Lufthansa, Lufthansa Cargo and Germanwings have reached a deal with the Vereinigung Cockpit pilot union (VC) and signed a new collective labor agreement (CLA) on all previously open issues. The signed contracts correspond to the agreement reached in March.

Talks between Lufthansa and VC have been ongoing since 2014 and have resulted in 14 pilot strikes that cost the German airline group €500 million ($590 million).

According to Lufthansa, the CLA is subject to approval of the trade union members in form of a ballot.

Among others, the deals include agreements on framework collective and remuneration deals, as well as accords on pension and transitional payments through June 2022.

Chief officer-corporate human resources and legal affairs Bettina Volkens said: “With the collective bargaining agreement, we have created a foundation for a new social partnership with the VC. We are jointly creating a sustainable collective bargaining peace until 2022. This compromise opens up career prospects for our pilots and makes an important contribution to the competitiveness of our company.”

The pension scheme will be changed from a system of defined benefits to a system of defined contributions, as already agreed with ground and cabin staff. As a result, pension liabilities will be reduced by a high three-digit million euro amount, while EBIT 2017 will improve by a significant three-digit million euro amount.

For cockpit employees, the average age pilots can retire from Lufthansa Passenger Services will be gradually increased to 60 until 2021, the same as pilots from Lufthansa Cargo and Germanwings. Pilots will also continue to have protective rights against permanent inability to fly.

Lufthansa, Lufthansa Cargo and Germanwings pilots can operate a minimum of 325 aircraft by the end of 2022, and the company will hire more than 700 junior pilots and create least 600 positions for future captains.

Pilots will receive staggered pay increases totaling to 10.3% and a one-off payment of up to 1.8 monthly salaries for the period of May 2012 until June 2022.

Kurt Hofmann,