KLM working to resolve issues with collective agreement, State aid requirements

Dutch airline KLM, in consultation with the trade unions, hopes to quickly find a solution to issues in the collective bargaining agreements signaled by the state agent for the airline. The state agent said in advice to parliament that the collective labor agreements KLM wishes to make with the unions do not meet the conditions of the government support package KLM received in the pandemic.

KLM is subject to strict conditions because of the state support the company received to get it through the coronavirus crisis. According to state agent Jeroen Kremers, the proposed 5 percent wage increase for all staff does not meet the conditions unless KLM cuts money elsewhere. Kremers also said that KLM did not inform him about the upcoming wage increase when it should have.

According to Kremers, KLM also falls short in limiting tax avoidance by employees. The state agent is not a member of KLM's management or supervisory board but can put topics on the agenda for meetings. He also reports to the Cabinet, usually every six months. But due to debates about extra support for KLM's parent company Air France-KLM, parliament requested his latest insights.

KLM stressed that the Cabinet promised it 3.4 billion euros in state aid, but the airline only used 942 million euros. KLM has also repaid 311 million euros of that amount and reduced its "controllable costs" by 30 percent - more than the 15 percent required.

The collective labor agreement for the KLM flight crew ran until March 1 this year. The agreement for ground- and cabin personnel is expiring at the end of this year. According to KLM, the new collective agreement for flight crews was delayed by a critical report by the International Labor Organization (ILO) about the conditions imposed by the State. According to the ILO, agreements on employee wages should not have been made without consultation with the trade unions. The ILO's ruling was non-binding, but sent a clear signal, said the unions that initiated the case.

KLM and trade unions will discuss the collective bargaining agreement for pilots further in the coming weeks. KLM also set up a working group with the trade unions.

Pilots' union VNV called the KLM state agent's advice about their collective labor agreement premature, as the union is still in talks with KLM. "Conclusions about contributions from personnel, and specifically pilots, are therefore premature and incorrect," VNV said.