Merger of PSA Into USAir Snags on Pilot Work Rules

The merger of Pacific Southwest Airlines with its new parent company USAir Group has hit a last-minute snag, just as USAir was about to order new uniforms for PSA employees and begin painting PSA jets over with its red and maroon color scheme.

The joint master executive council of the Air Line Pilots Assn., representing both USAir and PSA pilots, has rejected a transition agreement put forth by USAir management to cover the application of USAir pilots’ work rules to PSA pilots.

The agreement covers a number of issues including vacations, retirement and pay rates, said Pete Pettigrew, executive council chairman of PSA pilots.

The 7-4 vote on the agreement broke down along company lines, with the seven USAir members of the pilot council rejecting the transition agreement and four PSA pilot members approving it, Pettigrew said.

Until the pilots approve the integration plan for the two pilot groups, USAir will continue to operate PSA as a wholly owned subsidiary that will maintain its identity, a USAir spokeswoman said. Before the snag, USAir had hoped to meld PSA operations into its own by Jan. 1.

The pilot contract standoff in no way jeopardizes USAir’s $400-million acquisition of PSA, which was completed last May. However, the merger prolongs the job uncertainty of about 1,000 PSA administrative employees in San Diego, many of whom expect to be given walking papers by USAir once the merger is complete, sources close to the airline said Wednesday.

PSA pilots “feel badly” about the merger delay because PSA will become a more efficient airline once it becomes part of USAir, Pettigrew said.