HPTunco
Dec 2, 04, 11:30 pm
The unions are running to the table to cut deals before the judge tears up their contracts. US's ploy seems to be working........but the FA's and IAM will be tougher to deal with.
US tells the judge that without the cuts it could begin liquidation by the end of January.
US Airways gets cuts from union
Airline seeks concessions from remaining two unions
Friday, December 03, 2004
By Karen MacPherson, Pittsburgh Post-Gazette
ALEXANDRIA, Va. -- A union representing nearly 6,000 US Airways workers yesterday said it has struck a tentative concession deal with the airline, easing the likelihood of a strike but leaving two more unions to try to hammer out similar agreements.
The announcement from the Communications Workers of America came at the end of a day when the airline's lawyers began laying out the case for canceling contracts with unions that have failed to agree to steep pay and benefit cuts. The lawyers told a federal bankruptcy judge in Virginia that the company will be forced to liquidate by mid-January without the relief.
U.S. Bankruptcy Court Judge Stephen Mitchell, who will continue hearing arguments today, indicated he will not make a decision before January.
The airline was seeking $136 million in annual concessions from the CWA, which represents reservationists and other passenger service workers, and the union had threatened to strike if its contract was thrown out by the court.
CWA spokeswoman Candice Johnson said the new deal offset some of the most severe demands the airline had made on issues of pay and outsourcing, but would not discuss details until members got a chance to hear about them.
"It's a difficult situation. ... We were up against a petition to throw out our contract in its entirety," said CWA spokeswoman Candice Johnson.
Previous proposals from the airline had called for pay cuts of as much as 34 percent and elimination of 800 reservation staff jobs, farming out much of the work. In a court filing, the union had indicated that the airline's proposal would create a pay scale lower than what was in place in 1989, when the top wage was $17.32 an hour.
Johnson said the union hoped to hold a ratification vote as soon as possible.
Jerrold A. Glass, the airline's senior vice president of employee relations, said the CWA agreement "gives US Airways positive momentum toward a successful implementation of its transformation plan."
The agreement, if approved, would leave two unions, representing some 14,000 mechanics, baggage handlers and flight attendants, still on the hook for nearly $500 million in cuts the airline says it must have or it will continue seeking to wipe out their contracts in court.
After yesterday's five-hour hearing, US Airways officials said the airline will seek a court injunction to prevent a strike if Mitchell rules against the workers. In addition to the CWA, the Association of Flight Attendants has threatened to strike if Mitchell rules against their interest and is in the process of taking a vote among members to ratify such an action.
US Airways officials insist that the unions don't have the right to strike.
"If we haven't reached deals with the unions and the judge rules against them, we will ask [Judge Mitchell] to make a declaratory judgment that they have no right to strike," said US Airways senior vice president of corporate affairs, Christopher Chiames.
Earlier, attorneys for US Airways told Mitchell that the airline can't survive unless the unions agree to cuts that would total just over $1 billion annually from workers, including some $326 million already agreed to by 3,200 pilots and a few hundred other employees.
Without the full package of cuts, "it is likely to the point of certainty that, as early as sometime in mid-January, [US Airways] will be required to commence the process of liquidating," said attorney Brian Leitch. "It will be too late at that point to reach an agreement, or to turn back the clock."
Asked later outside the court about the possibility of liquidation, US Airways Chief Executive Officer Bruce Lakefield said: "It's not our call. If we can't make money and we can't break even, we can't exist for very long."
He added: "We're talking about 30,000 jobs that are still pretty darn good jobs. We want to keep this company alive. We want to keep them employed."
Teddy Xidas, the incoming president of US Airways' flight attendants union, said the proposals that US Airways has made to the unions would make it hard for many employees to make ends meet.
Negotiators for the union responded to some company proposals over the weekend, and Xidas said she believes that the threat of a strike by her union has helped move along negotiations.
Xidas also said she doubts that US Airways would be forced to liquidate in January, citing the decision by its major financier, General Electric, to restructure loans and free up about $140 million in cash over the next several months.
"Obviously they see the company surviving," Xidas said. That agreement, however, is contingent on Mitchell approving pay cuts, work rule changes and relief from retiree health and pension benefits.
Yesterday's hearing represented one track of a two-track process involving the airlines and the unions. While the hearing was going on, negotiators for the unions were engaged in talks designed to develop a compromise package of cuts that would satisfy both sides.
During the hearing, Leitch told Mitchell that US Airways officials are "humbled and have no illusions" about the financial pain they are asking employees to endure as the airline attempts to transform itself in a hybrid low-cost airline.
If Mitchell rules in favor of the airlines, Leitch said he couldn't guarantee that US Airways would survive. "All I can say is that, if relief is granted, debtors [US Airways] have a fighting chance."
Leitch added that attorneys for the airline had heard from hundreds of employees who are opposed to the company's efforts to abrogate the union contracts. He quoted from one letter, in which a 23-year employee wrote: "Surely there are other ways to cut losses than taking away our benefits."
Leitch said that "this is a tough case. In 22 years, I don't recall receiving the kind of heartfelt and sometimes vitriolic communications that we have received. That makes it difficult and makes it sad.
"But this is, at bottom, a case about the ability to make choices. If relief is denied ... employees won't have a choice. They will lose everything," Leitch said.
Among those who attended the hearing was William Sims, a retired US Airways load planner. Sims, who lives in Oxford, Ga., said he traveled to Virginia for the hearing because of his concerns over how the company's proposal will affect the cost of his health coverage.
