Wage Fixing
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Joined: Jan 2009
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From: california
Wage Fixing
Price fixing is an illegality which Airlines have been punished for in the past. Is wage fixing legal?
It is clear that in China, the middle east and Asia that major carriers have agreed a cap on experienced Captain Salaries. These carriers accept a shortfall of Captains without increasing wages to meet the demand. This is of course due to the fact that there is only a limited number of Captains available and that fixing salaries is more cost effective than free market competition for Pilots.
Certain CEO's have said in the past that in their view the market should be allowed to set the wages for Pilots, this of course only applies to a glut, during a shortage fixing is the best option.
The reason I make this observation is that wages in each of these regions are so entirely similar.Imagine the outcry if Investment Bankers or CEO salaries were being fixed.
It is clear that in China, the middle east and Asia that major carriers have agreed a cap on experienced Captain Salaries. These carriers accept a shortfall of Captains without increasing wages to meet the demand. This is of course due to the fact that there is only a limited number of Captains available and that fixing salaries is more cost effective than free market competition for Pilots.
Certain CEO's have said in the past that in their view the market should be allowed to set the wages for Pilots, this of course only applies to a glut, during a shortage fixing is the best option.
The reason I make this observation is that wages in each of these regions are so entirely similar.Imagine the outcry if Investment Bankers or CEO salaries were being fixed.
Last edited by polax52; 7th January 2015 at 11:47.
Joined: Nov 2011
Aviation Qualifications: CPL
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From: Somewhere close to me
Price fixing is consumer orientated, never heard of wage fixing!
If the monkey is happy to work for peanuts, you can hardly fault the airlines for not wanting to pay footballers salaries!
If the monkey is happy to work for peanuts, you can hardly fault the airlines for not wanting to pay footballers salaries!
Joined: Mar 2004
Posts: 136
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From: In the weather
Just out of interest, could you tell us what the wage cap is? How are the airlines ensuring that other airlines don't break the agreement? Some of the Chinese airlines seem to be increasing the salaries for contract pilots quite often. Are they in on this deal? It seems unlikely...
Joined: Jul 2007
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From: Germany
Essentially you are describing a situation where pilots have become a commodity (like oil) and what the bean counter's text books call an 'efficient market' has developed. There is price (in this case wage) transparency and a going rate has been established. The premise here is that all pilots are the same and that paying more is wasted money. Actually I still see pretty big wage differences particularly between locals and contractors, although most of us can agree there seems to be a worldwide reduction in overall terms and conditions.
Joined: Jan 1999
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From: north of barlu
Subtle price fixing
The real price fixing is being done in Europe by the training establishments who are making a very nice Proffit by creating an over supply of young pilots who are all trying to get jobs some of who are paying to "work" for airlines.
This is driving the whole market downwards, the airline bean counters are in the words of the main " real " employer of these people.......... loving it !
This is driving the whole market downwards, the airline bean counters are in the words of the main " real " employer of these people.......... loving it !
Joined: Jul 2007
Aviation Qualifications: ATPL
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From: Germany
There are a some other factors for instance legacy carrier pilots working longer, sometimes to 65, this is definitely a factor with the employment situation in Holland and other parts of Europe.
Joined: Jan 2000
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From: Asia
The big three Middle East airlines have a no poaching arrangement in place so a wage cap wouldn't be too hard to agree either.
In China, a pilot can only transfer with the employers consent and with their business networks an agreement on pilot pay wouldn't be too difficult.
Cathay terms are on a down slide as well with everything from crew meals and hotels feeling the pinch. A pilots dream job in the 1980s is becoming very average for new joiners.
Singapore Airlines got rid of its expats a while back, all local terms now.
The Middle East package is nowhere near what it used to be with expenses such as rent and school fees having a shortfall, and the pay has lagged behind inflation.
It's a bit like regular buyers at a car auction agreeing not to bid against each other and deciding who gets which cars in advance.
In most cities taxi drivers are in short supply and the companies are always advertising, but this is not reflected in the pay as rates are kept low.
In China, a pilot can only transfer with the employers consent and with their business networks an agreement on pilot pay wouldn't be too difficult.
Cathay terms are on a down slide as well with everything from crew meals and hotels feeling the pinch. A pilots dream job in the 1980s is becoming very average for new joiners.
Singapore Airlines got rid of its expats a while back, all local terms now.
The Middle East package is nowhere near what it used to be with expenses such as rent and school fees having a shortfall, and the pay has lagged behind inflation.
It's a bit like regular buyers at a car auction agreeing not to bid against each other and deciding who gets which cars in advance.
In most cities taxi drivers are in short supply and the companies are always advertising, but this is not reflected in the pay as rates are kept low.
