Hopes of a settlement between British Airways and its cabin crew have been raised after the two sides have agreed to meet this week to try to reach a settlement over pay and work conditions.

This is the first meeting BA and the union representing cabin crew, Unite, will have held since talks broke down last month, which lead to the announcement of a 12-day strike over Christmas and the new year.

Despite the meeting which will take place at the Trades Union Congress in London, Unite has also said it is continuing with plans to hold a second ballot over potential strike action.

The first strike was only averted after BA won a court order blocking it on the grounds that the ballot was invalid because it had included staff who had already agreed to take voluntary redundancy.

Unite remains opposed to reductions in cabin crew teams - one steward has been removed from all flights, and two from some long-haul services. BA meanwhile says it is adamant that the changes it introduced in November will remain in place.

The airline declined to say if Willie Walsh, the airline’s chief executive, would attend the meetings.

Derek Simpson and Tony Woodley, joint general secretaries of Unite, told The Times: “We will be approaching those talks in a constructive spirit, seeking to find a settlement that meets the real concerns of BA’s skilled, loyal and professional cabin crew, while keeping the airline flying.”

BA said: “We have always said we would make ourselves available for talks with Unite at any time without preconditions. We are pleased that this new round of talks will now proceed under the auspices of the TUC.”

The airline is in a desperate bid to cut costs as it struggles under record losses.

Yesterday it rolled marginally more upbeat figures, with capacity stabilising at 76.8 per cent in December compared to 76.7 per cent for December 2008. Club World long-haul business-class traffic rose by 1.6 per cent last month and that its long-haul business-class and first-class numbers continued to show signs of improvement.

But overall, passenger numbers fell by 4.4 per cent in December year-on-year to 2.4 million.