Working Conditions

Behind the Defiance in the Skies: Pilots strike at China Eastern Airways and mass sick leave at Shanghai and Wuhan Airlines.

High profile strikes are rare in China and this March saw the first major pilot strike - by China Eastern pilots as well as a mass sick leave by Shanghai Airline pilots and a similar action by those in Wuhan East Star. The strike action was initially denied by all concerned but later revealed with the pilots facing dismissal and huge fines. The article below comes from a relatively open domestic magazine called China Economic Observer and gives some background into the strike. Interestingly it also makes comparisons with strike action by aviation personnel in other countries and calls for more openness regarding industrial action and mediation.

Background

In March 2008, despite extensive media coverage of an alleged strike by pilots at China Eastern Airlines the Civil Aviation Administration of China denied such claims and instead stated that disruption to schedules were due to poor weather.

According to domestic media around 14 to 18 pilots flying for China Eastern refused to land and instead returned to their departure points during regional flights in Yunnan province between 31 March and 1 April.

Sources within both the Civil Aviation Administration of China (CAAC) and the airline's Yunnan branch told Xinhua it was the severe windy weather that had forced the flights to return, rejecting media reports of a pilot strike. CAAC also denied reports of an emergency meeting held by the administration that said it mulled life bans for pilots who were responsible for organizing the alleged strike. Pilots in their turn refused to disclose details. Media inside China however stated that an April 1 emergency meeting of the Civil Aviation Administration of China (CAAC) blamed the strikes on a lack of qualified pilots and poor consultation procedures; and that pilots who took strike action would be severely punished, while strike leaders may face a lifetime employment ban.

The pilots are believed to be employed by Yunnan Airlines, a subsidiary of China Eastern, in which a Singapore Airlines attempt to buy a minority stake was recently rejected. They had earlier written an open letter to the airline's management demanding better conditions. They complained of being restricted to shorter routes and thus lower wages than colleagues in China Eastern, and of working unusually long hours. They are also unhappy about the level of tax levied on their overtime.

Further reports raised fears of a second pilot strike at Shanghai Airlines where 40 pilots called in sick simultaneously on 14 March.  At the newly-founded Wuhan East Star Airline, 11 pilots asked for sick leave on March 28. Many of those pilots calling in sick at Shanghai Airlines are now trying to leave the company but are facing a law suit for compensation.

China Eastern who also initially said the flights were disrupted due to bad weather but later acknowledged that a "human element" was involved. It then posted a public apology on its website and promised proper handling of complaints that resulted from the disrupted flights. "The incident has revealed that we have problems in our operations. We will take this as an important lesson." It then suspended two senior executives at the unit and grounded pilots involved in the incident pledging to “punish” those involved.

Caijing reported the alleged strike action aimed to call for better treatment of pilots and urged the airlines to improve management. Pilots were facing stagnant wage levels and increased work loads. China has around 12,000 pilots but is facing increasing pressure to train new pilots to cope with rapidly rising demand for internal and regional flights.

Pilots in state-owned companies are believed to be commonly forced to sign 99-year contracts binding them to the companies. If they leave they are required to pay compensation ranging from 700,000 to 2.1 million yuan ($US98, 591 to $US295, 000). Several pilots have reportedly filed a series of lawsuits against the airline companies over the past two years but these have been either ignored or rejected outright by the authorities. Previously, in 2006, six pilots from China Eastern Airlines resorted to a hunger strike over their attempts at resignations.  One pilot from China Eastern Airlines was quoted as saying: “The only way left for us is to go on strike.”

CAAC then fined China Eastern Airlines 1.5 million yuan (S$290,100) and suspended the airline's operating licenses on certain routes in southern China's Yunnan province and will transfer the operating licenses to other carriers.

The East China branch of the CAAC then followed with a regulation stating that no airline could lose more than 1 per cent of its pilots annually. Any additional pilots who quit would be liable to pay their employer up to $324,000 compensation. Following that ruling, China Eastern Airlines required its entire workforce on April 8 to pledge to ``uphold professional values''.

Shanghai Airlines then filed suit in a local court seeking a combined 35 million yuan in compensation from nine pilots taking part in the March sick leave action who want to leave the company.

In a related case, China Eastern claimed 12.57 million yuan in compensation from Yunnan-based pilot Zheng Zhihong (郑志宏), who resigned in 2007. On 25 April, the Kunming Intermediate Court sentenced Zheng Zhihong, a captain at China Eastern Airlines' Yunnan subsidiary, to pay 1.34 million yuan in training fees within 30 days to China Eastern. Zheng should also return his salary of 73,005 yuan to the company within 15 days of his June 18, 2007, resignation. The court also told China Eastern to transfer Zheng's files to the Civil Aviation Administration within 15 days to allow Zheng to find a new job.

Zheng was first sentenced to pay 1.37 million yuan in compensation in December by Kunming Guandu Court. The Guandu Court also sentenced the company to transfer Zheng's files within three months, previous reports said. Both Zheng and the company appealed the verdict. Zheng said he was satisfied with the final verdict and called it a "win-win outcome" because he did not need to wait for three months to find another job, the official report said. China Eastern Airlines had asked for 12.57 million yuan from Zheng to compensate training costs.
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China Economic Observer online
OPINION: Behind the Defiance in the Skies 　

By Sun Liping   Observer, page 43, issue no. 363, April 14, 2008
Translated by Ren Yujie Original articles: [Chinese]

The author of this commentary piece is a social sciences lecturer with Tsinghua University.

Though the high-profile China Eastern Airlines (CEA) "flights disruption” case in Yunnan took place on March 31, the "truth" only emerged slowly over time.

