Austrian Airlines (OS, Vienna) has been dealt a blow so far as its cost-cutting plans are concerned after the European Court of Justice (ECJ) on Thursday ruled that collective wage agreements also apply to labour contracts after a transfer of operations.
The ECJ's ruling pertained to whether or not Austrian Airlines could unilaterally revoke a collective wage agreement in force prior to a 2012 decision to transfer all flight personnel and operations to its Tyrolean Airways (Innsbruck) subsidiary.
"The ECJ holds the opinion that the term 'working conditions stipulated in a collective wage agreement' contained in the EU Transfers of Undertakings Directive also apply to the working conditions of a collective wage agreement terminated during the transfer of operations," Austrian said in a statement.
In a bid to cut EUR263million in annual costs, Austrian in 2012, moved ahead with a controversial plan to shift some 2000 employees to its Tyrolean subsidiary where remuneration packages are less generous than those at Austrian.
However, unions representing staff affected by the switch took the matter to court resulting in a September 2013 Viennese court ruling that the staff were still employees of Austrian Airlines, entitled to their more generous employment contracts.
While the matter was subsequently referred to the ECJ, Tyrolean staff now work according to their previous pay deals, while those on more generous Austrian Airlines contracts have been frozen.
According to Reuters, the airline's works council wants the basis for renewed talks to be the old Austrian Airlines collective wage agreement, while the company wants to negotiate on the basis of the less-generous Tyrolean contracts.
