Negotiations Update
Ladies and Gentlemen
Negotiations with the Company have concluded. The HKAOA Negotiating
team has put the proposal to the General Committee, which will now
decide whether to recommend the proposal to the membership.
Time line
The estimated time line for this process is as follows:
• GC advice communicated to the Membership by mid-August.
• Voting opens 12 September
• Voting closes 15 October
Contents of The Proposal
The Proposal covers 5 main elements, which are offered together as a
package. Assuming the GC endorses the Proposal, you will receive
detailed information on all aspects of what is a wide-ranging deal. What
follows is an outline of the essential elements, which are:
• Pay
• Retirement Age
• Direct Entrant First Officer Recruitment
• Closure of ASL
• Miscellaneous Items
Pay
This is a 2 year deal, commencing 1 Jan 2008. There are increases to:
• HDP for all scales,
• B Scales and
• Freighter Scales
The tables below depict the Pay offer. Figures are based on 84 credit hours per month. The ‘Total’ column is an estimate for the total increase over the life of the deal, based on 2007 salary + HDP at 84 Hrs.
1 Jan 08 / 1 Jan 09 / Total
B Scale
AUS
Scale 3.0% / 3.0%
HDP 2.0% / 2.0% /11.5%
PFund HDP 0% / 1.5%
EUR
Scale 4.0% / 4.0%
HDP 2.0% / 2.0% /13.5%
PFund HDP 0% / 1.5%
NZ
Scale 0% / 2.0%
HDP 2.0% / 2.0% /7.5%
PFund HDP 0% / 1.5%
CAN
Scale 0% / 2.0%
HDP 2.0% / 2.0% /7.5%
PFund HDP 0% / 1.5%
USAB
Scale 0% / 0%
HDP 2.0% / 2.0% /5.5%
PFund HDP 0% / 1.5%
HKG
Scale 3.0% / 3.0%
HDP 2.0% / 2.0% /11.5%
PFund HDP 0% / 1.5%
*HKG CNs
As per HKG + change to increment gradient
/11.5% - 14.8%
*In addition to the increases outlined, the 19 HKG B Scale Command pay points will be adjusted so that each increment is 2%. This results in additional uplift ranging from 0% for HKG CN1 to 3.3% for HKG SCN17
1 Jan 08 / 1 Jan 09 / Total
Freighter
AUS
Scale 0% / 2.75%
HDP 2.6% / 2.3% /9.4%
PFund HDP 0% / 1.8%
EUR
Scale 4.0% / 4.0%
HDP 2.5% / 2.3% /14.6%
PFund HDP 0% / 1.8%
CAN
Scale 0% / 0%
HDP 2.3% / 2.3% /6.2%
PFund HDP 0% / 1.6%
USA
Scale 3.0% / 3.0%
HDP 2.9% / 2.2% /12.8%
PFund HDP 0% / 1.7%
1 Jan 08 / 1 Jan 09 / Total
A Scale
AUS
HDP 1.8% / 1.7%
PFund HDP 0% / 1.4% /4.9%
EUR
HDP 1.7% / 1.8%
PFund HDP 0% / 1.2% /4.7%
NZ
HDP 1.8% / 1.7%
PFund HDP -0% / 1.4% /4.9%
CAN
HDP 1.6% / 1.7%
PFund HDP 0% / 1.2% /4.5%
HKG
HDP 1.7% / 1.9%
PFund HDP 0% / 1.2% /4.8%
Changes to HDP
The increases to HDP above describe their effect on TOTAL pay. So, a 2% increase means a 2% improvement on the previous year’s Pay+HDP.
To illustrate this, changes to HDP and basic salary for a UK CN1 Freighter and Passenger are
shown below:
UK CN1 HDP @ 84 Hrs
Annual HDP and Basic Salary
2007 / 2008 / 2009 / ‘07- ‘09 Increase
Basic Pax £94,128 / £97,896 / £101,808 / £7,680
Basic Frtr £75,300 / £78,312 / £81,444 / £6,144
HDP (Pax + Frtr) £5,040 / £7,056 / £9,240 / £4,200
Other Important Notes on HDP Changes:
1. The figures above are based on 84 credit hours per month.
2. The 1st January 2009 HDP increase is “Tiered” and improvements to rates affect only credit hours worked beyond 56 hours, with hours worked in excess of 70 receiving the highest payments.
Changes to PFund Contributions - HDP
From 1st January 2009, HDP will be Provident Fundable. This change will not apply to Officers in CPALRS.
New CoS 08 Unified FO Scale
First Officers who elect to transfer to CoS 08, may move to the CoS 08 unified First Officers Scales at any time they wish. An example of a unified scale is given below.
GRAPH OMITTED - wouldn't cut & paste
FOs may wish to do this to achieve one of two things:
1. Improved Salary
2. Ability to remain flying freighters on base and move to ‘passenger pay’.
Note that an Officer switching to CoS 08 may remain on CoS ’99 salary scales and move to the unified scale at any time.
Retirement Age
CoS 08 has a normal Retirement Age of 65. All Officers will have the opportunity to switch to CoS 08 and work until 65.
However,
• All Officers may elect to remain on CoS ’99 with RA 55.