The disruption was undoubtedly an intentional one. At first, the CEA firmly denied it was due to a strike by the pilots. Instead, it gave the excuse that 18 flights turned back midway without landing at designated areas because of "poor weather conditions".

The explanation immediately raised doubts among passengers and industry experts. Why were all other flights able to land that day except those of CEA? To counter the doubts, the CEA gave another excuse that it had a stricter standards than others in guarding flight security, and the weather that day was not up to mark.

An investigation by the Civil Aviation Administration of China (CAAC) identified "human elements" in the disruptions, citing that pilots from the CEA's Yunan branch were involved*. In other words, the disruption was in fact a strike.

(*The article was written before the CAAC ruling came on April 17, when CEA was fined 1.5 million yuan, had some of its routes taken over by rival airlines, and told to take action against those responsible and uphold safety.)

The strike resulted from clash of interests between pilots and the carrier. Media reports have suggested that pilots and cabin crews were unhappy with declined incomes after Yunnan Airlines merged with CEA (back in 2002). There also was a salary gap between state-owned and private airlines. Internet rumors said that the pilots were taxed up to 30% of their earnings, unlike other airlines staff who could evade taxes through legal channels and submitted only about 5% of their salaries.

Ultimately, the strike harmed the interests of all parties involved.

For the pilots, the heaviest price they paid is losing the public's confidence and having their professional ethics questioned. In some countries, such action would have ended these pilots' careers. They have been criticized by the public for crossing the line in their dispute with the carrier.

In disputes between workers and employers, the public usually showers sympathy on the weaker party -- workers. This time around, however, public sentiment is reversed.

I believe the key question is not about the "fight", but the way the "fight" was conducted. When 18 flights turned back midway, the lives and safety of thousands of people were in question; the action was akin to hijacking a flight or kidnapping the passengers. In other words, the pilots had used public interest as a bargaining chip.

CEA too has suffered greatly. Apparently, many travelers have avoided flying with CEA after the incident. Some net users have been posting comments at online flights booking forums calling for a boycott of the CEA. The airlines' spokesperson has admitted that the fall-out is as serious as having an air crash.

In fact, the real issue in question here is the airlines' integrity. The China Consumers' Association has pointed out that CEA's initial denial was proven wrong by the CAAC's investigation; and that the carrier deliberately tried to mislead consumers, thus should be prosecuted under related laws on consumers' rights protection. For finding unreasonable excuses to downplay a negative incident, the carrier has paid with its image, and its dented integrity will take a long time to recover.

Another interesting point about the incident was that the whole event was shrouded in mystery. Even up till now, details are scant. Those involved have been planning the strike secretly, like an underground movement. Almost all media reports on the event have touched on a mysterious letter entitled "A Letter to the CEA Pilots of Yunnan Branch", circulating among pilots' in the two days prior the event.

The letter has listed four contentious issues. First, the pilots' incomes are lower than their counterparts in the industry; second, certain inspection procedures imposed on pilots are humiliating for the profession; third, their salaries and allowance packages are unmatched with the taxation standards; and forth, the injustice against Zheng Zhihong, a former CEA pilot who crossed over to another airlines and had to pay the former a huge sum of compensation (1.37 million yuan).

The letter ended by saying: "We hope everyone will speak up freely and make concerted efforts for a healthier and happier working environment, for flying safety, for the smooth and harmonious growth of the company." Those pilots who later participated in the "flights disruption" incident have all mentioned the letter. However, the author of the letter remains unknown.

In addition, the actual organization of the "strike" involving 18 flights and 40 cabin crew remains unknown. All those questioned have denied there was a leader.

Let's compare the incident with strikes in other places. A reporter who has covered the strike of Hong Kong's Cathay Pacific Airways once wrote: "pilots were organized by their union, which meticulously mapped out a strategy."

The airlines cabin crew targeted the peak flying season when all airlines were tight with manpower. The pilots either applied for sick leave en mass, or deployed what was called "wild cat" tactic, meaning the pilots would apply for sick leave after landing in overseas destinations, which resulted in the airlines inability to mobilize replacement for flights back to Hong Kong.

In addition, the union would tap the power of media and public opinion. Details of the negotiation process would be leaked to the media, generating public attention to exert pressure on the airlines.

Another strike that nearly happened with British Airways earlier this year had highlighted the use of law. Its union was unhappy with the carrier's decision to hire pilots at inferior pay, and during a union meeting, the pilots voted for carrying out a strike. However, the airlines had avoided the incident by seeking a court injunction.

The above cases were all related to conflict of interests and the fights for interests, however, the ways of fighting differed, so were the impacts. In other places, a strike is carried out openly and abides by certain rules of the game; whereas the CEA case has been brewing in the dark. The earlier is predictable and responses to avert crisis can be drafted in time, unlike the latter.

The differences arise not because of the fighters' differed mentalities, but more due to a different legal environment. In places where the laws have clearly stipulated the rights and boundaries for a strike, the fight is conducted openly for public scrutiny – including the interest parties, consumers and the government.

In China, carrying out a strike is considered illegal. When the weaker party, namely the workers, wish to exert pressure on their employer, they could only go underground. Thus the fight is carried out secretly without a regulatory framework, and where the wild card is potentially more harmful to the larger society and economy.

Not only are we lacking a regulatory mechanism to mediate such conflicts, we are further pushing the "fight" to go underground with talks of severe punishment for the culprits. In the CEA case, there was not a single body representing the cabin crew for negotiation, rather the carrier and investigators have to individually talk to all those involved.

The CEA case has underscored a deficiency in our legal framework.

Full text found at http://www.eeo.com.cn/ens/Observer/2008/04/22/97640.html