Estonian Air has terminated a collective agreement with its employees, which CEO Tero Taskila said was dated and did not take the current market situation into account, reported Postimees.
The Airline Pilots Association has been negotiating the terms of a collective agreement with Estonian Air for a year without result. “We have fundamental differences [...] We have not made any steps forward in a year's time,” said association chairman Rauno Menning.
“We want to make a compromise where both sides make concessions. They have presented us with an ultimatum: take it or leave it, this is the market situation. And we won't accept that,” Menning said.
The financially struggling national carrier aims to boost worker efficiency by 15 percent. In other words, pilots need to work more for the same salaries, according to Postimees. The disagreements include but are not limited to salaries and vacation time, the last having been cut significantly by Estonian Air.
“Estonian Air should be embarassed to even present such [demands],” said Menning, who will continue negotiating next Tuesday.
Taskila said that the market situation is tough internationally for commercial airlines. Nevertheless, the company aims to start making a profit by the end of next year.
Estonian Air's loss in the first half of the year amounted to 14.9 million euros, despite the company's turnover growing by 24 protsent to 43.9 million euros. Taskila blamed increasing fuel prices, decreasing productivity, cheaper airline fares due to competition, the transition to new airplanes and the costly implementation of a new strategy.
Taskila said the second half of the year would be better and that the company would try to avoid the need for additional government subsidies. He called Estonian Air one of the fastest growing airlines in Europe and said one in two travelers in Tallinn Airport fly with the carrier.