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Pilots Holding Up €3.4 Billion Bailout for Dutch Flag Carrier KLM

Pilots Holding Up €3.4 Billion Bailout for Dutch Flag Carrier KLM

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Update: The pilots union has come to an agreement with KLM, paving the way for State aid to be approved. Finance Minister Hoekstra acknowledged reaching a deal hadn’t been easy but that he was happy with the five-year pay cut agreement reached between the VNV pilots union and KLM.

The pilots union for KLM flight crew is holding up a €3.4 billion government-funded bailout, the Dutch airline said on Tuesday. KLM said unions representing cabin crew and ground staff have agreed to tough new conditions and temporary concessions after marathon talks but the Dutch Airline Pilots Association or VNV union is holding out and demanding talks with the country’s Finance Minister.

Negotiations to secure the multi-billion Euro bailout hit problems last week when the Dutch government said it required KLM employees to give up more of their wages if they expected taxpayers to keep the airline afloat.

KLM had already agreed temporary pay cuts with different employee groups which were due to end in 2022. But Finance Minister Wopke Hoekstra didn’t think that went far enough and wanted employees to accept pay cuts for the full duration of the bailout loan.

Pilots had already accepted a 20 per cent cut in their salaries but believe the open-ended nature of the so-called “commitment clause” is unfair.

“KLM is in the worst crisis of its 101 years of existence,” the airline warned on Saturday as a deadline set by the government to accept the clause passed without an agreement.

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“These are unprecedented times that also require unprecedented and unusual steps and approaches,” commented KLM chief executive Pieter Elbers. “I can only call once again on the pilots’ union VNV to take this final step and to fulfil its commitment by signing this clause. In the interests of its members, all KLM employees and the future of our company,” he continued.

The VNV, however, says it wants to meet with Hoekstra suggesting the minister doesn’t appreciate the sacrifice that pilots have already accepted. While it’s not known how long it could take to pay back the bailout, the maximum length of collective labour agreements in the Netherlands is five years.

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