Lufthansa and its main cabin crew union have hammered out a deal over a cost-cutting plan ahead of a key shareholder vote on a multi-billion Euro government bailout. The German flag carrier was keen to strike a deal with unions over its plans to axe thousands of jobs to prove to shareholders that it was committed to reducing costs in order to win approval for the €9 billion taxpayer-funded bailout.
Late last night, Lufthansa and the UFO union released a joint press statement after an agreement was finally struck. Talks had dragged on past a self-imposed June 22 deadline after negotiations between the two sides stalled last weekend.
Lufthansa said the deal was worth half a billion Euros in savings and would not involve any forced redundancies. The protection against Corona crisis-related lay-offs will last for at least four years according to the union.
Instead, Lufthansa will offer a voluntary redundancy programme to trim cabin crew numbers by as many as 2,600. Remaining cabin crew will have to agree to cuts in their working hours until travel demand picks up again. Pay raises have been suspended and pension contributions from the airline will be put on hold.
“The conclusion that has now been reached for the cabin employees of Deutsche Lufthansa brings the urgently needed job security,” commented UFO negotiator Nicoley Baublies. “The coming months will be very challenging for us as social partners. With this package and the other solutions we have found together, we are finally putting our social partnership on a new footing.”
Michael Niggemann, a member of the Lufthansa executive board who has been leading the negotiations for the airline said he hoped the deal would lead to a renewed partnership with the UFO after a year of acrimony.
Last year, the UFO led several days of strike action in a bid to win a pay rise for cabin crew and negotiations on a collective bargaining agreement have dragged on ever since. Earlier this week, a German newspaper even accused Baublies of demanding a personal payment of €1 million to strike a deal over the proposed job cuts.
Cabin crew will need to approve the latest deal in a ballot that is set to take place in the next few weeks.
