Lufthansa vows to resist union demands

Lufthansa said it will resist increasing spending on employees even as the German airline's flight attendants prepare for their biggest-ever walkout in a retirement dispute and a ground-handling and cargo-division union start contract talks.

The airline, undeterred by a slowdown in bookings following the UFO union's strike threat , can't accept the labour group's demands, Bettina Volkens, Lufthansa's head of human resources, said on Wednesday in Frankfurt.

UFO’s terms would result in as much as 25 per cent higher pension-benefit spending per worker, Ms Volkens said. The airline will present “alternative scenarios and options” later that it hopes will result in further negotiations, she said.

“We must make the company fit for the future and we cannot accept any further cost increases,” Volkens said.

UFO has a 5pm on Thursday deadline for the carrier to improve its current offer or flight attendants will halt work from November 6th until November 13th.

The Ver.di union, representing check-in, technical-services and air-freight employees as well as cabin crew members who aren’t in UFO, plans separately to start negotiating about pensions with Lufthansa on Thursday in a seventh round of wage talks.

The dispute with flight attendants stems from Lufthansa’s efforts to hold back spending to sustain earnings while competing with European discount airlines and full-service rivals from the Middle East.

It mirrors a conflict at larger competitor Air France-KLM Group, as well as a spat with Lufthansa's pilots, who staged a series of strikes until a court stopped the walkouts as an illegal protest against corporate plans to expand a low-cost unit.

Lufthansa said that, while UFO agreed to switch the corporate pension system to a defined-contribution program from defined benefits, the union still wants the absolute level of payments at least to be maintained.

In its latest proposal in September, the company called for employees to work for more years to reach that level.

- Bloomberg