It’s always nice to see airline executives leading by example. When times are tough, airline executives are quick to cut the pay of employees, asking them to be understanding of the sacrifices that are needed, and then give themselves big bonuses for all of their cost cutting. It’s nice when an airline doesn’t take that approach, for once.
In this post:
Singapore Airlines CEO takes 15% pay cut
Just about all airlines in Asia are being hit hard by the coronavirus outbreak, given the reduced demand for travel. Singapore Airlines is no exception. The company is now reducing pay… but only for management.
As reported by the Straits Times, a memo sent out to Singapore Airlines employees on Friday talks about how management employees will be taking pay cuts:
- The CEO will be taking a 15% pay cut as of March 1
- The Board of Directors will be taking a 15% pay cut as of March 1
- Executive Vice Presidents will be taking a 12% pay cut as of March 1
- Senior Vice Presidents will be taking a 10% pay cut as of March 1
- Divisional Vice Presidents will be taking a 7% pay cut as of April 1
- Senior Managers and Managers will be taking a 5% pay cut as of May 1
Expect other cuts from Singapore Airlines
In light of the huge reduction in demand as a result of coronavirus, Singapore Airlines Group (including Singapore Airlines, SilkAir, and Scoot), have cut more than 3,000 flights through the end of May, which represents nearly 10% of their capacity.
As far as other employees go, Singapore Airlines is introducing a voluntary no-pay leave scheme, and the company will also engage staff unions to discuss additional measures that can be taken.
On top of that, there will be some broader cost-cutting measures, including deferring capital expenditures.
As was stated by Singapore Airlines’ CEO in the note:
“We will continue to be proactive in implementing measures to meet the evolving challenges. Tough decisions will be needed along the way. Management will take the lead, and all of us must be prepared to make sacrifices. Our priority is to save jobs.”
Bottom line
Kudos to Singapore Airlines’ CEO for this gesture. He’s the first airline CEO I know of to voluntarily take a pay cut as a result of this situation.
If tough times are ahead for the company (and employees), then it sure is nice when the CEO is the first person to make a sacrifice.
people quick to say pr stunt when no us legacy ceos are taking any paycut. taking some paycut is better than us ceos that have all the employees take the burn. You wonder why us airlines never improve with ignorant passengers telling from the comments here. when the interest of the top are taking a hit along with everyone else it keeps them aware and focused on the bigger picture. Not themselves like the us legacy ceos.
In case you're interested, in the wider context virtually all members of the Singapore government and civil service are taking large pay cuts. (The coronavirus is taking its toll on the economy.) I suppose as the national carrier SIA isn't exempt. It's for optics of course but an appreciated gesture.
Isn't this 15% paycut is just for one month only ? Or for a year of pay cut ?
Meanwhile, Philippine Airlines, is quick to pull the trigger. They even used a screencap of your post. You might want to check this out Lucky. https://bilyonaryo.com.ph/2020/03/02/sacrificial-lambs-singapore-airlines-ceo-shares-pain-of-travel-crisis-while-lucio-tan-makes-pal-employees-take-all-the-brunt-palea/
I find it amazing that people are quick to run down someone who has taken a pay cut to the size of 15% and are able to justify it by saying he was making heaps anyway and wont miss it. I would ask them whether in their working lives have they ever taken a voluntary pay cut when they didn't need to? I bet not.
When earning money, it does not matter at what...
I find it amazing that people are quick to run down someone who has taken a pay cut to the size of 15% and are able to justify it by saying he was making heaps anyway and wont miss it. I would ask them whether in their working lives have they ever taken a voluntary pay cut when they didn't need to? I bet not.
When earning money, it does not matter at what level, there are always living expenses and other expenses that need to be met. Yes a lot of these are increased as a result of no longer eating minced beef, now eating top cuts of beef, or not having the occasional meal at a fast food restaurant and eating Michelin rated restaurants. But a sacrifice is being made. It didn't need to be.
For those complaining about American CEOs.
Taking 15% cut just doesn't work.
Either you take $1 salary or you don't. Anything in between is a failed PR stunt (just like all those who complain about 15%)
The reason is taking 15% cut doesn't change anything. CEO will still make big money and the saving isn't big enough to save the company. Employees see through that. However if the cut does make a...
For those complaining about American CEOs.
Taking 15% cut just doesn't work.
Either you take $1 salary or you don't. Anything in between is a failed PR stunt (just like all those who complain about 15%)
The reason is taking 15% cut doesn't change anything. CEO will still make big money and the saving isn't big enough to save the company. Employees see through that. However if the cut does make a difference then the CEO is grossly overpaid already.
A pay cut is a lose-lose option.
If the CEOs really wanted to show employees that they care then they should take a $1 salary as a symbolic gesture that they are in it together not a pay cut that doesn't affect the CEOs at all.
American CEOs are smart enough to realize this stupid stunt will get no where, they might as well just keep the money, LOL.
SIA has always had a history of everyone top down from the CEO to the ticket agent taking cuts when they have to for the benefit of the airline when times get tough. They have also in the past profit shared very generously on the upside after they have to go through these down turns to reward the personal sacrifice of all staff. That's one of many reasons they have remained such a top world class airline for decades.
I appreciate leadership taking the first cut. I know the popular rhetoric right now is to crap on wealthy or successful people, but taking a bigger pay cut than the one you are asking your subordinates to take is good leadership and I applaud it.
This is a PR stunt. This company is a brand, a symbol of the nation. It’s synonymous to statue of liberty in US or eiffel in france. Government will spend tax payer money to maintain them. Temasek aka the Government will keep injecting money to the company. No one will lose their job in SQ. Union? It’s singapore, union has no power.
It depends on the person. Plenty of wealthy people would fight tooth and nail over giving up 15% of their pay. My mom's net worth is easily in the 7 figures and she will stand in the customer service line at the grocery store if they overcharge her a mere $2. It's crazy.
I thought CEO of AA has base salary of $0 given all his pay is based on AA stock?
As for SQ CEO, I agree it’s great to see a 15% paycut but when they make millions a year that’s like winning the lottery every year!
So management are taking tiny hits to their fat salaries just before they put thousands of rank and file workers out of their jobs. Yup, really impressive.
Exactly, all these people claiming 15% doesn’t matter, yet all the American and European CEOs won’t even take that kind of pay cut to show solidarity with their employees.
No matter what y’all want to say but can you imagine other airlines such as BA or the legacy carriers of the US ever willing to take a pay cut from manager to CEO level?
I also heard that Vietnam Airlines management will be taking a pay cut. I’m unsure if they’re also asking other employees to take a pay cut as well, but it could be worth following up on.
15% is 15% but for the money he makes it won’t make a hole in his wallet.
The 15% pay payment is not worth it at all for persons who are already earning big
A 15% pay cut is not impressive for people who are already earning a fortune and could stop working at any time
SIA CEO earns total $5.5 million in last FY
According to SIA Annual Report FY2018/19, Goh earns $1.4 million in salary or about $116K a month. Including bonuses, shares and benefits, his total package amounted to some $5.5 million in the last FY.