Airline Finnair has warned it faces a €30m increase in pension costs if it is unable to agree a new pension package with its pilots.
The Finnish flag carrier said its current pension arrangements were more generous than the statutory minimum, which the government is set to reform as part of an increase to the minimum retirement age.
Finnair’s pension arrangements, covered by its collective bargaining agreements, offer a defined benefit arrangement for long-serving pilots, while newer employees are only offered a defined contribution fund.
If the government’s current draft bill passed without the airline agreeing any changes, Finnair said it would be liable for additional costs associated with the reform.
“Consequently, its pension obligations would increase by a total of approximately €30m,” Finnair said in a statement on the Helsinki Stock Exchange.
The airline said its pilots currently retired at an age of 58, well below the current statutory retirement age of 63, or the proposed new retirement age of 65 – agreed after negotiations between social partners in 2014.
The company added: “Finnair is actively exploring ways to mitigate the impact of implementing the pension reform, which was agreed by the Finnish labour market organisations, without incurring undue extra costs to the company.”
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