Finnair and the Finnish Flight Attendants' Union (SLSY) reached a settlement over their wage dispute late on October 20, ending a strike that had grounded a substantial portion of the Finnish flag carrier's fleet.

The end of the strike was confirmed at about 9.30pm (GMT+3) when both sides approved draft settlement conditions by Juhani Salonius, the state conciliator.

Mr Salonius did not submit a settlement proposal as the dispute involved divergent interpretations of an existing collective labour agreement.

The row began on October 19 when Finnair announced it was hiring 500 new cabin crew for its Asian routes through Aero, its Estonian short-haul subsidiary, under the national collective labour agreement. The pay stipulated by Finnair's agreement with its existing 1,800 cabin crew is 30 per cent higher than that in the national agreement.

Peter Forsstrom, representing the employer side, said October 20's settlement meant that new cabin crew would be hired under Finnair's internal, not national, agreement.

However, he added that the higher cost might affect the number of flight attendants Finnair recruited.

Mauri Koskenniemi, the chairman of SLSY, said the settlement restored the situation that prevailed prior to Finnair's Aero recruitment announcement.

"Both new and fixed-term employees will be paid according to Finnair's existing agreement," Mr Koskenniemi said.

Mr Koskenniemi added he believed Finnair would still recruit 500 new cabin crew.

The settlement came a day after the Transport Workers' Union's (AKT's) members stopped refuelling aircraft owned or chartered by Finnair.

Also other unions had pledged their support for SLSY's strike.

Emotions ran high on October 20 when Finnair used foreign replacement crews, including from Asia.

The strike and the alleged breaches of contract were being assessed by the Labour Court on October 20. A ruling is expected on October 23.