Conditions of Service Negotiations...Current Status?

[LOTW]

What is the current status in Conditions of Service negotiations between the pilots and management at CX?

Are the negotiation just beginning with years to go, in the middle or at the conclusion of negotiations?

What is the consensus of the gains to be made in pay, schedule and blah, blah, blah.

[Numero Crunchero]

Just at the beginning of 2 months of negotiations. First pay negotiations in 6 years. No discussions on rostering as that is done separately.

Like a long haul flight, bit hard to say at the beginning what the landing is going to be like!

[Sqwak7700]

Might be so, but that doesn't solve the problem they have of not filling interview slots in NA. The company has a problem with attracting, and retaining. They can give a pay cut if they want, but that will only make their problem worse.

I'm sure there will be a pay rise and some sort of improvement on the current situation. The question is wether it will be enough to fix their staffing problem. NR might be "wishing" that raising the retirement age alone would bring some back from Oasis, but I think the bigger portion of the problem is filling the bottom of the glass, not keeping the top full.

Raising the retirement age is only a stop gap, and if anything, will require a bigger raise to attract new joiners. After all, if they are having trouble attracting people when the upgrade on the Freighter is arround 2 years and the passenger is arround 10years, then it will only get worse for them when it is raised by going to age 60 (maybe 65) retirement. :hmm:

[BuzzBox]

I agree with Numero. They'll talk and talk and talk and talk and not come to any negotiated agreement. The company will then 'offer' the package they were always intending to offer, take it or leave it. As Numero said, that's how it has played out in every 'negotiation' in recent memory.

[Mr. Bloggs]

Yes, most likely to give a sign or be fired or take it or leave it, etc, etc………………….it’s the Cathay way.

However, it is up to each and every one of you to sign off on it. My speculation is the pilots will sell their soul for a small pay rise.

They will agree to working beyond 55 for less than they have now, the freighter flying will be integrated into the COS but on a lower pay scale (no money in freight and still can’t figure out why UPS and Fed Ex pay so much), DEFO’s will be entering the system on less pay then now (common pay scale), monthly hours will be increased and probably just about anything else CX wants.

Will that mean there will be a common pay scale for Captains? If it is good enough for the First Officers then it must be good enough for the Captains. We should be working to reduce all the pay scales and have just three, one for Captains, First Officers and Second Officers. If it is more, the company wins.

However next pay negotiations will promise A Scale Captains salary, oh yes that was offered before or so says the DFO and the pilots believed him.

As you can tell, I don’t hold much hope. Back to contract compliance.:}:}

[Numero Crunchero]

Mr Bloggs...sounds like you have a listening device in the negotiations!

[Sqwak7700]

this company is REactive, not PROactive.
I agree with you there NC. But, I believe they have reached the point of reaction. The Fire has already started because they didn't do enything when they could have. For example, maybe not have offered such a ****ty deal back when COS 07 was up for a vote. That would have been proactive.
Now, the precedent has been set and enough people have voted with their feet. And that is with our present situation. So, now comes their reaction to the fire. Not only does their action have to put out the flames, but in this time of rapid expansion, they are gonna have to spend lots on preventing it from flaring up again so that this expansion goes smoothly.
Check the last ATW. On the statistics in the back, you will see an airline with the highest growth rate in the world for the year of 2006. That was Cathay Pacific at 33%. They've already stated that they intend to double in 5 years. And they are in the process of placing a major order for either 748fs or 777fs.
I honestly think the winds ore on our tails. Regardless of what happens here, in today's market, I don't think guys are hesitating to leave if it doesn't improve drastically. There are just too many options out there, unlike when the 49rer deal went down. I know that I would not hesitate myself. I've even dusted off the ol' resume and have started crunching numbers in the log-book.
Everyone here should, it is our only barganing chip.:ok:

[geh065]

There has been much talk of what % of a pay rise we would need to merely cover inflation since our last pay rise. Does anyone actually have the figures of year on year Hong Kong inflation? We had deflation for a couple of years, so I would be interested in seeing the actual % of pay rise we would need to merely counter inflation.

