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Dutch Airline KLM Unilaterally Withholds Pay Rise to the Ire of Unions

Dutch Airline KLM Unilaterally Withholds Pay Rise to the Ire of Unions

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Dutch flag carrier KLM announced on Thursday that it was unilaterally withholding a 2.5 per cent pay rise for all of the airline’s employees that had been agreed last year and was due to take effect this month. Unions reacted with anger to the news, saying they had been willing to discuss the postponement but only as part of wider talks on cost-saving measures that workers will be expected to brunt in KLM’s response to the Corona crisis.

The airline, however, said it couldn’t wait any longer, citing a daily cash burn of €10 million for taking the unilateral decision to the ire of its collective labour organisations. “KLM cannot now afford to implement the salary increase in August. Not socially, and not financially,” the airline said in a statement.

Photo Credit: KLM

“KLM is in a crisis of unprecedented magnitude since the outbreak of the COVID-19 virus,” the statement continued. “The half-year result that was announced on July 30, is the worst ever. To survive, KLM must take measures to reduce costs.”

“Last year, KLM agreed with the unions in the 2019 CLA on a wage increase of 2.5 per cent from 1 August 2020. However, the situation at that time is completely different from the reality of today.”

The airline said it asked unions to agree to the salary increase postponement ahead of an agreement on a broader range of measures which won’t be completed until October. KLM claimed the unions couldn’t agree so it had no choice but to go ahead with the change without reaching an agreement.

The VNC union said in response that it understood the “serious situation” the airline was in but that its action would set back any future negotiations. The more hard-line FNV union said it was “shocked” by KLM’s decision, which it says could be illegal.

“We do realise the seriousness of the matter and we also see the need to take steps quickly. However, speed does not exclude carefulness,” the union said in a statement.

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