NYTimes.com Article: US Airways Pilots Hint Deal Is Near on Cuts

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US Airways Pilots Hint Deal Is Near on Cuts

September 2, 2004
 By MICHELINE MAYNARD





The pilots' union at US Airways said yesterday that it
might be close to reaching an agreement on wage and benefit
cuts that the struggling airline contends are necessary to
avoid another bankruptcy filing.

But US Airways and the machinists' union traded angry words
after the company dismissed a proposal that the union said
would save the airline $115 million a year.

US Airways is pushing its unions for $800 million in
concessions, on top of two rounds they granted while the
airline was in bankruptcy. US Airways wants the cuts by
Sept. 15, in advance of a crucial series of financial
deadlines at the end of the month.

The airline wants pilots to grant $295 million in cuts, the
largest share among its four leading unions. The
concessions sought by the airline include wage cuts,
slimmer pensions and changes in work rules. It also wants
pilots to fly more hours each month, a move likely to lead
to layoffs because fewer pilots would be needed.

Talks continued yesterday on a counterproposal made by the
Air Line Pilots Association, which represents pilots at US
Airways.

In a statement on its Web site, the union said its
bargainers were reviewing the financial details of the
airline's latest offer. It said the leadership of the
pilots union most likely would meet Friday in Arlington,
Va., where the airline is based, to consider the outcome of
those negotiations.

It said discussion of a tentative agreement "could very
well be" on the agenda and urged pilots to attend the
meeting.

The council must approve any tentative deal before it can
be presented to members for a vote. But the group is split
on whether to grant concessions of the size the airline is
seeking.

Union leaders from Philadelphia and Pittsburgh, who
represent enough pilots to defeat a contract proposal, are
particularly upset at the prospect of further reductions in
retirement benefits, which shrank while the airline was in
bankruptcy. Those two US Airways hubs are home base for
hundreds of pilots.

Yesterday, US Airways said it was fully committed to
working with the union to "bring these negotiations to a
successful conclusion as quickly as possible."

But US Airways is sparring with the International
Association of Machinists and Aerospace Workers over
proposals floated on Tuesday. The airline is seeking $174
million in annual cuts from the machinists' union, which
represents the airline's mechanics.

The union has refused to reopen its contract, but it gave
the company a list of suggestions that it said would save
$115 million a year. The union said the airline could save
money on spare parts and in its maintenance operations and
could benefit from delegating more tasks to midlevel
personnel. It did not offer to accept any cuts in wages or
benefits. In a letter to the rank and file, the union said
it was "inconceivable" that US Airways would ignore the
ideas and risk a bankruptcy filing.

US Airways countered that the machinists' plan would
actually cost it $500,000 a year in additional expenses.

In a statement, the airline said the machinists "must come
to grips with the fundamental fact that other union leaders
have reluctantly but correctly concluded - the industry has
changed forever."

It went on, "The airlines that will be successful will be
those who transform their entire business and create a
sustainable cost structure."

http://www.nytimes.com/2004/09/02/business/02air.html?ex=1095132764&ei=1&en=0b35e824202bb676


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