[LapSap]

I can't wait to hear what The Management have to say.:E

[7FF]

I feel that the Swire Management would rather bleed to death in the gutter than give us a pay rise and/or better COS. If they cannot find the crews then they will simply limit the expansion. Remember they are still effectively a privately owned company and as long as we make money, some money, then they will be happy. I don't think the Swires view CX as a world dominant airline. Small, neat and fairly profitable.:E
The answer is NO now what was the question..........

[Freehills]

You can get inflation data here

http://www.censtatd.gov.hk/

Series C (for high income families) is probably the most appropriate - covers the spending of the top 10% of HK household

Since B scales started

1993 83.6
1994 92.0
1995 100.6
1996 107.2
1997 113.7
1998 117.3
1999 112.9
2000 108.0
2001 106.3
2002 103.3
2003 100.3
2004 99.6
2005 100.3
2006 102.6
2007 104 (April)

So price level now about the same as it was in 2001/2 or 95/96

Makes sense, a friend came to stay who hadn't been in HK since 1997, his comments were that HK was cheaper than ten years ago.

[jtr]

"Series C (for high income families) is probably the most appropriate - covers the spending of the top 10% of HK household"

How many of us fit into that category?

[geh065]

So price levels the same as 2001 which is when our last previously agreed B scale pay increase was? Does that mean we have not really lost out to inflation at all?

[Freehills]

JTR - C households spend in the range of $28,200-$61,500, so yes, probably covers most of us - rental puts most of us in there by itself.

geh065 - On the face of it, true. However, someone might want to see if there is an expat inflation index, might be different

Of course, if you measure the salary in ozzie dollars or UKP, a different story, but that is a different argument

[jtr]

Thanks for the reply. Looks like a good example of an exponential curve. I personally fall off the lower end of the range, as would most/all commuters I suppose, but I guess if you factor in how much is spent in your home country then it is all evened out.

<Sits back and tears the top off another equiv HKD30 can of beer>

[Ex Douglas Driver]

This is the year-on-year percentage change of the CPI(C) scale with the index on the right:
1993 +9.5% 83.6
1994 +10.0% 92.0
1995 +9.6% 100.6
1996 +6.6% 107.2
1997 +6.1% 113.7
1998 +3.2% 117.3
1999 -3.7% 112.9
2000 -4.5% 108.8
2001 -1.5% 106.3
2002 -2.8% 103.3
2003 -2.9% 100.3
2004 -0.9% 99.6
2005 +0.8% 100.3
2006 +2.2% 102.6 (Website data incorrectly shows -5.7%)
CPI has increased by 31.7% from 1993 to the end of 2006.
CPI has decreased by 5.1% from 2001 to 2006. Don't forget the significant world events between 2001 and 2005, and that we're expanding...
Data from: http://www.censtatd.gov.hk/hong_kong_statistics/statistical_tables/index.jsp?charsetID=1&tableID=052

[Dan Winterland]

And it would be fine if all of us didn't have commitments in our home countrys. But as most of us do, and in my home country the real inflation rate (as opposed to what the government tells us) is about 6%, we are losing out. And don't even get me started on the exchange rate!

The airline I left this place for has had about a 45% pay rise since I resigned. Here - diddy squat!

This is where the market forces are. HK is not an attractive option financially. Pilots just aren't going to the interviews - and people are leaving for the better packages and working conditions at home and on other expat contracts.. Something will have to be done soon or serious damage will be done to the operation.

[Captain Don Quixote]

Cathay was always supposed to be the dream job. Right now my job options are virgin blue, qantas, jet star and cx. Even allowing for tax what I dont get is why I would take a 50% pay cut to move to hkg as a Second Officer when I am told it costs a lot more to live up in Hong Kong. But what I find stranger is why I would take a 20-30% pay cut to stay in Australia and work for Cathay here on a basing?
Unless I have got this wrong, my choices are, take a big paycut, give up all legal and industrial protection, take 9+ years to command, be subject to incredibley weak Hong Kong dollar. Or, take a slightly lower starting salary, take 2-4 years longer to command, be able to control which aircraft and which base I am on based on my seniority. Control my lifestyle and my pay with my seniority and earn about $100,000 more a year 15 years from now in Qantas than I would in Cathay and earn more money over a career.

Like I said I dont get it?

Could one of you Cathay types tell me what it is I am missing? It just seems so bloody obvious that CX is ****e compared to QF in terms of career earnings and lifestyle.

