Published by Global Banking & Finance Review®
Posted on December 17, 2024
2 min readLast updated: January 27, 2026
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Portugal's Supreme Court has ruled TAP must pay retroactive wages to 1,200 cabin crew, potentially costing up to 300 million euros, amid ongoing privatisation.
By Sergio Goncalves
LISBON (Reuters) - Portugal's top court has ruled that 1,200 TAP cabin crew members on short-term contracts who were laid off and later reinstated as staff should get retroactive pay, a decision that could cost the airline as much as 300 million euros ($315 million).
The Supreme Court ruling, dated Dec. 12 and seen by Reuters on Tuesday, said TAP must treat the cabin staff as if they had always been on permanent contracts and compensate them with back salaries dating from the start of their employment.
The ruling affects flight personnel who were initially hired for one year in 2020 and 2021 but whose contracts were renewed by TAP over the following three years.
TAP avoided paying them the much higher salaries it awards to its permanent staff, as well as overtime and other allowances, despite both performing exactly the same tasks, the Supreme Court ruling said.
A TAP spokesperson declined to comment on the legal process.
The Supreme Court decision has a "unifying" character that sets jurisprudence for future rulings by other courts, in which dozens of cabin crew have already filed lawsuits against TAP.
Ricardo Penarroias, who heads civil aviation flight personnel union SNPVAC, told Reuters the ruling could also apply to another several hundred cases over contracts signed in 2006.
This would affect a total of 2,000 employees, potentially costing TAP between 200 million euros and 300 million euros as staff pay can easily be double that of short-term workers.
Portugal's flag carrier, now immersed in a privatisation process, underwent an extensive restructuring imposed by a Brussels-approved 3.2 billion euro rescue plan in 2021.
Lisbon said last month it had received interest from potential buyers including Air France-KLM, British Airways-owner IAG and Lufthansa.
Penarroias said the court decision showed it was "crucial for governments, boards and interested parties in TAP's privatisation to speak to workers to avoid these situations".
($1 = 0.9526 euros)
(Reporting by Sergio Goncalves; Editing by Alexander Smith)
The article discusses a court ruling requiring TAP to pay retroactive wages to cabin crew, impacting the airline's finances.
1,200 TAP cabin crew members on short-term contracts are affected, with potential implications for additional employees.
The ruling could cost TAP between 200 million and 300 million euros, affecting its financial stability during privatisation.
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