You have been sent this message from psa188@juno.com as a courtesy of the Washington Post - http://www.washingtonpost.com To view the entire article, go to http://www.washingtonpost.com/wp-dyn/articles/A31092-2002Sep17.html US Airways Gets Last Of Union Agreements By Keith L. Alexander US Airways last night secured wage and benefit concessions from the two union groups that had been holding out, meeting the outstanding conditions to get a $900 million federal loan guarantee and solidifying its chances of emerging from bankruptcy protection early next year. Nearly 57 percent of 6,800 mechanics represented by the International Association of Machinists voted to ratify an agreement that called for the employees to give up $160 million a year for 6 1/2 years. That represents nearly a 6.8 percent pay cut for each mechanic. The same percentage had voted down the same agreement last month. Both sides agreed to a revote after union officials said some members did not understand that a contract imposed in bankruptcy proceedings could require even more concessions. Also yesterday, nearly 75 percent of the airline's 8,000 reservation, ticket and gate agents represented by the Communications Workers of America approved the airline's proposal to reduce their wages on average by 8 percent over seven years. The Arlington-based airline had sought about $950 million in concessions from its employee groups as part of its effort to reduce its costs by $1.2 billion a year. The airline said it has obtained about 85 percent of that target. It now will focus on securing about $300 million in concessions from its aircraft lessors and suppliers through the bankruptcy proceedings. "The ratification of this last remaining employee agreement provides us with tremendous momentum to secure our financing, complete our restructuring plan, and emerge from bankruptcy early in 2003. We have the elements in place to become a competitive and successful airline, and ultimately our mechanics and related employees recognized that some painful tough decisions now can lead to success and opportunities," said Jerry A. Glass, US Airways senior vice president of employee relations. David N. Siegel, US Airways president and chief executive, said the employee concessions were the largest wage and benefit concessions ever obtained by an airline. As part of their new agreements, employees will own nearly 30 percent of US Airways' stock after the airline emerges from Chapter 11. "Our employees made incredible sacrifices, and they should be rewarded for such," Siegel said. In exchange for their concessions, the mechanics will receive a board seat as well as an equity stake or a profit-sharing plan that the union said has yet to be determined. The mechanics are also giving up two holidays, but the paid days off will be reinstated in 2008. There will be increases in pay of 2 percent beginning in July 2004 and an additional 2 percent in 2005 through 2007 and 5 percent in 2008. "Ratification of this proposal restricts US Airways from seeking further cost reductions from IAM members in bankruptcy court," said Scotty Ford, president of the union's District 141M. As part of the CWA's new agreement, after initial salary cuts, pay will increase by a total of 8.75 percent between 2005 and 2009. The employees will also share 2 percent of the airline's stock after its anticipated emergence from bankruptcy in the first quarter of 2003. Workers earning less than $30,000 a year were exempt from the pay cuts. Two of the employees' 10 holidays will be temporarily cut; they will be reinstated at the end of the contract. Also, employees will earn only 75 percent of their salary while on vacation. That, too, will snap back to 100 percent in 2009. Also, as part of the contract, furloughed CWA members will be offered new jobs created within the US Airways Express regional subsidiaries as well as the airline's growing Internet operations. US Airways also agreed to allow the union to represent employees in its new regional jet operation, Mid Atlantic Airways. "We are extremely pleased with the decision of our employees to willingly support the company's restructuring plan, and we applaud them for sharing in the sacrifices necessary to restore our company to financial health," said US Airways' Glass.