US Airways is denied concessions by 2 unions as court deadline nears

Machinists to take case to court

pilots to vote later

October 06, 2004|By KNIGHT RIDDER/TRIBUNE

PHILADELPHIA - US Airways Group Inc. failed yesterday to win immediate cost-cutting contracts from two major unions, despite the threat of court-imposed cuts tomorrow.

After a day of acrimonious debate in Pittsburgh, leaders of the Air Line Pilots Association reportedly will vote to send a tentative agreement to its 3,200 members for ratification, but not until after the company's court deadline.

At the same time, the union that represents 9,450 mechanics, fleet service workers and baggage handlers rebuffed the company's demands for 23 percent interim wage cuts as "unjustifiable," with a spokesman saying, "We'll make our case in court."

The developments could lead to a battle in U.S. Bankruptcy Court between the airline and most of its workers over the 23 percent cost reductions, totaling nearly $950 million, that the airline says it needs to avoid liquidation by mid-February.

US Airways filed for bankruptcy reorganization Sept. 12, the second trip into bankruptcy in two years for the airline, which is the biggest in the Philadelphia region and the seventh-largest nationwide.

The Arlington, Va.-based airline gave its unions until tomorrow to agree to the interim cuts or risk having them imposed by U.S. Bankruptcy Judge Stephen Mitchell for up to six months, pending unions' acceptance of longer-term contracts.

"Absent ratification, we will proceed to seek emergency funding," US Airways spokesman David Castelveter said earlier yesterday, according to the Associated Press.

It was unclear how the company would react to the decision by the pilots' leadership to seek ratification of the tentative agreement with a vote later this month.

Typically, the union requires several weeks to educate its workers about a tentative contract before holding a ratification vote.

The tentative agreement would cut pilots' pay 18 percent, slash pension payments and increase the number of hours pilots have to fly, totaling $300 million in reductions.

The union's 12-member Master Executive Council has been divided since Friday over whether to let members vote on the pact.

Four council members representing Pennsylvania-based pilots have opposed deep concessions. They blocked an effort on Labor Day to let members vote on a previous tentative agreement, precipitating the airline's filing for Chapter 11 bankruptcy protection six days later.

Since then, the company has increased the amount of concessions it is seeking from all unionized workers, to $950 million from $800 million.

The four pilots - Frederick R. Freshwater and John M. Brookman of Pittsburgh, and Philadelphia-based John A. Crocker and Daniel Von Bargen - wield controlling votes on the council because they represent a majority of pilots.

The union leaders have asserted that the contract makes workers bear the cost of corporate mismanagement.

Pilots say they already have granted an estimated $5 billion in various concessions in two previous cost-cutting battles.

At least one pilot, Freshwater, said last week that he sees little difference between agreeing to a draconian contract or having one imposed by a judge, an argument other union leaders disputed.

Also opposed to concessions, the International Association of Machinists and Aerospace Workers said their "attorneys are prepared to argue before the court and defend our members and our contracts," said a union notice to workers signed by union Presidents Randy Canale and William O'Driscoll.

The company also has exchanged proposals with the Association of Flight Attendants, representing 6,100 employees. It has given the union a list of cuts to choose or face a court fight.

Yesterday, the flight attendants joined the Machinists in filing objections in court to the proposed cuts.

Likewise, the Communications Workers of America, representing 5,400 customer-service workers, has failed to reach agreement and could face court-ordered pay and benefit cuts.

On Monday, the airline announced it has begun cutting hundreds of management jobs and slashing management costs by more than 20 percent. It put the value of the management cuts at more than $45 million in eliminated jobs, pay cuts and reduced benefits.

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