Pilots at Singapore Airlines (SIA) have agreed to swingeing pay cuts after two months of talks, in the hope of shoring up the finances of the once-profitable carrier.
The decision by unions representing the airline's 1,600 pilots comes just weeks after more than 400 job losses were announced.
The pact signed by management and unions, with their members' approval, will see pilots' pay cut by 16.5% from July until March next year, while first officers' pay will fall 11%.
Like its peers in Asia, SIA was hit hard by the collapse in passenger numbers following the outbreak of the Sars respiratory virus, a setback which further damaged an aviation business already weakened by the global slowdown and the after-effects of the 11 September tragedy.
In April and May, the airline, 56% of which is owned by Singapore's government, was losing $6m (£3.6m) a day.
Give and take
The agreement came at the last minute before the dispute between the airline and its staff over pay cuts went to arbitration.
Earlier in the negotiations, the Airline Pilots Association Singapore (ALPA-S) had accused management of wanting to slash salaries by as much as half.
In the end, both sides have given ground, with pilots agreeing to take two days off without pay each month.
In return, the airline's executives have promised they will restore salaries should after-tax profits beat 500m Singapore dollars in the year ending March 2004.