Wednesday, July 16, 2014

MALAYSIA:::Take pay cut, MAS unions told

Unless the MAS unions are willing to work with the airline to get over its financial woes, nothing is going to change, say economists
MASKUALA LUMPUR: Two economists have advised employees of Malaysia Airlines System (MAS) to get their priorities right to enable the national airline to survive these turbulent times.
Universiti Utara Malaysia’s Prof. Dr. Amir Hussin Baharudin said it would not serve any purpose for the unions to demand a meeting with the Prime Minister without any concrete plans to turn around the airline which itself is overstaffed.

He said he was baffled as to what role the unions were actually playing in the airline’s deep financial woes because they portrayed themselves as neither adversaries nor friends.
He said when Japan Airlines was facing financial distress like MAS, its employees rallied behind the management and it emerged stronger and more profitable.
Dr. Amir Hussin said union activism and unreasonable demands when the car market was weak, were major causes for bankruptcy in 2008 of 100-year-old General Motors and at one time the world’s biggest car maker.
He also cited what happened at Delta Airlines, another American company, as lessons which unions affiliated to MAS can learn from.
When Delta Airlines was bleeding like MAS, the first initiative came from the employees, including pilots, who voluntarily took a pay cut and with the CEO taking a 35% cut, he said.
“This was supposed to be a temporary measure until the airline got over its problems but the workforce decided to continue being paid less as long as they kept their jobs. Since 2006, Delta Airlines has become stronger and much more profitable,” Dr.Amir Hussin added.
“So if the MAS unions in wanting to meet the Prime Minister are willing to take a pay cut and forego their bonus for the next five years, I think even he would be happy to meet them. But if this is not the case, then forget about it, as nothing will be resolved.
“Without the workers and management seeing eye to eye, it may be the last time we need to talk about MAS,” he warned.
University of Science and Technology School of Business dean Dr.Yeah Kim Leng, who is also ex-group chief economist of RAM Holdings, said the demand of unions for the resignation of the airline’s top management executives was a distraction and could derail any proposed restructuring plan.
“Firstly, it should not be politicised and be purely made as commercial decisions. So, the less political interference, the less political consideration, the better for MAS in terms of having a more sound and commercially-viable restructuring plan,” he added.

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