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Lufthansa halts talks with union on staff cost cuts

FILE PHOTO: A Lufthansa aircraft at the airport in Frankfurt, Germany

BERLIN (Reuters) – German airline Lufthansa said on Thursday it had walked away from talks with union Verdi over a package to cut staff costs and would only return to the negotiating table if Verdi offers significant labour cost savings.

“We have decided not to continue the negotiations with Verdi for the time being,” a Lufthansa spokeswoman said. “We do not see any progress at the moment.”

Verdi, which is negotiating on behalf of 35,000 Lufthansa ground staff, said the airline was demanding unreasonable pay cuts of up to 23% of employees’ pre-tax salaries.

“The refusal (to continue negotiations) is a slap in the face of the employees,” Verdi deputy chairwoman Christine Behle said in a statement, adding that Lufthansa was demanding salary cuts without giving guarantees of job security.

The union said it had offered up to 600 million euros ($710 million) in staff cost cuts so far.

Last week, the airline put German workers on notice of compulsory lay-offs, saying the slump in air travel and slow progress in union negotiations meant cuts were unavoidable after the carrier lost 1.7 billion euros ($2 billion) in a single quarter.

On Thursday, the airline said it was still willing to negotiate.

“… we will return to the negotiating table when Verdi presents an offer with significant personnel cost savings,” the spokeswoman said.

Lufthansa, which in June received a 9 billion euro government bailout to secure its future, said last week it expected capacity to increase to only around 50% by the end of the year and two-thirds of last year’s level in 2021.

(Reporting by Klaus Lauer, writing by Riham Alkousaa, editing by Thomas Escritt and Susan Fenton)

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