FedEX HKG Ex-pat package is out, and boy is it funny...

[skypine27]

I can not BELIEVE that this was voted in favor of 11-1 by our Union. Between this and DW's stand on the retro age 60 fiasco, I don't wear an ALPA pin or Lanyard anymore.

For MEM, ANC, and LAX guys who don't want to take the time to read the whole thing (and/or who aren't lawyers) before voting, here is a summary:


1--Housing allowance of $2700/mo (LOA B.2.d.i) if you rent. You'll get $1300/mo (LOA B.2.d.ii) if you buy. You have to live within 100 miles (LOA B.2.d.iii) of HKG (assuming HKG is the "base airport") Please remember that a "normal" apartment big enough to house you, your wife, and one kid is roughly 8500++ USD per month in any desirable area of HKG, and that you are RENTING, and not building equity in anything.

2--Remember the two hour limit on ground transport? That's gone. Get ready for a midnight van ride to Guangzhou for a 3 am show (LOA sect. G).

3--Want to go back to visit the folks stateside? You'll be able to do just that (along with your family) on an annual basis. . . in coach class. . . after having been in your new base for two years (LOA B.2.f). Perhaps after that amount of time you will have forgotten about Grandma. Out of sight out of mind?

4--Relocation allowance of $10K or 79 credit hours (contract 6.C.2) is now just $10,000 (LOA B.2.a) and you'll get an additional $5000. . . after 4 YEARS of staying in your new base. (LOA B.2.b)

5--Minimum commitment is 2 years (LOA B.2). Let's be conservative and assume you are single with no wife and kids, and can live in a very nice van down by the river in HKG for $6000/mo. You're paying $3,300 out of pocket (utilities aside) for rent (which we all know it lost money). . . $3300/mo for min commitment of 24 months equals your cost for living in HKG for two years-- $79,200!! Remember, that's for the van down by the river. . .

6--We're getting "tax equalization." In other words, you will pay the exact same taxes as if you lived in the USA. Isn't that the whole point of being an ex-pat, to avoid paying US Federal income tax (on the 1st 84K anyway) Take away that benefit, and still expect guys to live in THE most expensive, one of the MOST polluted (complete with air you can see), and crowded cities in the world?? I have never, ever, in the history of any US company basing employees overseas, heard of taking away the tax benefit Is FedEX honing its stand-up routine or what?

I hope FedEX is ready to fill the FO side of HKG with new hires. And I hope FedEX is ready to change its typical hiring practice. I'd love to listen in on the phone call from Kim to the typical, 38 year old, ex-military guy, with a wife and 3 kids... "Hello, congrats, you are hired at FedEX and we're ready to offer you a class date! You'll be going to Hong Kong, the most expensive city for ex-pat housing in the world. You can not afford to bring your wife, and we will not assist you in any way at all in schooling your children, because that only costs around $15,000 per year, EACH. And, we're going to pay you 52 bucks an hour! Welcome aboard!"

FedEX is going to need start hiring guys like the Commuter airlines do. 24 years old, no wife, no kids, little debt, still getting money from mom and dad, still suffering from Shiny Jet Syndrome, and willing to take ANY offer to get out of their CFI job.

[Saturn]

At this point I might just do it. I have friends at purple and after this week have contacted them. I think I am getting to the point where I have had just about enough!!! I can winge about or do what seems to be the logical thing and possibly the most sensible and just leave.

[Freehills]

In the words of Nelson Muntz: “HA HA!”

[Cpt. Underpants]

That's pretty shoddy by any standard...
Two thoughts come to mind:
I wonder if CX or NR had a hand in compiling this CoS, and...
I could almost guarantee that if it had been even remotely competitive, CX would have had it's mates in the Immigration Department put an end to it, tout de suite

[teedub]

skypine27

great info on purple...little depressing but not so surprising given the way the industry is going....hope no one with any sense will grab at that as a choice....wonder if you have any scoop on the paris base....

cheers

Teedub

[christep]

Please remember that a "normal" apartment big enough to house you, your wife, and one kid is roughly 8500++ USD per month in any desirable area of HKGThis is a ludicrous assertion. Even in the current buoyant economy with all the bankers back in town HK$66K per month gets you one of the top 1% of properties in Hong Kong. It's statements like this that give airline pilots a bad name - airline pilots are not generally seen by those who pay for the tickets that pay their salaries as being deserving of the top 1% of living standards.

[Dan Winterland]

No education? That will be a big factor. As an expat, fee paying schools are the only realistic option for your kids, and thy're not cheap!

[skypine27]

....with all the bankers back in town HK$66K per month gets you one of the top 1% of properties in Hong Kong. It's statements like this that give airline pilots a bad name....

