Cathay strike fallout

WITH the Cathay Pacific dispute over and management crippling the Flight Attendants' Union (FAU), managing director Rod Eddington may find he has won a pyrrhic victory.

Whatever sympathy Cathay management may have had at the start may have turned in favour of the flight attendants because of its hard-nosed approach in insisting on the right to discipline and even dismiss strikers. For its part, the FAU also lost some public support when outside trade unions became involved, giving the impression that they were manipulating the dispute.

Initial estimates put the immediate cost of the strike at up to $200 million in lost revenues. However the damage to an airline that has built its image around the smiling faces of flight attendants from 10 Asian lands will be more difficult to measure. Mr Eddington has already admitted that the strike has caused substantial long-term damage to the company's image. Just how detrimental will depend on how the airline handles the process of disciplining striking members who have agreed to return to work.

Mr Eddington has given assurances that beyond the disciplinary measures management has always insisted it has a right to take, there will be no victimisation of staff. A Legislative Council committee set up to oversee the matter will ensure he delivers on that pledge. While the committee's powers are not binding, it should prove an effective watchdog. The dispute has also put labour law at the top of the Legco political agenda. Reform is as likely to guarantee the right to strike and curb the rights of management to dismiss workers as to outlaw wildcat actions and enforce strike-ballots.

More ominously for Cathay, legislator Mr Chim Pui-chung has already seized the opportunity to attack the Government's protectionist aviation policy in its favour. His move will delight Western carriers demanding the right to pick up passengers in Hongkong for a share of the lucrative short-haul Asian market. It could prove attractive even to some of China's new regional airlines.

While Mr Chim's move may not succeed, it is an indication of how much Cathay stands to lose if its popularity takes a dip.