Cathay raises pilots’ school-fees cap, pledges no pay cuts

Cathay Pacific Airways Ltd. raised the allowance it gives to pilots to cover their kids’ school fees by 50% and locked in pay benchmarks for two years as it tackles a chronic shortage of aircrew that’s led to mass flight cancellations.

Hong Kong’s biggest airline will increase its school-fee cap 50% to HK$150,000 ($19,180) for each eligible child between 11 and 18 years’ old, according to a memo seen by Bloomberg News. Other incentives include a pledge to keep a metric of hours flown that’s tied to take-home pay the same through the end of 2025, essentially averting pay cuts.

Cathay said in a statement it will continue to listen to and communicate with the pilot community to make enhancements where appropriate.

The company has been scrambling to hire more pilots, after Covid-related job losses gutted its ranks and pay cuts for those that remained — more than 45% for some crew — sparked an exodus. The shortage of captains and first officers, and a sudden uptick in seasonal illnesses, culminated in mass flight cancellations through the end of February that prompted the pilots’ union to call for a government inquiry into the carrier’s handling of the issue.

Hong Kong Chief Executive John Lee said earlier this month he’s very concerned by the cancellations as flight capacity is important to the city’s role as a transportation hub. Cathay has been asked by the government to submit a report by the end of January explain the cause of the incident and its approach to handling flight arrangements in order to prevent similar incidents occurring again.

Still, it’s unlikely the latest round of enticements will be enough to solve Cathay’s long-term image problem and pilot shortage, according to the union.

“This is an admission by Cathay management that pilot pay remains uncompetitive,” Hong Kong Aircrew Officers Association Chairman Paul Weatherilt. “But it’s a piecemeal approach — what is required is a comprehensive and mutually enforceable contract.”