Icelandair Group has achieved a breakthrough in its restructuring efforts, with a provisional productivity agreement with cabin crew representatives.
While the company had reached new deals with its pilots and aircraft mechanics, cabin crew union FFI was holding out and Icelandair Group was pessimistic over progress.
But it states that the two sides have managed to sign a new collective-bargaining agreement which will run until the end of September 2025.
“The agreement meets the set objectives of increasing productivity and flexibility for the company and, at the same time, ensures competitive compensation for cabin crew members,” says the airline.
Icelandair Group had been looking to relax duty-time clauses and obtain flexibility which would open up the possibility of new western US and southern European services.
Cabin crew union members are set to vote on whether to accept the deal, which is an important part of the company’s restructuring plans.
Icelandair Group is intending to issue new shares to reinforce its liquidity position, but had been looking to secure updated agreements with its workforce beforehand.
It had shifted the timeline for embarking on the share offering – originally expected before the end of June – while it continued discussions with parties including the unions.
Icelandair Group has already secured shareholder approval to increase its share capital by up to IcKr30 billion and is planning to raise $150-200 million from issuing new shares.