NYTimes.com Article: United's Mechanics to Vote on Revised Proposal

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United's Mechanics to Vote on Revised Proposal

December 2, 2002
By MICHELINE MAYNARD






CHICAGO, Dec. 2 - Mechanics at United Airlines, who
rejected an earlier request for wage and benefit
concessions aimed at helping the struggling airline, will
vote on a revised proposal on Thursday, union officials
announced this morning.

Approval of the plan by mechanics would be the last
critical piece in United's recovery program, which is aimed
at avoiding a Chapter 11 bankruptcy filing and win federal
loan guarantees.

The revised proposal is still worth the $700 million in
cuts that the earlier plan would have yielded, but
addresses union members' concerns about workplace issues
and vacation time they would be losing as part of their
concessions, said Scotty Ford, president of the union local
that oversees United's 13,000 mechanics.

The announcement of the vote, posted this morning on the
union's Web site, was accompanied by a letter from United's
chief executive, Glenn F. Tilton, who promised that the
company would review workplace improvements throughout its
operations by June 1.

The two sides reached agreement on the revised concessions
plan after a marathon bargaining session that began on
Sunday morning. Neither the union nor the company have
disclosed where the talks took place.

United's board meets today to discuss a range of issues
related to the company's restructuring efforts. The company
faces a vital decision on a $375 million payment on loans
backed by aircraft, which is due today. Executives close to
the restructuring effort say that it is likely to take
advantage of a grace period of 10 business days, pushing
the payment's due date to Dec. 16.

That would be well after the vote by the mechanics, who are
members of the International Association of Machinists and
Aerospace Workers. The airline needs their approval to
complete a package of $5.2 billion in wage and benefit
concessions that is the linchpin of a $14.1 billion
turnaround plan it has presented to the federal Air
Transportation Stabilization Board.

The board has set no timetable for approving United's
application, but it is expected to meet later this week.

Approval of the revised mechanics package would boost the
airline's case. Two other groups represented by the
machinists' union approved their portion of concessions
last week. Pilots at United previous approved $2.2 billion
in wage and benefit cuts, while flight attendants voted in
favor of a package worth $412 million on Saturday.

All of the concessions sought by the airline run for the
next five and a half years, and kick in as soon as it
obtains the loan board's approval and secures financing.

Mr. Ford pleaded over the weekend for union members to put
aside animosity for the airline and reverse their decision.
In announcing the revised package this morning, Mr. Ford
told workers in a letter that the package offered "the
final opportunity" for United to avert a Chapter 11 filing.


"On Thursday you will be voting on more than your contract;
you will be voting on the direction of your company, your
job and your future. Weigh all options before you vote, and
make an informed, educated decision," Mr. Ford said.

The earlier contract proposal, which mechanics rejected on
a vote of 57 percent to 43 percent early on Thanksgiving
Day, contained wage cuts of 6 to 7 percent, depending on
job classification, as well as the loss of four vacation
days.

Union officials said workers were upset that they could not
choose which specific days would be forfeited. And they
also felt the proposal should have addressed longstanding
disputes over what the union terms "quality of work life"
issues, basically matters at work sites that involve
decisions made jointly by union and management.

Such efforts are supposed to encourage team work between
the two sides. But mechanics, and many other union members
at the airline, have long complained that they do not have
control over their schedules, which they say are dictated
by management without their input.

And, many union members have been displeased at what they
consider to be the slow pace at which their complaints are
resolved by supervisors.

Mr. Tilton, in a letter to Mr. Ford, said he would seek a
report from the airline's labor relations department on the
workplace issues by June 1. Mr.

Tilton disclosed that United's concessions agreements with
each of its unions call for the establishment of committees
to review the way each part of the airline is run. Said Mr.
Tilton, "Cost savings are necessary if we are to be able to
avoid a Chapter 11 filing but we must also have management
working together with all employees to incorporate employee
input."

Under the revised concessions plan, workers still give up
pay for the four vacation days a year that was called for
in the rejected proposal. Under the new plan, workers
initially will be asked to give up those days during early
2003, when the airline "faces dire financial
circumstances," according to Peter B. Kain, United's vice
president for labor relations.

In subsequent years, mechanics will be able to choose which
of the four vacation days will be unpaid, with at least two
falling in the first half of the year, unless a union
member has decided to take all his or her vacation in the
second half of the year, Mr. Kain said in a letter to Mr.
Ford that was posted on the union's Web site.

http://www.nytimes.com/2002/12/02/business/02CND-AIR.html?ex=1039838452&ei=1&en=6899c2a5a959b072



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