Payroll rates?

How much are you guys focusing on your payroll? Do you leave it standard? Do you drop it as much as possible?

I’m running a cargo airline so not really sure how much it matters to pay my pilots more or less. Also wondering what would happen if I drop the pay as much as possible for cargo workers and logistics people especially when I’m the one doing all the logistical/fleet planning work!

Also what’s the best way to get rid of employees? I leased a group of planes I thought would be easy to work with given their low rent rates but the MX just makes them break even or pull just a little bit of a profit. When I return those planes I’ll have a lot of spare pilots. Is it better to retrain or just fire them?

If your airline is growing don’t fire the pilots or almost anyone since I think the severance packages are very expensive and worth many weeks/months of pay!(I wish i worked in AS) if you see them being used even in a few months don’t fire them. retrain the pilots as you get more aircrafts.

As far as paying these people if you go below avg your ratiings will drop and it has a high negative effect on pax flights, not sure how bad the effect will be on cargo flights.

Ivan.

Thanks Ivan. Yea I’m wondering how it works on cargo. When I return these aircraft to the lessor obviously I won’t be needing the pilots anymore. So I was thinking of lowering their pay as much as possible but I was worried about how it would effect the cargo demand.

Hi,

salaries influence staff mood. Staff mood is one of the factors that decide the image of your airline, together with type of aircraft, age of aircraft, space between seats and the technical condition of your aircraft. The image of your airline has no direct effect on passenger demand.

However, the overal image of your airline is one of the factors that decide whether passengers like your flights, together with type of seats, on-board service and the price of your tickets.

Anyway, 75% of my fleet consists of aircraft I bought… so I see a lot of red bars next to the line "aircraft age", one of the other image factors. But the overal image of my airline is 3 green bars, all my flights have a rating of 100/99 and my average load factor is 93%.

I don’t think it has that much impact on passenger demand. Things may become different in the future, when employees could go on strike if staff mood drops below a certain level. But nobody knows when that feature will be implemented.

Jan