Before I get 'flamed' I do have friends in both organisations so am not completely ignorant!

[C-152Captain]

Could one of you Cathay types tell me what it is I am missing? It just seems so bloody obvious that CX is ****e compared to QF in terms of career earnings and lifestyle.

Cathay is more glamorous, and we have the best pilot group who can take more ****e than any other pilot groups in the world.

[superfrozo]

One reason to chose CX over QF:

You don't have to call some pompous pr!ck "skipper" to stroke his/her ego..!!:} (you just call the pompous pr!ck by his/her first name instead!!!)

Not that I had a choice, I can't fold cubes like the Mensa members at QF:{

[Veruka Salt]

Don,

It's not true that CX is ****e compared to QF in terms of career earnings and lifestyle.

Oz based CX F/Os take home around the same as a mainline QF F/O (excluding the -400 of course :hmm:)

They get a hell of a lot more days off then 767 drivers, don't have to pay into their own super (As in division 3 Qantas. Instead, they get 15.5% company contributions), don't pay tax on their allowances, get private health insurance through MBF paid by the company (worth around $2500/yr net to anyone with a family), get the medicare levy reimbursed and still get commands after 8 years. They don't get to salary package cars or computers though :(.

They're paid in Oz dollars, so the relative weakness of the HK dollar is irrelevant.

VS.

[Captain Don Quixote]

Hi veruka,
thanks for that. One mate has been in QF for 11 years now. He is earning $250K as a 400FO. But as you said he has to pay 5% into his super. He said his payout should be around $1.5million aussie. He said his allowances aren't taxed and he gets around $20,000 per year. Another mate who happens to be on a basing as a Captain says he is on $204K as a 2 year CN and he has been in Cathay for 10 years and he said his allowances would be around $10K and also not taxed.

So FO on $250K paying 5% - get $1.5M super - $20K in allowances tax free

or 2 yr CN -$204K get 15.5% topay who knows how much at 55, $10K in allowances and free medical.

Like I said, seems like an absolute no brainer to me! By the way, the Qantas guy gets more days off than the Cathay CN! Once he starts getting senior his salary will start going up! Junior 400 CNs get $300K, senior ones get up to $400K.

Think I will study the mensa tests!

[Harbour Dweller]

Captain Don Quixote,

One mate has been in QF for 11 years now. He is earning $250K as a 400FO

Your overlooking the obvious. Do you think your going to make B744 FO in 11yrs at current promotion rates in QF?

Forget the Mensa. :eek:

[Captain Don Quixote]

Harbour Dweller,
good point. If I stayed on the 400 as an SO I would be earning $30-$50K a year more than a Cathay FO with more days off as well. If I go onto the 737 or 767 as an FO I will get slightly more money but the days off will drop back. No matter what, I will be on more money, just not sure which seat of which aircraft.

Qantas has had a quiet time for last few years but they have a huge training plan in place for the next few years. Prospective new recruits are being told commands would be 10-11 years on 737/767. Current salary on those fleets are well in excess of CX salaries.

I thought there must have been some 'X' factor I was missing why people went to CX - but no one has told me anything on this thread that makes me see why it makes sense.

My command will take a couple of years longer, my pay will most probably be higher for most of the first decade and then accelerate way ahead of Cathay after that. My Super is defined benefit. My allowances are twice the amount. I get long service leave, industrial protection and clean air. I think I can put up with calling the captain skipper for a while.

My Qantas mates don't have any real problems with the training system either versus some pretty 'interesting' stories from Cathay!

Back to my cube folding books!

[Wine Glass]

