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Lufthansa Group Balance 2014 EN - Employment policy based on partnership

It is tried-and-tested company policy to settle clashes of interests between company man- agement and the bodies representing employees in a transparent manner. A fair approach to coexistence in all areas creates the balance needed to advance the ­Lufthansa Group’s position in the market. The growing plurality of opinions and opinion leaderships, much like developments in society as a whole, is increasingly a challenge for all parties concerned. The guiding principles for joint efforts are flexibility and responsiveness. Ú Partnership in collective agreements ­Lufthansa employs its staff under conditions that guarantee them social and material security not only during but also after their working years. These are established on the basis of collective agreements that the com- pany negotiates with its union partners Ver- einte Dienstleistungsgewerkschaft (ver.di), Vereinigung Cockpit (VC), and Unabhängige Flugbegleiter Organisation e.V. (UFO). The goal is to treat all employee groups within the company fairly and justly—a desideratum that the multiplicity of unions within the company presents with an array of increasingly chal- lenging conditions. Pay negotiations with ver.di for ground staff On May 1, 2013, the air traffic employers’ association Arbeitgeberverband Luftverkehr e.V. (AGVL) and the trade union ver.di agreed in the fourth round of negotiations on a wage settlement for the roughly 33,000 workers whom the ­Lufthansa Group employs in Ger- many as ground staff. This agreement is the first to make distinctions among the various business segments based on differences in their economic performance. The wage agreement is valid for a period of 26 months, from February 1, 2013, to March 31, 2015. The introduction of differentiated wage scale increases in combination with long terms for collective wage agreements marks an impor- tant change of course for future wage policy. Since the pay increases also do not go into effect until later, beginning in February 2013 the employees made a contribution, with the delay of several months in their wage increases, to the ­Lufthansa Group’s mea- sures to safeguard profitability. In return, the ­Lufthansa Group promised the employees job security until 2015. The agreement was preceded by several widespread warning strikes in Germany. LSG Sky Chefs: Structural reform for the German regional companies A structural reform was negotiated in February 2013 between ver.di, the AGVL, and LSG Sky Chefs for the employees of the German regional companies of LSG Sky Chefs. In this agreement, cost reductions were defined for existing employees, while adjusted pay terms were defined for new hires. At the same time, a promise of long-term job security was made. Owing to this solution, it was agreed that the companies included in this structural reform would not fully participate in the 2013 round of Group-wide collective bargaining. New agreement for Germanwings cabin staff Germanwings and the representatives of the flight attendants’ union UFO reached agree- ment in June 2013 in the wage negotiations for cabin personnel. For ­Lufthansa cabin crews, an agreement was made in the reporting year to implement the mediated settlement with the UFO from 2012. A noteworthy feature is the collective agree- ment on annual working hours, which improves the ability of the company in Ger- many to cover seasonal demand and thereby lighten peak workload demands on cabin crew members while the summer flight sched- ule is in effect. For the transition from the decentralized services of ­Lufthansa to The ­Lufthansa Group’s success depends greatly on the ideas, enthusiasm and commitment of its employees. Therefore, the aviation company attaches the greatest importance to providing its employees with an attractive work environment and appropriate salaries. Likewise, it is an established tradition always to balance the economic interests of the company with the expecta- tions and needs of its employees. Employment policy based on partnership Creating viable conditions for the future  90 // Social Responsibility

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