USAir pilots to vote on pay-cut plan

March 28, 1995|By Suzanne Wooton | Suzanne Wooton,Sun Staff Writer

After a long-awaited breakthrough in crucial negotiations, the leaders of USAir's pilot union are due to vote today on a cost-cutting package that could save the airline nearly $190 million a year for the next five years.

The agreement provides for a 20 percent pay cut for pilots, or $150 million a year over the next five years, plus $40 million in other concessions, according to David W. McLarney, a spokesman for the pilot union.

The deadlock in the negotiations was broken after the pilot union agreed to let the company furlough up to 300 pilots over two years, the New York Times reported yesterday. Previously, the union had insisted that no pilots be furloughed, while the airline demanded that there be no limit on the number. Currently, 300 USAir pilots are on furlough.

The pilots' plan hinges on other union and nonunion employees providing the remainder of the $500 million a year that USAir is seeking over the next five years. "Our deal is not going to take place unless the company works out some sort of deal with the other three groups," Mr. McLarney said.

Representatives of the airline's flight attendants, machinists and other ground workers also have been negotiating with the Arlington, Va.-based airline, which is the largest carrier at Baltimore-Washington International Airport. Officials at these other unions did not return phone calls seeking comment yesterday.

Pilots, who earn an average of $129,000 and account for 30 percent of the company's payroll, will likely be providing the largest share under Saturday's agreement.

"I think the whole package will equal $500 million, but how that breaks down, I don't know," said Mr. McLarney, who predicted that the airline machinists and other ground workers would agree to an 18 percent to 20 percent pay cut. But he could not say what USAir's 8,600 flight attendants would do.

Richard Weintraub, a spokesman for USAir, said yesterday that company officials were scheduled to meet today with representatives of the International Association of Machinists and Aerospace Workers.

Mr. McLarney would not give further details about the agreement -- including how the $40 million in additional concessions would be produced -- until after the union's leaders vote on the plan at a meeting today in Washington.

In exchange for its concessions, the pilots have asked for an equity stake in the company and seats on the airline's board of directors.

The employee givebacks are seen as critical to the survival of the nation's sixth-largest airline as it battles low-cost, discount carriers.

Since 1989, the airline has lost $2.5 billion and, with the devastating impact of two crashes last year, it is expected soon to report near-record losses for 1994.

Last March, the company told its employees that it needed $2.5 billion in employee concessions over the next five years. In the meantime, USAir has moved forward with other cost-cutting measures, deferring aircraft purchases and cutting flights.

But given the airline's continuing financial losses, many analysts have been perplexed by the pace of the labor negotiations, which are in their eighth month. "It was almost like they were playing a big game of chicken," said Alex C. Hart, an airline analyst with Ferris, Baker Watts Inc. of Baltimore.

But Mr. Weintraub quickly dismissed the criticism about the pace of the labor negotiations, saying other airlines had taken far longer to reach cost-cutting agreements with their workers.

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