After a week of negotiations, Cathay Dragon flight attendants have won a 3% pay rise, along with a commitment from the airline to discuss raising the mandatory retirement age to that enjoyed by their colleagues at Cathay Pacific. The wage deal is the first to be agreed since Cathay announced it had turned a profit for the first time in three years.
“Our cabin crew are well deserved to have a good pay rise as a recognition of their hardship,” explained a spokesperson for the union that represents Cathay Dragon flight attendants shortly before talks got underway. Formally known as Dragonair, the wholly owned subsidiary of Cathay Pacific was rebranded as Cathay Dragon in 2016.
Flight attendants at the mainline carrier won a 3% pay rise and an annual bonus worth a months salary after negotiations concluded late last year. While Cathay Pacific flight attendants initially demanded a 5.5% pay rise, they did win the right to up their retirement age from 55 years old to 60.
While Cathay Dragon flight attendants haven’t yet won the right to increase their own retirement age, the company has agreed to start negotiations on the issue. Such a move would bring the airline in line with many of its competitors in the region including Singapore Airlines and Thai Airways.
The Hong Kong Dragon Airlines Flight Attendants Association has also won an agreement to improve hotel accommodation and uniform entitlement such as improved crew luggage.
The Cathay Pacific group recently reported a profit of HK$2.3 billion profit (approximately USD $293 million) for 2018 – a significant improvement on the HK$263 million (US$33 million) loss it made in 2018.
However, Cathay’s chairman, John Slosar was cautious about market conditions: “The environment in which our airlines operated was as ever difficult in 2018,” he explained. “Competition was intense, fuel prices increased and the US dollar strengthened.”
Slosar attributes much of Cathay’s success on a three-year transformation plan that the airline put in place in 2017. The airline has made difficult cost-cutting decisions like cutting hundreds of Head Office middle management jobs, while also making investments in the passenger experience.
Pilots at the airline recently overwhelmingly rejected a pay deal despite Cathay Pacific improving its offer and backing down from a controversial plan to cut housing allowances. Talks are set to go to mediation in May but if that fails a backstop agreement of a mere 1% pay rise might be implemented.