Chinese carriers face growing shortages of pilots, rare labour turmoil and poaching by rivals
Labour unrest is brewing in the Chinese airline sector with shortages of qualified personnel on the rise and established carriers trying to prevent their staff from moving to new employers for higher pay.
Initial signs of unrest first surfaced two years ago when a court in Jiangsu province ordered eight pilots who quit their jobs at an undisclosed carrier to pay between 1.07 million yuan ($143,000) and 1.86 million yuan in compensation. That came as new airlines were being established which were looking to hire qualified personnel away from the major carriers with promises of better working conditions and higher pay.
There have been a number of other such examples over the past couple of years in China, as the courts have tried to take a tough stance on pilots trying to jump ship. Things came to a head recently when China Eastern Airlines suffered an unprecedented flash strike by several of its pilots. Over the 31 March-1 April period a number of the airline's pilots returned their aircraft to departure airports after takeoff in a rare protest for better pay and working conditions. The Civil Aviation Administration of China (CAAC) later hit the carrier with a 1.5 million yuan fine over the incidents, and several pilots and senior managers were suspended from duty.
In another recent incident, Shanghai Airlines went to court seeking a combined 35 million yuan in compensation from nine pilots who are attempting to leave. According to official media reports, the carrier claims "it spent much time training these pilotsand their resignations would have a negative impact on the company's operations and flight safety". Another 10 Shanghai Airlines pilots are reportedly seeking to leave but their cases are being handled through arbitration.
Many of China's airlines have been suffering from a shortage of pilots as the domestic air transport market has been growing at rapid rates. This has forced some to hire more foreign pilots and this has increased costs. Industry observers expect the problem will only get worse in the coming years as fleet growth plans continue generally unabated, and say the pilot shortage will eat into expansion plans of airlines.
Shanghai Airlines has already admitted to facing trouble in this area. It recently announced it fell into the red in 2007, in part as more intense competition for labour slowed growth.
In an attempt to prevent widespread poaching of staff, the CAAC has introduced new rules that make it more difficult for pilots to quit to join other airlines. For example, the CAAC's East China office recently implemented a new regulation under which not more than 1% of an airline's pilots may leave each year. New rules will also reportedly force pilots who quit to join another airline to pay between 700,000 yuan and 2.1 million yuan in compensation. In addition, new carriers that are part-owned by foreign groups, such as cargo carrier Great Wall, which is part-owned by Singapore Airlines, are only allowed to hire foreign pilots.
Source: Airline Business
