Qatar Airways Cuts Some Employee Salaries In Half

Qatar Airways Cuts Some Employee Salaries In Half

Qatar Airways announced on Tuesday it is cutting salaries for mid-level and above employees by half, according to a press release from the airline.  The move comes amid the coronavirus pandemic, which is completely changing the airline market and drastically impacted airlines around the world.  The airline intends to pay employees back when they have the money available.

According to the report, the pay cut will impact salaries for three months, beginning with April pay.  The airline warns there is potential for the pay cut to extend beyond the three months, depending on the economic situation.  On March 29, Qatar Airways CEO Akbar Al-Baker forfeited his salary pending a return to full operations.

Qatar Airways is one of many airlines responding to the sharp global decrease in travel demand.  In the U.S., United CEO Oscar Munoz painted a grim picture of the airline industry’s future.  Southwest Airlines CEO Gary Kelly took a different tone, and he told employees he hopes to avoid furloughs.  Of course, that is based on the U.S. airline industry rebounding before the airline runs out of cash flow.

Earlier this week, Jet Blue announced its own cuts, requiring some employees to take unpaid leave between now and September.  Jet Blue’s move occurred despite it accepting stimulus money from the U.S. Treasury, which requires airlines to keep employees through September 30, 2020.

This all is taking place while the U.S. Treasury is handing over large loans to the airlines and involving taxpayer funds in the volatile market.

Other international airlines are examining their own options.  Last week, Cathay Pacific announced the shutdown of its U.S. cabin crew bases.   Four Norwegian Air subsidiaries announced they were filing for bankruptcy on Monday, putting over 4,700 jobs at risk.

Virgin Australia announced it filed for administration, essentially the Australian version of bankruptcy.  And then of course, there’s mention that Malaysia is looking to find a merging partner for Malaysia Airlines.

Bottom Line

It’s a difficult time to be an airline employee.  Some people think it’s a difficult time to be an airline, but my sympathy really lies with the employees who will likely take the brunt of the impacts that occur, as they have.  A CEO not taking pay is a great gesture, but the impact to that individual is minimal.  A mid-level manager losing half of their salary during an economic downturn does have a significant impact.  An employee at Jet Blue forced to have to take paid time off does have an impact on that individual and their family.

These are difficult times, and it’s important to remember who the real victims are in this crisis.  It’s these workers and workers all around the world who are suffering.  Perhaps, if airlines were smarter with their cash flow when they were making amazing profits, they could weather this storm a little better.

But I digress.  I hope for the sake of these employees the cuts are only for three months.  I also hope the money is returned to the employees in a timely fashion, as the airline has said it will when conditions are right.