Cargolux – Union Pushes for Vote on Industrial Action

Just when Cargolux was seemingly getting itself back into a “normal business mode,” the LCGB union issued a statement on October 29th that they were now contemplating industrial action against the carrier.

LCGB officials announcing their union’s support for industrial action against Cargolux  -  credit LCGB
LCGB officials announcing their union’s support for industrial action against Cargolux - credit LCGB

Rocking the boat?
There was much discussion and discourse from the Luxembourg unions during the past twelve months and their (LCGB) main claim has been based around the outsourcing of LUX based ground staff and pilots under the so called “Scope Clause” in the collective work agreement. It is interesting to note that from the OGBL, the largest union in the Grand Duchy, nothing much was heard about this topic lately, particularly no industrial actions were announced.
The present version of the CWA expires on 1 December of this year.

Is it all really about aircraft outsourcing?
The discussion between Cargolux management and the LCGB about the positioning of CV Boeing 747400Fs to Milan under Cargolux Italia flagging has been going on for many months now.
When reading the press release from LCGB, it would seem that this is the main axe the union has to grind with the management.
But is it just that?
Power plays between unions and managers is not uncommon and we have seen this in the still ongoing battle between Lufthansa and its pilots union.
Who will give in first? – That’s the impression one can get and maybe it is no different in Luxembourg.

Controversial collective work agreement
The collective working agreement between the LUX unions and CV’s management has been, along with the CV Italia subject, the main issue during the past months as this is due to expire at the end of November.
If an agreement is not reached, then there definitely is the danger of a strike ballot being called.
One has to wonder though, how many pilots and other staff would actually follow this call that obviously is not supported by the OGBL.
Cargolux informed the press during the past lightning strikes that almost all flights were operated and that the reaction from pilots to strike was very low.
Would this be the case this time?

Cargolux Italia remains the bone of contention
The union, LCGB, states that they have proposed extensive cost saving measures to CV to the amount of US$10 million per annum and that 90 percent of these costs would be borne by the pilot community.
In the same breath they complain that CV has, despite past promises, further increased the number of aircraft operating under the CV Italia flag and that some of these aircraft and their “cheaper crews” are operating regularly out of Luxembourg and not just Milan.
The complaint is that CV is sidelining the Luxembourg government in that social security payments and income taxes for those pilots are being paid in Italy and should be coming into the Luxembourg fiscal coffers.

Cargolux claims that their Italian offspring creates more jobs in Luxembourg than in Italy  -  source hs
Cargolux claims that their Italian offspring creates more jobs in Luxembourg than in Italy - source hs

If this were the case, then surely this is for the tax authorities to take up with CV’s management and not a reason (or part reason) to call a strike ballot.

Moa’s perception
We have asked spokesperson Moa Sigurdardottir of Cargolux to deliver her airline’s view on the LCGB allegations. This is what Moa told CargoForwarder Global:
She pointed out that in 2015 Cargolux Italia indeed expanded the operational scope, however, its Luxembourg-based parent company expanded even more. “As Cargolux we have, for instance, added flights from Oman to India, commenced services to Turkmenistan and expanded our operation at Zhengzhou with transpacific flights to Chicago.” Moa insists that all of these flights are operated with Cargolux aircraft and Cargolux crews.
Asked about the workplace ratio at the carrier’s home turf Luxembourg she assures that CV is still hiring staff and crews in the Grand Duchy and announces an increase of staff and crew levels also throughout 2016. Moa concludes that “all of this would be jeopardized by adverse industrial actions.”

Win-win situation
Further, she recalls that parent Cargolux also profits from Cargolux Italia’s expansion by gaining valuable traffic rights only the Milan-based offspring was able to obtain. This includes flights between Italy and Japan (Osaka / Tokyo) and Russia (Novosibirsk). 
Meanwhile, Cargolux Italia holds a market share of 14%, making the daughter company the number one cargo carrier in the Italian market. This positive development underpins the importance “of developing both airlines in parallel,” resulting in a win-win situation.
The favorable production costs allow Cargolux Italia to continue serving financially challenging markets such as Africa, resulting in positive effects on the company’s global network.

Valuable contributor
Finally, Moa stresses that Cargolux Italia’s profitable operation delivers additional contribution to support jobs in Luxembourg, for instance in cargo handling and maintenance. Mrs Sigurdardottir states: “Every single job at Cargolux Italia secures three additional jobs at Cargolux in Luxembourg.”
So in contrast to the LCGB assumption the message from CV‘s management is that  Cargolux Italia does not threaten its parent causing job losses or poorer working conditions, but has become a valuable contributor to the well-being of its founding company.

John Mc Donagh  /  Heiner Siegmund

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