Cathay Pacific Flight Attendants Union
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Cathay to pay 3,300 staff retroactive rises
Cathay Pacific Airways has bowed to a court ruling and agreed to grant pay rises retroactive to 1999 to 3,300 flight attendants.
It unilaterally canceled the rises during the Asian financial crisis.
Airline spokeswoman Carolyn Leung said the total amount is still being calculated, though local media have said it will be at least HK$280 million.
She refused to say whether the compensation will be reported as an extraordinary item in its interim results.
She said the money will be paid at the end of this month. Cathay decided not to appeal against last month's ruling by the Court of First Instance, which held that the airline had breached employment contracts.
``It is in everyone's interest that we now put the issue behind us in order that we can move forward together to grow Cathay Pacific into a stronger airline,'' Leung said.
Paying up should be no problem.
In its final results for last year, the airline said it had liquid funds of HK$11.47 billion at the end of the year.
In 1999, Cathay unilaterally terminated the automatic promotion and pay rise system for staff, citing pressures brought on by the Asian financial crisis, which sharply curtailed air travel in the region.
The Cathay Pacific Airways Flight Attendants Union brought a lawsuit against it as a result.
In a city with little history of labor militancy over the past 30 years, Cathay's strained staff relations stand out.
Flight attendants went on strike for 27 days in 1993 to protest against the dismissal of three colleagues in an earlier job action against increases to their workload.
In 1998, pilots went on strike for 15 days over wage and rostering issues. After 51 pilots were fired in 2001, their colleagues staged several work-to-rule campaigns in a vain effort to win their reinstatement.
The case is still unsettled.
Cathay has offered each sacked pilot 10 months' salary worth about HK$1 million, or the chance to apply for a job as a freighter pilot with the airline, in return for dropping their suit alleging unlawful dismissal. In February, the Hong Kong Aircrew Officers Association voted narrowly to reject the offer.
Cathay shares ended 1.36 percent down at HK$14.50 on Friday.
It unilaterally canceled the rises during the Asian financial crisis.
Airline spokeswoman Carolyn Leung said the total amount is still being calculated, though local media have said it will be at least HK$280 million.
She refused to say whether the compensation will be reported as an extraordinary item in its interim results.
She said the money will be paid at the end of this month. Cathay decided not to appeal against last month's ruling by the Court of First Instance, which held that the airline had breached employment contracts.
``It is in everyone's interest that we now put the issue behind us in order that we can move forward together to grow Cathay Pacific into a stronger airline,'' Leung said.
Paying up should be no problem.
In its final results for last year, the airline said it had liquid funds of HK$11.47 billion at the end of the year.
In 1999, Cathay unilaterally terminated the automatic promotion and pay rise system for staff, citing pressures brought on by the Asian financial crisis, which sharply curtailed air travel in the region.
The Cathay Pacific Airways Flight Attendants Union brought a lawsuit against it as a result.
In a city with little history of labor militancy over the past 30 years, Cathay's strained staff relations stand out.
Flight attendants went on strike for 27 days in 1993 to protest against the dismissal of three colleagues in an earlier job action against increases to their workload.
In 1998, pilots went on strike for 15 days over wage and rostering issues. After 51 pilots were fired in 2001, their colleagues staged several work-to-rule campaigns in a vain effort to win their reinstatement.
The case is still unsettled.
Cathay has offered each sacked pilot 10 months' salary worth about HK$1 million, or the chance to apply for a job as a freighter pilot with the airline, in return for dropping their suit alleging unlawful dismissal. In February, the Hong Kong Aircrew Officers Association voted narrowly to reject the offer.
Cathay shares ended 1.36 percent down at HK$14.50 on Friday.
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fair to adjust staff remuneration
HONG KONG (AFP) - Hong Kong flag carrier Cathay Pacific said it would pay 3,300 cabin crew back-pay after a court ruled the airline was in breach of their contracts by stopping their automatic pay rises.
A Cathay Pacific spokeswoman said the company decided not to appeal the High Court ruling in March and will make "appropriate" salary adjustments accordingly.
Although she declined to comment on how much this will cost the airline, union representatives have reportedly estimated the unpaid wages could reach 2.8 billion Hong Kong dollars (360 million US dollars).
