Cathay Union threatens action in absence of talks on wages

Business Mirror
December 5, 2012

CATHAY Pacific Airways Ltd.’s flight attendants union, which represents more than 5,800 airline cabin crew members, threatened industrial action if the carrier doesn’t agree to hold wage talks by 3 p.m. on Tuesday.

The Flight Attendants Union will set up a preparation committee for possible action, including work to rule or a strike, if the carrier declined the demand, Tsang Kwok-fung, a spokesman, said by phone on Tuesday. Elin Wong, a spokesman for the airline, didn’t immediately respond to an e-mail seeking comment.

More than 100 flight attendants staged a rally at Hong Kong’s airport on Monday after the company said last week it would raise salaries by about 2 percent next year, less than the 5 percent sought by the workers’ union.

Cathay on Monday reiterated its position on pay increments and urged the union to remain calm and put the interest of the public first.

Shares of the carrier fell 0.8 percent to HK$13.30 as of 11:40 a.m. in Hong Kong on Tuesday. The city’s benchmark Hang Seng Index was little changed.

Cathay Chief Executive Officer John Slosar told staff last month the airline faces a “very challenging year” and must cut expenses as it contends with rising fuel costs, declining fares and a cargo slump caused by the economic slowdown.

Hong Kong’s government last month increased its forecast for the city’s full-year inflation rate for 2012 to 3.9 percent from 3.7 percent, citing higher global food prices, the impact of quantitative easing in advanced economies and a renewed pickup in housing rental costs. The CPI increased 3.8 percent in October from a year earlier.

Cathay, which reported a first-half loss, has unveiled cost-cutting measures, including banning spending on festive gatherings, scrapping a management conference and cutting entertainment spending to a “bare minimum.”