CHICAGO (AP) -- United Airlines has vanquished the threat of a strike and all but secured the labor savings the carrier says it needs to help it emerge from a 2 1/2 year bankruptcy.þþA preliminary agreement announced Tuesday between UAL Corp. and its machinists union -- the company's largest labor group -- likely will give the nation's No. 2 airline its final victory in a seven-month quest to rewrite its union contracts to cut an additional $700 million in annual labor costs.þþHours earlier, United's mechanics union announced its members had ratified their long-term contract.þþBoth unions -- the last of United's labor groups to agree to additional concessions -- had threatened to walk out if a bankruptcy judge annulled their existing contracts and allowed United to impose wage and benefit cuts.þþBankruptcy Judge Eugene Wedoff gave United and the machinists union until June 17 to work out a formal contract. Both sides said they expect the agreement to hold up.þþ''We now have what we wanted all along, which is a fair and equitable settlement on all issues,'' said Randy Canale, president of District 141 of the International Association of Machinists and Aerospace Workers.þþEarlier this year, United reached long-term contracts with unions representing its pilots and flight attendants, as well as two smaller labor groups.þþDespite Tuesday's optimism, the bruising labor negotiations have left many employees bitter. The latest wage and benefit cuts come atop $2.5 billion in concessions United won in 2003.þþ''During the last several months this membership universally experienced a deep sense of anger provoked by the policies and actions of United management,'' said Aircraft Mechanics Fraternal Association Local 9 president Joseph Prisco.þþThe union representing United flight attendants continues fighting Wedoff's May 10 order approving United's plan to unload its four defined-benefit pension plans on the Pension Benefit Guaranty Corp., the government's pension insurer.þþA hearing on the Association of Flight Attendant's request for an injunction to have the pension termination blocked by a federal district court in the District of Columbia is scheduled for Friday.þþ''The fact that labor groups have expressed extreme dissatisfaction with upper management makes a quick turnaround in company morale seem unlikely,'' said Joseph Schwieterman, a transportation expert and economics professor at DePaul University who attended Tuesday's court hearings.þþThe airline's 20,000 baggage handlers, customer service representatives and other ground workers still must ratify the contract, but the union leadership's endorsement leaves little doubt it will be approved.þþWhile extracting about $175 million in annual concessions, United gave in on the machinists' demand that contributions to a replacement pension fund be steered into the union's National Pension Plan rather than a company 401(k).þþWith the uncertainty mostly removed from its labor picture, United still must persuade banks to lend it $2 billion so it can emerge from Chapter 11 bankruptcy.þþIn a statement Tuesday, the Elk Grove Village, Ill.-based company said the labor deals ''move us significantly forward in our restructuring and set the stage for our exit from bankruptcy.''þþDespite the labor rancor, United was among only four of 14 major carriers to improve service over the last two years, according to an Airline Quality Rating study released in April.þþ
Source: NY Times
