Interview:
ALU What is the state of relations between your members and Cathay Pacific?
JF In the early nineties Cathay decided on cost cutting measures. For years they hadn’t applied much in the way of cost controls, they were making too much money and were too busy counting it. [laughter] To be fair I think they needed to do it but the way they went about it was all wrong, and they haven’t learned from the errors of their ways over the years.
Really all they have done is to succeed in alienating what was probably the most dedicated group of pilots in the world. Pilots don’t just fly aeroplanes for money; a pilot traditionally would work towards a major airline, and having made it to a major airline he or she will stay there for their whole career, so for people to give up the potential of working for a major airline in their own country and come to live in Hong Kong, especially before 1997, airlines had to make it attractive for them to come here. So if people commit to Hong Kong, once they are here, the company knows that to some extent it can blackmail them.
Seniority is the guiding principle in pilot’s lives. You work for an airline starting at the bottom and work your way upwards. This works for the companies as well. Regarding the investment needed to train pilots, the company also does not want high staff turnover, but they know if they really want to attack the staff, reducing salaries or making them work longer hours, many people say well if they don’t like it they can always go, but if they leave they have to start at the bottom again. I cannot think of another profession where this doesn’t apply - doctors, solicitors, accountants, and even Cathay managers and Director, usually only move for promotion and more money.
Since I arrived here around ten years ago, this is the first time we have taken industrial action. Indeed, in its 37 year history, the HKAOA has never before taken industrial action.
ALU In 1999, didn’t you take industrial action?
JF This present dispute dates back to 1999, but the pilots didn’t take industrial action, Cathay did. They said if you don’t sign this new contract that we know you don’t want, and there were pay cuts of up to 28 percent involved, they would sack the pilots; that is industrial action in my book. And at the time people were hugely worried about the prospect of finding another job, their families welfare, children being forced to leave schools, etc.
Our members were suffering stress due to worrying about the job - you can imagine when they went to work they worried ‘am I going to get fired’, and that is not a safe working environment. So we advised our members to consult their doctor if they were feeling stressed, because the law relating to aviation in Hong Kong is very specific, it says a pilot may not operate if he is, or thinks he is, unfit to fly. Some doctors say even if the thought just crosses your mind, you are not fit.
So we told them to see the doctors, and the doctors said ‘you are not fit to fly’. So all the pilots who weren’t flying in 1999 were doing so on the strength of doctors’ notes - the majority of them were Cathay Pacific’s own doctors. And it caused a huge amount of disruption. Cathay took the industrial action and they were the cause of the considerable disruption to service.
The dispute was never sorted out properly. We were prepared to negotiate salary cuts, improved productivity etc., but Cathay said that finances were bad. We said that we didn’t believe them and asked for proof. We thought they were over the worst of the Asian recession. But they refused to give us their own forecast about the way the company was going, and our view was that in 1999 Cathay would make a profit and increased profits as time went on. Their argument was that they would make a loss in 1999, might just break even in 2000, but would not be in the black until 2001. We just did not believe them, the figures available seemed optimistic, and events proved us right - they made HK$2 billion profit in 1999, and over $5 billion in 2000. This demonstrates that what we were saying in 1999 was true and what they were saying was not. They knew they were going to make a profit, but they used the recession - they use anything they can - to convince staff - of all grades - that Cathay is in trouble, ‘You better not be after pay rises or we might have to make redundancies,’ - they rule by fear.
So as part of the deal in 1999, there were pay cuts for grades on A-Scale, those employed before April 1993, and small pay rises for B-Scale. From that agreement a three percent rise was agreed for this year for the post-93 pilots, subject to review in the light of Hong Kong’s economy and subject to the company’s performance. We say that with HK$7 billion profit over the last two years, the three percent should be increased and because of a disparity between the two scales we wanted to have an improvement in the captains’ salary scales for the B-Sale, which the company admitted were below industry norms. And there was also an agreement that we would recommence talks on rostering by the end of October 1999.
After over 50 meetings we just couldn’t get anywhere with them, and that really was the precursor to this year’s dispute. When we asked them to talk about improving B-Scale’s three percent this year, we said we would like to talk about other items related to salary and pensions, and they agreed to talk about it. They even offered an increase using an hourly payment for extra hours flown over the contractual maximum. So, instead of taking the third year cut, they actually agreed to make more money available for the old A-Scale grades who would have to fly more hours, and they offered that without us asking for it. Yet they have the nerve to say that we broke the 1999 agreement. Well I am asking them, ‘Where did we break it?’ - We didn’t break it at all.
We had talks with the [Hong Kong government] Labour Department this year as we did in 1999, and at those talks we couldn’t make progress. So here we are in dispute.
ALU How are government departments to deal with?
JF I find them totally neglectful of their duties. We have approached the Chief Executive, Tung Chee-hwa, Sandra Lee [Secretary for Economic Services], and Selina Chow from the Tourist Association. Just a few weeks ago, they all said the pilots should be getting back to work, they shouldn’t be causing a dispute, and they are the best paid pilots in the world - which is factually incorrect. Fifteen years ago, there is no question that our pilots were the best paid in the world, but not now. Post-1997 there is not the uncertainty there was. So you don’t have to pay expatriates so much to live and work in Hong Kong, and we accept that. But this isn’t a pay issue, it is about rostering; it is about contract abuse.
For example two senior officers in this company; both are relief-captain-qualified, they both fly the same aircraft, they do exactly the same job, and one of them gets 40 percent less money than the other. This came about after April 1993 when they said, ‘we can get pilots here for less money than we are paying and we are going to do it.’ And they did, and the union didn’t resist it.