"It is in everyone's interests that we now put the issue behind us in order that we can move forward together to grow Cathay Pacific into a stronger airline," the airline said in a statement.
The High Court earlier ruled in favour of the three cabin crew who said Cathay Pacific had violated their contracts from 1999 by not giving them an annual pay increase of 3.5 percent.
Cathay Pacific had said the change of policy was done to ensure its competitiveness after it was hard hit by the Asian financial crisis and later the 9/11 terrorist attacks in 2001 and the Severe Acute Respiratory Syndrome (SARS) crisis in 2003.
The airline said it maintains the view that it is "fair to adjust staff remuneration in a way that reflects the company's ability to pay, individual staff contributions and the general economic climate".
A Cathay Pacific spokeswoman said the company decided not to appeal the High Court ruling in March and will make "appropriate" salary adjustments accordingly.
Although she declined to comment on how much this will cost the airline, union representatives have reportedly estimated the unpaid wages could reach 2.8 billion Hong Kong dollars (360 million US dollars).
"It is in everyone's interests that we now put the issue behind us in order that we can move forward together to grow Cathay Pacific into a stronger airline," the airline said in a statement.
The High Court earlier ruled in favour of the three cabin crew who said Cathay Pacific had violated their contracts from 1999 by not giving them an annual pay increase of 3.5 percent.
Cathay Pacific had said the change of policy was done to ensure its competitiveness after it was hard hit by the Asian financial crisis and later the 9/11 terrorist attacks in 2001 and the Severe Acute Respiratory Syndrome (SARS) crisis in 2003.
The airline said it maintains the view that it is "fair to adjust staff remuneration in a way that reflects the company's ability to pay, individual staff contributions and the general economic climate".
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I recently took CX to a U.K tribunal with several complaints. One was breach of contract. My holiday entitlement was contractually 22 days in the first year of employment rising to 25 on a one extra day per year basis. Also I had a public holiday entitlement of 8 days.
CX worked out my holiday entitlement by adding the 8 public holidays to the leave making 30 days, then pro ratering down as I worked 12 hour shifts - this meant I was actually given a total of 20 days including public holidays.
In court CX tried to argue that this was industry practise, but had no proof of this. To the contrary I had proof that it was not industry practise so the tribunal upheld this complaint saying that I was entitled to my contractual holiday of 30 days and not the 20 CX had given me.
Now the disturbing part - CX knew they were wrong as it had been proven in court. Rather than accept this and pay others who had also been given reduced holiday allowances the cash equivalent (in many cases into the tens of thousands of pounds) they swiftly issued a new contract (within days of the court case) in an attempt to get the people whom had lost out to sign away their contractual right to the higher holiday allowance. When questioned by current staff the copanys representatives denied the new hastily issued contract altered the terms and conditions, merely stating things had been clarified. They of course knew that this was not true.
It is my opinion that CX will only ever give anything up to staff when told to by a court. Unless a judgement is specificaly applied to all staff the individuals who hope to benefit would have to take the matter up themselves.
Cabin crew I fear will have a long wait for CX to give them the money they owe them. After all it is better financially for CX to sit back and do nothing as they know the vast majority will not persue legal action.
However it has been very satisfying to know that CXs dreadfull behaviour towards their U.K based staff has resulted in huge staff turnover and the difficulty the company is now experiencing in recruiting the staff they need.
What goes around comes around as the saying goes.
AND YES, THEY CAN BE BEATEN.
CX worked out my holiday entitlement by adding the 8 public holidays to the leave making 30 days, then pro ratering down as I worked 12 hour shifts - this meant I was actually given a total of 20 days including public holidays.
In court CX tried to argue that this was industry practise, but had no proof of this. To the contrary I had proof that it was not industry practise so the tribunal upheld this complaint saying that I was entitled to my contractual holiday of 30 days and not the 20 CX had given me.
Now the disturbing part - CX knew they were wrong as it had been proven in court. Rather than accept this and pay others who had also been given reduced holiday allowances the cash equivalent (in many cases into the tens of thousands of pounds) they swiftly issued a new contract (within days of the court case) in an attempt to get the people whom had lost out to sign away their contractual right to the higher holiday allowance. When questioned by current staff the copanys representatives denied the new hastily issued contract altered the terms and conditions, merely stating things had been clarified. They of course knew that this was not true.
