Lufthansa and UFO conclude collective bargaining agreement

Lufthansa and the independent flight attendants' union UFO announced (05-Jul-2016) their acceptance of mediator Matthias Platzeck's recommendations. The parties spent approximately half a year negotiating all open collective bargaining agreements and a wide range of other issues. Lufthansa chief HR and legal officer Bettina Volkens said, "Reaching a comprehensive agreement and ensuring that there is no need for cabin strikes in the years ahead was tremendously important for Lufthansa and all our colleagues in the cabin alike". The details of the arbitration agreement include:

• Long-term no-strike agreement: The collective labour agreement will be active until 30-Jun-2019 and the collective agreements regarding pensions and transitional payments will be active until 2023. In addition to this, the parties have also agreed upon a number of conflict resolution mechanisms which will remain in place until 2023;
• Pensions and transitional payments: Lufthansa and UFO have agreed upon a new system regarding pensions and transitional payments. It allows the group to shift the second-largest group of employees from a defined-benefit system to a defined-contribution system. Lufthansa and Verdi had already agreed in Nov-2015 to move ground staff to a defined-contribution system. This switch allows the company to lower the costs and risks for the schemes. In future, Lufthansa will contribute a total of 5.2% of eligible income to the pension schemes of cabin staff. This is the same benefit the ground staff of the group receive. The new system still makes it possible for cabin staff to retire from airline service when they turn 55. New employees will receive no contributions to pension and transitional payment schemes for the first five years of their employment, unless they have completed a specific training course on the bachelor level. New employees will not receive contributions to the transitional payment scheme, even after five years, if they do not complete this training. In future, employees can use unused transitional payment schemes to increase the benefits of their company pension scheme. Coverage for all employees in case of permanent flight disability will remain in place. The collective labour agreement will be active for 10 years as of 01-Jan-2014;
• Compensation: The circa 19,000 cabin employees will receive a wage increase of 1% as of 01-Oct-2016, and an additional 2% as of 01-Jan-2018. The collective labour agreement for wages will remain in place until 30-Jun-2019;
• Compensation structure: Lufthansa and UFO have agreed on a new qualification-based compensation structure for cabin staff. The company will offer an 18-month training course at the bachelor level in cooperation with the Chamber of Industry and Commerce. This will allow Lufthansa to further increase the already high standard of qualification and service of its staff. In future, only flight attendants who have completed this training will be eligible for compensation above level eight, which corresponds to a basic compensation of EUR2150 per month;
• Guaranteed Employment: Employment is guaranteed for all Lufthansa cabin employees until 2021, as the company has ruled out redundancies for the duration of five years. In addition, it has been agreed that Lufthansa aircraft may not be operated with external cabin staff until 2023. Ms Volkens said, "It was a struggle to reach an agreement in which it was necessary for both sides to make cutbacks from their original position". [more - original PR English] [more - original PR German] [more - original PR German II]