"I pay $130 a month right now for myself and my wife. But if the judge does go along with the airline, that will go up to $630 a month," Sims said. "It would be devastating."
US tells the judge that without the cuts it could begin liquidation by the end of January.
US Airways gets cuts from union
Airline seeks concessions from remaining two unions
Friday, December 03, 2004
By Karen MacPherson, Pittsburgh Post-Gazette
ALEXANDRIA, Va. -- A union representing nearly 6,000 US Airways workers yesterday said it has struck a tentative concession deal with the airline, easing the likelihood of a strike but leaving two more unions to try to hammer out similar agreements.
The announcement from the Communications Workers of America came at the end of a day when the airline's lawyers began laying out the case for canceling contracts with unions that have failed to agree to steep pay and benefit cuts. The lawyers told a federal bankruptcy judge in Virginia that the company will be forced to liquidate by mid-January without the relief.
U.S. Bankruptcy Court Judge Stephen Mitchell, who will continue hearing arguments today, indicated he will not make a decision before January.
The airline was seeking $136 million in annual concessions from the CWA, which represents reservationists and other passenger service workers, and the union had threatened to strike if its contract was thrown out by the court.
CWA spokeswoman Candice Johnson said the new deal offset some of the most severe demands the airline had made on issues of pay and outsourcing, but would not discuss details until members got a chance to hear about them.
"It's a difficult situation. ... We were up against a petition to throw out our contract in its entirety," said CWA spokeswoman Candice Johnson.
Previous proposals from the airline had called for pay cuts of as much as 34 percent and elimination of 800 reservation staff jobs, farming out much of the work. In a court filing, the union had indicated that the airline's proposal would create a pay scale lower than what was in place in 1989, when the top wage was $17.32 an hour.
Johnson said the union hoped to hold a ratification vote as soon as possible.
Jerrold A. Glass, the airline's senior vice president of employee relations, said the CWA agreement "gives US Airways positive momentum toward a successful implementation of its transformation plan."
The agreement, if approved, would leave two unions, representing some 14,000 mechanics, baggage handlers and flight attendants, still on the hook for nearly $500 million in cuts the airline says it must have or it will continue seeking to wipe out their contracts in court.
After yesterday's five-hour hearing, US Airways officials said the airline will seek a court injunction to prevent a strike if Mitchell rules against the workers. In addition to the CWA, the Association of Flight Attendants has threatened to strike if Mitchell rules against their interest and is in the process of taking a vote among members to ratify such an action.
US Airways officials insist that the unions don't have the right to strike.
"If we haven't reached deals with the unions and the judge rules against them, we will ask [Judge Mitchell] to make a declaratory judgment that they have no right to strike," said US Airways senior vice president of corporate affairs, Christopher Chiames.
Earlier, attorneys for US Airways told Mitchell that the airline can't survive unless the unions agree to cuts that would total just over $1 billion annually from workers, including some $326 million already agreed to by 3,200 pilots and a few hundred other employees.
Without the full package of cuts, "it is likely to the point of certainty that, as early as sometime in mid-January, [US Airways] will be required to commence the process of liquidating," said attorney Brian Leitch. "It will be too late at that point to reach an agreement, or to turn back the clock."
Asked later outside the court about the possibility of liquidation, US Airways Chief Executive Officer Bruce Lakefield said: "It's not our call. If we can't make money and we can't break even, we can't exist for very long."
He added: "We're talking about 30,000 jobs that are still pretty darn good jobs. We want to keep this company alive. We want to keep them employed."
Teddy Xidas, the incoming president of US Airways' flight attendants union, said the proposals that US Airways has made to the unions would make it hard for many employees to make ends meet.
Negotiators for the union responded to some company proposals over the weekend, and Xidas said she believes that the threat of a strike by her union has helped move along negotiations.
Xidas also said she doubts that US Airways would be forced to liquidate in January, citing the decision by its major financier, General Electric, to restructure loans and free up about $140 million in cash over the next several months.
"Obviously they see the company surviving," Xidas said. That agreement, however, is contingent on Mitchell approving pay cuts, work rule changes and relief from retiree health and pension benefits.
Yesterday's hearing represented one track of a two-track process involving the airlines and the unions. While the hearing was going on, negotiators for the unions were engaged in talks designed to develop a compromise package of cuts that would satisfy both sides.
During the hearing, Leitch told Mitchell that US Airways officials are "humbled and have no illusions" about the financial pain they are asking employees to endure as the airline attempts to transform itself in a hybrid low-cost airline.
If Mitchell rules in favor of the airlines, Leitch said he couldn't guarantee that US Airways would survive. "All I can say is that, if relief is granted, debtors [US Airways] have a fighting chance."
Leitch added that attorneys for the airline had heard from hundreds of employees who are opposed to the company's efforts to abrogate the union contracts. He quoted from one letter, in which a 23-year employee wrote: "Surely there are other ways to cut losses than taking away our benefits."
Leitch said that "this is a tough case. In 22 years, I don't recall receiving the kind of heartfelt and sometimes vitriolic communications that we have received. That makes it difficult and makes it sad.
"But this is, at bottom, a case about the ability to make choices. If relief is denied ... employees won't have a choice. They will lose everything," Leitch said.
Among those who attended the hearing was William Sims, a retired US Airways load planner. Sims, who lives in Oxford, Ga., said he traveled to Virginia for the hearing because of his concerns over how the company's proposal will affect the cost of his health coverage.
"I pay $130 a month right now for myself and my wife. But if the judge does go along with the airline, that will go up to $630 a month," Sims said. "It would be devastating."