There is some selective cherry picking of job attributes going on here. Some are blending attributes of a CX Aus basing with that of a HK basing to paint a rosy picture to support their argument. Compare apples to apples!
CX command IS about 8 years, unlike QF which is ....? However, that is IF YOU ARE PREPARED TO RELOCATE YOUR FAMILY TO HK, OR COMMUTE. If you enter as a DEFO on a basing, and are not willing to uproot the family (a situation now comparible to your equivelent QF pilot based permanantly in OZ), your time to command will be significantly longer on the base.
There are three factors at work.
(1) Since the option of staying on the base as an FO and waiting for command has been introduced, plenty of FO's are electing to do just that. This will significantly increase a based individual's time to command. Effectively, a based FO will have to choose lifestyle (stay) or career (HK base) at the time that a HK command becomes available.
(2) Generally getting an Aus base was relatively easy. Now that CX is recruiting plenty of bodies into these positions, I predict they will become a lot more elusive. This will increase their perceived value and people will be reticent to give one up for fear of difficulty in getting one again in the future. Result - people will exercise the option now available of sitting out on a base as an FO rather than relocating to HK/commuting for what shapes up to be a hell of a long time before a based command becomes available.
(3) Retirement age will almost certainly increase to 65. This is a BIG issue. Retirement age 55 is one of the factors that keeps the time to command at CX favourable compared to other airlines...look at QF. People commonly laugh at these geriatric QF -400 captains. When CX introduce age 65, all those captains who are sitting happily on a base aint going to go anywhere; why would they? So now, the guys in the based command slots are going to each spend an extra TEN YEARS holding that slot. Think about what that will do to time to command for a DEFO entrant who is not willing to relocate the family to HK (think children and schooling, established home, wifey's social life etc).
CX definitely has it's advantages over QF if you are considering one over the other. Just make sure you understand what you may have to do in order to achieve some of those advantages. Then you will create a much more level playing field to compare jobs. :)

[Veruka Salt]

Don,

Your mate is imbellishing his earnings a little.

As an 11th yr -400 F/O he is on 11th or 12th yr pay.

12th yr pay is the highest pay tier under the longhaul certified agreement, so his only pay increases will be from EBA increments.

He is also a very junior -400 F/O so he is not in a position to pick the eyes out of the high overtime trips to maximise his earnings. As a rotator he would be doing his fair share of standbys and sim supports which do not attract any overtime, of course. A good friend of mine is the second most junior -400 F/O, joined in late 1996, and assures me he doesn't earn $250K per year.:cool:

As an 11th yr F/O he is a hell of a long way off a mainline command - his only choice for a command inside the next 5 or so years would be Jetstar, as 9 of his colleagues of similar seniority have just done. I vaguely recall that the last 2 767 command allocations went to guys with starting dates of around 1987.

With regards to future commands on the 737 or 767. . . . ?

The 767 is slated for replacement by 2012. A new joiner today will not get a command on the 767 because the aircraft will be gone by the time he or she is senior enough for a command. They are to be replaced by the 787. These will not be flown at current Qantas rates. They will either be flown by Jetstar crew, or by mainline crew who agree to fly them for Jetstar rates. . . . or on AWAs.

A 737 command therefore will become even more senior than it is currently, and at 11yrs seniority he is still a long way off.

Your defined benefit superannuation payout is based on your final average salary. Unless you are being paid at command rates, it costs more to contribute 5% of net earnings then it is to invest 15.5% of company contributions (not a cent of your own money) into a retail super fund, returning around 18% historically.

As a -400 S/O you will not be earning $30-50K more than an Oz based CX F/O and getting more days off. You'll be earning the same dough for the same days off. I know, 'cos I've done both jobs! One of them is a hell of a lot better though. . . .:}

This is an interesting discussion, but I think you've jumped to some hasty conclusions. No guarantee you'll get a start as a -400 S/O either. A330 S/Os do much worse than -400 S/Os.

Wine glass makes some good points.

VS.

[The Messiah]

If you want to live in Oz and pay Oz tax then QF is the go, without doubt in my opinion, if you can handle Hong Kong and want to make some money (housing allowance) then CX is a better option.

Oz is always an option years later either as a base with CX or another carrier or even career change. You should be able to do it with no mortgage which really beats the QF option.

[jtr]

it costs more to contribute 5% of net earnings then it is to invest 15.5% of company contributions (not a cent of your own money) into a retail super fund, returning around 18% historically.

It is obviously quite subjective, but given a basket of funds over say 10 years (or 20) I think 18% might be a touch excessive. - Unless of course you have been picking all the Italy/Indonesia/Em. Markets etc in which case where do I sign up for your info?

