| FOR IMMEDIATE RELEASE | 8 December 2009 |
Cathay Pacific Airways today announced that the majority of its eligible Hong Kong-based staff will receive an average salary increase of 1.8 per cent in 2010.
The difficulties the airline has faced during the recent global economic downturn mean it is once again unable to pay the usual one month's salary as a discretionary year-end bonus to eligible Hong Kong-based employees. However, it will make an ex-gratia payment to all such employees of an amount equal to half a month's salary or HK$8,000, whichever is the greater.
The announcement comes after Cathay Pacific - along with the rest of the aviation industry - has suffered one of its worst years in recent history. The deep and sustained downturn that began in the latter part of 2008 had a significant impact on the airline's revenues from both its passenger and cargo businesses.
Cathay Pacific Chief Executive Tony Tyler said: "We have been through a lot in the past year and we are still in a vulnerable position. While we have seen a noticeable, and very welcome, pick-up in business over the past couple of months, it cannot compensate for the massive slide in business seen in the first nine months - and we still don't know whether the current upturn will continue into next year.
"For that reason we are again unable to pay the usual one month's salary as a discretionary year-end bonus for our Hong Kong-based employees. However, I am pleased to be able to announce that we will give a salary increment for 2010 along with the ex-gratia payment for eligible staff. We recognise the great effort our staff have made and the support they have given the airline during what has been a very challenging period."
As a commercial airline with no government financial support or subsidies, Cathay Pacific had to work to manage its resources in a responsible and prudent manner in the interests of shareholders and staff. The airline took a number of measures in reaction to the business downturn including reducing capacity, cutting back frequencies, parking a number of aircraft, deferring major capital expenditure and introducing cost-saving measures that included inviting all staff to take part in a no-paid leave scheme. The so-called "Special Leave Scheme" received overwhelming support from colleagues around the world.
Mr Tyler said that while it appears the worst is now over, there is still uncertainty over whether the airline's business will recover to levels seen previously. "For that reason we will continue to manage our finances prudently and keep a very close eye on costs in order to preserve the financial health and well-being of the airline," Mr Tyler said.
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