United Airlines Asks Judge to OK Cuts
United Airlines, feuding with its flight attendants over a new cost-saving contract, Monday asked a Bankruptcy Court judge to settle the matter by allowing United to lower wages and benefits for its 15,500 flight attendants.
The request came in a court filing in which United again asked U.S. Bankruptcy Judge Eugene Wedoff in Chicago for permission to wring additional concessions from its 6,800 mechanics and 19,500 other ground workers.
United, a unit of UAL Corp., says it needs $725 million in additional annual savings from all its worker groups to emerge from Chapter 11 bankruptcy proceedings, during which it has been restructuring for more than two years. That’s on top of $2.5 billion in labor savings the airline already had secured.
The airline, based in suburban Chicago, has lost billions of dollars in recent years and says it needs the savings to compete against the growing presence of discount carriers.
United also is seeking court approval to dump its workers’ four major defined-benefit pension plans. The plans are badly underfunded, and United says it can’t afford the payments.
In late January, United reached new wage-and-benefit contracts with its 6,450 pilots and with the flight attendants, saving more than $300 million a year. But United hasn’t reached new pacts with its mechanics and the other ground workers, so it has asked the court for help.
The mechanics and other ground workers say they have given back enough and have pressured United’s management to find other strategies for exiting Chapter 11.
Then on Friday, United’s deal with the flight attendants began falling apart.
The Assn. of Flight Attendants threatened to terminate their new pact on grounds that United hadn’t demonstrated that management and other salaried employees had made promised concessions.
United denied the allegation and in its court filing asked Wedoff to scrap the flight attendants’ contract so that the airline can impose the cuts it wants.
“Their action today seems pure retribution for the flight attendants holding them accountable,” said AFA spokeswoman Sara Nelson Dela Cruz, adding that the union had asked Wedoff to block United’s move.
A United spokeswoman didn’t return a call seeking comment. A hearing on United’s request is set for May 11.
Soaring jet-fuel prices have left the airline in no position to compromise on its cutback plans, the airline said in its filing.
“The unalterable fact remains that, as the future of one of the world’s largest airlines and its 60,000 employees hang in the balance, now is not the time for half-measures,” United said.
UAL Chief Executive Glenn Tilton said Monday that the carrier still hoped to emerge from bankruptcy protection this fall. The labor savings are required to get the bank financing necessary to leave reorganization, he told reporters after a speech to the City Club of Chicago.
United is the busiest airline at the Los Angeles and San Francisco airports and overall is the nation’s second-largest carrier, behind AMR Corp.’s American Airlines. About 4,000 of United’s employees live in California.
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Associated Press was used in compiling this report.