It is my opinion that CX will only ever give anything up to staff when told to by a court. Unless a judgement is specificaly applied to all staff the individuals who hope to benefit would have to take the matter up themselves.
Cabin crew I fear will have a long wait for CX to give them the money they owe them. After all it is better financially for CX to sit back and do nothing as they know the vast majority will not persue legal action.
However it has been very satisfying to know that CXs dreadfull behaviour towards their U.K based staff has resulted in huge staff turnover and the difficulty the company is now experiencing in recruiting the staff they need.
What goes around comes around as the saying goes.
AND YES, THEY CAN BE BEATEN.
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Crew dispute settled
Apple Daily and Wenweipo reported CX responded to a High Court ruling against the company in the case brought by three plaintiffs relating to the salary increments for monthly-paid cabin crew by making payments and salary adjustments to all those potentially affected
Peter Langslow, GM Inflight Services, explained that with significant increases in monthly-paid crew costs, corresponding reductions in other elements of overall monthly-paid crew costs or an offsetting increase in productivity would be needed to keep the airline competitive.
From the DFO
Cabin Crew Increments
You are probably aware that at the beginning of last month, the High Court ruled against the Company in the case brought by three cabin crew relating to the level of annual increments paid to monthly-paid cabin crew.
This week the Company has applied the court's declarations to all relevant monthly-paid cabin crew. A provision had been made in the accounts to protect against such a ruling.
Apple Daily and Wenweipo reported CX responded to a High Court ruling against the company in the case brought by three plaintiffs relating to the salary increments for monthly-paid cabin crew by making payments and salary adjustments to all those potentially affected
Peter Langslow, GM Inflight Services, explained that with significant increases in monthly-paid crew costs, corresponding reductions in other elements of overall monthly-paid crew costs or an offsetting increase in productivity would be needed to keep the airline competitive.
From the DFO
Cabin Crew Increments
You are probably aware that at the beginning of last month, the High Court ruled against the Company in the case brought by three cabin crew relating to the level of annual increments paid to monthly-paid cabin crew.
This week the Company has applied the court's declarations to all relevant monthly-paid cabin crew. A provision had been made in the accounts to protect against such a ruling.
From the DFO
Translation: “We knew what we we doing was wrong and probably illegal, so we made a provision in case we got found out”.
PS: One can only wonder about the size of the "provision" that has been made in the accounts for the 49ers!
This week the Company has applied the court's declarations to all relevant monthly-paid cabin crew. A provision had been made in the accounts to protect against such a ruling.
PS: One can only wonder about the size of the "provision" that has been made in the accounts for the 49ers!
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April 2, 2005
Cathay must pay $ 280m in back wages; Airline seeks greater productivity after flight attendants' successful court case that forces it to maintain promised pay rises
Cathay Pacific will pay around $ 280 million in back wages to 3,400 flight attendants this month after deciding not to appeal against a High Court defeat over the scrapping of automatic annual pay rises.
The payouts - averaging more than $ 80,000 per flight attendant - will be given to staff, along with salary increases dating back seven years after a judge ruled last month that Cathay breached their contracts by abolishing the pay scales.
The award applies only to longer-serving monthly-paid crew and not to flight attendants hired since 1998.
In a memo to staff, Cathay's general manager for inflight services, Peter Langslow, said there would be other cuts in monthly-paid crew costs or a requirement for greater productivity to offset the cost of the legal defeat.
Lawyers for Cathay are understood to have spent weeks studying the Court of First Instance ruling before advising that the airline did not have a strong enough case to take to the Court of Appeal.
However, a spokeswoman for the airline said yesterday Cathay had decided to settle the matter promptly because it wanted to "put this all behind us and move on".
In his memo, Mr Langslow said cost cuts would be required elsewhere. "The significant increase in monthly-paid crew costs associated with this outcome must be recognised. Corresponding reductions in other elements of overall monthly-paid crew cost, or an offsetting increase in monthly-paid crew productivity will be needed in the future, in order that we may maintain a competitive cost structure and make the required contribution to the company's unit-cost goals and overall profitability."
