The article below from NYTimes.com has been sent to you by psa188@xxxxxxxxx /--------- E-mail Sponsored by Fox Searchlight ------------\ I HEART HUCKABEES - OPENING IN SELECT CITIES OCTOBER 1 From David O. Russell, writer and director of THREE KINGS and FLIRTING WITH DISASTER comes an existential comedy starring Dustin Hoffman, Isabelle Hupert, Jude Law, Jason Schwartzman, Lily Tomlin, Mark Wahlberg and Naomi Watts. Watch the trailer now at: http://www.foxsearchlight.com/huckabees/index_nyt.html \----------------------------------------------------------/ US Airways Asks Court for Pay Cuts September 25, 2004 By MICHELINE MAYNARD US Airways late yesterday asked a federal bankruptcy court to approve emergency pay cuts plus other moves, aimed at raising $38 million in cash per month. Bruce R. Lakefield, the airline's chief executive, told employees of the company's move in a hotline recording last night, shortly before the company filed its motion. In addition to the cuts, which its unions said would be 23 percent, Mr. Lakefield said the airline would implement spending cuts and other cost-saving moves aimed at generating an additional $5 million per month. "I fully understand the difficulties this change will cause for many of you, and I truly regret the fact that our company's financial condition puts us all in this unhappy situation," Mr. Lakefield said. If granted, the cuts would apply to members of five unions: the Air Line Pilots Association, Association of Flight Attendants, International Association of Machinists and Aerospace Workers, the Communication Workers of America and the Transport Workers Union. About 150 flight dispatchers, who are members of the transport workers, are exempt from the motion. They reached a tentative agreement with US Airways earlier this week on $4.5 million in cuts. In its motion, the airline said it had met the bankruptcy court's standard that it would be caused "irreparable harm" if its current pay levels were allowed to remain in place. In order to avoid a cash crisis in early 2005, the airline said it must accrue $200 million in cash between now and year's end. "Waiting for a cash crunch to be right in front of us is simply too late," Mr. Lakefield said. US Airways sought bankruptcy protection in Alexandria, Va., near its headquarters in Arlington, on Sept. 12, its second filing in two years. The airline said on Wednesday that it would seek a judge's permission to impose the temporary cuts, unless its unions reached tentative agreements. Except for the dispatchers, none of the unions have agreed to the airline's bid for $800 million in wage and benefit cuts. The concessions would come on top of two earlier rounds of cuts, collectively worth $1.9 billion, that were granted during US Airways' first bankruptcy filing, which was in August 2002. US Airways emerged from that reorganization in April 2003, only to find that its costs were still higher than low-fare airlines, which had invaded its turf on the East Coast. Then, under a $1.5 billion restructuring plan announced last spring, US Airways moved to emphasize direct flights and low fares. It has already begun dismantling its hub in Pittsburgh, and dropping flights to other cities to concentrate on Boston, New York, Washington, its hub in Philadelphia, and flights to Florida and the Caribbean. The bankruptcy code allows companies to ask for emergency pay cuts and to have labor contracts set aside and replaced with less-expensive contracts. US Airways has not said whether it will seek to set aside the labor contracts. Its request for temporary pay cuts requires a court hearing, but workers do not get to vote on that proposal. Once it requests that contracts be set aside, a judge has 60 days to make a decision. In that time, companies and unions could reach agreement on cuts. A judge can impose concessions on unions that do not reach new terms. US Airways is in an unusual situation for many bankruptcies, in that it could not arrange debtor-in-possession financing. Its assets are pledged to secure the balance of $900 million in federal loan guarantees awarded by the Air Transportation Stabilization Board in April 2003, when the airline emerged from its first bankruptcy. Under an agreement with the board and its lenders, US Airways must have $585 million or more in cash on Oct. 15. It is expected to reach a subsequent agreement with the federal loan board and its lenders, who have the right to see the airline's books and must receive weekly revenue projections. "Simply put, US Airways must actively manage its cash and build its reserves for the slower fall and winter to remain a viable company," Mr. Lakefield told employees. The fourth quarter and first quarter are traditionally the weakest for airline travel, except for the holidays. He said talks were scheduled for Monday with the pilots' union and the union that represents reservations agents. Talks with other unions are also expected next week. US Airways sent letters to its unions Wednesday saying it would seek 23 percent wage cuts and would cease or reduce payments to some of its employee pension plans. It also told workers it would not abide by its commitment to maintain a fleet of 279 aircraft. US Airways has not announced cuts for salaried personnel or management, but the airline said they are expected to participate in cost reductions. http://www.nytimes.com/2004/09/25/business/25air.html?ex=1097135916&ei=1&en=1f496240ebbbb0d5 --------------------------------- Get Home Delivery of The New York Times Newspaper. Imagine reading The New York Times any time & anywhere you like! Leisurely catch up on events & expand your horizons. 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