[Jimothy]

Don
If you are not yet in Qantas your Super will not be a Defined Benefit. You will join an Accumulation Scheme. This changed sometime ago - pre 2004.
No one can predict over the long term which will offer the most returns. There are just too many variables such as airline expansion (Jetstar), promotions, retirement ages, changes to super rules, changes to industrial laws (Work Choices!), Asian meltdown, Sars, over capacity, pilot shortages etc etc...................
That being said, I believe a CX DEFO slot based in Oz beats a QF SO position hands down. So that covers the first 8-10 years, after that who knows?!
New joiners to Qf also stand a very good chance of endinging up on the A330, this means a lower hourly pay rate than the -400 and no where near as much overtime as the -400. You get NO choice about which fleet you go to.
A mate of mine who is an SO with Qf on the -400 loves to tell everyone how much he earns, however he also fails to tell them the figure he is quoting includes the companies Super contributions and all of his allowances.

[ULRequalsSLEEP]

There's always rumours...but which ones are true?

Here's a question? What would it take for FOs and SOs to vote for a deal that had RA 60 in it? From the Crews News spin over the last few years it is obvious that management have assumed we would all love the opportunity to work closer to our death date. Solves the PF problem.

There will be up to 290+(2013) retained CNs if RA60 is introduced or up to 500+ (2017) if RA65 is introduced. Obviously medicals, financial independance, mortality beyond age 55 etc will reduce the total number.

Hopefully someone can explain to me how it is good for FOs to have 290+ or 500+ of us old farts hanging around!?

FOs and SOs
Quick commands in the past were due to faster turnover RA55 induced. If you want to work more years by accepting RA60/65 make sure you know what you are trading it for. There is no point getting the same career earnings at age 58 that you could have got at age 55 with RA55. You are 3 years closer to death with no net financial gain. You have effectively worked for free for 3 years.

[geh065]

I am hearing that things are progressing very slowly and that they have a long way to go till they meet in the middle given that the offer/request is so far apart.

[BusyB]

As far as retirement age goes you really need to think it through. In most jurisdictions age discrimination is, or is going to be, illegal. If the AOA should negotiate a compensation arrangement and you vote it down, CX will just change it as the law changes and you won't get any compensation.

Not disimilar to what BA FO's experienced when 3 pilot aircraft were changed for 2 pilot ones. Twice as many FO's as needed so commands went to 24 years! At least its nowhere near as bad as that.:ok:

[ULRequalsSLEEP]

True Busy B if HKG decides to change its labour laws to fall in line with the western world. CX can simply take all bases back onshore if it becomes an age discrimination problem between HKG and the bases. It would save them a fortune in salaries anyway with current exchange rates, but they would lose on housing and benefits.

In the meantime, if CX is 'forced' to let us work to RA60/65, gee they might not be able to cut the salary, the housing, remove education and medical benefits - gosh, thats a big loss to all our 54 year olds!!!!

So vote for a certain rogering or take the chance on a maybe rogering...call me wussy but I will take the maybe!

[willnotcomply]

Management will use recent low inflation(previously deflation) stats to justify their stance for negligible increases to HK salaries. This will be front and centre in their take it or leave it sales pitch. When it comes to bases though, management are keen to forget about inflation.And if you are CX, why not. That would suggest a pay increase. Proof of course is the discrepancy between CX and QF salaries. Probably fair to say that the QF FO is about $40,000 better off than his CX counterpart, thats conservative. Guess what? Inflation has been consistent in OZ for many years now. That means that a garbage collector, tradesperson, nurse and everyone else you can think of, has seen consistent wage growth throughout the last decade, courtesy of inflation. Everyone except a CX pilot. At current rates, CX will never catch QF in Australia. Have a look at the LCC's, they are even catching up to CX. Until everybody unites in refusing to take it up the ass, you will all have alot more to complain about. Stand up and be counted for once. The other option of course is to join the opposition. It may literally be a breath of fresh air.

[ULRequalsSLEEP]

willnotcomply
Here are some more accurate numbers. I must say the first year or so at QF confuses me as to when you come off training pay etc. So to compare 'apples with apples' I will start with year 3. CX includes full HDP and ADB(13th month) - no tax taken out. HKG 16% flat, Oz - lots!

Year 3
CX $83,000(SO3)
QF $130,000(SO3-744)

Year 6
CX $135,000(FO2)
QF $140,000(FO6 -767)

Year 10
CX $204,000(CN1)
QF $198,000(FO10 -744)

Year 15
CX $221,000 (SCN 3)
QF $230,000 (CN12 - 767)

Year 20
CX $243,000 (SCN 8)
QF $300,000 (CN12 -744)

The QF numbers apply to junior permanent line holders - ie, people on the 70th percentile in the fleet and rank.

