Local UA mechanics will never approve concession plan
Aug 30, 2002, 3:19 pm
#1
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Local UA mechanics will never approve concession plan
Staff and News Services
August 30, 2002
In his strongest rebuke yet of United Airlines management, the president of the Indianapolis mechanics union said his 1,800 members would never approve a $450 million-per-year company-proposed wage and benefit concession plan.
"It's unbelievable," said Ben Nunnally of the International Association of Machinists and Aerospace Workers Local 2294 about the proposal, which calls for, among other things, a 10.4 percent cut in wages, a reduction in the pension plan, fewer vacation days and less job security.
"A lot of our guys would rather take worse from a bankruptcy judge than to freely give this to the people who put us in this position," Nunnally said.
Labor cutbacks would provide the bulk of $2.5 billion the struggling carrier has targeted in annual savings.
The first specifics of United's plan to transform itself into a smaller, more cost-efficient carrier came Thursday at the halfway point of its self-imposed 30-day deadline for reaching agreements with labor and other groups on the far-reaching cutbacks.
Without such a consensus, Chief Executive Officer Jack Creighton reminded employees this week, the airline may be forced to file for Chapter 11 bankruptcy protection.
The proposed cuts are part of a companywide push to sharply reduce costs in hopes of receiving a $1.8 billion federal loan guarantee and helping it end more than two years of unprofitability.
"The company believes that the $2.5 billion target will better align costs with anticipated future revenues and increase the likelihood that the company will qualify for $1.8 billion in loan guarantees from the Air Transportation Stabilization Board," the airline said in a brief statement Thursday.
The company's new terms for its pilots and flight attendants were not available.
The proposal to the machinists union calls for mechanics, ramp workers and other IAM-represented workers to take immediate pay cuts and forgo raises negotiated earlier this year for 2003 and 2004, to be replaced by annual 1.5 percent pay hikes, IAM officials said.
District 141-M members -- who include mechanics at Indianapolis International Airport and aircraft cleaners -- are asked to reduce costs by $185 million, including 10.4 percent wage cuts. District 141 members -- ramp, customer contact and cabin service employees -- are being asked to provide a $265 million yearly cost reduction and take 9.5 percent pay cuts.
The proposed concessions would virtually eliminate job security at Indianapolis, Nunnally said.
Today, United can outsource no more than 20 percent of its maintenance work to outside companies. The company wants to remove the cap, clearing the way for unlimited outsourcing.
Even with the 20 percent cap, about 350 mechanics in Indianapolis have lost their jobs in the past year. Another 250 are at risk of getting pushed out this fall.
National IAM spokesman Joe Tiberi said the union doesn't feel any discussions about a recovery plan should take place until United hires someone to replace Creighton, who will turn 70 on Sunday and wants to step down soon.
Relations between management and labor at United have been frayed for years.
Under United's employee stock ownership plan, many workers gave up raises in 1994 in exchange for stock that has plummeted in value.
Shares in United parent company UAL Corp. fell 23 cents to close at $3.05 in trading on the New York Stock Exchange.
August 30, 2002
In his strongest rebuke yet of United Airlines management, the president of the Indianapolis mechanics union said his 1,800 members would never approve a $450 million-per-year company-proposed wage and benefit concession plan.
"It's unbelievable," said Ben Nunnally of the International Association of Machinists and Aerospace Workers Local 2294 about the proposal, which calls for, among other things, a 10.4 percent cut in wages, a reduction in the pension plan, fewer vacation days and less job security.
"A lot of our guys would rather take worse from a bankruptcy judge than to freely give this to the people who put us in this position," Nunnally said.
Labor cutbacks would provide the bulk of $2.5 billion the struggling carrier has targeted in annual savings.
The first specifics of United's plan to transform itself into a smaller, more cost-efficient carrier came Thursday at the halfway point of its self-imposed 30-day deadline for reaching agreements with labor and other groups on the far-reaching cutbacks.
Without such a consensus, Chief Executive Officer Jack Creighton reminded employees this week, the airline may be forced to file for Chapter 11 bankruptcy protection.
The proposed cuts are part of a companywide push to sharply reduce costs in hopes of receiving a $1.8 billion federal loan guarantee and helping it end more than two years of unprofitability.
"The company believes that the $2.5 billion target will better align costs with anticipated future revenues and increase the likelihood that the company will qualify for $1.8 billion in loan guarantees from the Air Transportation Stabilization Board," the airline said in a brief statement Thursday.
The company's new terms for its pilots and flight attendants were not available.
The proposal to the machinists union calls for mechanics, ramp workers and other IAM-represented workers to take immediate pay cuts and forgo raises negotiated earlier this year for 2003 and 2004, to be replaced by annual 1.5 percent pay hikes, IAM officials said.
District 141-M members -- who include mechanics at Indianapolis International Airport and aircraft cleaners -- are asked to reduce costs by $185 million, including 10.4 percent wage cuts. District 141 members -- ramp, customer contact and cabin service employees -- are being asked to provide a $265 million yearly cost reduction and take 9.5 percent pay cuts.
The proposed concessions would virtually eliminate job security at Indianapolis, Nunnally said.
Today, United can outsource no more than 20 percent of its maintenance work to outside companies. The company wants to remove the cap, clearing the way for unlimited outsourcing.
Even with the 20 percent cap, about 350 mechanics in Indianapolis have lost their jobs in the past year. Another 250 are at risk of getting pushed out this fall.
National IAM spokesman Joe Tiberi said the union doesn't feel any discussions about a recovery plan should take place until United hires someone to replace Creighton, who will turn 70 on Sunday and wants to step down soon.
Relations between management and labor at United have been frayed for years.
Under United's employee stock ownership plan, many workers gave up raises in 1994 in exchange for stock that has plummeted in value.
Shares in United parent company UAL Corp. fell 23 cents to close at $3.05 in trading on the New York Stock Exchange.
Aug 30, 2002, 6:30 pm
#2
Join Date: Sep 1999
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<font face="Verdana, Arial, Helvetica, sans-serif" size="2">"A lot of our guys would rather take worse from a bankruptcy judge than to freely give this to the people who put us in this position," Nunnally said.</font>
On both sides.
Greg
Aug 30, 2002, 8:07 pm
#3
Join Date: Apr 2001
Location: New York, NY, USA
Posts: 27
"I'd rather be a stubborn class-warrior and wind up with my family on welfare than tighten my belt and try and keep the company going."
Aug 30, 2002, 8:09 pm
#4
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Join Date: May 1998
Location: Escondido CA USA
Programs: AS, UA, HY, Hil, Merr
Posts: 3,207
Many a abandon steel mill (and other type) sits with ex-employee waiting for decades for it to reopen, as the company sure can afford to keep all our programs, and cut somewhere else.