News of the deal between the Norwegian Pilot Union and the airline was announced on the website of the Parat Luftfart trade union group. The development was confirmed by mediator Nils Dalseide and Norwegian airline's spokeswoman in Sweden, Charlotte Holmbergh Jacobsson.
"The negotiations have been very difficult as we were very far apart, but we've had a breakthrough for a common collective agreement across Scandinavia, independent of the reorganization that's taking place," Norwegian Pilot Union chair Halvor Vatnar said in a statement.
If the parties hadn't reached a deal, flights to and from Sweden would have been cancelled, with a total of 603 Norwegian, Swedish, and Danish pilots from the Norwegian Pilot Union prepared to walk out.
Mediators worked all weekend to forge a new labour agreement. While the old deal expired at midnight on Sunday night, negotiations continued throughout the night and into Monday morning, according Holmbergh Jacobsson.
Negotiations have been led by Norway's national mediator, Nils Dalseide. The parties gave the Parat Luftfart trade union organization and the Norwegian employers' group NHO Luftfart the job of managing the talks.
The conflict stemmed from Norwegian's desire to have its pilots in Scandinavian countries employed by a staffing firm within Norwegian's corporate structure, albeit with the same pay. The union rejected the move, arguing it would weaken pilots' employment security.
In addition to a new collective agreement for pilots in Norway, Sweden, and Denmark, the deal also reinstates defined-benefit pensions as well as company-wide employment protections that apply regardless of which Norwegian subsidiary employs them.
"Although employees are scattered in several subsidiaries, we maintain a community in Scandinavia through identical collective agreements. Norwegian also maintains the necessary freedom to streamline while we work to ensure that employees in different countries can organize themselves," Hans-Erik Skjæggerud, head of Parat Luftfart, said in a statement.