United Vows to Keep Flying if Pilots Strike

In 1978, the last time United Airlines was struck, the carrier canceled all flights and was grounded for 58 days. But come Friday, United plans to take an entirely different approach if its pilots walk out, as now appears likely.

The company, the nation’s largest airline, said it hopes to continue operating as many as 40% of its flights, probably the lucrative transcontinental routes such as New York to Los Angeles.

Most major airlines have taken an increasingly aggressive stance in labor disputes with unions in recent years, with several having gained major wage and work-rule concessions.

Erosion of Union Power

If United, which on a typical day boards more than 130,000 passengers in 157 cities in all 50 states and several foreign countries, succeeds, it will pave the way for further erosion of union power in the airline industry, management and union officials agree.

After months of negotiations, United and the pilots are still deadlocked over a company demand that it be allowed to hire new pilots at dramatically lower starting salaries than it now pays and then for many years keep them at lower wages than pilots hired earlier.

For the last two days, the two sides have been negotiating with the assistance of a federal mediator in a Boston hotel.

Representatives of the Airline Pilots Assn. said Tuesday that their members are ready to walk off the job at 12:01 a.m. Friday, when a 30-day cooling-off period expires, if no settlement has been reached. In response, United officials have continued to insist that the carrier will operate during a strike using management personnel, ex-military pilots and pilots lured away from other airlines.

The company’s plan to operate represents an aggressive posture that has become widespread in U.S. business since President Reagan fired 11,000 striking air traffic controllers in 1981, according to Charles Craypo, chairman of the economics department at Notre Dame University and a labor relations specialist.

“The atmosphere has changed,” he said.

A strike against United could have a significant impact on travelers because of the volume and breadth of the carrier’s routes, according to industry spokesmen. More than 15% of all people who board U.S. carriers daily fly United.

The strike would be commencing as the year’s heaviest travel period begins.

Even though the company has said it plans to continue some operations, travel agents are beginning to tell customers to book reservations on other lines.

“As we approach May 17, we’re beginning to divert quite a bit of traffic away from United to TWA, American and Western,” said Richard Carter, senior vice president-marketing of Van Nuys-based Ask Mr. Foster, the nation’s largest travel agency. He said his company does $100 million of business with United yearly, about two-thirds of the bookings coming from corporate accounts.

Main Objective

Chuck Novak, United’s manager of corporate communications, said the company still hopes to avert a strike.

“Our No. 1 objective is to reach a cost competitive contract with our pilots without a strike,” he said in a telephone interview from company headquarters in Chicago.

Novak said pilots for American Airlines have been operating under a two-tier pay scale since November, 1983, and United must secure the right to pay newly hired pilots less than its incumbent work force if it is to expand and remain competitive not only with American but with new non-union carriers, such as People Express.

Currently, United starts pilots at $22,400. The company proposes to lower that to $21,600, a 4% drop. While the pilots are not happy with the idea, they do not object to it nearly as much as they do to what would happen in future years under the company proposal. It would take a newly hired pilot 20 to 25 years to reach the same wages as people doing the same work who were hired earlier, said Bill Scholes, vice chairman of the United pilots’ council in Los Angeles.

Willing to Strike

“We think that’s so obnoxious that we’re willing to have a strike over it,” said Scholes, who’s been flying for United for 18 years.

“You’ll put a guy on the second level for two-thirds of his career,” said Sam O’Daniel, a United pilots’ spokesman based in Chicago.

He said that if the union accepted the company proposal, it would mean that future United pilots would earn an average of 41% less than their colleagues hired earlier.

“That would create a cancer at the company,” O’Daniel asserted. “You have pitted one pilot group against another. This could carry over into the cockpit.”

He said the union has told the company it would accept a lower pay scale for newly hired pilots. O’Daniel said, however, the union wants the new pilots to have their pay scales merged with the old scale by the sixth year, much earlier than under the company proposal. United’s machinists and flight attendants agreed to such a two-tier contract last year.

Proposal Assailed

The company has said the pilots’ proposal is inadequate, and big money is at stake.

“The ALPA proposals would cost United 18% or $110 million a year,” Novak said. “Our contract would leave labor costs the same as they are now--$440 million a year in wages and fringes of $170 million a year.”

Novak said United has offered the bulk of its current pilots a 6% salary increase upon signing the contract and another 2% increase on April 1, 1986. However, captains on 747s--United’s highest-paid pilots, who receive up to $152,000 a year--would get a one-time lump sum bonus of 6% of current salary when the contract is signed. That bonus would not become a part of the pilot’s base pay in the future.

More than 95% of the United’s 5,300 pilots gave their negotiators authority to call a strike last November. The pilots stress that they have given United considerable concessions in recent years, including the deferral of a 6% pay raise worth $30 million last year.

No Raises

“We have not had a pay raise since October, 1982,” Scholes said. “They made a profit of $282 million last year and still have not seen to fit to pay us the 6% that’s owed us from the last contract.”

Scholes said the average pay of United pilots is $85,000 a year; company officials said it is $91,000 annually.

The United pilots are a very senior group, averaging 52 years old, according to union officials. Since federal regulations require a pilot to retire at age 60, United will have roughly a 50% turnover in its pilot force in eight years and could begin to save millions of dollars in salaries if it gets what it wants in negotiations.

An additional motivation for the company is that it has plans for significant expansion. Last month, United announced it would pay Pan American World Airways $750 million for its profitable Pacific routes. United would acquire 11 Boeing 747s, 6 Lockheed L-1011s and a McDonnell Douglas DC-10 if the deal is approved by federal regulators.

Ailing Carrier

In addition, on Monday, financially ailing Frontier Airlines said it will sell 25 of its Boeing 737-200 aircraft to United for $265 million, paving the way for further United growth.

“As you can expand and bring in new pilots at 40% to 50% below the current rates, you can see what the effect will be,” said Robert Joedicke, an airline analyst at the brokerage house Shearson Lehman Bros. Inc.