Delta, pilots near contract

Tentative settlement stays imminent strike

April 15, 2006|By BETH KASSAB | BETH KASSAB,ORLANDO SENTINEL

Delta Air Lines and its pilots union reached a tentative agreement early yesterday, effectively ending the looming threat of a strike that could have shut down the ailing carrier for good.

Neither Delta nor the Air Line Pilots Association, which represents nearly 6,000 Delta pilots, released details of the accord.

The last-minute deal did not surprise many industry observers, who predicted an agreement would come in the final hours before an arbitration panel's deadline today to decide whether Delta could throw out its pilot contract so it could impose up to $325 million in annual pay and benefit cuts.

The pilots vowed to strike as early as next week if that happened, a move that would have devastated Delta's operations and likely put it out of business.

"There are a few hurdles left, but the major hurdle, without a doubt, has been handled," said Terry Trippler, an aviation analyst with CheapSeats.com. "This is what we've been waiting for. A Delta shutdown would have been a disaster."

Delta sought to calm any concerns that potential customers might have about booking a ticket on the airline, emphasizing that there's no longer a need to be wary of a strike.

"Delta passengers can continue to book on Delta with confidence," said Edward H. Bastian, Delta's executive vice president and head of the company's in-court restructuring efforts, in a news release. "There has been no disruption to our service. Our pilots are performing professionally, flying as scheduled and, together with all Delta employees, are taking good care of our customers."

Stuart Klaskin, an aviation expert with KKC Aviation Consultants in Miami, said he's planning to fly Delta in the next few weeks and isn't worried about changing those plans.

"I think the traveling public is spooked," Klaskin said. "They probably should have an understanding of what their alternatives may be ... but I don't think there's any point in booking away" on another airline.

The tentative agreement must be ratified and voted on by the union as well as approved by the bankruptcy court.

Capt. Lee Moak, chairman of the pilots' negotiating committee, sent a phone message to pilots yesterday saying a union executive committee would thoroughly debate the agreement next week before sending it to the full membership for a vote.

"We will not hurry," Moak said in the message. "During the ... Master Executive Council ... meeting next week, and during any subsequent membership ratification process, we will proceed in an unrushed, methodical manner."

The pilots have had mixed feelings about the job senior executives have done since the company filed for bankruptcy protection in September, and ratification of the agreement isn't a lock.

Delta's pilots previously agreed to $1 billion in annual concessions, including a 32.5 percent wage cut, in a five-year deal in 2004. But Delta, which has imposed pay cuts on other employees, said it needs more from its pilots.

The company says the average earnings of pilots last year who worked the full year was more than $157,000. But the pilots union has said the figure was inflated by overtime and they have projected a significant decrease in average pilot earnings for 2006.

"Emotions are running high," Chief Executive Officer Gerald Grinstein said in a recorded message to Delta employees. "Our customers have expressed concern. Now more than ever, we need to support and respect one another."

Trippler said Delta's future as a stand-alone airline remained uncertain.

"It will be called Delta, but it will be run by Northwest," Trippler said, predicting a merger between the two carriers that are seeking to get out of Chapter 11 bankruptcy protection.

Beth Kassab writes for the Orlando Sentinel. The Associated Press contributed to this article.

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