Pay for endorsement = bankrupt airline?

[sockedunnecessarily]

I think I'm starting to see a link between Australian companies which do this pay for endorsement crap and their poor long term financial management.

It seems the only regional or jet airlines in Australia making a profit at the moment are the ones who made an investment in their staff and paid for their endorsement.

Sure, you can make pilots pay for endorsements (because pilots are generally stupid, selfish creatures trying to scramble into something faster, bigger, shinier and for a tiny bit more money). And it might impress the bean counters in the short term. But it seems that sort of management technique (treating people like ****) goes hand in hand with poor long term financial management.

It would be childish of me to say "I told you so" to those colleagues of mine who lined up to throw $30k at a greedy airline. But now your companies are teetering on the financial edge, share prices are tumbling, they are closing bases, shunting pilots off to Singapore, parking aircraft....

I never wish bad things on anyone. But you reap what you sow.
When your shiny jet airline goes tits up, you'll be wishing you had that $30k.

[capt_akun]

But did we not get that mentality from the GA era of our life? Those who has the endorsement of the aircraft that the operator has will have a better chance then those who don't with the same amount of hours.

[FourBalls]

But you reap what you sew.

If you are a dressmaker. Most farmers sow.

[Mr. Hat]

Correct me if I'm wrong - is it not true that airlines that don't charge for an endorsement put you on a tiny training wage which finishes with your final check?

No I haven't "paid" for one but people need to look a little closer at this robin hood carry on. As they say nothing in life is free.

[chimbu warrior]

Maybe I am losing the plot, but when I grew up I was always lead to believe that the main reason for seeking and securing employment was to earn an income.

Every profession or trade has pre-requisites for employment; in our case that would be a CPL or ATPL. Up until about 10 years ago that system worked just fine, but then somebody decided that the cost burden of type endorsements should be passed from the employer to employee (or, all too frequently the potential employee). Sadly, there were enough people who wanted to short-circuit the system (you know, the time-honoured system where you go out and get the experience to move up the next rung on the ladder) and they willingly shelled out their (or maybe Dad's) cash to skip a few years of the process.

Sure enough, this came to the attention of airline management (who could not believe their luck), and next thing you know everybody is expected to pay for their type training.

For old farts like me who cling to the belief that this cost is an employers responsibility, it has made it very hard to get a job. When you are 50 plus, you are trying to save for those rapidly approaching years in the rocking chair, and hence subsidising an employer is unpalatable.

So just stop and think before whipping out the credit card: "...do I really want to be buying jobs for the rest of my life?"

I feel better now.

[Arnold E]

Lets face it, if the supply exceeds the demand then the price paid is going to be low. Employer responsibility has nothing to do with it, unfortunately.
Employers will always find the cheepest alterative.

[sockedunnecessarily]

Sure enough, this came to the attention of airline management (who could not believe their luck), and next thing you know everybody is expected to pay for their type training.

Exactly. That must have been absolutely stunned (and overjoyed) by the stupidity of Australian pilots who started lining up in droves.

All I'm trying to say - it appears an airline which has the professional decency to pay for your endorsement, is (through the way it treats people and business in general) much more likely to make money in the long term.

Or, to put it another way - if you scab a job by paying for it, eventually your cheap airline will go tits up.

[Whiskery]

............if you scab a job by paying for it, eventually your cheap airline will go tits up.

So with your logic,sockedunnecessarily, can we expect to see Virgin Blue, Pacific Blue, Jetstar, Singapore Airlines, Easy Jet, Qantas and Tiger go tits up in future?

[coke drinker]

Chimbu, I'm in the vicinity of 30 odd years your junior, but what you have posted is exactly my opinion too. Getting your licence is the pre-requisite for a job! Endorsements on type are surely the responsibility of the person employing you to fly their aeroplane!

[Jetpipe2]

This is a slight drift but does cover a similar issue.

There are many different ways that pilots pay for their training. Some are upfront and in your face, like paying cash and others are a little more subtle.

Most large companies have had a bond for many years. This has nothing to do with paying for the cost of the training but trying to stop pilots leaving five minutes after they are endorsed, for a similar job else where. Hence managment stopped the flow of training dollars out the door by bonding. If you stay with them then the Company got its value from the training dollar but if you left you paid.

This is the subtle method, as you work on a lower wage for a longer time and hence the company gets its money back.

However with the introduction of LCC's where you pay for everything this process was taken a step further. If you look at the set up costs of an airline recruiting qualified pilots is cheap, if you can get them but if not you have to pay. If the pilots are happy to pay upfront this saves the share holders money but doesn't secure the future,as the loyalty isnt there.

So in most companies you have either paid upfront or by reduced earnings. It would be interesting to compare the figures over five years and see who made the most money? Would it be the LCC pilot who paid for training but got a command in 12 to 18 months or the legacy pilot who didn't pay and is still an FO?

Maybe others can fill in this detail.....

[psycho joe]

I never wish bad things on anyone. But you reap what you sow.
When your shiny jet airline goes tits up, you'll be wishing you had that $30k.

Except of course those pilots who got most of that 30K back from the Tax Man and gained a free 777 endorsement.

Or, to put it another way - if you scab a job by paying for it, eventually your cheap airline will go tits up.

Or to put it another way - Scab enough experience from said scabby airline to be able to work as a scab in an airline more of your choosing.

But wait, what happens if the original scabby airline is successful and becomes seen as mainstream?

What if Pilots from a non scab airline want to work for said scabby airline as direct entry scabs? Does that mean that these scabs are scabbier scabs?

Would they pertain to be "scabbier than thou"?




(A dozen scabs in a single post. Is that a record?)

[Mr. Hat]

There are many different ways that pilots pay for their training. Some are upfront and in your face, like paying cash and others are a little more subtle.

Spot on Jetpipe. Unfortunately the majority of people look only at the upfront cost and not at any of the tax implications. Another point is copilot or command rating.

[43Inches]

I thought you couldn't claim pay your own endorsement unless already employed by the airline. The tax office eventually catches up and claims the employer should have paid for it as its their responsibility, bad luck, etc... And if you salary sacrifice there is no tax paid so no tax break.

Consider most training wages only last untill training is complete, a few months at most, you may miss out on a few $1000 at worst. Most pay your own endorsement will not even consider you employed (let alone pay you) until you pass your company checkride, this may be two to three months with no income at all! and you still owe the endorsement cost if you fail!!

As far as how quick command is may be a sign of how quickly people are leaving for decent terms, or an airline that is over-extending itself financially.

[Mr. Hat]

Hi 43,

I thought you couldn't claim pay your own endorsement unless already employed by the airline.

Case by case basis - ATO have been proved wrong.

Consider most training wages only last untill training is complete, a few months at most, you may miss out on a few $1000 at worst. Most pay your own endorsement will not even consider you employed (let alone pay you) until you pass your company checkride, this may be two to three months with no income at all! and you still owe the endorsement cost if you fail!!

No not the case depends. Some of the salaries involved are quite high. My only point is that one needs to really look closely at all the figures.

Hey i reckon its crap that you have to part with any money but have mates that have gone down both paths and had some interesting comparisons.