There are extremes - senior 744 SOs are on up to $180K. 744 FOs are on $230K (taking out allowances). Senior 400CNs on up to $400K. 50th percentile 400 CNs are on $340-350K.

For CX Oz basings, FOs earn from $127-158K pa including HDP. CNs earn from $208-$296K(19increments).

[BlunderBus]

Interesting to see that over the last 10-12 years the airline has battered conditions and salary to death...and 'summarily executed' 49 guys.You may want to consider where you will be in a few years time as are the guys who have been here longer than you.The company has shown with wonderful clarity that the longer you stay the worse it gets....salaries,duty time,crewing,...and if you stand up against them they'll whack you....en masse.Best of a bad bunch?..maybe...but that doesn't make it right.
The entire 55 retirement thing is designed to erase any retirement benefits beyond that age..."we'd like you to stay but you got to b*gger off on B pay limited benefits and endure a roster designed to flummox the hardiest s/o on freighters...oh yes..by the way thanks for the last 20 years loyal service".....adios boys..good luck with your crewing.

[jumpseat]

Blunderbus dear fellow, you have hit the nail on the head. If anyone in CX thinks for one second that things aren't going to get worse in the harbour, they are strangely deluded.
History speaks for itself. The COS at CX has detoriated in the last 20 years from one of the best to one of the worst. There is good reason to believe that this decline will continue, if not accelerate.
The numbers being crunched on this site are meaningless whilst CX conditions head south and operators in Europe etc.. like Thomsonfly, Netjets, Virgin are constantly reviewing their contracts to the better.
Whilst you stay at CX your ability to look after your family and eventually yourself in retirement diminishes. If you join CX now, you will have entered a downward spiral, wishing you had stayed where you were, because no matter how much better CX may seem now, it will eventually turn out to be have been the worst option.
The pilots who have been here the longest are the very pilots that NPR and his cohorts are hanging out to dry. It will happen to everyone here at CX, dont doubt it. You think your salary (package) is low now? Look at the package about 20 years ago, the current package is worth about a third in real terms.
Pensions have all but dissappeared as inflation eats into salaries that are actually decreasing ( never mind keeping pace with inflation )
The completely immoral attitude towards pilots aged 55+, paying age 55+ pilots , less than they were earning pre 55, ( with no pension contribution) and the illegality of the employment COS in virtually every jurisdiction except HK and the failure of CX to increase salaries to keep pace with inflation should be a volumous warning to anyone wishing to join CX.
It will only get worse.

[Numero Crunchero]

Veruka Salt,
please let us know the fund that gives you 18%. Especially if it is guaranteed over 20-30 years. I suspect you have enjoyed some short term success. Good luck to you and enjoy it.

Unfortunately what I have learnt is that the top quartile performers of this five years are invariably the bottom quartile performers of the next five years. Regression to the mean!

18% -hmmmm. Well the DJIA has gone up on average about 11.0% pa since 1983. It has gone up about 6.3% pa since 1966.

So what? Ok, one more statistic. From 1966 to 1983(17years) the DJIA went up on average 0% pa(thats right, was 1000 in 1966 and then 1000 in 1983).

ANd by the way, none of the figures above take into account inflation. I would take out at least 3% a year to get 'real' returns.

My point; don't compare 15.5% PF contributions combined with 18% returns with a defined benefit scheme. Not really a fair comparison especially when your assumptions are so blatantly unsupportable.

What would be relevant to compare is the new QF PF scheme that someone said exists?

[SIC]

Blunderbus and Jumpseat - I am afraid you are right....

and to make things worse

.....Qantas is building a new flight school I hear. To supply them with 3000 new guys in next ten years. I have a feeling others will follow in the west - follow the example of Airlines in China/ Indonesia/ Malaysia who figured out that hiring a 20 year old - giving him a license and signing him up for 20 years with a huge bond and a very low starting salary is much more economical than hiring already experienced guys at high salaries.

That my friends seem to be the future of professional aviation - airline cadet schemes creating young automatons signed up for life long subjugation.
" What pilot shortage ?" I hear management say " we just make them ourselves - and cheap too...."