CHICAGO - Three unions at United Airlines said on Wednesday that they were prepared to strike to protect their contracts, one day after the carrier, which is operating under bankruptcy protection, received court permission to terminate four pension plans.þþThe unions - representing flight attendants, bag handlers and machinists - all issued statements saying members gave wide approval to strike. A spokeswoman for the Association of Flight Attendants, which has 21,000 members at United, said the union would most likely respond through unannounced and intermittent strikes called chaos strikes. Such actions could take the form of a one-day national strike or a strike on a single flight at a remote location.þþThe flight attendants' union said it was reviewing the possibility of appealing the default of its pension plan, but a spokeswoman, Sara Nelson Dela Cruz, called avoiding termination ÿall but impossible,ÿ given the court's action. þþUnited contends any strikes would be illegal because the rest of the workers' labor agreements remain in effect. Airline workers are covered by the Railway Labor Act, which forbids them to strike as long as contracts are in place.þþOn Tuesday, Judge Eugene R. Wedoff of Federal Bankruptcy Court sided with United and its argument that it could not emerge from bankruptcy with its pension plans in place. That move led to the largest pension default in the three decades that the government has guaranteed pensions. The ruling releases United, a unit of the UAL Corporation, from $3.2 billion in pension obligations over the next five years. þþThe federal agency that guarantees pensions, the Pension Benefit Guaranty Corporation, will assume responsibility for the plans, which cover about 134,000 people. The government measures United's pension shortfall at close to $9.8 billion. þþAnalysts said yesterday that the pension default might put pressure on United's rivals, like Northwest and American, to reduce the costs of their retirement plans. Northwest, the fourth-largest American carrier, is seeking to lower labor costs by $1.1 billion a year and is talking with unions on pay, pension and benefit cuts. With its pension plans underfunded by $3.8 billion, Northwest said last month that reducing its labor costs was imperative. þþUAL, based in Elk Grove Village, Ill., also announced on Wednesday that its first-quarter loss more than doubled to $1.07 billion as expenses for jet fuel and its reorganization rose. The company said the net loss widened to $9.23 a share, from $4.17 a share, or $459 million, a year earlier. Sales rose less than 1 percent, to $3.92 billion from $3.91 billion. UAL has lost $5.8 billion since entering bankruptcy in December 2002. þþThe airline was also back in court, asking Judge Wedoff to impose permanent pay and benefit reductions on unions representing its machinists and mechanics. The airline continues to negotiate with some unions on revisions in their labor agreements, trying to get long-term pacts.þþSome 40 United workers and retirees came in a yellow school bus to the courthouse on Wednesday. Their gloom was palpable. þþÿUnited Airlines just robbed me of any future with the company,ÿ said Carol Krause, 47, a 20-year employee who works as a customer service agent at O'Hare Airport in Chicago. ÿI feel blindsided, and United management has to answer for this.ÿ þþRoland Dean, a retired ramp serviceman, said he agreed to retire early, in July 2003, after 36 years with United, to receive less-expensive health insurance. Then United nearly tripled his monthly premium last year, to $116 a month for him and his wife, who has osteoporosis. Now, with the reduction in his pension, his costs will rise another 25 percent to 50 percent, he said. þþÿIf I had known it was going to go like this, I would have stayed working,ÿ Mr. Dean, 63, said. ÿNow I will have to go out and get a job.ÿ þþHe predicted that United would find itself in the position of Eastern Airlines in the early 1990's, when crippling strikes led to a bankruptcy filing and the demise of the airline. ÿEastern Airlines whittled away like dust in the wind,ÿ he said. ÿThis one is being taken down in a hurry.ÿþþMs. Dela Cruz said that United management was forcing the unions' hand. ÿWhat seems to be more insidious is that there seems to be a move under way by management to do away with benefits altogetherÿ at United, she said. þþAnalysts said unions were not likely to back down and would be compelled to take some action - even it if is symbolic. þþÿThe reaction has been far more vehement than any of us even feared,ÿ said Joseph P. Schwieterman, a professor of public service management at DePaul University and a former United marketing analyst. ÿThese are deep wounds that will take years to heal.ÿ þþBut Gary N. Chaison, a professor of industrial relations at Clark University in Worcester, Mass., said that by raising their strike threats, United's unions were walking a dangerous line. þþÿThey may find themselves going down a path they can't get off now,ÿ Professor Chaison said. ÿIf they don't talk about a strike, no one will pay attention to them. And if they do talk about strikes, their bluff will be called and that's the last thing they want right now.ÿ þþ
Source: NY Times
