Labour court questions Austrian's Tyrolean transfer

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A Vienna labour court has called into question the legality of Austrian Airlines' restructuring move last year to transfer flights to regional unit Tyrolean Airways, despite ruling it strictly complies with the country's labour laws.

The Lufthansa-owned carrier transferred all flight operations to Tyrolean in July 2012 to cut staff costs for pilots and cabin crew after failing to negotiate a new deal with unions. While the employee salary levels were not reduced, the move was particularly aimed at slowing the rate of pay increases.

In today's ruling a judge at the Vienna Labour and Social Affair Court says that while an "ostensible violation" of law has not taken place, it has called the transfer of operations within a corporate group in the question

“We acknowledge the first instance judgment," says Austrian Airlines chief executive Jaan Albrecht. "It is surprising for us that he casts doubt upon the common practice of transferring operations as part of Group restructuring programmes.

“We will pursue every legal avenue at our disposal in the appeals process in order to also legally safeguard our restructuring path. In the meantime, we hope that the talks initiated with the works council on the collective wage agreement will result in a viable solution independent of the decision handed down by the court," he adds.

The labour court ruling is dealing with the specific legal repurcussions on the transfer of flights operations to Tyrolean from an employment law basis, but bears no direct relation to the decision currently being considered by Austria's supreme court clarifying the after-effects for former Austrian Airlines flight personal from the termination of their collective wage agreement. In June that court sought a clarification from the European Court of Justice on several legal issues about the operational transfer.