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Korean Air Lines Co.'s pilots union has agreed to a wage freeze, the first in eight years, helping South Korea's largest carrier withstand fuel prices that have jumped 81 per cent in a year, said a Bloomberg news report.
The pilots withdrew their initial request for a 3.3 percent pay increase, the Seoul-based airline said in an e-mailed statement on Wednesday. The rest of the company's workforce agreed to a wage freeze in March.
The pay deals may help Korean Air avoid the job cuts undertaken by Qantas Airways Ltd. and other carriers as they struggle to cope with rising fuel costs. Korean Air, which is scaling back capacity, expects to post a second-quarter loss because of fuel costs, President Lee Jong Hee said on July 17.
Korean Air has about 2,300 pilots with 1,300 belonging to the union, according to Bloomberg.
The price of jet fuel, the single biggest expense for most Asian carriers, hit a record close of $181.85 in Singapore trading on July 3. Yesterday, the price closed at $157.05, down 14 per cent from that.
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