Pilots at United Airlines, angered at the prospect of seeing their pension plans replaced with less generous versions, vowed yesterday to use all legal means available to fight such a move.þþBut United, which filed for bankruptcy protection in December 2002 and is trying to obtain billions of dollars in financing so that it can reorganize, replied that ÿnothing has been or will be immuneÿ as it re-examines its costs. þþUnited, a unit of UAL and based outside Chicago, made the comment as it asked a bankruptcy judge for five more months to draft a restructuring plan. Until now, Judge Eugene C. Wedoff of Federal Bankruptcy Court has extended United's rights a month at a time.þþThe bankruptcy court meets Aug. 20, when the airline may say what it plans to do with its retirement plans.þþOn June 28, United failed for the third time to obtain a federal loan guarantee. þþLast month, it said it would not make required contributions to its employee pensions while it remained under court protection. United also said it was considering terminating its four employee pension plans, to which it must contribute about $4.1 billion over the next five years.þþYesterday, the Air Line Pilots Association, which represents the airline's 8,800 pilots, warned that terminating pension plans ÿhas the potential to destroy the career of every pilot, and potentially plunge labor relations at United into years of hostility and chaos.ÿþþThe dispute brought to mind the slowdown by United pilots in the summer of 2000. One out of every four flights in the country was delayed that summer because of the slowdown, bad weather or an air traffic overload. The problems led to deep losses at United, beginning its fall into bankruptcy. þþThis month, the International Association of Machinists, which represents ramp workers and other airline personnel, sued the airline in Illinois and New Jersey over the prospect of pension terminations. The union charged United's senior management, including its chief executive, Glenn F. Tilton, with breaching its fiduciary duty. United said the suits were baseless.þþWhile the machinists' union has long been a militant group, the pilots had been fairly conciliatory in their dealings with United, and industry executives and analysts said that gave yesterday's stance added weight.þþÿThis is a really critical group,ÿ said Gary L. Chaison, professor of industrial relations at Clark University in Worcester, Mass. ÿYou have got to have the pilots, but essentially the pilots are saying, 'We're just like the machinists.' ÿþþThe pilots' union, which like the machinists' union has a seat on United's board, was the first union to grant wage and benefit cuts both before and after United sought Chapter 11 protection.þþLast month when the airline missed a $72.4 million pension payment, the pilots' union, whose plan is funded through July 2005, said that it thought that skipping the payment was in the company's financial interest.þþBut there was little language of support in yesterday's statement. The pilots' union said it was responding to numerous news reports on the pension situation.þþÿThe pilots of United Airlines have the following message for the company, the media and the financial markets: We will use every resource at our command and every legal means available to prevent the company from destroying the pilot pension program,ÿ said Mark Bathurst, chairman of the master executive council of the United pilots' union.þþMr. Bathurst, a United captain, criticized airline executives for taking aim at the retirement plans when the airline's operating costs remain 25 percent higher than those at American, which won cuts from its unions last year under the threat of a Chapter 11 filing.þþRich Nelson, a spokesman for United, said the airline had to look at every aspect of its business, in part because of surging fuel prices, which will raise United's costs this year by $750 million.þþProfessor Chaison interpreted the union's warning as a very clear threat of the pilots' intent to disrupt operations, unless the company met its pension obligations.þþWhile it would be illegal for pilots to walk off the job, pilots could extract a costly revenge through other tactics. As little as a one-minute delay in the schedule of every plane could be enormously expensive for United, which has prided itself on its tightly run operations, said Robert W. Mann Jr., an industry consultant in Port Washington, N.Y.þþÿIt's their version of, 'orange alert, buy the duct tape,' ÿ Mr. Mann said.þþA spokesman for the pilots' union, Steve Derebey, said it was not ÿtrying to send any kind of messageÿ to expect such measures. But the union feared that United might act quickly to cancel its pension plans. Before that happened, ÿwe felt we had to take a stance,ÿ he said.þþþþ
Source: NY Times
