Pilot shortage at Brussels Airlines ?

teach · Post by **teach** » 13 Aug 2007, 14:15

should be less than any AVRO anyway.

I'm willing to put good money down on a bet that it will be more, not less.

LX-LGX · Post by **LX-LGX** » 13 Aug 2007, 17:09

When salaries are compared here, it’s always the Belgian gross salary compared to a foreign offer. However, the Belgian gross salary is not the total salary cost for a Belgian employer. They indeed have to pay an extra 34,52% as patronale lasten / charges patronale (translated: "employers' charges”) on top of the gross salary.

For salaries above a certain limit, there is also an additional “buitengewone pensioenbijdrage” (special pension fund charge), once again on top of the gross salary: I think it’s 8% that has to be added (but I’m not sure about it – so I don’t mention it any further).

fcw wrote:Taxes are not the basic problem:

BruAir capt.: gross 7.000 - tax 3.500 - nett 3.500
Easyjet capt. gross 10.000 - tax 3.000 - nett 7.000

So the difference in tax is only 500 a month. The gross salary a BruAir is simply too low...

I assume the tax friendly Ireland is not charging anything on top of the gross salary. So if I add the 34,52% Belgian employers charges (patronale lasten / charges patronale) to the gross salary, it looks like this:

BruAir capt.: salary cost 9.410 - taxes 5.910 - nett 3.500
Easyjet capt.: salary cost 10.000 - tax 3.000 - nett 7.000

And here is a way out for pilots: the Belgian government has waived these employers’ charges for at least three groups:
- scientific research people
- people employed by the OCMW/CPAS in économie sociale - sociale tewerkstelling (the Art. 60's)
- people working on board an international baggerworks ship

If the extra employer’s charges would also be waived for cockpit crew, I’m sure that a practical solution can be found to let them benefit from it. A direct pay out isn't possible, as that will be subject to the "normal" salary charges. But with some imagination, I'm sure it's possible. Example: paid out as a monthly payback of the former study / pilot's course costs. And paid out as formation expenses = thus without taxes/charges.

FlightMate · Post by **FlightMate** » 13 Aug 2007, 17:30

easy flies under UK flag (or Swiss), not Irish

But I agree, taxes must be less than belgian ones anyway.

Mudvayne · Post by **Mudvayne** » 13 Aug 2007, 18:40

If you don't really know how the UK system works it's hard to really compare an English with a Belgian Company !

easyJet also has extra costs on top of their pilots gross salary.
For example, in Orly (with the new french social security rules) easy contributes 38 062£ to the French Social Security and CRPN on top of a Captain's 74 000£ basic gross salary...

teddybAIR · Post by **teddybAIR** » 13 Aug 2007, 18:55

The reason why fore instance people involved in R&D are exempted from the standard tax regulations is because of the strategic importance of this pool of people for the development of an entire national economy! An exception to the tax system should only be applied in such cases of strategic development, and not because some airline carrier - even if the company has a lot of brand ambassadors and goodwill from aviation enthousiasts (including me) - has trouble becoming profitable in the economic reality we are living in. I'm a firm believer that only a philosophy of "survival of the fittest" will be optimal for the end-consumers...and it's ALL about end-consumers!!!

LX-LGX · Post by **LX-LGX** » 13 Aug 2007, 20:01

BATA / Belgian Air Transport Association has sent out a press release in May 2007 that the problem exists for all Belgian airlines.

Just one example of the press coverage about it:
http://www.hln.be/hlns/cache/det/art_460202.html

Air Key West · Post by **Air Key West** » 13 Aug 2007, 22:10

As far as I know, taxes and social contributions to be paid in France by employers are (of course, not identical) but very similar to the ones paid in Belgium : they are high ! So why are Air France pilots among the best paid pilots in the industry and why does Air France make huge profit ? Many reasons for that, of course.
But it is time b.air starts to treat its pilots more generously or the airline will not be grounded because of bankrupcy but because there won't be any pilots left.
And I am a firm believer pilots should get adequate salaries (flight attendants, too). The first are there to take is safely from point A to point B at an altitude of 30,000 feet at 800 km/hour. The flight attendants are there primarily for passengers' safety (we tend to forget that). They are not just waiters in the sky. So, they also deserve good pay and working conditions.

pressman · Post by **pressman** » 13 Aug 2007, 22:26

To answer the previous posters question , air france pilots do have a special tax deal , they are taxed as "Artists", so in turn pay very low levels of tax .

