SIA chief takes 20% pay reduction

Singapore - The head of Singapore Airlines (SIA) will take a 20% pay cut, while his management team will have their salaries slashed between 10-20% in a bid to boost the airline's financial position, battered by weak travel demand and volatile oil prices.

From 1 July 2009, all management staff in SIA will take a salary cut, with Chew Choon Seng, CEO of SIA taking a 20% pay cut, with progressively lower rates down the ranks, to a minimum of 10%, the airline said.

In response, Board of Directors at SIA has volunteered with a 20% cut in directors fees.

Approximately 2,000 airline employees have signed up for the company's voluntary no-pay leave scheme, where staff could apply for leave without pay for up to two years.

In addition, the Air Line Pilots Association - Singapore (ALPA-S) have signed an agreement with SIA, for all pilots in the airline to take one day unpaid leave each month and a cut of 65% to one day's pay, pro-rated from monthly basic salary.

The agreement which will take effect from 1 July, augments a series of measures taken by SIA to mitigate the cost of excess staff resources resulting from the global business downturn.

According to SIA, the airline currently has a surplus in its pool of pilots due to an earlier capacity reduction following the sharp fall in demand for air travel.

SIA will decommission 16 aircraft before 31 March 2010, while fewer flights will be operated and capacity produced will be lower by 11% from the preceding year.

These costs saving initiatives are expected to save the airline S$21 million (US$14.4 million) in the current financial year.

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