Estonian Air has signed a new collective agreement with its cabin crew, outlining changes to rest time, working conditions, social guarantees and salaries.
The agreement covers all flight attendants irrespective of trade union membership, the airline says in a statement.
It adds that following lengthy negotiations management and unions have brokered a settlement that will "ensure a good working environment" and pave the way for unspecified "further cooperation" between the two sides.
Estonia's flag carrier is preparing to nearly halve its workforce as part of a strategic re-think which centres on scaling back its hub aspirations and shrinking the fleet.
"The aviation market is already very competitive and will remain so in the future," notes newly-appointed chief executive Jan Palmer.
"It is therefore important to find a good balance between the wishes of employees and the possibilities the company can offer, in order to ensure sufficient flexibility to respond to changes in the market and to continue to be competitive."
Veiko Saga, chairman of Estonian Air cabin crew union ESSA, says that the new collective agreement entails productivity improvements of up to 15% for workers.
"[At] the same time we agreed to retain the wages on the level of year 2008," he adds. "We hope that the company is able to implement the planned reconstruction and stabilise its activities in the coming year."