Bloomberg News

Cathay Union Accepts Deal Averting Christmas Protests

December 20, 2012

Cathay Pacific Cabin Crew Sets Noon Deadline in Labor Talks

Cathay Pacific flight attendants stage a protest at the international airport in Hong Kong on Dec. 3, 2012. Photographer: Philippe Lopez/AFP/Getty Images

Cathay Pacific Airways Ltd. (293), Asia’s biggest international carrier, and its flight attendants union agreed on a labor deal, averting the threat of possible industrial action over the Christmas travel period.

The accord includes changes in flight patterns and working conditions, Dora Lai, the union’s chairwoman, told reporters in Hong Kong today. The group had set a noon deadline for Cathay to respond to a proposal following two days of talks with management and government mediators.

The agreement means Hong Kong-based Cathay and its passengers won’t have to contend with flight attendants working- to-rule during the year-end rush. The union had also said it could stage a strike next year if no agreement was reached.

“This is the best possible outcome for our customers, who have always been at the forefront of this issue for us,” Chief Executive Officer John Slosar said in an e-mailed statement. “They can now look forward to their holiday travel plans with confidence.”

The carrier also agreed to keep overseas attendants within 15 percent of total crew staffing in the two years starting Jan. 1, Liza Ng, Cathay’s cabin crew general manager said. All destinations will remain available to Hong Kong based crew, she said.

Pay Increase

The dispute, which intensified after the carrier announced Nov. 30 a pay increase of about 2 percent against the union’s 5 percent demand, mainly focused on Cathay’s use of cabin crew based outside of Hong Kong, some of whom receive less pay than staff living in the city.

Coupled with the airline cutting long-haul flights because of slower demand, Hong Kong-based flight attendants faced potentially fewer flight hours, lower take-home pay, and reduced opportunities for promotion, according to the labor group.

Union members had authorized leaders to initiate industrial action in a vote earlier this month. The group represents more than 5,800 of Cathay’s 9,000 cabin crew.

“We were worried that more jobs may go to overseas,” Lai said. “Now we are satisfied because it gives us some guarantee of local positions.”

The carrier fell 0.3 percent to HK$14.08 at the close in Hong Kong trading. It has risen 5.7 percent this year, compared with a 23 percent gain for the city’s Hang Seng Index.

Cathay flight attendants haven’t gone on strike since the Lunar New Year holiday in 1993, when about 1,000 walked out for 17 days, according to Tsang Kwok-fung, a spokesman for the union. Since then, there have been smaller actions such as working to rule, he said.

To contact the reporter on this story: Jasmine Wang in Hong Kong at jwang513@bloomberg.net

To contact the editor responsible for this story: Neil Denslow at ndenslow@bloomberg.net


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