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Cathay Pacific, Flight Attendants Fail to Reach Accord

Cathay Pacific Union Talks Start Today With Government Mediators
A Cathay Pacific Airways Ltd. aircraft takes off from Chek Lap Kok Airport in Hong Kong, China. Photographer: Jerome Favre/Bloomberg

Dec. 19 (Bloomberg) -- Cathay Pacific Airways Ltd. and its cabin crew union failed to reach an agreement in talks yesterday as government mediators seek to avert possible industrial action during the year-end travel rush.

The Cathay Pacific Airways Flight Attendants Union will begin protests if negotiations don’t produce “significant progress” by the end of today, the group said in an e-mailed statement yesterday, adding that management suggestions can’t address the concerns of cabin crew. Members may work to rule or reduce services, the union said earlier.

The airline’s assessment of the talks was more positive: it called them “constructive” with “good progress made,” according to an e-mail. Talks resume today, Cathay said. The airline and the union didn’t disclose topics discussed.

The discussions are focused on work patterns and conditions, Tsang Kwok-fung, a spokesman for the labor group said by telephone before talks started yesterday. Shifts and routes affect cabin crew’s pay because they get extra allowances for longer flights. The union represents more than 5,800 of the Hong Kong-based airline’s 9,000 flight attendants. It has no plans to strike over Christmas or New Year’s Eve, Tsang said.

The dispute comes as slumping long-haul travel demand forces Cathay to cut capacity in a bid to end losses. The cuts affect cabin crew because allowances make intercontinental flights more lucrative and help speed promotions.

Cathay has said it won’t raise pay by more than 2 percent. That’s “very much” a final decision, Chief Executive Officer John Slosar said in an interview published in the South China Morning Post yesterday. The union earlier asked for as much as 5 percent.

The airline’s stock fell 0.7 percent to HK$13.88 in Hong Kong trading yesterday and has gained 4.2 percent this year, compared with a 22 percent climb in the benchmark Hang Seng Index.

The last time Cathay flight attendants went on strike was during the Lunar New Year holiday in 1993, when about 1,000 cabin crew walked out for 17 days, the longest in the union’s history, according to Tsang. Since then, there have been smaller actions such as working to rule, he said.

To contact the reporters 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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