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The air passenger transport sector in the EU is in the process of transformation due to liberalisation, privatisation and increased competition. In a context of heightened uncertainty, the major companies have followed a dual approach of qualitative competition based on service, and cost-cutting; the latter has strong implications for employment, as labour costs are the key variable cost under their control. Various forms of PECs have been pursued in order to manage this process, reflecting the high level of dependency of companies on their staff. The prospects for PECs in the future are strongly related to the domestic institutional frameworks for collective bargaining, as well as the scale of proposed change, but it is likely that in general some form of understanding will be necessary to manage the process of change.
