Austrian agrees limited job-security guarantees

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Austrian Airlines and staff representatives have struck a pay deal covering its approximately 2,600-strong technical and administrative workforce.

The deal – which takes effect in January – brings "the most extensive change in employment conditions in the company’s history", says the wholly owned Lufthansa subsidiary.

While the agreement is no cause for "jubilation", the staff’s works council succeeded in its main objective "to secure the business location [in Vienna] and limit damage for the employees", says the body's chairman Alfred Junghans.

The jobs of line-maintenance and check-in staff have been secured until 2018. However, job-security guarantees have not been extended to administrative employees at Austrian’s headquarters, located at Vienna airport.

The airline revealed earlier this month that it is cutting 150 positions as a result of merging its flight operations with regional arm Tyrolean Airways in 2012.

Automatic pay increases have been curbed, although entry-level salaries will be higher than in the past, the airline says. Wages will be frozen in 2014 – with staff being given a €1,000 ($1,360) one-off payment – while salaries are to be adjusted for cost-of-living increases in 2015.

The airline has replaced its previous bonus system with a new scheme, based on a model that sister carrier Swiss International Air Lines employs, whereby payments are linked to rises in the earnings margin.

Austrian is also terminating its company pension scheme. The airline adds that employer contributions will be continued "on an individual basis".

The collective-bargaining agreement covers redundancy pay, and the airline has committed to continuing apprenticeships.

A fundamental arrangement had already been reached in late June 2013, but the deal still required finalisation of details.

Austrian’s employees will bear "a considerable part of the burden in restructuring the company", says chief executive Jaan Albrecht.

"Now we share the responsibility to show that this contribution is not being made in vain," he adds.