AND
• Junior Officers remaining on CoS ’99 will be eligible to receive Command bypass pay for passenger Captains working past 55.
Loss of licence in CoS 08 will be increased by 5 years, so that it will start to reduce (1:1) at age 58 and will be nil at age 60.
During the negotiations, the Company indicated that it will be going to “onshore” the basings companies. To a substantial degree this is being forced upon them by Revenue Departments and the applicability of local employment legislation, particularly age discrimination law. The Association will be fully involved in this process as it may have significant effects on based Officers’ contracts. We are already in the process of seeking legal advice regarding the onshoring of bases.
CoS 08 Terms and Conditions Post Working Beyond 55
Most terms and conditions will remain the same beyond 55
• Salary scales will be retained, i.e. an A scale Officer may remain on A scale.
• Expatriate benefits in HKG, such as Housing and Child Education Allowance, will be unchanged.
• CPALRS will not be available post 55. In place, Officers who were in CPALRS will receive PFund contributions into the applicable PFund, BBS or cash in lieu.
Green Page Benefits Post 55
• Green pages medical will be retained post 55.
• All other Green Page benefits, including Leave Passage Allowance (Travel Fund) will cease.
• Officers will transfer to the new travel scheme.
Command Bypass Pay
Command bypass pay, for Captains working beyond 55, will be available to any junior Officer remaining on CoS 99.
Officers on ‘Extensions’ Who Transfer to Cos 08
Officers on a freighter extension will complete a freighter commitment, with freighter service prior to 1 Jan 2008 counting towards that commitment. Transfer back to the passenger fleet will be in accordance with the Freighter Basings Policy. Officers who are held on the Freighter Aircraft beyond their commitment period will be eligible for Integration Deferment Pay. Upon completion of their Freighter commitment, such Officers will return to their original Salary Scale and accrued increment.
Officers on C&T extensions will revert to CoS 08 terms and conditions from 1 Jan 2008.
Direct Entrant Officer Recruitment
The general concept of last year’s DEFO proposal remains, in that this proposal allows FOs to be recruited directly to the passenger fleet on a unified First Officer scale.
However there are some crucial improvements.
• Officers receive 6 weeks leave.
• The current USAB command scale will be available to new joiners.
• The unified scale in the US has been increased by 6% so that FO earnings over 10 years are unchanged from the current typical progression.
• The unified scales includes 3 ‘freighter level’ pay points, followed by an intermediate pay point followed by 6 SFO pay points at the ‘passenger level’. An example is given above (GRAPH OMITTED) in the ‘Pay’ section. This improved profile now reflects what happens today, in that freighter Officers generally move to the passenger fleet after about 31/2 years.
• The Hong Kong scale remains unchanged.
The Permanent Basing Policy Agreement (PBPA) will be amended to require that all First Officers attain the rank of SFO1 and remain on base for at least 2 years before returning to HKG.
As a reminder, here are some DEFO features that remain.
DEFO Positions Offered to Current Officers First
DEFO positions will be offered to current Officers first through the PBPA. Freighter FOs and SOs may take these in seniority. If they have finished their freighter commitment (FFOs) or been assessed as suitable (SOs) they will go on current passenger pay. If not, they will go on CoS 08 and the unified First Officer Scales.
Transition
The transition lasts until the last current Officer has had a chance to become a passenger FO.
• During the transition, there will still be freighter only FOs. This is to allow ‘passenger’ DEFOs to be identified. These identified passenger DEFOs will trigger FO bypass pay for current SOs.
• Unlike the current system, the Company will pay FO bypass pay to un-assessed SOs.
• There will be no DEFO recruitment to HKG during the transition period.
FO Bypass Pay After the Transition
After the transition, FO bypass pay will be paid to SOs for all DEFOs. (Not just DEFOs recruited to the passenger fleet.) However, SOs in the future must have served 42 months to become eligible for FO bypass pay.
Closure of ASL
ASL will be wound up and so the FACA will cease to exist.
ASL crews will join the bottom of the Aircrew Seniority List in rank and on pay point. Note that the Captains involved will remain on the freighter Command pay scale and be restricted to freighter flying until they achieve passenger seniority as per the Freighter Basing Policy.
This will mean that the voluntary nature of freighter flying will cease. The following improvements to rostering have been secured:
1. 747F Classic crew will be credited at the rate of 1.14, as opposed to 1.07.
2. Compensation will be paid for loss of G-Days caused by down route disruption when operating Freighter aircraft.
Miscellaneous
Termination of Employment - Section 35.3 of CoS
This section of CoS allows for the termination of employment by either party giving 3 months’ notice or payment in lieu.
The Company will add agreed words in this section that require the Company to give reasons, in writing, for termination under this section and also provide the Officer access to the full appeals process set out in the D&G Procedure.
Scope
CoS is amended to scope all wide body aircraft including freighters. Previously only passenger aircraft were included.
Freighter Commands
The Company has committed to meet with the AOA to review the ongoing benefits of maintaining separate salary scales for Passenger and Freighter Captains. This will take place once this agreement has been ratified and the work associated with its implementation has been completed. Also, the Joint Rostering Committee will be tasked with reviewing credits for change of PX/PT and manning level provisions on the freighter.
Steve Turner
President
HKAOA
09 August 2007