It does huh? Well, what does 21K HGD get you (FedEX's offer)? A cardboard box?

[Freehills]

Actually, clever by FEDEX.

No, it isn't nearly good enough to make a FO or Captain move across.

But, if you are a junior FO, and no Captains bid, then the numbers might stack up. Move to HK as a captain, and when seniority is enough to hold captain back home, move back. Might speed up your command enough to be worthwhile...

Ditto for new joiners. If few or no FO's move across, and your only way in to Fedex is a HK base, then rather then risk spending next five years in a regional, take the job, and, again, move back to the states once you can.

Do Fedex hire US nationality pilots only? That might give immigration problems. Work Permits are only meant if you can't find locals, and if you refuse to take locals in the first place...

[Sqwak7700]

No cardboard box. It just guarantees that everyone will live in Tung Chung, right next to CLK. You can comfortably live in TC with 1300 USD a month rent and have a 3 bedroom appartment. But you are right, you can forget about affording anything downtown without matching at least the allowance with money from your own pocket. And then you are talking about a place the size of a cardboard box.

You are right, only new hires will get stuck on a HK basing because the senior guys will think it isn't sweet enough. And on a new hire salary it will make it even tougher.

At Cathay, our compensation isn't as good as at FedEx, but the housing allowance jacks it up quite a bit to make living in HK and "option".

[Cpt. Underpants]

In Tung Chung (near airport, 10' by cab) 20+ listings for HKD20K-HKD30K rental, 1200+ sq ft, all views:

http://cybersearch.midland.com.hk/cybersearch/index.jsp?regionId=&lang=en&distId=3005060000&area=1200%2C1500&price=&rent=20000%2C30000&x=32&y=10

Thats' USD2500 - USD3800 per month.

[christep]

You're looking at the websites designed for people with more money than sense. There are loads of apartments in Tung Chung for less than US$2000 per month for 1200+ sq.ft. For HK$21K you can get a 3-storey (2100 sq.ft) village house with a garden in the New Territories or on South Lantau, or 1300sq.ft in Discovery Bay.

[skypine27]

Squak, Underpants, and Chris:

For someone who knows NOTHING about the various locations of HKG (when I layover, I dont leave a 5 block radius of the hotel), can you help me out a bit?

The area you guys are talking about "TC", that is close to the airport where apartments can supposedly be found for our measley proposed 22K HKD allowance... is this actually a desirable area to live in?

If you are single, is there any nightlife in that area (ie, bars, girls, and Flight Attendants living there). If you are married, how's the shopping, malls etc. If you are married with kids, any schools in that area, movie theatres, blowing alleys, etc.

My question may sound stupid to those familiar with HKG, but the only place I've hung out in HKG is within a 20 minute walking radius of the Hong Kong SHERATON Hotel, 20 Nathan Road, Kowloon.

[Drunknsailor]

Tung Chung is right by the airport. As you are on final to 25 they are the highrise towers you see on your left descending through 600 feet. Prices vary from about USD 800 a month to USD 1800 a month for the standard apartments in the buildings; 700 sqf two bedrooms through 1300 sqf 3 bedrooms. One point to note, however, HK measures gross square footage, meaning the size of the box PLUS your share of the common area elevator shaft etc. so you can shave between 150-300 sqf off of the quoted size. I live in a 1080 sqf flat that is about 800 sqf of living space!

As far as what is in Tung Chung, not a whole heck of a lot I'm afraid. CityGate outlet mall is here and there is a movie theatre there. There are a few restaurants, all serving some sort of asian fare! There is a well stocked grocery store and you can easily get take out from Indian, Thai and a Pizza joint!

As far as single prowling is concerned, the one pub is called the Aviator, it is knicknamed the Gayviator, nuff said.

Tung Chung is 25 minutes from Central where you can find just about anything you need.

I don't mean to knock Tung Chung, there are a lot of people very happy here, there are better places to live, but they are all more expensive than Tung Chung.

With 20k HKD (USD2500) You can rent a small place in DB, a smaller Village HOuse in South LAntau(over the hill from the airport) or about 700sqf in town.

All this being said, vote that proposal down guys, it is definitely below market!

All in all, Tung Chung is not that bad.

[Dan Winterland]

Tung Chung 'desireable'? If you don't mind living in a concrete jungle and you like aircraft spotting - then yes. It's handy for the airport and buying clothes which can't sell in central, but that's it. And I won't even mention falling cable cars!

And as for the 'Gayviator', otherwise known as 'The Slasher's Arms', just be careful who you talk to. You could be thinking you've just gone out for a few quiet beers, but find out later that you've been recruited for Oasis!

[skypine27]

So from what I can tell, TC is a pretty cappy place for a single guy to live. (family guys as well)

I pray to god that our membership votes this package, forcing the company to up the offer.

