Rejection Of Pay Deal By Air France-KLM Staff Results In Resignation Of Its Chief

Following the rejection of a new pay deal by the French staff at Air France-KLM, its chief Jean-Marc Janaillac has announced his resignation form the strike-hit airline.

“I accept the consequences of this vote and will tender my resignation to the boards of Air France and Air France-KLM in coming days,” he said.

A new proposed pay deal was rejected by 55 per cent of French employees in a ballot vote.

There has been a series of strikes in recent week at Air France-KLM which is amongst the largest airlines in Europe.

The airline – a Franco-Dutch joint venture, has lost millions of euros because of the strikes and business disruptions.

The company authorities had proposed a 7 per cent hike for the staff over a period of the next four years which was summarily rejected by the employee in the ballot vote.

It was in February this year that the troubles began in the airline after the employees demanded a 5.1 per cent enhancement in their pay in 2018.

“This is an enormous mess that will only put a smile on the faces of our competitors,” Mr Janaillac told a news conference.

While not answering any questions on the issue, he said that he hoped his resignation would help to instill “a more acute collective awareness”.

A promise to resign from his post in case the pay deal was rejected was earlier made by the 65-year-old chief executive who had bene heading the company for a little less than two years.

The airline had been facing stiff competition from budget and low-cost airlines and the national carriers of the Gulf countries and Mr Janaillac had bene attempting to reduce costs of operation to address the challenge of competition.

Air France-KLM said that he will officially resign next Wednesday.

Even as he announced his resignation, the employee unions of the airlines said that they would organize further strikes in the coming days to continue to press for their demands.

The profit and growth expectations for 2018 have already been lowered by Air France-KLM.

The company was formed in 2004 with the merger of Air France and KLM. Every year, the airline transports tens of millions of passengers around the world.

The state-owned SNCF rail company has also been hit by strikes organized by its staff as a result of the labour reforms that have bene launched by the French President Emmanuel Macron.

In recent year, there has already been deep cost cutting in both British Airways and Lufthansa and there are analysts who believe that Air France has lagged behind in that aspect from its rivals.

“There is inevitably some pain for staff when structural changes are made, but once that is dealt with, you’re left with a much healthier company,” said aviation consultant John Strickland.

“That has been proved in the cases of the turnarounds achieved by Iberia and British Airways.”

(Adapted from BBC.com)

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