Air Key West · Post by **Air Key West** » 13 Aug 2007, 22:33

Thanks pressman. So, Air France pilots are "artists" (cannot resist : LOL).
But seriously, so "tax breaks or shelters" exist in the EU for pilots. Interesting.

LX-LGX · Post by **LX-LGX** » 14 Aug 2007, 01:20

We really have the European title: Belgium has the highest taxes on labour in Europe (and perhaps in the world), as this study from the OECD shows:

Income tax plus employee and employer contributions as a percentage of labour cost:
http://caliban.sourceoecd.org/vl=386052 ... 02-g01.htm

http://dx.doi.org/10.1787/842502472483

edit after posting:

source = OECD Factbook 2007 with figures from 2000 <-> 2005
(OECD = Organisation for Economic Co-Operation and Development)
(Dutch name: OESO / Organisatie voor Economische Samenwerking en Ontwikkeling)
(French name OCDE = Organisation de Coopération et de Développement Economiques)

tolipanebas · Post by **tolipanebas** » 14 Aug 2007, 09:11

LX-LGX wrote:We really have the European title: Belgium has the highest taxes on labour in Europe (and perhaps in the world), as this study from the OECD shows:

LX-LGX-

First of all, congratulations on admitting for the first time (although implicitly) that the exodus of pilots from SN, which is causing the company much operational headaches is due to the uncompetitive GROSS salaries offered. I distincly remember the time when you were making it sound as if NET salary was lower just because of the high income taxation in Belgium, whereas now you finally have taken the turn and admitted GROSS salaries as well are simply uncompetitive! Big thumbs up for you on that!

However, your agrument again lacks what I would call a wide perspective.

First of all, I am not to be convinced labour costs in Belgium are amongst the highest in the industrialized world, however, as others has pointed out before, it would be extremely symplistic to assume that only in Belgium an employer pays 'extra charges' on top of the gross salary an employee gets to see.
I can assure you that in continental Europe at least, the mechanism is pretty much similar to what you have discribed as being in force in Belgium and although the percentages of the extra charges may be lower abroad indeed (depending on the country), I dare to say they will be quite similar in real values due to the higher gross salaries to start from and will in any way not differ enough to explain the huge difference in GROSS salary between what SN pays and what is offered abroad.

Secondly, I have asked this question before and you have avoided answering it time after time again: why does SN want to waste so much energy on trying to get some fiscal consessions from the Belgian government? It is a given the Belgian government is -at best- going to offer minor concessions only, but definitely not the game changing fiscal revolution SN would dearly need in order to turn a labour costs of lets say 8,000 euro/month per pilot in a net salary of... virtually the same!
Why doesn't SN simply delocalize their operations? Easy, swift and with guaranteed results.

Thirdly, you have been mentioning the aditional pension fund contribution as yet another charge for the gross salary, yet then suddenly didn't elaborate: a pitty really since there is some interesting stuff in there which I would like to share with the readers.

LX-LGX wrote:For salaries above a certain limit, there is also an additional “buitengewone pensioenbijdrage” (special pension fund charge), once again on top of the gross salary: I think it’s 8% that has to be added (but I’m not sure about it – so I don’t mention it any further).

It is correct that for salaries above a certain gross limit, one is obliged to pay an additional pension fund contribution and the salaries of pilots have traditionally fallen in this category.

However, in the mid 1990s, the Belgian government -in an efford to support Sabena- decided to waive the payment of this additional pension contribution and in order to make it legal gave the same waiver to all Belgian airlines. The Royal Decree was originally ment to last 5 years, but was extended for 5 years in 2000 and in 2005 (at the end of its second term) it was agreed after strong lobbying by BATA that it would be extended for the last time, this time for 2 years only!
This brings us to 2007 and the irony now wants that as from last month, the Belgian airlines are having to pay this addtional pension fund contribution on pilot salaries again for the first time in over 12 years!!!!!

Just to show you how likely it is that the Belgian government is going to give in to the demands from BATA to seriously lower the taxes on gross salaries or the additional charges paid on them! They have decided to start collecting the additional pension contribution again as of last month, and have thus in effect increased the charges! At best they might retroactively extend the waiver, but then we are still nowhere really, are we?

A second interesting consequence of the above waiver which might be highlighted in this context is that since this measure was destined at Sabena, yet was applicable for all Belgian airlines, it was really up to the airlines themselves to do with the additional pension fund contribution (which legally still had to be deducted from the gross salary, yet by A.R. didn't have to be turned over to the government) what it wanted.
Sabena decided to keep it for itself as sort of reduction of labour costs (which was also the aim of the measure and had the agreement of the unions), whereas other Belgian airlines of that time (EBA for instance, which later became Virgin Express, now absorbed in... indeed Brussels Airlines, what a small world, isn't it?) decided to give the money back to their pilots.

