Austrian Airlines cancels pay talks after staff veto offer

Fri May 30, 2014 10:50am EDT
 
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By Angelika Gruber and Georgina Prodhan

VIENNA (Reuters) - Austrian Airlines called off pay talks with cabin crew and pilots on Friday, after its works council rejected a wage offer and reminded the airline it could strike at any time.

The airline, a unit of Germany's Lufthansa, said there was no basis for further talks and withdrew its offer, which it had hoped would break a years-long stalemate and create the certainty needed to allow investments in its fleet.

Employees had on Monday rejected the offer, saying it could lead to a loss in real wages, following a three hour-long meeting attended by about 1,000 staff that caused the cancellation of 34 flights and the disruption of many more.

The works council reaffirmed its mandate to take industrial action up to and including strikes.

"We have an authorization to strike from the staff. We'll see how it goes," flight crew works council chief Karl Minhard told Reuters. "We are still ready to negotiate, but over sensible collective wage agreements."

Lufthansa, which bought the airline from the Austrian government in 2009, had its own labor issues this year when its pilots grounded planes for three days, costing it 45 million euros ($61 million) in operating profit.

Austrian has been at loggerheads with its cabin crew since 2012, when the loss-making carrier eventually transferred its entire flight operations to lower-cost Tyrolean as part of a restructuring after failing to reach a wage deal.

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The tails of Austrian Airlines planes are pictured at the airport in Schwechat March 14, 2013. REUTERS/Heinz-Peter Bader