New moves come as revision to MAG's current reward scheme underway
Malaysia Aviation Group (MAG) will grant bonuses in a new performance-based bonus structure and raise wages in line with inflation as the company aims to retain its top talent.
The organisation, which has 12,000 employees on payroll, will be giving out bonuses worth between two and five months of their staff's salary, depending on performance.
"We believe that by implementing a performance-based bonus structure, we can incentivise our staff to deliver on the customer value propositions we've developed," Datuk Captain Izham Ismail, MAG group managing director, told The Edge Malaysia.
MAG, the parent company of national carrier Malaysia Airlines Bhd, will also be raising the wages of its pilots, cabin crew, engineers, and technicians in line with the rising cost of living and inflation, according to the report.
"Recognising the current economic climate, we are committed to fostering a competitive compensation package that not only motivates achievement but also helps us retain top talent," Izham said.
The director added that there will also be a 30% increase in flying allowance for employees who travel to overseas stations, recognising the impact of currency fluctuation among staff.
According to Izham, their higher compensation schemes still fall short compared to competing companies, but he hoped it would "narrow the gap" for MAG.
MAG's recent moves are part of its "immediate intervention" while it revises its current reward scheme.
"Currently, MAG is undergoing a reward philosophy/change, driving productivity, efficiency and [being] incentive-based. We want to transform ourselves to be a performing organisation. Henceforth, the reward scheme/structure has to change to drive performance. This is currently a work in progress," Izham said as quoted by The Edge.
The first phase covers pilots, cabin crew, engineers, and technicians, while the second phase will see a revision of the current reward scheme for the whole organisation.
Izham said they're targeting the third quarter of 2024 to finish the overhaul.
"We have engaged an adviser to help us, who has done it for 56 airlines," he said.
MAG is one of the organisations that remained afloat during the pandemic without laying off employees, according to The Edge Malaysia, after the aviation industry took a hard hit as lockdowns reduced demand for air travel across the world.
The company, however, had to ask employees to take a voluntary unpaid leave, while senior management, including pilots, had their wages and allowances cut.
MAG in FY2023 saw a return to profit, with total revenue registering a 31% increase to RM13.85 million. MAG group chief financial officer Boo Hui Yee said they are expecting to remain profitable this year.
"The forecast for 2024 is RM4.606 billion. For 2024, we expect cash to remain positive on a daily basis," Boo told The Edge.
