Pilots working for Spanish airline Iberia have agreed to a deal with employers that will reduce and then freeze their incomes temporarily. The deal was primarily meant to help the carrier recover from past losses.
Spanish airline Iberia and pilots union SEPLA announced Thursday they'd agreed to pilots having to accept a 14 percent wage cut and seeing their salaries frozen until 2015.
International Airlines Group (IAG) - Iberia's parent company which was created after the 2011 merger with British Airways - said future income developments would be subject to profitability levels, with the option of a further wage cut of 4 percent.
"This groundbreaking deal reduces the cost structure and provides the foundation for the airline to grow profitably," Iberia's Executive Chairman Luis Gallego said in a statement.
Recovering from earlier losses
The agreement also saw the pilots union accept the creation of low-cost subsidiary Iberia Express which it had opposed because in its view it violated a collective wage bargaining accord.
According to its own calculations, Iberia posted losses to the tune of 850 million euros ($1.16 billion) between 2008 and 2012 as a result of high fuel prices as well as mounting operating costs amid an unfavorable business environment in Spain.
The deal announced Thursday is still subject to the approval of SEPLA's General Assembly.
hg/hc (AFP, dpa)