Singapore Airlines ends MVC salary cuts for S’pore-based staff from Aug 1

SINGAPORE – National carrier Singapore Airlines (SIA) has ceased monthly variable component (MVC) cuts to basic salary for all its Singapore-based staff since Aug 1, it said in a statement on Friday (Aug 13).

The airline implemented MVC cuts, along with no-pay leave, hiring freeze and retrenchments, to cut expenditures last September.

But additional pay cuts for pilots remain in place, as per an agreement with the Air Line Pilots Association – Singapore union last year to mitigate further job losses for pilots.

SIA’s senior management also continue to take additional pay cuts to their basic salary – 15 per cent for senior vice-presidents, 20 per cent for executive vice-presidents and 25 per cent for the chief executive.

Board members will continue taking a 30 per cent cut in fees in solidarity with the management, the airline noted.

A staff circular issued by SIA CEO Goh Choon Phong on Wednesday (Aug 11), seen by The Straits Times, stated that the ending of the MVC cut of basic salary for Singapore-based staff is applicable for the remainder of the financial year, from August 2021 to March 2022.

Additional pay cuts for managers up to divisional vice-presidents will also cease, he said.

Mr Goh noted in the circular that SIA had announced in July a reduction in the MVC wage cuts from 10 per cent to 5 per cent as per its collective agreements, for the August to October period.

This applied to Singapore-based employees up to the level of divisional vice-president.

The cessation of some of the wage cuts from August is a “recognition of the prolonged sacrifices” that staff have made, Mr Goh said.

“Many uncertainties remain ahead, and the competition will be stiff in the new normal. We must continue to maintain a tight lid on costs, while being nimble and agile to grab all revenue and growth opportunities in the market,” he added.

SIA implemented a range of cost-cutting measures during the stages of the pandemic last year, including the renegotiating of contracts with suppliers and deferring non-critical projects.

Its staff measures, including voluntary release schemes and no-pay leave, resulted in staff numbers dropping by 20 per cent compared with pre-Covid-19 levels.

In its statement, SIA said that since its retrenchment exercise last year, it has experienced higher attrition among ground staff and cabin crew, with staff continuing to suffer a reduction in salary over the past 1½ years.

The group decided to cut around 4,300 positions across its carriers – SIA, SilkAir and Scoot – last September, a move that affected about 2,400 employees after accounting for measures such as a recruitment freeze and natural attrition.

The airline will continue to make the necessary investments in its people and the business to ensure that it can emerge stronger and fitter as international travel recovers, SIA said.

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