A noble idea indeed, but over the years, this sum became an integral part of the net salary at these airlines and has always been taken into account as such when negociating new Collective Labour Agreements. However, as from last month the contribution is due again, meaning it needs to be deducted AND paid from the present gross salary!

At DAT, this has only consequences for the company, as the airline has always been deducting the contribution from our salaries and keeping it to itself just like Sabena had traditionally done, yet our ex-VEX colleagues at Brussels Airlines have recently seen their net salary being reduced by a considerable margin as their employer has always returned the contribution to them so far! You can already imagine what they think when they hear our CEO talk about 'working with the government to find fiscal solutions to improve the net salary of pilots in Belgium' and how much faith they have in the outcome...

Just to show you how different reality on the ground (or in the air actually) is from the theoretical reports you read and the promissing words you hear from BATA and clearly believe blindly!

LX-LGX · Post by **LX-LGX** » 14 Aug 2007, 10:16

tolipanebas wrote:
LX-LGX wrote:We really have the European title: Belgium has the highest taxes on labour in Europe (and perhaps in the world), as this study from the OECD shows:
First of all, congratulations on admitting for the first time (although implicitly) that the exodus of pilots from SN, which is causing the company much operational headaches is due to the uncompetitive GROSS salaries offered. I distincly remember the time when you were making it sound as if NET salary was lower because of the taxation in Belgium, whereas now you finally have taken the turn and admitted GROSS salaries as well are simply uncompetitive! Big thumbs up for you on that!
!

Sorry to dissapoint you: it's not the nett salary and it's not the gross salary that is causing SN headaches: it is the total salary cost. What I've said (and what you probably haven't understood because of my poor English) is that in most posts here, one wrongly uses gross salaries to compare to other offers. One has to add employers' charges. Once again, you don't want to do this. Is it because it proofs that f.e. the total salary cost for a pilot is about the same for SN and Ryanair?

tolipanebas wrote:
First of all, I am not to be convinced labour costs in Belgium are amongst the highest in the industrialized world, ...

Nice to have a VRHFSTDT fan between us!

tolipanebas wrote: however, as others has pointed out before, it would be extremely symplistic to assume that only in Belgium an employer pays 'extra charges' on top of the gross salary an employee gets to see.

Unfair argument from you, as I didn't said that. I've only said that I thaught it was probably not the case in Ireland.

tolipanebas wrote: I can assure you that on continental Europe at least, the mechanism is pretty much similar to what you have discribed as being in force in Belgium and although the percentages of the extra charges may be lower abroad indeed (depending on the country), I dare to say they will be quite similar in real values due to the higher gross salaries to start from and will in any way not differ enough to explain the huge difference in GROSS salary between what SN pays and what is offered abroad.

Repeat: please stop comparing gross salaries: the cost for an airline is not gross salary: it's gross + employers' charges.

tolipanebas wrote:Secondly, I have asked this question before and you have avoided answering it time after time again: why does SN wants to waste so much energy on trying to get some fiscal consessions from the Belgian government? It is a given the Belgian government is -at best- going to offer minor concessions only, but definitely not the game changing fiscal revolution SN would dearly need in order to turn a labour costs of lets say 8,000 euro/month per pilot in a net salary of... virtually the same! Why doesn't SN simply delocalize their operations? Easy, swift and with guaranteed results.

1. if the employer's charges could waived be waived - and amended into a form of direct pay out, this really will allow SN (and other Belgian carriers who face the same problem) to make better offers.

2. Delocalize? And pay you through SN-LUX? It's like suggesting SN simply has stop paying the employer's charges to the state. No sir, this has been discussed before. I remember one of the many reasons is that it not possible because some share holders reject it. I'm almost sure you will reject this as nonsense, so may I suggest already now you first give us the names from two other major new investors who will take over the investement from mr D and mr L (and the companies/banks they represent)?[/quote]

tolipanebas wrote: Thirdly, you have been mentioning the aditional pension fund contribution as yet another charge for the gross salary, yet then suddenly didn't elaborate: a pitty really since there is some interesting stuff in there which I would like to share with the readers.

The reason why I've said I'm not sure about it, is because there is already a pension fund allocation in the 34,52% employers' charges, and I diodn't knew there was an extra one. Your remark "you then suddenly didn't elaborate" is once again unfair, as you suggest I knew there was something wrong.

tolipanebas wrote: ... It is correct that for salaries above a certain gross limit, one is obliged to pay an additional pension fund contribution and the salaries of pilots have traditionally fallen in this category. However, in the mid 1990s, ...

