SIA faces fresh turbulence as pilots show dissent

SIA faces fresh turbulence as pilots show dissent

Bernice Han, Agence France-Presse, Singapore

Singapore Airlines (SIA) is undergoing fresh turbulence soon
after recovering from the SARS epidemic amid disenchantment among
its pilots over the way the carrier has treated its staff.

The pilots' union sacked its officers last month as a sign of
protest over wage cuts agreed with management when the Severe
Acute Respiratory Syndrome (SARS) crisis rocked the travel
industry in the second quarter of the year.

The upheaval triggered a sharp response from the government,
which took steps to clip the wings of the union but also
castigated the state-controlled carrier's management over its
human resources policies.

SIA is majority owned by the government through its investment
vehicle, Temasek Holdings.

Analysts said SIA's reputation may be at stake if the
restiveness among pilots spills over to the rest of the flight
crew of an airline known for its high level of customer service
and efficient operations.

"The premium that SIA has is its service and if morale is
affected, that could hurt the product," said a regional aviation
analyst.

"They have to be careful about not affecting morale at the
airline," he said.

SARS, a mysterious flu-like disease which originated in China
and led to a massive slump in air travel, pushed the carrier into
the red for the first time with a S$312.3 million (US$182.6
million) loss in the June quarter.

SIA swiftly returned to profitability in the September quarter
when earnings topped S$306 million after pilots' wages were cut
by up to 16.5 percent and other staff were forced to take unpaid
leave.

The pilots subsequently voted to remove all 20 officials in
the Airline Pilots Association of Singapore as they felt the
union leadership had given in too easily to SIA management.

Their action was slammed by the government as
"confrontational" and a risk to Singapore's status as a regional
aviation hub, and the Trade Unions Act will be amended to strip
the union members of the right to veto agreements between the
union leadership and SIA management as a result.

The pilots' union is the only one in Singapore whose members
have the right to ratify any deal made by their leaders, and has
been vocal compared to the rest of the organized labor movement.

But while moving against the union, the government also told
SIA to improve its remuneration packages or risk hurting employee
morale and staff loyalty amid reports that SIA pilots, contrary
to popular belief, received considerably less than their
counterparts in some rival airlines.

"Employees will be incentivized to be active partners of
change if they can share in the rewards when the company performs
well," Prime Minister Goh Chok Tong's office said in a statement,
adding the carrier "must improve its human resource management."

"SIA will have to pay competitive wages to retain the services
of their good staff and gain the loyalty of its pilots and other
staff. Such changes will raise morale and increase cooperation,"
the statement said.

An airline spokesman told AFP the carrier "will continue
working towards improving communications with its employees on
the challenges facing the industry and the related components of
the national economy."

"In the current international operating environment, wage
reform is necessary and we will work with our unions and the
government to achieve this," the spokesman said.

Captain P. James, the outgoing spokesman of the pilots' union,
said it was now time for the two parties to put the acrimonious
past behind them.

"I think the challenge now for all of us is to work as
partners for the progress of the company and to regard each other
as partners," he said.

"The objective is for the company to do very well and to do
that you need staff with high morale," he added.

David Leong, managing partner of human resource recruitment
agency ManpowerCorp International, said the issue was "about
balancing the reward system."

"The whole thing arose because the pilots felt disconnected
and this comes from the compensation issue," Leong said.

He supported the government's decision to step into the
dispute.

"Singapore is too small to accept that kind of turbulence...
the whole aviation hub will be challenged," Leong said.

"If we don't balance our act properly, we are subjecting our
whole aviation industry to uncertainty," he said.