United's pilots vote to accept 29% pay cut affecting 9,700

Talks continue on benefits, rules

2 smaller unions ratify reductions of 13%

January 08, 2003|By BLOOMBERG NEWS

CHICAGO - United Airlines pilots voted to take a 29 percent pay cut, making theirs the first major union to accept concessions aimed at helping the carrier emerge from bankruptcy proceedings.

Two small unions representing United dispatchers and meteorologists also ratified 13 percent cuts, leaving the airline needing approval from flight attendants - whose vote results will be announced today - and the Machinists union.

The world's second-biggest airline had said it would ask the bankruptcy-court judge to void labor contracts with unions that reject its wage-cut proposals.

The carrier and the pilots union, which represents 9,700 workers, are also negotiating possible work-rule and benefit changes.

United, a unit of UAL Corp., has said high labor costs, and a drop in revenue caused by less business travel in a weakened U.S. economy and the Sept. 11 attacks led to losses and the filing. United wants to cut $2.4 billion in annual labor expenses.

"We have been disappointed at management's approach to labor discussions since the bankruptcy filing and we expect that this significant pilot sacrifice will encourage the company to engage in a collaborative discussion," Paul Whiteford, chairman of United's pilots union, said in a statement yesterday.

UAL shares rose 14 cents to $1.49 on the New York Stock Exchange.

A first-year United captain flying a Boeing Co. 737, one of the airline's smallest planes, earns about $179,000 annually working 80 hours a month, while a 12-year captain flying a Boeing 747, the biggest aircraft, earns about $306,000, according to David Kelly, a spokesman for the pilots union.

A bankruptcy-court judge is expected to rule this week on an objection by the Machinists union to a similar company wage-cut proposal. The Machinists union is United's biggest union, representing baggage handlers and mechanics.

The flight attendants union has said it will release results of a membership vote on a 9 percent pay cut today. The 21 meteorologist members of the United Transport Workers Union ratified a 13 percent pay-cut proposal yesterday.

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