IAG accept proposal over Iberia cuts

International Airlines Group and unions representing Iberia workers have accepted a mediator's compromise proposal for less harsh job and salary cuts at the Spanish flag carrier following its merger with British Airways, officials said Monday. The government-appointed mediator, Gregorio Tudela, proposed Wednesday that loss-making Iberia lay off 3,100 workers instead of the 3,800 the airline had planned to let go. He also recommended that Iberia limit salary cuts to 7.0 percent for ground crew and to 14 percent for cabin crew. The airline had been proposing salary cuts of 11-23 percent. "The majority of unions are in favour of signing," Manuel Atienza, a spokesman for aeronautical workers at the General Workers Union said following a meeting with the mediator. While the proposals were still "insufficient", they make Iberia's layoff and salary cuts "less traumatic", he added. International Airlines Group, the holding company set up for Iberia and British Airways after the two companies merged in 2011, said on Sunday that it had accepted the mediator's proposal at an extraordinary board meeting. The holding company's decision to accept the compromise was influenced by strikes waged by Iberia workers in recent weeks and "probably" by pressure from the Spanish government, said Atienza. If unions sign the compromise proposal, they will call off the third of three five-day strikes scheduled from March 18 to 22. Iberia ground and flight staff went on strike between February 18 and 22 and between March 4 and 8, forcing the cancellations of hundreds of flights. Unions had threatened to stage an open-ended strike unless Iberia backed down on its plans. Iberia executives say the airline accumulated 850 million euros in losses between 2008 and September 2012. In a bid to stem the red ink, the Spanish airline plans to slash its network capacity by 15 percent and downsize its fleet by 25 aircraft, including five long-haul jets, by the middle of this year.