However, just gathering facts. Whats a decent area for a single guy to live in? (Prowling a primary concern). What do rents for smaller apartments go for in those areas? Is a studio even possible on our lousy 22K HKD allowance?

Thanks again for the info.

[Numero Crunchero]

skypine27,
$22K is pretty marginal! CX pays up to $27K? for SOs for the first 2 years. Then they get $55K? until 8 years in the company then you get around $67K then as a Captain(expat) you get over $80K. It is linked to some government housing indexes so changes from month to month.

I am one of those 'weird' banker types who live in a place that rents for $9,000 US a month! But nearly all my peers are also weird and rent places at a similar price level. Maybe Christep has a problem with people actually wanting to live somewhere nice and near to town. I was promised a standard equivalent to my home country when I joined and that is what I enjoy!

I may be telling you US types stuff you already know, but HKG is considered a 'high cost housing locality' by the IRS. Consequently the upper limit on your housing exclusion is around $114,300US for 2006. YOur Foreign Exempt Income for 2007 is $85,700 so on top of that you can add any housing expenses less the base rate($13,712). So you can add 12x$2,700 - $13,712=$18,688 to $85,700 meaning you can earn $104,388US before paying any US tax as it stands. You will be subject to up to 16% HKG flat tax on the non rental portion of the package.

The part of the deal that would be best improved is the rental allowance as it has no effect on your US world wide taxation given the very high limit on your IRS HKG housing exclusion!

clear as mud?

[christep]

Maybe Christep has a problem with people actually wanting to live somewhere nice and near to town.Not at all. I have a 900+ sq.ft apartment right by the Central Escalator and therefore within a few minutes on foot of all the nightlife. I pay HK$19,000 (US$2450) per month. As a single guy that works for me. If I had a family I'd pay about the same for 1200 sq.ft or so in Discovery Bay, or somewhere like that.

[Dan Winterland]

I'm wierd too. About $8000 a month in my case. Why? Because it gives a reasonable quality of life and is the size of house I would be living in should I be back in my home country.

[Sqwak7700]

"...If you are married with kids, any schools in that area, movie theatres, blowing alleys, etc."

I can't believe nobody picked up on this Freudian slip. Are you guys loosening up on spelling? Come on, there is a reputation at stake here on these boards. :ugh:

Obviously, you've been to HK. There is plenty of "Blowing Alleys" in HK, but the most popular is Wanchai, or "the Wanch". It has many blowing alleys.

But, that is at least 56 minutes by MTR or 33 to 47 minutes by Cab, or 72 minutes by bus. Those are estimates, of course, since I have never been to such place. :rolleyes:

Happy Blowing! :ok:

[teedub]

Numero Cruncho

I understand the US housing tax free allowance has changed due to the 2006 tax bill passed that
1: Index linked the salary exclusion (ie 83K plus for 07')

BUT

2: Capped the housing allowance exclusion to approx 27K ie:anything paid you in access of 27K is fully taxed by the US. The floor remains as you mentioned at 13K

So it looks to me like the full 82K CX housing allowance for US CX pilots is gonna hurt (unless you can somehow show it as rent/tdy or some other accountant magic trick)

The fed ex 20 odd K allowance would actually be ok from a tax perspective....its all madness and just gonna get worsre......tax wise....buy your roth IRA folks....

Cheers
Teedub

[Numero Crunchero]

teedub
the salary exclusion was $82.4 in 2006 but I believe it is $85.7 in 2007.

The upper cap of $27K on housing exclusion is based on the 30% limit of salary exclusion HOWEVER it does not apply in 'high cost localitys' of which HKG is one. If you go to your IRS website and look up the information form on filling out Form 2555 on page 4 or 5 you will see housing upper limits for various cities around the world and HKGs is $114.3K USD.

So like I said, if you can get FedEx to up the housing deal a bit it wont cost you any tax. I may be telling you to suck eggs here but you do know that the housing exclusion can include most of your housing costs (including renting furniture!). Sorry if you already knew this!

By the way, the floor is not the same - it is actually 16% of the Foreign Income Exclusion amount ie 16% of $85.7K this year.

clear as mud!

[404 Titan]

Numero Crunchero

I’m very impressed.:D How did you become so knowledgeable about the Seppo tax system? I know Zippo about it even though I should considering my circumstances and background.:confused:

[Numero Crunchero]

ergo MBA > CPA ;-)

[skypine27]

Regardless of the how the US taxes are handled, our EX-Pat "Package" (HAH!) is a freaking joke.

It's going to be funny with FedEX pilots living in cardboard boxes and child-size studios along side of Cathay and Dragon Air guys who actually live in houses with running water and ovens.