The Taiwan High Speed Rail Corp (THSRC) labor union yesterday criticized the company’s decision to freeze pay raises for workers this year, saying that salaries for management should be frozen as well.
The company had explained its reasons for the freeze in an internal memo issued on Wednesday evening.
“The COVID-19 pandemic has brought unprecedented challenges to the global economy, and the transport business and tourism industry are expected to be hit the hardest by the outbreak,” the company said. “Many transport and travel service operators have been forced to suspend business, reduce employees’ salaries, lay off employees and decrease workers’ hours to stay afloat in this difficult time.”
Revenue has been lower than expected, the company said, adding that it is requesting bailout funds from the government, in addition to reducing train services and finding ways to lower operating costs and bring in additional income.
Its plan to give employees a 3.42 percent raise this year needed to be postponed given the current economic situation, the company said, adding that raises would be given once the coronavirus is contained and stable revenue resumes.
The measure is needed to sustain operations and ensure long-term benefits for all stakeholders, it added.
The union said that it understands that the company froze salary increases to control operational costs, but the decision demoralizes employees and makes them question management.
The decision ignored that employees have willingly worked extra hours and sacrificed holidays to comply with the government’s disease-prevention measures, even though workers risk contracting COVID-19 when serving passengers, the union added.
“We want to tell management that they should not keep telling rank-and-file employees to endure this difficult time, and use public opinion and moral arguments as an excuse for not giving workers a raise,” the union said. “They should eliminate unnecessary costs from maintenance, operations and marketing, and also evaluate the salaries for management.”
The company should offer a detailed explanation of its decision and fulfill its promise to its employees, the union added.
The company said that it has raised employee salaries four times since 2015, adding that it made the pledge to increase salaries when revenue and passenger volume set records last year.
However, when it made the pledge — on Oct. 25 last year — it could not possibly foresee that operations would be severely disrupted by the coronavirus, it said.
The company’s pretax surplus last month was NT$65.16 million (US$2.15 million), down 93.62 percent from January, while operating profit was NT$557 million, down 71.27 percent from a year earlier, a company financial statement showed.
It was the lowest monthly profit since it began making a profit in October 2015, the company added.
Industry analysts have said that people are less willing to travel due to the pandemic and have become more cautious about being in public transport’s closed spaces.
The virus’ effects are already apparent in the company’s January and last month financial statements, they said, adding that the situation is likely to worsen this month.
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