Delta pilots union balks at company's pay cut request

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Delta pilots union balks at company's pay cut request

ATLANTA (AP) =97 The Delta Air Lines pilots union is balking at a 22%=20
wage-reduction proposal that is part of a companywide cost-cutting=20
campaign. In a memo distributed to pilots Tuesday night, the union's=20
economic and financial analysis committee said the nation's third-largest=20
airline needs to cut costs to survive but noted employees have already made=
=20
sacrifices. "Labor did not create this problem, and the E&FA team does not=
=20
endorse management's specific proposal," the memo said. "The team has=20
concluded, however, that all stakeholders, including labor, need to be part=
=20
of the solution." The union's financial team linked Delta's problems to a=20
drop in revenue and new debts =97 not to what it pays its pilots. The union=
=20
leaders stopped short of calling for the proposal to be rejected, but said=
=20
their data should be considered when members make a decision. "Labor costs=
=20
as a percentage of total expenses have been fairly flat," the memo said.=20
"Expenses have not changed very much. Although it appears there has been a=
=20
recent spike in labor expenses relative to total revenue, the main cause of=
=20
the relative percentage increase in labor expenses is the reduction in=20
revenue, not the increase in expenses."

The union said it is still gathering input from pilots before deciding on a=
=20
course of action. Last month, Delta told pilots it wants to cut their=20
hourly wages by 22%, cancel pay raises due over the next year and reduce=20
some benefits. In addition to the pay cut for pilots, Delta wants to reduce=
=20
the company contribution to a family savings plan for pilots from 3% to 2%.=
=20
It also is proposing comprehensive negotiations focusing on work rules,=20
benefits and further discussion on pay rates in the fall of 2004 or sooner,=
=20
depending on the financial condition of the company. Chief executive Leo=20
Mullin has said Delta will use deep salary concessions agreed to at=20
American Airlines as context for its talks with its own pilots. Delta lost=
=20
$466 million in the first quarter on top of $1.3 billion it lost last year.=
=20
Atlanta-based Delta has laid off 16,000 employees since the Sept. 11=20
attacks. It has also furloughed more than 1,000 pilots and said earlier=20
this month it would furlough an additional 200 pilots this year because of=
=20
a drop-off in travel due to the war in Iraq. It also plans to reduce=20
capacity by 10% and will remove 12 MD-11 aircraft from service. The pilots'=
=20
union represents 9,000 Delta pilots.


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