US Air union talking strike

Machinists press for agreement during cooling-off period

Airlines

August 28, 1999|By June Arney | June Arney,SUN STAFF

The union that represents mechanics at US Airways Group Inc. said yesterday that it would strike after a 30-day cooling-off period unless a labor agreement is reached to protect jobs and improve salaries for about 7,000 workers.

US Airways, the second-largest operator at Baltimore-Washington International Airport, said it expected the labor uncertainty to hurt its short-term revenue.

The cooling-off period was imposed Thursday by the National Mediation Board, which had been involved in negotiations between the two sides after the union membership rejected a tentative pact reached in June.

"If a tentative agreement is not reached, a strike will begin at 12: 01 a.m. on Sept. 26, 1999," William Freiberger, assistant general chairman for District 141-M of the International Association of Machinists, said yesterday.

In a filing with the Securities and Exchange Commission yesterday, the airline, which reported net income of $363 million on operating revenue of $4.36 billion in the first six months of 1999, said it anticipated that the cooling-off period "will have an adverse effect on short-term revenues." Samuel C. Buttrick, an airline analyst with PaineWebber Inc., said nervous travelers were more likely to choose another airline than risk a strike.

"At a minimum, there will be a booking-away impact as passengers shift to booking with US Airways' competitors," said Buttrick. "In a worst case, the airline will experience a short strike as they did in 1992." A strike could cost the carrier $20 million a day in lost revenue, Buttrick said.

The IAM has been negotiating for a new contract on behalf of US Airways' cleaners and mechanics since 1995. The union said its members want a share of the profit the airline has earned.

"We suffered through a strike in '92, when the company was almost bankrupt, and we helped turn this company around until it was making record profits," Freiberger said. In a letter to employees Thursday reporting the National Mediation Board's imposition of the cooling-off period, company executives wrote: "We wanted to report this information to you immediately and to underscore once again our commitment to reaching an agreement with the IAM that is fair and equitable to our employees and to the company."

Richard Weintraub, a spokesman for US Airways, which is based in Arlington, Va., said he could not discuss whether further meetings with the union and federal mediators had been scheduled or were expected.

Overall, the airline industry is experiencing a difficult period in labor relations because industry profits are up but in many cases workers are locked into contracts that they feel are not keeping pace with those profits, experts say.

Reuters contributed to this article.

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