Head of pilots union says all unions at Northwest must take cuts

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Head of pilots union says all unions at Northwest must take cuts

MINNEAPOLIS (AP) =97 The chairman of the union that represents Northwest=20
Airlines pilots said that all labor unions will have to take cuts to ensure=
=20
the airline's viability. The Air Line Pilots Association doesn't plan to=20
meet a July 1 deadline set by management to accept labor concessions. ALPA=
=20
points out that Eagan-based Northwest has maintained a cash balance in=20
excess of $2 billion, so there "is not a sense of urgency or rush to=20
judgment required," ALPA chairman Mark McClain said. But McClain said labor=
=20
unions and other financial stakeholders can't ignore the fact that=20
Northwest has lost $1.6 billion since early 2001. He said Wednesday that=20
the pilots will be "significant participants" in cutting Northwest's costs,=
=20
but that it's premature to say how big of a cut the pilots will accept. In=
=20
late February, Northwest executives asked the pilots union to consider=20
cutting pilot costs by $2.76 billion from July 1, 2003, through Dec. 31,=20
2009, which would include more layoffs and a 17.4 percent pay cut.=20
Northwest executives want to reduce labor costs by $950 million a year,=20
$442 million of which would come from the pilots.

When Northwest faced bankruptcy in 1993, the pilots agreed to a 15.5=20
percent pay cut and changes in work rules that allowed the company to save=
=20
about $365 million. Pilots received stock in exchange for the concessions.=
=20
Union leaders are developing proposals for rewards =97 which could include=
=20
stock, options or profit sharing =97 they'd like to see the pilots receive=
=20
this time for making sacrifices to return Northwest to profitability. "We=20
are not latching on to any one or rejecting any one because it could be a=20
combination of deferred compensation mechanisms that exist," McClain said.=
=20
The union's executive council will meet in mid-June to discuss cost-cutting=
=20
options as well as future rewards. Leaders of Northwest's labor unions have=
=20
been meeting jointly to discuss the labor concession proposals and the=20
company's financial condition. "We've got to gauge what everybody else is=20
willing to do," McClain said. Labor unions cannot stand alone in making=20
financial sacrifices, he said. "Everybody is going to have to step up," he=
=20
said, including Northwest's management, banks, creditors and lessors.


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