Labor and Social Affairs Court Questions Practice of Transferring Flight Operations to Tyrolean

In a ruling handed down today by the Vienna Labor and Social Affairs Court, the court questioned the legal validity of the transfer of flight operations from Austrian Airlines to Tyrolean Airways. Fundamentally speaking, the judge said in his decision that the stipulations contained in the Austrian Labor Contract Law (Arbeitsvertragsrechts-Anpassungsgesetz – AVRAG) were in fact strictly complied with. Accordingly, “an ostensible violation of the law is not given.”
However, in its ruling the Labor and Social Affairs Court attached great importance to employee protection, and called the transfer of operations within a corporate group into question.

The transfer of flight operations from Austrian Airlines to Tyrolean Airways was an aspect of the restructuring concept of the Airline Group following the failure of negotiations to reach agreement with the works council of the flying staff last year.

“We acknowledge the first instance judgment. I would like to thank the judge for the fact that he dealt with our cases and reached a decision despite the political sensitivity of the issue. It is surprising for us that he casts doubt upon the common practice of transferring operations as part of Group restructuring programs” , says Jaan Albrecht, CEO of Austrian Airlines in his initial reaction to the court ruling. “We will pursue every legal avenue at its disposal in the appeals process in order to also legally safeguard our restructuring path. In the meantime, we hope that the talks initiated with the works council on the collective wage agreement will result in a viable solution independent of the decision handed down by the court. Regardless of the court’s ruling we continue to feel responsible for doing everything in our power to safeguard the competitiveness of Austrian Airlines.”

The Austrian Supreme Court has not handed down a decision yet pertaining to the after-effects of the airline’s collective wage agreement. In June, the Austrian Supreme Court informed Austrian Airlines that it would request clarification from the European Court of Justice on several legal issues.

Whereas the Austrian Supreme Court is only focusing on clarifying the after-effects of the terminated collective wage agreement for former Austrian Airlines’ flight personnel, the Vienna Labor and Social Affairs Court was dealing with all specific legal repercussions of the transfer from Austrian to Tyrolean with respect to employment and labor regulations. From a formal perspective, the legal proceedings at the Labor and Social Affairs Court bear no direct relation to the decision on the part of the Supreme Court.

At the beginning of 2012, the Austrian Airlines Group launched a comprehensive restructuring program designed to ensure the continuing operations of the country’s largest domestic airline. An integral aspect was the transfer of the company’s “flight operations” to its subsidiary Tyrolean Airways effective July 1, 2012 following failed negotiations. Prior to this, the collective wage agreement of the flight crew was rescinded by the Austrian Federal Economic Chamber. In response, the trade union terminated the collective wage agreement at Tyrolean Airways. Today the corporate guidelines based on the collective wage agreement of Tyrolean Airways apply to the flight operations.

Source / Author: Austrian Airlines