Cathay pilots, crew offered voluntary exit package

Cathay Pacific has come up with a voluntary redundancy plan for pilots and crew members that offers salary compensation of two to six months.

That came as unionists were told Cathay still has too many employees as the number of flights have been cut because of the pandemic.

A Cathay spokeswoman said yesterday the flagship carrier has been operating "a skeleton flight schedule" due to strict travel restrictions and quarantine measures around the world.

"While we have seen some recent relaxations to these restrictions, our operating environment remains incredibly challenging and the pandemic continues to have a devastating impact on our business. Our network remains heavily reduced and we expect there to be no discernible improvement in the short to medium term," she said.

"We have decided to offer certain of our employee groups the option of a voluntary separation scheme. We are providing support to all those who apply, including a competitive exit package," the spokeswoman said.

But no target on staff numbers has been set for the scheme.

In an internal letter to staff, the company said the scheme is being offered to cabin crew, pilots and employees at the Hong Kong International Airport.

Cathay told its staff that despite some relaxation of quarantine requirements for cargo operations crew recently, it is still in "a very dynamic situation" as the pace of recovery and demand for international travel remains highly uncertain.

"While the departure of more of our valued colleagues is not something we hoped to see, we thought it would be worthwhile to provide an option for people who would like to leave us for personal reasons or to pursue other opportunities," Cathay said in the letter.

The scheme will have ex-gratia payment of up to six months of staff's April salary. Staff can choose to get two months of their April wages, or two thirds of the factor of April wage multiplied by years of service.

Their medical benefits will be extended for one month.

Applications for the scheme opened yesterday and end on May 12, with employment to cease by May 31 for those opting in.

In October, the airline sacked 5,900 employees, including 5,300 Hong Kong-based staff. Its subsidiary Cathay Dragon also ceased operations. Those who survived the large-scale layoffs had to sign a new contract with a pay cut.

The chairwoman of the Cathay Pacific Airways Flight Attendants Union, Zuki Wong Sze-man, said the ex-gratia payment of the voluntary scheme this time was not attractive.

"It's difficult to gauge how many people will join the scheme," she said. "But I believe it can be another option for those who have planned to resign or to immigrate."

Wong said the scheme would further undermine staff morale after the large-scale layoffs in October.

"Our salaries have been significantly reduced under the new contract, so the amount of ex-gratia payments will be much lower now," she said.

Since the scheme is voluntary, the union will not negotiate with the company, she said.

Wong also said it was hard to tell whether the company will have a new round of layoffs later.

Simon Lee Siu-po, a senior lecturer at the Chinese University's business school, said it is understandable for the airline to offer redundancy.

He also believed a new round of layoffs is possible if the response to the scheme is unsatisfactory.

Transport sector lawmaker Frankie Yick Chi-ming said the scheme is not ideal but he understands the airline is struggling and in a dilemma.

It would be worse if the company closes down and all employees would be affected, he said.