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Lufthansa signs pay deal with ground staff

German carrier Lufthansa says it's reached a deal with services sector union Verdi covering 30,000 ground staff. The airline is also in long-running disputes with pilots and cabin crew which has led to several strikes.

Saturday's deal means Lufthansa ground staff and employees of several subsidiaries will be given a one-off payment of 2,250 euros ($2,350) if they worked between April and December 2015. They'll also receive a 2.2 percent pay increase for the next two years.

Employees at subsidiaries Lufthansa Systems, Lufthansa Service catering, Lufthansa Technik maintenance and Lufthansa Cargo freight service will benefit from the new collective bargaining accord, which runs until the end of 2017.

The deal comes as the company seeks to slash costs in the face of competition from low-cost rivals and Gulf airlines.

Disputes with several of the airline's unions has led to

regular industrial action over the past year,

especially among pilots and cabin crew.

Crippling strikes

A

seven-day cabin crew walk-out

earlier this month was the longest in the company's history and saw 4,700 flights cancelled and left more than half a million passengers stranded. That action was

called off earlier this week

due to signs of progress in talks.

In late March, ground staff at several key airports in Germany had answered a call for a half-day strike call, which caused hours of delays.

The company set a deadline for the end of November to reach an agreement with ground staff.

Changes to employees' retirement benefits have also been a key sticking point in negotiations with all staff unions.

The Verdi union said on Saturday that Lufthansa had agreed that recent and future hires will receive the same pension scheme as long-time employees. However, all employees must now contribute 1 per cent of their salary to their plan while the company will put in 5.2 per cent.

The company plans to hold a "jobs summit" on December 2 with flight attendants' union UFO, the Cockpit pilots' union and Verdi to hash out key problems in their long-running disputes.

As well as cutting jobs and wages, Lufthansa has merged its two lost-cost carriers - Eurowings and Germanwings - under the single Eurowings brand.

mm/rc (AFP, dpa)

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