Cargolux reaches preliminary pay deal with staff

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Luxembourg freight carrier Cargolux appears to have reached a labour agreement with the LCGB and OGBL unions.

After the unions had planned to call in an arbitrator for the deadlocked negotiations in June, both sides have now agreed in principle to reinstate the existing collective work agreement (CWA) - as demanded by the employees - until the end of 2014, but to include an appendix. The amendment covers the partial revocation of certain pilot working-time provisions in the existing CWA. Cargolux says in a statement that LCBG and OGBL have accepted "working-time optimisations" in return for the contract extension. The airline declined, however, to reveal any details about the appendix, as the final wording has yet to be worked out.

One of the measures is to set up a pilot "off-day pool scheme" to improve the deployment of flightcrew, says the airline. This programme will be controlled both by the staff and management.

Ultimately, no arbitrator was involved in the discussions. Employee pay and benefits levels were not changed, says Cargolux. The airline had proposed, for example, to halve the 13th monthly salary for staff above a certain salary threshold. But employees will have to increase productivity to maintain their remuneration levels.

The unions and management leadership also agreed to set up joint working groups to develop additional initiatives to raise efficiency and productivity across all departments.

Cargolux expects the appendix to be finalised by 6 August. While the airline and OGBL have initialled the draft version, LCGB decided to wait with its endorsement until all documents have been completed.

The changes regarding pilot working time require approval by Luxembourg's regulator Direction de l'Aviation Civile (DAC).

Cargolux had aimed to cut costs by $10 million through efficiency gains in 2013, and is targeting $12.5 million in savings for 2014.