Cockpit rage
February 22, 2010
As thousands sat stranded and frustrated Monday at Germany's airport terminals, Lufthansa announced that it would take legal action against the four-day pilot strike that is likely to cost the airline up to 15 million euros ($20 million) a day.
The costs to the German economy are likely to be greater. Transport Minister Peter Ramsauer urged Lufthansa managers and pilots to resume talks as quickly as possible, pointing to the country's precarious economic situation.
"A strike like this is happening at just the wrong moment," Ramsauer said. "The biggest German fleet cannot be virtually grounded for four days."
Playing with fire
The potential threat was big enough to draw comment from Werner Schnappauf, director of the Federation of German Industries (BDI), an organization usually careful to keep out of industrial disputes.
"The Lufthansa pilot strike comes at a really bad time," Schnappauf said as the last-ditch negotiations failed over the weekend. "A strike would have a wide reach, because all air traffic is dragged in, and it affects the fragile green shoots of our economic stabilization after the crisis."
For an export-based economy like Germany's, the consequences of long-term industrial action at Lufthansa could indeed be catastrophic. For this reason, Lufthansa's cargo subsidiary was quick to announce Monday that "90 percent of its operations" would continue throughout the strike. The financial damage to Lufthansa is severe enough, but is bearable as long as the airline's reputation remains intact and customers do not become skeptical.
Per-Ola Hellgren, an analyst at the LBBW state bank of Baden-Wuerttemberg, told Deutsche Welle that the dispute was a calculated risk for both sides. "The damage of a four-day strike can be more or less contained," Hellgren said, "But it's a risk for the pilots too. They can only lose out too if Lufthansa starts losing customers."
Passing round pilots
The accusation against the pilots' trade union Vereinigung Cockpit is that the national economy faces substantial damage, at least in the short-term, in the interests of a minority of employees. Lufthansa airline pilots do not exactly inhabit Germany's bottom wage bracket.
According to Cockpit, wages for Lufthansa pilots begin at 62,000 euros a year, though they have to begin paying off 60,000 euros of their two-year training program when they begin work. If they are promoted to captain, pilots can expect wages of 110,000 euros a year, rising up to a possible 250,000 euros a year. It is not difficult to see why the reaction of many stranded passengers was kneejerk anger, even if advanced warning of the strike meant that the expected airport chaos was relatively limited.
The strike is of course not primarily about wages, but job security. Lufthansa made a number of smaller acquisitions following the financial crisis last year, including the British airline BMI, Austrian Airlines, and Swiss - the remainder of the bankrupt Swissair. Restructuring the concern to integrate these companies is proving expensive, and Lufthansa says it needs to cut the costs in its passenger service by a billion euros. Cockpit is accusing Lufthansa of passing pilots around these lower-paying subsidiaries at will, and fear for their positions at Lufthansa.
Airplane worker solidarity
Support for Cockpit for the current strike from other unions has been muted, perhaps because the gap in wages between pilots and most other workers in the airline industry is substantial. Cockpit was formed in 1968, but until 2000 was bound up with the German Salaried Employees' Union (DAG) - an independent trade union that represented a huge range of jobs.
When the DAG was dissolved to form the service industry union Verdi in 2000, Cockpit left the larger organization. "They believed they were better able to represent their employees independently, and have repeatedly shown over the years that they have enough clout to do that," Verdi spokeswoman Cornelia Hass told Deutsche Welle. Verdi represents both ground staff and cabin crews, both of whom are dependent on the large union.
Hass declined to comment on the Lufthansa strike, and she said Verdi was unlikely to make an official statement on it. But the union is planning to open its own negotiations with Lufthansa on behalf of other airline workers. "Our focus will also be on job security," Hass said. These negotiations are to begin as early as March 1, and represent another potential headache for Lufthansa.
Author: Ben Knight
Editor: Sam Edmonds