STOCKHOLM (AFP) - Some 400 pilots in Sweden walked off the job on Friday (June 11) in a dispute over wages and working conditions, stranding 4,000 passengers, Scandinavian carrier SAS said.

"The Swedish pilots union has called 400 members on short-haul flights out on strike. Both domestic and European flights from Sweden are cancelled," the company said in a statement.

Some 40 flights flown by pilots based at Stockholm's Arlanda airport were cancelled after the strike broke out at 6pm, SAS said.

After months of negotiations, the Swedish pilots union SPF rejected the mediators' proposal of a 2.2 per cent wage increase, insisting on a 3.5 per cent increase.

The employers' organisation insisted however that the pilots' overall demands, including employment contracts offering greater job security, would entail a 10 per cent cost increase.

"We want our employees to feel secure in their jobs, but the pilots' wage demands are just too high. We can't afford to pay that much given the competitive (air travel) market," SAS chief executive Rickard Gustafson said on Friday before the strike broke out.