Talks aimed at resolving the deficit in the Aer Lingus and Dublin Airport Authority pension fund have broken down.
The talks are crucial because the Government cannot sell its 25% stake in Aer Lingus until the issue of the deficit, which stood at €640 million on 31 March, is resolved.
Sources described the gap between employers and unions as "unbridgeable".
The DAA negotiators were not attending today's talks, which were focussed on arrangements for a new pension fund solely for Aer Lingus employees going forward.
However, union sources said they had sought an adjournment to consult with their members as proposals from Aer Lingus were deemed inadequate and incapable of leading to a resolution.
It is understood Aer Lingus negotiators will brief the board tomorrow.
The facilitator of the talks, Labour Relations Commission Chief Executive Kieran Mulvey, is expected to contact the parties on Wednesday to see if there is any prospect of resolving the dispute.
However, no date has been set for a resumption of talks.
The multi-employer scheme known as the Irish Aviation Superannuation Scheme (IASS) covers workers in Aer Lingus, the DAA and applied to aviation maintenance company SR Technics until the company went out of business.
Aer Lingus and the DAA have consistently stated that they will not contribute extra lump sums to offset the deficit.
Proposals at the negotiations for cutting the deficit have included the use of sovereign bonds and changes in indexation.
Another key issue is co-ordination with the State pension.