Lufthansa Reaches Deal With Pilots To Cut Costs
Lufthansa has said that it has reached an agreement with pilots over a package of short-term measures to cut costs as the German airline battles to reduce losses due to the coronavirus pandemic.
In return for job guarantees until at least March 31, 2021, pilots union Vereinigung Cockpit (VC) has agreed to reduced top-up payments to short-time working benefits as well as cuts to pension benefits through to the end of 2020, Lufthansa said.
Lufthansa added that it will only be able to avoid redundancies beyond March if it reaches a long-term agreement for pilots, including a corresponding cut in working hours and salaries. Lufthansa employs approximately 5,000 pilots.
It added that wage increases previously negotiated for this year will be postponed until January 2021.
The VC union said that the short-term agreement gives the two sides time to work on a longer-term deal.
"We clearly reject Lufthansa's threat to make redundancies for operational reasons. In our opinion, a social partnership must show how resilient it is, especially in bad times," VC president Markus Wahl said in a statement.
Last week, the airline put German workers on notice of compulsory layoffs, saying that the slump in travel and slow progress in union negotiations means that cuts are unavoidable after the carrier lost €1.7 billion in a single quarter.
Lufthansa, which in June received a €9 billion government bailout to secure its future, said last week that it expects capacity to recover to only approximately 50% of normal by the end of 2020 and to two thirds of last year's level in 2021.
Cabin Crew Deal And Ground Staff Talks
Cabin crew voted in favour of a deal to stop pay rises and cut hours, the UFO trade union said on Saturday August 15, while Lufthansa said last week that it had walked away from talks with union Verdi on behalf of 35,000 ground staff over a package to cut costs.