SAS and pilot unions have finally reached a wage deal, ending a 15-day strike that had grounded 3,700 flights and put the carrier’s future in doubt. The new agreement will see pilots receive a pay increase of 3.5% over the next three years, with SAS also agreeing to a number of other demands from the unions. This is a significant victory for the pilots, who had been threatening to walk out again if their demands were not met.
The agreement comes after weeks of negotiation between SAS and the unions, with both sides eventually coming to an agreement that was acceptable to both parties. The pay increase will be retroactive from April 1st, meaning that pilots will receive back pay for the period they were on strike. This is a significant victory for the pilots and their union, which has been fighting for a better deal for its members for several years.
The agreement will also see SAS commit to a number of other demands from the unions, including improved working conditions and greater job security. This is a positive result for both sides, as it ensures that SAS can continue operating without the threat of further industrial action, and the unions have secured significant concessions from the airline.
This is a huge relief for passengers who were stranded by the strike, and it will also be welcomed by businesses who rely on SAS for their travel needs. The airline had been facing severe financial difficulties even before the strike, and this dispute had put even more pressure on its finances.
The agreement between SAS and the unions is a positive result for all involved, and it should help to stabilize the airline’s operations in the future.
SAS shares jumped 12%
SAS shares jumped 12% in early morning trade on Tuesday, but then steadied and were up around 4% at 1223 GMT. They are still down about 40% since the beginning of the year.
The airline said it would cut capacity by 50% in the second quarter of 2020 compared to the same period last year, as the coronavirus outbreak continues to hit demand for air travel.
“We expect the negative effects of Covid-19 to continue for several quarters,” SAS CEO Rickard Gustafson said in a statement.
“By making these tough decisions now, we are safeguarding SAS’ long-term competitiveness and ensuring that we will be able to emerge from this crisis as a stronger company,” he added.
SAS said it would also temporarily lay off around 3,600 of its employees, or around 20% of its workforce.
The airline said it was in talks with unions about the layoffs, which will affect all SAS countries except Norway. The layoffs will be in effect for at least three months.
“It is with a heavy heart that we have to take these measures, but they are unfortunately necessary in order to secure SAS’ future,” Gustafson said.
SAS is the latest airline to announce drastic capacity cuts and layoffs as the coronavirus continues to spread around the world, leading to a sharp drop in demand for air travel.
Earlier this month, British Airways announced that it would cut up to 30% of its flights and lay off up to 12,000 employees as a result of the outbreak.
And on Monday, German airline Lufthansa announced that it would cut capacity by up to 50% in the coming months and temporarily lay off around 22,000 employees.
The strike by the airline’s pilots, which began on July 8, is the longest in the carrier’s history.
The airline has been trying to reach a new labor agreement with its pilots since 2016. The two sides have been in mediation since May 2018.
The main sticking point in the negotiations has been overcompensation. The pilots are seeking a pay increase of about 20 percent.
The airline has offered a pay increase of 8 percent over four years. It has also said it is willing to consider a higher pay raise if the pilots agree to make some concessions on work rules.
The strike has forced the cancellation of more than 4,000 flights and affected 380,000 passengers.
The airline has said the industrial action has cost it more than $145 million to date.
The two sides are scheduled to meet with a mediator again on Monday in an effort to reach a new labor agreement.
New Deal
The new deal with its lenders will give the airline the much-needed breathing room to raise $700 million in fresh financing and finalize its plans for bankruptcy protection. This is a critical step in ensuring the long-term viability of the airline. We are committed to working with our lenders and all other stakeholders to ensure a successful restructuring process that will position the company for future success.
REHIRING PILOTS
SAS said the agreement with pilots involved higher productivity, increased flexibility in seasonal capacity, and a commitment, as operations ramp up until 2024, to rehire 450 pilots laid off during the pandemic.
Pilots had agreed to around a 25% cut in wages and terms as well as up to 60 working hours per week, up from the current 47, the chairman of the Danish pilot union, Henrik Thyregod told Danish media.
“The SAS Group is delighted to have found an agreement with the Danish Pilots’ Union that enables us to continue our recovery after the Covid-19 pandemic,” said chief executive Rickard Gustafson in a statement.
“This is an important step forward in our efforts to rebuild SAS and secure long-term competitiveness.”
SAS has been hit hard by the pandemic with air travel demand plummeting. It has cut around 6,000 jobs and raised 5.5 billion Swedish crowns (500 million pounds) through a rights issue and debt restructuring. ($1 = 10.4309 Swedish crowns) (Reporting by Jacob Gronholt-Pedersen; Editing by Susan Fenton)Our Standards: The Thomson Reuters Trust Principles.
New Deal Between Sas and The Danish Pilot’s Union
The new deal between SAS and the Danish pilot’s union is a good step forward, but there is still more work to be done. The agreement is a parallel agreement, which means that it does not replace the existing Link and Connect agreements. SAS has pledged not to hire any new pilots under these agreements, and they will not be renewed. This is a good first step, but it does not solve all of the problems. The Danish pilot’s union wants to see more transparency from SAS about their hiring practices, and they want to ensure that all pilots are treated fairly. There is still some work to be done, but this new agreement is a good start.
Final Verdict – SAS Strike Recent Updates
The SAS strike has been going on for a while now, and there have been some recent updates. The most recent update is that the airline has agreed to a new deal with its lenders. This will give the airline the breathing room it needs to raise $700 million in fresh financing and finalize its plans for bankruptcy protection. This is a critical step in ensuring the long-term viability of the airline. We are committed to working with our lenders and all other stakeholders to ensure a successful restructuring process that will position the company for future success.
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