There may be more lay offs, says the company

Singapore Airlines (SIA) staff have agreed to pay cuts of 11% after the company confirmed record losses due to the Severe Acute Respiratory Syndrome (Sars) crisis.

The cuts come after the airline's 1,600-member pilot union accepted a 16.5% pay cut and 24 days of compulsory unpaid leave per year.

"We have reached a sound agreement which will help SIA reduce staff costs and increase its competitiveness in a rapidly changing industry," said Loh Meng See, the airline's senior vice-president for human resources.

Backed by the Singapore government, SIA is traditionally one of the world's most profitable airlines, but in April and May the company lost $3m a day as air passenger numbers in Asia halved.

Last month, 414 staff were laid off - SIA's largest-ever round of job cuts.

Restoring cuts

Wages of general staff earning a basic salary of more than $853 a month will be cut by 7.5% while those earning less than that amount will take a 5% cut. Administrative staff face wage reductions of 11%.

As in the deal made with the pilots, the airline will restore the pay cuts by up to 115% once its troubles are over, depending on profit levels.

Long serving crew members have been offered early retirement.

However, according to Abacus, Asia's largest air ticketing and reservation company, passenger volumes are on their way to returning to normal.