VIENNA May 30 Austrian Airlines called off pay
talks with cabin crew and pilots on Friday, after its works
council rejected a wage offer and reminded the airline it could
strike at any time.
The airline, a unit of Germany's Lufthansa, said
there was no basis for further talks and withdrew its offer,
which it had hoped would break a years-long stalemate and create
the certainty needed to allow investments in its fleet.
Employees had on Monday rejected the offer, saying it could
lead to a loss in real wages, following a three hour-long
meeting attended by about 1,000 staff that caused the
cancellation of 34 flights and the disruption of many more.
The works council reaffirmed its mandate to take industrial
action up to and including strikes.
"We have an authorisation to strike from the staff. We'll
see how it goes," flight crew works council chief Karl Minhard
told Reuters. "We are still ready to negotiate, but over
sensible collective wage agreements."
Lufthansa, which bought the airline from the Austrian
government in 2009, had its own labour issues this year when its
pilots grounded planes for three days, costing it 45 million
euros ($61 million) in operating profit.
Austrian has been at loggerheads with its cabin crew since
2012, when the loss-making carrier eventually transferred its
entire flight operations to lower-cost Tyrolean as part of a
restructuring after failing to reach a wage deal.
The move reduced the airline's pension obligations and
helped Austrian return to profit last year after five years of
losses, but has been challenged in various courts.
The European Court of Justice's (ECJ) advocate general is
due to give an opinion next Tuesday on the continued validity of
the old collective bargaining agreement. The ECJ follows the
advocate general's opinion in most cases.
Austrian had hoped to draw a line under the disputes with
last week's offer, which proposed new flight duty rules and
salary scales and a new pension fund, but was based on the
current Tyrolean collective agreement.
The works council wants the basis for the talks to be the
more generous Austrian Airlines agreement.
Currently, Tyrolean staff work according to their previous
pay deals, while Austrian Airlines pay has been frozen.
Austrian Airlines said on Friday it was putting on hold a
plan to fully integrate its Tyrolean and Austrian units and did
not believe the time was right to make large investments to
upgrade its fleet and take on new long-haul routes.
"The management of Austrian Airlines does not believe it is
an opportune time to make the potential investments of up to 1
billion euros to replace the Fokker aircraft and expand
long-haul routes," it said.
"The former collective wage agreement does not provide a
sound basis for such investments."
Austrian had signaled its intention to modernise its
medium-haul fleet but had not yet ordered any planes.
($1 = 0.7345 Euros)
(Editing by David Holmes)