Quick Action to Block United Strike Unlikely
If United Airlines and its mechanics are unable to reach agreement on a new contract by Wednesday, a strike could last for days before the government would be able to intervene--a walkout that could severely disrupt U.S. air travel and push the carrier toward bankruptcy.
The mechanics, as expected, Tuesday rejected a contract proposed by a presidential emergency board and authorized a strike Feb. 20 if a settlement isn’t reached before then. United, a unit of UAL Corp., and the International Assn. of Machinists union plan to resume bargaining Friday in Chicago.
If they remain deadlocked and the 10,600 mechanics strike, Congress is widely expected to take the rare step of intervening in the dispute by extending the negotiating period or forcing a contract settlement on both sides. But Congress goes into recess after today until Feb. 26, so it’s conceivable a walkout could last several days before Congress could act. President Bush or a congressional leader could make an urgent appeal for lawmakers to return earlier to deal with the issue.
Regardless of the solution Congress would choose, the entire body would have to pass legislation at the Capitol to enact the measure and “nothing would happen until they got back” to Washington, said one congressional source familiar with the United situation.
In the meantime, United is being hurt by a growing number of skittish passengers “who are booking away from the airline,” said Michael Boyd, who heads The Boyd Group, an aviation consulting firm.
If a strike does occur and the airline is grounded, United--with 1,650 flights a day and hubs that include Chicago, Los Angeles and Denver--would immediately lose up to $30million a day, and likely would seek Bankruptcy Court protection to conserve cash, Boyd said. United currently has more than $2billion of available cash, but it’s already losing about $10million a day due to the weak economy and the post-Sept. 11 travel slump.
Still, one major travel agency, Carlson Wagonlit Travel, continues to recommend United to its customers because it’s “quite confident that this will be ironed out,” spokesman Steve Loucks said. UAL Chairman Jack Creighton said that if “progress is made [in negotiations], and there is no reason to believe that it can’t, then we anticipate that another vote will occur by mid-March, without interruption of operations.”
Union President Thomas Buffenbarger said union negotiators would “travel anywhere, and meet around the clock if necessary, for the next six days to reach an agreement.” But he reiterated the union’s opposition to federal involvement, urging Bush and Congress to “stay out and we will get it done.”
Bush already has used his main lever for heading off a strike against United, the nation’s No. 2 airline behind AMR Corp.’s American Airlines. The mechanics originally planned to strike Dec. 20, but Bush convened an emergency board that kept the mechanics working while it developed a contract proposal. The mechanics rejected that proposal Tuesday.
“We are ready for a strike and we’re moving toward shutting this company down on Feb. 20,” said Tom Reardon, assistant general chairman for the IAM in Chicago.
Bush is unlikely to get involved further for the moment, said White House Press Secretary Ari Fleischer. “The parties have indicated they are going to continue to meet and work to get a good-faith agreement,” he said. “The president will continue to monitor the situation, but that’s where the action is now.”
The House Transportation Committee, led by Rep. Don Young (R-Alaska), would be the likely starting point for congressional intervention. “The basic indication that [Young’s] received from United and the union is that they believe they can negotiate a contract,” and Young “is optimistic that a strike will not occur,” said Steve Hansen, a committee spokesman.
The mechanics, who haven’t had a pay hike since 1994, rejected a contract that would have raised wages for senior mechanics by 37%, to $35.14 an hour, with additional raises in the coming two years. The new wages would put United’s mechanics on par with peers at other big airlines.
But with nearly 90% of the eligible IAM members voting, 68% rejected the offer and 86% voted to authorize a strike, the union said. The contract also covers 2,200 cleaning and janitorial workers at United, but at different pay scales.
UAL’s stock, which is majority owned by the mechanics and other United employees, tumbled 58 cents to $11.81 a share on the New York Stock Exchange.
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Times staff writer Laura Loh contributed to this report.
