Hi guys,
the method behind the LH selection is to find good pilots and people that fit into a certain scheme, thereby eliminating the chance for human error. We try to find people that will go along well with each other, who are able to live CRM and who have a certain mindset. The argument about the others being "less good pilots" and so on is brought up time after time. Well, it can be said that some are maybe not as good, but many simply don't fit in. They might be excellent pilots, but for some reason they are not within the limits.
As for the payment. FO gross seems to be 3500 Euros, however per diem and other commodities will be up to Italian standards (13th and 14th salary paid). Captains earn much less than with mainline LH.
@EAM: It seems you are not recognizing that LH doesn't work like many other airlines. Being typically German they select those pilots they want beforehand and avoid expensive training thereby. Getting the best out of 800 is much cheaper than taking the first 50, not being able to get 10 through the training and having to give another 10 much more time than planned. Things are maybe not perfect with LH, but are well-considered. The company does not have money to be wasted!