... Just to show you how different reality on the ground (or in the air actually) is from the theoretical reports you read and the promissing words you hear from BATA!

Your post makes it clear that you don't see a solution: SN is unwilling, the government doesn't like aviation, BATA doens't mean what they're saying.So the only solution for you to get a decent salary is to accept one of those fantastic foreign offers. When are you leaving?

FlyA330 · Post by **FlyA330** » 14 Aug 2007, 10:55

If Bru.Air still thinks they will solve the problem with paying more salary, they are wrong. It's not only about money, it's about the treatment of the flying crew and about the lack of good organisation.

tolipanebas · Post by **tolipanebas** » 14 Aug 2007, 11:26

LX-LGX wrote: Sorry to dissapoint you: it's not the nett salary and it's not the gross salary that is causing SN headaches: it is the total salary cost. What I've said (and what you probably haven't understood because of my poor English) is that in most posts here, one wrongly uses gross salaries to compare to other offers. One has to add employers' charges. Once again, you don't want to do this. Is it because it proofs that f.e. the total salary cost for a pilot is about the same for SN and Ryanair?

I have understood you very well.

At first, the argument from you was, "Yes, net salaries are indeed lower in Belgium than abroad, but that is because of the taxes!"

It was then showed how large the difference in gross salaries really is and that there is just no way income taxes alone can be blamed for this difference, and now you are trying to open the scope by saying: "Yes, but the gross salaries in Belgium are lower (congratulations for this first time admittal), but mind you, in Belgium there are also employer's charges!"

What you forget to mention however is that most other European airlines (SN has more competitors than just FR, doesn't it?) ALSO face this... Easyjet for instance, or Lufthansa, to pick just the soon-to-be 2 main competitors of SN in Brussels!
At these airlines too, the gross salary is not the total cost of employment either, but you preferred to point to the one exception to the rule , i.e. FR, to find an argument for SN to keep underpaying.

tolipanebas wrote:
First of all, I am not to be convinced labour costs in Belgium are amongst the highest in the industrialized world, ...

LX-LGX wrote:Nice to have a VRHFSTDT fan between us!

Here your bad English has lead you to misreading me!

Read it again, am I sure you will then grasp the meaning...I was actually saying you were right!

LX-LGX wrote: Repeat: please stop comparing gross salaries: the cost for an airline is not gross salary: it's gross + employers' charges.

Indeed, and as I have repeatedly said to you, other airlines too face the burden of employer's charges on top of the gross salary, so that in fact there is no way for you to turn a lower gross salary into a higher salary cost for any of SN's competitors but for one airline, FR....

Again, if you have to make use of the exception to the rule to proof your point, it generally means you have a very weak point, my friend.

LX-LGX wrote:Delocalize? And pay you through SN-LUX? It's like suggesting SN simply has stop paying the employer's charges to the state. No sir, this has been discussed before. I remember one of the many reasons is that it not possible because some share holders reject it.

Indeed, our investors do not agree with any delocalization as you rightfully say. It is their personal choice not to do so, and however noble it may be to them and you, it is definitely putting SN at a serious handicap.
It is a general rule in business that if you put yourself in such an unfavourable position by not making use of an clear advantage available to you, you must have something in your pocket which will work away the disadvantage, but in this case, they simply haven't, and their ideologic decision is hurting the company badly...

Starting to see why many employees at SN have long changed their mind on the 2 old pappies and the bunch of shareholders they've racket together? It is due time they let go of their legacy at SN so real business-like decisions can be taken....

flyavro · Post by **flyavro** » 14 Aug 2007, 12:49

and might I also add that, although it is indeed rather important for the employer, we don't care how much he has to pay for his personnel. What counts is how much you earn at the end of the month. I can't go buy food with all that extra money BA pays the government.

I know it's a huge burden for the employer but every firm in Belgium has to pay these costs, and probably so do all others in Europe.
So please comparing gross salaries will probably be rather fair to get the costs to any European company (Ryanair excluded maybe).

When you go talk with your boss about a payrise do you think: maybe not because it's going to cost him too much?

And LX your remark: when are you leaving? Is once again exactly the reason why they are having these problems: we are leaving.

As someone else said a few posts ago: money isn't the nec plus ultra. Some of us are leaving to somewhere else where they will get paid less. The way we are treated in this company is also very high on the list of reasons why people leave. And that is something management have themselves to blame for, they can't dump it in the government's lap.

teddybAIR · Post by **teddybAIR** » 14 Aug 2007, 14:30

Can we stop this ridiculous discussion between two ego’s fighting for the difference in meaning between net or gross salaries and total wage cost. I’m sorry to have to say this, but if the discussion is about your respective definitions, please take it into direct mail.

