Tuesday, April 29, 2014

Lufthansa flight cancellation due to pilot strike

Lufthansa flight cancellation due to pilot strike
On 2nd of April 2014, a three days duration of pilot strike were carry out by 5,400 staff from Lufthansa group towards the recent pay cut and retirement plan on pilots. During the 3 days strike, Lufthansa have to cancel a massive 3,800 flight which affecting at least 425,000 passengers who had booked the air ticket.
According to an article in Bloomberg, these 3 days strike could cost Lufthansa around 75 million loss in profit, in fact this was not the first time Lufthansa facing the walkout of stuff, In 2010, 2,000 flight cancellation due to staff walkout which cost 48 million euro loss to Lufthansa as well. The main reason behind these 3 days strike is because of pay cut and scrapping off the early retirement plan that was implemented for pilot when they first join.
According to an article from The Guardian, mass walkout were rare in Germany and when it actually happens the public were usually supportive but this time they were bemused by the action of the pilots from Lufthansa as they feel that passenger were held as hostages or tools in order for them to get higher pay check.
Based on what I’ve read through those articles, I’m convinced that Lufthansa have the responsible for this unfortunately incident happened which is not just causing inconvenience to the passengers but in fact it actually affecting the image and reputation of Lufthansa, other airlines are taking this opportunity to attract those affected customer to choose their airline instead of Lufthansa. Why I’m saying that Lufthansa have responsible is because this is not the first time they having staff walkout due to cutting cost or pay cut, it happens in the year 2010 and 2012 as well. So that could be their references before they make any decision especially regarding the payment for the staff.
Lufthansa should have negotiate and come to an agreement with the labor union first before they made the decision which have upset so many staff. According to the article from Bloomberg, a Lufthansa pilot can retire at the age of 55 years old, get paid 60% of the last salary until the age of 63 years old which is the legal retirement age, due to this policy, more and more pilot requested to fly longer hours destination to accumulate more mileage to increase their salary by the age of 55 years old. The annual salary of a Lufthansa pilot stands at 260,000 euros a year, for the past 2 years they been having discussion with Lufthansa through pilot union to increase 10% more but could not come to an agreement. Instead Lufthansa offered 5.2 percent plus a one-time sum and dropped a demand to tie raises to financial performance for three years. Even if they wanted to implement certain policy they should carry it out slowly, and from there they would get the reaction from their staff whether they like the new policy or not, because by not doing that you are actually presenting them the opportunity of having a protest or a massive walkout which presenting to the public that your company is not good at dealing and handling with your staff.