Mr Langslow said the company would "study and pursue the measures necessary to achieve this" but did not give further details of what the measures would involve.
Scores of flight attendants had filed claims against Cathay for back pay and salary increases in light of the case brought by two serving and one former member of staff and funded by the 4,000-member Flight Attendants' Union.
The union was to have presented the cases of the first three claimants - seeking payouts ranging from $ 80,000 to $ 138,000 - to an industrial tribunal listed for April 13. That hearing is expected to be cancelled.
Before the High Court case, Cathay offered each flight attendant a one-off "goodwill" payment of $ 6,000 to $ 11,000, according to rank, on top of pay rises totalling 7.5 per cent over the next three years.
The out-of-court offer - which would have cost the airline $ 24.3 million, less than a tenth of the amount it must now pay out - was rejected by the union as "an insult".
Cathay's argument at the hearing was that it had been forced to cease the annual increments because of the economic downturn and increased competition.
No one from the Flight Attendants' Union was available for comment yesterday.
Cathay must pay $ 280m in back wages; Airline seeks greater productivity after flight attendants' successful court case that forces it to maintain promised pay rises
Cathay Pacific will pay around $ 280 million in back wages to 3,400 flight attendants this month after deciding not to appeal against a High Court defeat over the scrapping of automatic annual pay rises.
The payouts - averaging more than $ 80,000 per flight attendant - will be given to staff, along with salary increases dating back seven years after a judge ruled last month that Cathay breached their contracts by abolishing the pay scales.
The award applies only to longer-serving monthly-paid crew and not to flight attendants hired since 1998.
In a memo to staff, Cathay's general manager for inflight services, Peter Langslow, said there would be other cuts in monthly-paid crew costs or a requirement for greater productivity to offset the cost of the legal defeat.
Lawyers for Cathay are understood to have spent weeks studying the Court of First Instance ruling before advising that the airline did not have a strong enough case to take to the Court of Appeal.
However, a spokeswoman for the airline said yesterday Cathay had decided to settle the matter promptly because it wanted to "put this all behind us and move on".
In his memo, Mr Langslow said cost cuts would be required elsewhere. "The significant increase in monthly-paid crew costs associated with this outcome must be recognised. Corresponding reductions in other elements of overall monthly-paid crew cost, or an offsetting increase in monthly-paid crew productivity will be needed in the future, in order that we may maintain a competitive cost structure and make the required contribution to the company's unit-cost goals and overall profitability."
Mr Langslow said the company would "study and pursue the measures necessary to achieve this" but did not give further details of what the measures would involve.
Scores of flight attendants had filed claims against Cathay for back pay and salary increases in light of the case brought by two serving and one former member of staff and funded by the 4,000-member Flight Attendants' Union.
The union was to have presented the cases of the first three claimants - seeking payouts ranging from $ 80,000 to $ 138,000 - to an industrial tribunal listed for April 13. That hearing is expected to be cancelled.
Before the High Court case, Cathay offered each flight attendant a one-off "goodwill" payment of $ 6,000 to $ 11,000, according to rank, on top of pay rises totalling 7.5 per cent over the next three years.
The out-of-court offer - which would have cost the airline $ 24.3 million, less than a tenth of the amount it must now pay out - was rejected by the union as "an insult".
Cathay's argument at the hearing was that it had been forced to cease the annual increments because of the economic downturn and increased competition.
No one from the Flight Attendants' Union was available for comment yesterday.
Last edited by Turbo Beaver; 6th Apr 2005 at 23:13.
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Cathay cabin crew fear retaliation
Cathay Pacific has been urged not to "retaliate" against its flight attendants after they won a $ 280 million payout from the airline by taking it to court for denying them automatic annual pay rises for the past seven years.
Cabin crew are anxious about a backlash after Cathay was defeated in the High Court last month, forcing it to increase salaries and award back pay from 1998, according to the leader of the Flight Attendants Union Becky Kwan Siu -wa.
Concerns were heightened by a memo circulated to cabin crew by Peter Langslow, general manager for inflight services, saying the airline would pay the money this month but would seek "corresponding reductions" in crew costs or increased productivity.
