Aer Lingus and the pilots’ unions are engaging in meditated discussions in what is hoped will avert further disruption amid the busy summer holiday period.

The airline and Irish Air Line Pilots Association (Ialpa) returned to the Labour Court on Monday in a bid to end the bitter industrial dispute.

Both sides have blamed the other for prolonging the stand-off that has led to almost 400 flights being cancelled and disrupted tens of thousands of passengers’ travel plans.

The airline has said pilots’ industrial action to date has caused “significant financial and reputational damage”.

Its chief corporate affairs officer Donal Moriarty said there could be further cancellations after this weekend and that Monday’s talks would be challenging.

“This dispute is causing significant financial and reputational damage to Aer Lingus and it’s impacting negatively on everyone that’s connected with the company, including our passengers,” he said.

“So we’ve no doubt that the engagement today in the Labour Court will be challenging, but we’re willing to engage in that meaningfully.”

He added: “We’ve always been willing to engage in meaningful discussion and negotiation and we will continue that approach in the Labour Court today.”

The president of Ialpa Captain Mark Tighe, said the group moved on its initial pay claim of 24% but claimed the company would not compromise “at all”.

“Ialpa did make a move. It felt that had it been invited by the company into a meeting that there was a possible solution on the table. Having moved, the company stated that they were not moving at all, which ended those talks.

“From where Ialpa is, we believe that we are talking about a difference of approximately five million euro a year, in a company that is making 225 million (euro in profits) last year, much more profits going forward.

“We hope now that the company have reflected upon this, and the Labour Court will be able to do something.”

He said: “If this fails today, we are back looking at an escalation. There is nothing that I can see beyond the Labour Court and its extensive experience and in recognition of that we didn’t escalate, but if this doesn’t work, there’s not many other options on the table.”

He said what sort of escalation would be a matter for “tactical discussion” within Ialpa.

“I’m always hopeful that there is a solution. We’ve always been willing to talk. Ialpa has moved in an attempt to find a solution, the company has not in 22 months, that should say a lot to people.”

Ialpa escalated its industrial action on Saturday when hundreds of Aer Lingus pilots it represents marched around Dublin Airport during an eight-hour strike.

The pilots walked at 6am from Aer Lingus’s head office on the airport site and walked past the two terminal buildings twice holding placards and banners.

Pilots then set up a picket line at the main roundabout on the entrance to the airport.

They have also been involved in indefinite work-to rule industrial action that began on Wednesday.

Flights have been cancelled by Aer Lingus up until Sunday July 7 as a precaution, but further disruption could be announced.

Both parties accepted an invite to attend the Labour Court issued on Friday, while Ialpa’s disputes committee considered an escalation after talks broke down last week.

The union accepted the invite and agreed not to escalate “at this point in time” but said their work-to-rule would continue.

The pilots had been seeking a pay increase of 24%, which they say equates to inflation since the last pay rise in 2019.

However, reports over the weekend suggested the Ialpa they would be willing to accept a lower pay increase.

Ialpa president Captain Mark Tighe told the Sunday Times that Ialpa would be open to an offer below 24%, but said any offer would have to be accepted by union members.