News / Mechanics strike, and pilots may join in, as Cargolux stands firm on payouts

Cargolux is facing grounded flights after employees downed tools in the early hours this morning in a dispute over salaries and pandemic-era remuneration.

The action, announced yesterday, was swiftly followed by stern rebuttal from CEO Richard Forson, who contested claims that employees had not been adequately compensated from the windfall profits thrown up by Covid-19 and associated supply chain chaos.

“Profit share per employee has exceeded €200,000,” he said. “This applied to each and every one of them, regardless of salary, rank, or performance, and was paid pre-tax, with Cargolux paying all the social contributions attributable.

“We seriously challenge their claims of having not been rewarded.”

Mr Forson said €37,502 per employee was paid in 2020, €75,946 paid in 2021 and a further €85,296 distributed to each member of staff last year.

While the amounts paid out in some cases represent twice what workers receive in a single year, the present dispute revolves around renegotiation of the collective bargaining agreement, Cargolux pushing for a planned 6% pay rise to be tethered to profit.

“Under no circumstances can the increase claimed by the unions be related to the company’s profit-sharing bonus,” said LCGB, one of the unions representing workers.

“Due to the investments planned for Cargolux, the payment of such a bonus for the coming years becomes much more unlikely and therefore does not constitute a lasting improvement in wages unlike a salary increase.”

Despite 27 rounds of negotiations and five meetings with the National Conciliation Office, the parties have been unable to resolve the stand-off.

Some 120 mechanics took to the picket line this morning with reports that a “large majority” of the 630 pilots on the carrier’s books are expected to join their ranks in what is expected to be three days of action – although Mr Forson said: “These strikes are the first in Cargolux’s history and are due to run for three days, but the union also suggested this could be indefinite.”

He said Cargolux was “preparing for all eventualities”, but the number of flights grounded would depend on how many pilots participated in the strike.

He described the union’s demands as “unreasonable” and that they failed to consider the medium- to long-term viability of the airline.

“When downturns happen, drops are deep, with price per kg already down 50% on pandemic era figures, so for the unions to demand this, they are saying they would rather ensure their benefits, and the carrier falls into difficulties.

“Cargolux used cash reserves to enter a fleet renewal programme and build the airline’s resilience for the volatility evidenced by the current downturn.”

However, the unions said that from 2002 to 2018, pilots received no salary increase, with ground staff receiving a single 1% salary bump in 2006.

“Given inflation and very moderate wage increases over 20 years, 6% is not disproportionate, especially in view of the company’s recent excellent results,” said the LCGB.

“To date, management has only submitted a proposed 4% increase over four years. Contrary to statements, a 5% increase over five years has never been officially submitted.”