Lufthansa pilots agree to mediated talks in pay dispute

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A pilot takes part in a demonstration during a strike of the German airline Lufthansa pilots at Frankfurt airport

FRANKFURT (Reuters) – Lufthansa <LHAG.DE> and German pilots’ union Vereinigung Cockpit have agreed to mediated talks to resolve a row over contracts dating back to 2012, averting the threat of further strikes for a few more weeks, the two parties said on Friday.

Lufthansa has been embroiled in a series of separate disputes with its pilots and cabin crew staff over pay and conditions as management seeks to reduce costs to compete with budget airlines and more efficient long-haul carriers.

The mediation process is to start in early January and be completed within the month, during which time the pilots will not call for further strikes, Lufthansa and VC said in a statement on Friday.

“The negotiating table is the only place where we can find solutions that offer prospects for employees and for the company,” said Bettina Volkens, Lufthansa’s head of personnel.

Lufthansa’s pilots have walked out 15 times since early 2014, costing the carrier hundreds of millions of euros in lost profits. Most recently, they were on strike for six days in November, costing the airline a further 100 million euros ($104 million) in profits.

The pilots have asked for an average annual pay increase of 3.7 percent over a five-year period back-dated to 2012, which is when their last collective bargaining contract with Lufthansa expired. The pilots say altogether these increases would amount to a rise of nearly 20 percent on current pay.

Lufthansa has proposed an increase of 4.4 percent in two installments in 2016 and 2017, plus a one-off payment worth 1.8 months’ pay.

CABIN CREW DISPUTE

Separately, cabin crew union UFO said on Friday that three-way talks with Lufthansa’s budget carrier Eurowings and fellow union Verdi had failed to reach an agreement.

UFO has been trying to agree new contracts for staff at Eurowings for two years. But Verdi reached a separate agreement with the carrier earlier this month, which Eurowings wants to apply to all 450 cabin crew staff.

Under the agreement with Verdi, flight attendants receive a retroactive pay increase of 2.5 percent from Oct. 1, followed by another 2.5 percent next year and 1.25 percent in 2018.

“We have offered UFO the same agreement,” Eurowings said on Friday. “We cannot have two different wage contracts with one group of workers,” it added.

Lufthansa wants Eurowings to become Europe’s third largest point-to-point carrier. It announced on Friday it was leasing 38 planes and their crew from ailing rival Air Berlin <AB1.DE> from February and this week struck a deal for a full takeover of Brussels Airlines.

(Reporting by Maria Sheahan; Additional reporting by Peter Maushagen; Editing by Greg Mahlich)

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