Lufthansa Pilots to Strike Monday and Tuesday: Pilots Resist Efforts to Cut Retirement Benefits

The Wall Street Journal
By William Boston And Natalia Drozdiak

Updated Nov. 30, 2014 9:20 a.m. ET


FRANKFURT—Pilots at Germany’s flagship carrier Lufthansa AG will go on strike, grounding passenger flights and some cargo transport out of Germany Monday and Tuesday, after the latest round of talks between the airline and its pilots over plans to cut retirement benefits broke down last week.

The strikes mark the latest action by the pilots union, Vereinigung Cockpit, which has repeatedly grounded Germany’s biggest airline this year in a labor dispute that has dragged on for more than two years. The pilots’ action also demonstrates a growing militancy among German labor unions, which have brought Germany’s national railway to a standstill several times this year and are threatening aggressive action to press for higher autoworker wages in 2015.

“With these strike measures the pilots are continuing to fight decisively against cuts in retirement benefits,” the pilots union said Sunday in a statement.

Lufthansa pilots will ground flights of Lufthansa’s passenger airlines on Monday, Dec. 1, from noon until Tuesday, Dec 2, 23:59 Central European Time (22:59 GMT). The strikes will target all short-haul and midrange passenger flights out of Germany. Pilots will also strike long-haul flights and flights of the Lufthansa Cargo AG freight division scheduled to leave Germany between 03:00 CET and 23:59 CET on Dec 2.

Lufthansa unit Germanwings isn’t affected by the strikes.

The pilots union blamed management for the impasse in talks, saying “disputed issues could not be resolved despite all efforts by the pilots to present compromise proposals.”

Lufthansa management said in a statement that it believes the two sides have made progress recently and regrets the pilots’ decision to resort to strikes.

“We are still convinced that solutions able to stand the test of time can only be achieved together at the negotiating table,” Lufthansa said in a statement.

Lufthansa said it is offering salary increases for the pilots, who earn an average €180,000 ($224,068) a year, of about 5%, which would be a €750-a-month raise.

The two sides are still far apart on the issue of retirement benefits. Lufthansa pilots can currently retire at age 55 and continue to receive 60% of their salary.

Lufthansa has offered to leave the retirement benefit intact for existing pilots, but wants to raise the minimum retirement age for new hires to 60 years old, taking advantage of a new European Union rule that allows pilots to fly until the age of 65.

The two parties are also at odds over the German carrier’s plans to shift some flying to lower-cost operations. Lufthansa’s supervisory board is set to decide on its lower-cost long-haul concept in early December.

The airline needs to cut costs to keep up in a price war with budget airlines such as EasyJet PLC and Ryanair Holdings PLC and new carriers like Abu Dhabi’s Ethihad Airways, which holds 30% of Lufthansa rival Air Berlin PLC, its biggest shareholder.

Increasing competition, a murkier global economic outlook, and labor disputes at home caused Lufthansa to scale back its profit outlook for next year. 

- Source:  http://online.wsj.com