"There is a threat there," said Ms Kwan, who believed the wording of the memo sent out on Thursday was intentionally vague. "Any company has the right to control costs at any time but it shouldn't be done as retaliation.
"Some of our members fear the firm will retaliate by making our lives miserable but we hope it will have more sense than to do that.
"Happy crews mean happy passengers and that means profit for the airline. If you have miserable crews, eventually the airline will suffer."
She said she had urged members not to fear a backlash as a result of the court victory.
Cathay announced on Friday it would not appeal against a High Court ruling last month that it had breached the contracts of three flight attendants hired before 1998 by scrapping the pay scales entitling them to automatic annual pay increments.
The judgment means 3,400 flight attendants are entitled to pay rises of thousands of dollars a month each and back pay averaging more than $ 80,000 to compensate them for their losses over the past seven years.
Ms Kwan described the victory and the subsequent pay award as "a great achievement for our union movement" but added: "I really hope we can put these issues behind and look to the future."
She said many of the flight attendants involved in the court case would be prepared to work extra hours if the company wanted to increase productivity, provided their original contract conditions were respected.
Cathay's argument that it had been forced to do away with the pay scales because of the economic downturn and had looked after its staff in other ways was rejected by the court.
Scores of flight attendants have been filing claims for back pay to the Labour Tribunal based on last month's ruling and Ms Kwan said those claims would not be immediately withdrawn.
The union would first seek talks with the airline to make sure their calculations for back pay and pay rises owed to monthly-paid flight attendants matched up.
A Cathay spokeswoman said the airline had decided to settle the legal matter because it wanted to "put this all behind us and move on".
Cathay Pacific has been urged not to "retaliate" against its flight attendants after they won a $ 280 million payout from the airline by taking it to court for denying them automatic annual pay rises for the past seven years.
Cabin crew are anxious about a backlash after Cathay was defeated in the High Court last month, forcing it to increase salaries and award back pay from 1998, according to the leader of the Flight Attendants Union Becky Kwan Siu -wa.
Concerns were heightened by a memo circulated to cabin crew by Peter Langslow, general manager for inflight services, saying the airline would pay the money this month but would seek "corresponding reductions" in crew costs or increased productivity.
"There is a threat there," said Ms Kwan, who believed the wording of the memo sent out on Thursday was intentionally vague. "Any company has the right to control costs at any time but it shouldn't be done as retaliation.
"Some of our members fear the firm will retaliate by making our lives miserable but we hope it will have more sense than to do that.
"Happy crews mean happy passengers and that means profit for the airline. If you have miserable crews, eventually the airline will suffer."
She said she had urged members not to fear a backlash as a result of the court victory.
Cathay announced on Friday it would not appeal against a High Court ruling last month that it had breached the contracts of three flight attendants hired before 1998 by scrapping the pay scales entitling them to automatic annual pay increments.
The judgment means 3,400 flight attendants are entitled to pay rises of thousands of dollars a month each and back pay averaging more than $ 80,000 to compensate them for their losses over the past seven years.
Ms Kwan described the victory and the subsequent pay award as "a great achievement for our union movement" but added: "I really hope we can put these issues behind and look to the future."
She said many of the flight attendants involved in the court case would be prepared to work extra hours if the company wanted to increase productivity, provided their original contract conditions were respected.
Cathay's argument that it had been forced to do away with the pay scales because of the economic downturn and had looked after its staff in other ways was rejected by the court.
Scores of flight attendants have been filing claims for back pay to the Labour Tribunal based on last month's ruling and Ms Kwan said those claims would not be immediately withdrawn.
The union would first seek talks with the airline to make sure their calculations for back pay and pay rises owed to monthly-paid flight attendants matched up.
A Cathay spokeswoman said the airline had decided to settle the legal matter because it wanted to "put this all behind us and move on".
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"Happy crews mean happy passengers and that means profit for the airline. If you have miserable crews, eventually the airline will suffer."
I doubt that very much, here at Qantas according to a recent company survey a very high percentage of cabin crew are not happy and either are our passengers. As Qantas has proven huge profits can still be made regardless if crew are happy or not.
I doubt that very much, here at Qantas according to a recent company survey a very high percentage of cabin crew are not happy and either are our passengers. As Qantas has proven huge profits can still be made regardless if crew are happy or not.
