Dutch airline KLM, which has been forced to cancel thousands of flights due to labor shortages, has reached an agreement with ground staff trade unions that will see workers receive pay rises.

In a press release, KLM said that while it was “no easy task” to reach an agreement, it was pleased that the negotiation’s results will bring “stability and improve the outlook for all our ground personnel”.

The agreements include KLM offering its ground staff a salary increase of 2% effective October 1, 2022 and a further 2% effective March 1, 2023. A minimum of €80 ($80) has been set for both increases, ‘to ensure that the financial position of those on lower incomes is strengthened’, the airline said. The offer will now go to union members for approval.

KLM said that rising inflation, declining purchasing power, high work pressure and the tightening labor market were factors in deciding to offer pay increases.

Over the past weeks, KLM had to increase flight cuts for its summer schedule due to staff shortages at Schiphol Airport.

The unprecedented wave of post-pandemic travel demand has set off a wave of operational challenges for many airlines in the industry, further exacerbated by staff shortages. 

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KLM will cancel 10 to 20 return flights to European destinations every day, due to operational problems caused by staff shortages.
 

“These agreements will restore stability to our organization and offer better perspectives to (future) staff”, the airline said. 

However, the Dutch airline, part of the Air France-KLM Group, warned that while it had managed to repay government loans and its finances had improved, recovery was still fragile. KLM said it therefore had to continue efforts to cut costs to ensure that it continued to have access to financing and that it may need to re-open talks with unions.

“If circumstances change in the coming period, causing KLM to slip into crisis once more, we will return to the negotiating table with the trade unions,” the airline cautioned.