25,000 Cathay Pacific employees take unpaid leave

Another embattled airline works to 'conserve' the business amid the ongoing coronavirus outbreak

25,000 Cathay Pacific employees take unpaid leave

Over 25,000 employees at Cathay Pacific has opted to take unpaid leave to help the airline cope with the ongoing financial challenges worsened by COVID-19 outbreak.

The three-week leave program was offered in early February by CEO Augustus Tang in an internal memo. It will take place between March and June this year.

In a recent follow-up note, the CEO said many frontline and corporate employees at the Hong Kong-based airline have responded to the company’s ‘call for help’. Experts estimate the figure to be about 75% of the company’s 33,300 workforce.

However, not as many pilots or cabin crew have volunteered – about two-thirds of the 3,800-strong combined aircrew at Cathay Pacific and Cathay Dragon had opted for unpaid leave, reported the South China Morning Post.

Tang said business challenges “remain acute” for the airline, and thanked employees “for selflessly making your own contribution” and agreeing to the leave scheme.

READ MORE: Coronavirus: HR's role in business continuity plans

The cost-cutting measure is similar to efforts by several hard-hit Asia-based airlines attempting to “protect the business” and weather the harsh outbreak. Most have had to cancel flights due to the sharp decline in travel.

Cathay Pacific and subsidiaries Cathay Dragon and HK Express have cut their capacity by 40%, with over 60% of scheduled flights cancelled due to the outbreak.

Singapore Airlines Group, which includes SilkAir and budget carrier Scoot, have similarly suspended flights to mitigate the impact of the drop in demand. More than 3,000 scheduled return flights from February to end May have been temporarily put on hold.

Some measures taken by SIA include an appeal to employees to take up a voluntary no-pay leave scheme, a hiring freeze for ground staff, and a pay cut for all senior leaders.

The International Air Transport Association (IATA) predicted that airlines operating in the Asia Pacific region may lose a combined total of US$27.8 billion in revenue this year due to the global virus outbreak.

This is the first time air travel has declined since the 2008 financial crisis, said Alexandre de Juniac, CEO at IATA.

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