business continuity and operational efficiencies to keep the team intact.”
To pare back costs, HK Express has delayed non-critical spending and reduced capital expenditure while putting more focus on productivity and cost-saving, including pressing suppliers for more favourable payment arrangements, according to the airline’s CEO.
A pilot who wished to remain anonymous said the company was offering no transitional financial support for the pay cut, in contrast to Cathay’s offers to its pilots.
“Many colleagues will be forced to move our families out of Hong Kong as soon as the aviation situation improves. [The pay package] is not enough for an expat family with two kids,” the pilot said.
