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United Airlines Union Vows to Battle Bid for Concessions

From Associated Press

The union for United Airlines’ flight attendants promised Friday to fight the company “over every dime” of its plan to impose an additional $725 million in labor cuts and to eliminate traditional pensions.

The objections signaled that the nation’s second-biggest airline was in for a battle in seeking another round of cutbacks involving employees who already have made $2.5 billion in annual labor concessions.

UAL Corp. Chief Executive Glenn Tilton told employees late Thursday that the proposed new wage and benefit concessions and changes in work rules were part of $2 billion in annual savings the ailing carrier needs to secure financing and emerge successfully from bankruptcy.

But the Assn. of Flight Attendants said the demands were “not fair, equitable [or] necessary for a successful reorganization.”

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“The company’s demands are disastrous,” said Greg Davidowitch, president of the United branch of the union. “If management stands by these stipulations they will destroy United Airlines. We’re not going to let that happen.”

Leaders of the pilots’ and machinists’ unions declined to comment Friday while each group met to pore over the new numbers.

Responding to the flight attendants’ criticism, spokeswoman Jean Medina said “we have to make difficult decisions now” to exit Chapter 11 bankruptcy protection as a competitive, profitable company.

Company executives said they would save $650 million a year by terminating the airline’s pension plans, in addition to the $725 million of reductions in pay and other benefits. They said an additional $655 million in non-labor cost savings, already identified, would put the company close to the $2 billion in savings it expected to need to emerge from Bankruptcy Court protection.

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United already has lopped $5 billion from its annual expenditures, half of that from labor costs, since filing under Chapter 11 in December 2002.

Sources familiar with the proposals, speaking on condition of anonymity, said Friday that the additional annual concessions sought by the company amounted to $191.1 million for pilots, $137.6 million for flight attendants, $101.2 million for mechanics and airplane cleaners and $180 million for ticket agents, baggage handlers and other workers.

In addition, United plans annual savings of $111.8 million from its nonunion salaried and management employees and approximately $3 million from its unionized flight dispatchers and meteorologists.

Mechanics and airplane cleaners would have their wages cut by 9%, the sources said. Percentages for the other groups were not immediately available.

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