Air France-KLM's Dutch arm puts workers' pay hike on hold

AMSTERDAM (Reuters) - Air France<AIRF.PA>-KLM's Dutch arm said on Thursday it would unilaterally freeze a 2.5% pay raise it had agreed for workers in 2020, in light of the company's plans to cut costs in the face of the coronavirus pandemic.

In a statement, the company said it had been unable to reach agreement with unions over the matter, even as they discuss restructuring plans KLM put forward on July 31, which include cutting 1,100 jobs.

The company noted it has received multi-billion euro bailout packages from the Dutch and French governments and it said it is currently losing 10 million euros per day.

"In this context, KLM cannot allow the August pay raise to go ahead, not financially, not in the eyes of society, and not under the terms of the government loan conditions," it said in a statement.

(Reporting by Toby Sterling; Editing by Susan Fenton)