Lufthansa German Airlines and the UFO flight attendants union reached (13-Nov-2012) agreement to settle their pay dispute based on proposals put forward at arbitration by former government economic advisor Professor Bert Rürup. Their agreement resolves the pay dispute, which has occupied the airline since Apr-2012. The issues discussed at arbitration focused on a pay agreement, profit-sharing and the commitment on both sides to negotiate the compensation structure from the arbitration procedure on 16-Jan-2011. The pay settlement will come into effect on 01-Jan-2013 and will operate through 31-Dec-2014. Lufthansa said the package is equivalent to a 4.6% pay award in 2013 with details as follows:
- An increase of EUR100 for each level in the basic remuneration scale, except for flight attendants and pursers on the final level, whose basic pay will be raised by EUR50. Additionally, all cabin staff are to receive a one-off payment of EUR320, which equals the volume of 0.6%. The pay agreement thereby envisages an increase of 3.95% in total volume in the remuneration scale. The union's demand for abolition of the so-called preliminary pay levels for around 6000 staff has also been taken into account in the settlement. This will especially benefit staff on the lower pay tiers. In return, the yearly upgrade was suspended for all employees to a new level in the pay scale. Furthermore, an enhancement of productivity was agreed upon;
- Agreement on a new pay scale for all staff recruited in the future will create a firm base to safeguard jobs in the cabin and secure the ongoing competitiveness of Lufthansa in the long term;
- Enhanced profit-sharing was agreed upon, which can achieve at the maximum the monthly gross pay;
- Introduction of a yearly working-time model for new staff interested in seasonal employment at Lufthansa;
- Compulsory redundancies in the cabin have been ruled out for the duration of the pay settlement despite existing and further anticipated excess capacities. Cabin staff underpinned this assurance by assenting in solidarity to a working-time corridor of 5%;
- In return for voluntary transition by cabin staff to Germanwings, which is taking over Lufthansa point-to-point traffic in future, the two sides agreed on major safeguards for the staff, especially the retention of their existing pay and maintenance rights.
German Airlines board member Peter Gerber, who headed the Lufthansa negotiating commission, said: “After months of difficult negotiations, we have now reached an agreement, which takes into account the positions of both sides. For us, the sustainable ongoing development of the pay system with remuneration scales for new staff was essential in the competitive cost environment, in which we operate. Additionally, we have made sweeping concessions in terms of flexibility and productivity. In return, Lufthansa has accepted rises in salary and has made concessions in safeguarding jobs. All in all, we have come to an acceptable settlement, which makes demands on both sides, while taking due account of the interests of the employer and employees". [more - original PR - Lufthansa] [more - original PR - UFO - German]