"They (the management) have committed the blunders that have caused the problems and they expect us to pay for them," Isa Jani, president of MAS Executive Staff Association (MESA) said in a telephone interview.

"There is bottleneck at the top level of management which is delaying decisions," he said referring to a restructuring plan of the company that involves pay cuts for executives.

Isa represents 650 of some 800 executives from information technology and engineering maintenance divisions, accountants and some junior station managers. Malaysia Airlines has nearly 20,000 employees.

A spokesman for Malaysia Airlines declined to comment on the statements made by the MESA president. The association is protesting a MAS decision to cut by two per cent salaries of executive grade and above from April.

"If you go throughthe Financial report, they are doing quite well operationally," Isa said, adding that it was some of the investments made and routes operated by the airline that had put it in Financial trouble.

Isa cited examples of Malaysia Airlines investment in Royal Air Cambodge and Air Maldives, saying the association had advised the management against unfettered capital expansion, forays into unproductive routes and hiring of expatriates in top management.

"They have cut off communication with all associations and unions. The chairman believes the unions and associations are no longer relevant," Isa said.

MESA said in a statement that the proposal to cut salaries was discriminatory and did not address the root cause of the airline's losses last year.

"The MAS chairman has gone on record to put the blame for the company's poor performance on the staff but these are the same staff responsible for record profits between 1994 and 1997," Isa said in the statement.

"The tendency for management to claim total creditfor itself during good Times and pass the buck for poor results is not conducive for morale," the statement said.

Malaysia Airlines reported a net loss of 441.09 million ringgit in the first half of 1998 against a profit of 23.50 million in the year-ago period.

In 1997, the company reported a net loss of 260 million ringgit against a profit of 333.02 million in 1996.

Isa said the association and other unions of the company had met the company's management twice in the last two months since the pay cuts were announced, but the matter was not resolved.

He said MESA was particularly discriminated against because of its outspokenness. There had been no salary hike for MESA members for the last four years, though other divisions have received increments.

The National airline is in the middle of drawing up a restructuring programme to cut its debt burden. It has debts of around 11.8 billion ringgit ($3.1 billion) following aggressive aircraft purchases over the last several years, analystssaid.

Analysts have said the company needs to consider injecting new equity, rationalising its fleet and coming up with inventive ways to beat growing competition in the region.