The facts about the SIA dispute

January 7, 2004
Singapore Democrats

This post is at least a year old. Some of the links in this post may no longer work correctly.

The letter below was first posted at www.pprune.org/forums

The situation regarding the pay of SIA pilots has been so confused by 9/11, SARS and the Singapore governments pronouncements on the subject that there appears to be a need to get back to basics in the hope that a little common sense might prevail. I write this in the hope that a thread may develop that deals with facts and avoids descending into a slanging match.

Fact 1.
The Collective Agreement (SIA pilots pay package) that expired on 14 Dec 2003 came in to effect on 15 Dec 2000. This agreement replaced the one that expired on 20 Nov 1998 and the pay scales where thus backdated to that time. The pay scales applicable to SIA pilots prior to the present pay cut are therefore just over five years old.

Fact 2.
Following 9/11 SIA cut staff pay in order to avoid retrenchments and reduce losses. The pay was never returned and the group made a profit in the region of $680,000,000. The pay cuts therefore increased a profit rather than reduced a loss.

Fact 3.
In response to the effects of SARS SIA sought massive reductions in salary that amounted to nearly 40% when all factors were taken in to account. They eventually achieved a reduction of 16.5% in the case of Captains but the reduction in take home pay was very much higher when reduced flying and no pay leave were added in to the equation.

Fact 4.
SIA made its first ever quarterly loss in Q1 of 2003. That loss was recouped by the end of Q2 (September). SIA will nevertheless continue to cut staff pay until the end of March whilst making very considerable profits and at a time when staff are working as hard as they have ever done.

Fact 5.
SIA will repay the deducted salary plus 15% if the end of year profit exceeds $600,000,000. That 15% of deducted salary is less than the bonus that would be paid under the normal bonus scheme.

Fact 6.
SIA have unilaterally abolished payments of 10% of basic salary into a provident scheme that affects approximately 1200 staff without replacing those contributions.

Fact 7.
The SIA pilots union (ALPAS) agreed to the measures taken under Facts 2 & 3 above under the guidance of their leadership. This was the major factor leading to the eventual vote of no confidence in that leadership.

Fact 8.
Much has been made of performance related pay. The pay structure in SIA already takes account of this. A pilot who does not fly at all in a month receives 48% less than one who flies the legal maximum number of hours. In addition, bonus payments account for a 28% difference in pay between a no profit year and a maximum bonus year. The target of 30% is thus already massively exceeded.

Fact 9.
ALPAS and the non-union pilots of SIA have made no threats against the Company.

Fact 10.
Government Ministers from the Senior Minister down have made repeated statements implying that the pilots of SIA are threatening the future of SIA and the economy of Singapore itself.

Those are enough facts to be going on with. A perusal of the above suggests to me that SIA have panicked in reaction to the novel experience of losing money for a few months against a background of making money for many years. Whilst cost saving measures were clearly required, the severity and duration of the pay cuts inflicted on the staff show scant regard for the supposed Core Values of SIA as well as the financial and spiritual welfare of staff and amount to a supreme demonstration of appalling Human Resource management.

The confrontational pilots” have seen a far from generous pay package (by international airline standards) that is already five years out of date eroded at every turn by a management that appears intent on destroying the very trust and dedication that a very good airline was built on. It would be a sad day if the pilots of SIA were not concerned by the direction being taken by the management of SIA apparently with the full support of the government.

Ministers have made much of the importance of SIA, Changi Airport and Singapores air hub status. In view of that importance it is time to stop the attacks on the goose that lays the golden egg. Perhaps the generals should return to the armed forces and one of the worlds great airlines should be run by airline professionals that can make the most of the fantastic advantages enjoyed by SIA. The staff are available to help continue the remarkable success of SIA but if the present attitude prevails they may not be available much longer.

SIA pilots are forbidden from discussing these matters by Company rules. Are there any white knights out there who can help to point out the injustice of this sad situation?