KLM Pilots agree to wage cuts clearing path for €3.4 billion state aid package

The labor union representing Dutch airline KLM's pilots has signed a commitment to agree to salary cuts for the duration the airline receives state support to cope with a decrease in travel brought on by the coronavirus pandemic. The VNV union was the last of eight labor unions to agree to the pledge.

"This brings KLM one step closer to obtaining the government loan and guarantees on bank loans totalling EUR 3.4 billion," the airline said in a statement. "The loan package is crucial to securing the future of KLM and its network for the Netherlands.

In order for KLM to receive 3.4 billion euros in state aid, the Minister of Finance Wopke Hoekstra demanded that all airline employees agree to the possibility of a decrease in salary through 2025. The unions were supposed to submit their approval to the austerity measure by noon on October 31.

While VNV, and also the FNV union representing some flight attendants and ground crew, said that they would not allow the airline to go bankrupt. At the same time, they said that it was incomprehensible that they would have to commit to the slashing the salary of KLM staffers if the airline had a chance at recovering by 2023.

The stance of the unions led Hoekstra to pull the aid package off the table over the weekend. “It is up to KLM and the unions to ensure that the conditions set are still met. If the conditions are still met at a later time, the Cabinet will further inform your House,” he said on Saturday in a letter to Khadija Arib, the Chair of the Tweede Kamer, the lower house of Dutch Parliament.

"Without this loan, KLM will not get through this difficult time,” said Pieter Elbers, KLM CEO, in a statement released earlier on Saturday.

The two FNV unions involved signed the commitment clause on Monday.