In short my opinion on the essence of the discussion:

1. Are pilots at Bru.Air payed less than their colleagues in other countries?
Yes, but the cost of living is generally lower as well, compared to the cost of living in other countries
2. Should Bru.Air increase the salary of its pilots in order to spur loyalty?
Yes, as it is definitely perceived as a problem, otherwise we wouldn’t be discussing this as heavily here. Nevertheless, merely adjusting the wages will NOT solve the whole problem. It will keep the merely materialistic people (even if you want to ignore this, such people unfortunately exist…I’m even one of them

) but not the ones in search of a good atmosphere or state of the art materials to fly.

Best regards,
bAIR

LX-LGX · Post by **LX-LGX** » 14 Aug 2007, 17:39

teddybAIR wrote: In short my opinion on the essence of the discussion:

1. Are pilots at Bru.Air payed less than their colleagues in other countries?
Yes, but the cost of living is generally lower as well, compared to the cost of living in other countries
2. Should Bru.Air increase the salary of its pilots in order to spur loyalty?
Yes, as it is definitely perceived as a problem, otherwise we wouldn’t be discussing this as heavily here. Nevertheless, merely adjusting the wages will NOT solve the whole problem. It will keep the merely materialistic people (even if you want to ignore this, such people unfortunately exist…I’m even one of them ) but not the ones in search of a good atmosphere or state of the art materials to fly.

Best regards,
bAIR

With all respect: if one ignores why pilots don't get more on their bank account, further discussion indeed makes no sense. You don't have be a Master in Economics to understand this:
3.500 euro = nett
6.475 euro = gross
9.975 euro = total cost for SN
So if you like it or not, the problem for SN really is that they have to pay too much taxes and charges to the Belgian State. Remember the OESD-stats. For a total salary cost of 10.000 euro's, a Ryanair-pilot gets 7.000 euro on his bank account, and a SN-pilot 3.500 euro.

"To spur loyalty" ??? For people who are constantly sh... here on their colluegues in office jobs and management positions, and on their share holders? And will cabin crew and ground staff accept a salary increase for pilots only?

Vinnie-Winnie · Post by **Vinnie-Winnie** » 14 Aug 2007, 17:51

LX-LGX wrote: With all respect: if one ignores why pilots don't get more on their bank account, further discussion indeed makes no sense. You don't have be a Master in Economics to understand this:
3.500 euro = nett
6.475 euro = gross
9.975 euro = total cost for SN
So if you like it or not, the problem for SN really is that they have to pay too much taxes and charges to the Belgian State. Remember the OESD-stats. For a total salary cost of 10.000 euro's, a Ryanair-pilot gets 7.000 euro on his bank account, and a SN-pilot 3.500 euro.

"To spur loyalty" ??? For people who are constantly sh... here on their colluegues in office jobs and management positions, and on their share holders? And will cabin crew and ground staff accept a salary increase for pilots only?

And what about possibilities of advancement in the company? The future prospects of the company? I'm sorry but it is not only about money, it is also about prospects! Fly a little Avro which in a few years won't be airworthy anymore, or become trained to become a pilot on an Airbus!

Seriously if you wanna talk about belgian tax system and how unfair it is, go on politics.be or whatever political forum there is dedicated to the belgian taxation system!

In a sense you are polluting this discussion I'm sorry! What we want to know is the situation at Brussels Airlines, not get a goddam lecture about taxation!

We all know that taxation in Belgium is higher than average! Full stop!

Post by **ElcoB** » 14 Aug 2007, 17:55

LX-LGX wrote:For a total salary cost of 10.000 euro's, a Ryanair-pilot gets 7.000 euro on his bank account

I dunno if this is correct but I think you forget something.
* Payed holidays? (In Belgium at least 20).
* Health-care?
* Pension provisions?
Some of the tax-money is returned ......

JAFflyer · Post by **JAFflyer** » 14 Aug 2007, 18:30

Vinnie-Winnie wrote:Seriously if you wanna talk about belgian tax system and how unfair it is, go on politics.be or whatever political forum there is dedicated to the belgian taxation system!

In a sense you are polluting this discussion I'm sorry! What we want to know is the situation at Brussels Airlines, not get a goddam lecture about taxation!

We all know that taxation in Belgium is higher than average! Full stop!

Amen to that!!!