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  • Topic: Airline, Cathay Pacific, Dragonair
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  • Published : January 15, 2013
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1. Introduction of Cathay Pacific Airways
Cathay Pacific Airways Limited, which was founded in 1946, is an international airline registered and based in Hong Kong, offering scheduled passenger and cargo services to 162 destinations in 42 countries and territories around the world. With a fleet of 132 aircraft, the substantial investments of Cathay Pacific include catering, ground-handling companies and the corporate headquarters at Hong Kong International Airport. As a wholly airline owned subsidiary of Cathay Pacific, Hong Kong Dragon Airlines Limited (“Dragonair”) operates 32 aircraft on scheduled services to 33 destinations in Mainland China and elsewhere in Asia. In 1999, Cathay Pacific co-founded the Oneworld global alliance with its subsidiary, Dragonair, as an affiliate member of Oneworld. Nowadays, Cathay Pacific and its subsidiaries employ more than 29,000 people worldwide (more than 22,000 of them are in Hong Kong). Today's Cathay Pacific has quickly grown into one of the most powerful airlines in Asia. [1]

(Sources from: Cathay Pacific Airways Limited Annual Report 2011, p26) 2. External Environment Pressures and Business Strategy
With the slogan——People. They make an airline, Cathay Pacific has committing to become the most admired airline in the past six decades. Although the development of Cathay Pacific during this period was not easy: suffered adverse impact from the aviation industry overcapacity, experienced the Asian financial crisis and avian influenza in 1997, faced with the pilots’ collective strike in 1999, experienced "911" and SARS, impacted by the ever-fluctuating fuel price and the rapid development of budget airlines in the past decade, Cathay Pacific has made a series of strategic responses to solve these crisis and challenge actively.

In the mid-1990s, with the growing aviation market competition, the company’s original rigid management system has restricted the development of Cathay Pacific. Increasingly fierce competition in the aviation market urgently required further innovation of aviation industry towards the goal of efficiency improving, simplifying processes and further cost leadership. At that time, human resources department of Cathay Pacific has immediately conducted internal human resource reorganization and implemented a new HR practice named “The Best Performance Actions” to adapt the company’s restruction. Employee job evaluation methods have been timely updated by the HR managers. The positions within company were readjusted to A, B, C, D, E five grades. Nowadays, the position grade has become an essential reference for assessing welfare standards of staff. In 2009, Cathay Pacific started developing “Sustainable Development Strategy” as their new business strategy and decided to implement five prior areas within company up to 2020. [2]

Five Prior Areas to be implemented within Cathay Pacific since 2009
(Sources from: Cathay Pacific Sustainable Development Report 2011) 3. Current HRM Issues
As one of a five-star aviation companies, Cathay Pacific insists in reducing costs while retaining excellent service for customers. However, the company’s continuous measure of cost reduction has triggered numerous human resource issues in recent year, which compel the HR managers to improve the ever-worsening labour-capital relationship as soon as possible. Cathay Pacific Airways has involved in labor dispute lawsuit in 2008 and eventually convicted lost at last month. The company has been pointed out that deducting the third allowances vacation pay compensation for cabin crews and refusing to release compensation’s specific calculation method. In 2011, Cathay Pacific began to implement overnight working system for the local flight attendants. Cabin crews were required to work in the consecutive night round-trip flights, whose average working hours are more than 13 hours per day. What’s more, the “Cross Flying Plan” that expected to be launched in 2013...
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