Sun, Jan 23, 2005 - Page 10 News List

US Airways union agrees to sweeping wage, benefit cuts

NY TIMES NEWS SERVICE , NEW YORK

Members of the machinists' union at US Airways voted Friday in favor of US$269 million in wage and benefit cuts, completing the airline's efforts to win contract concessions.

Approval came after a bankruptcy court judge said in early January that he would set aside contracts for the union, the International Association of Machinists and Aerospace Workers, allowing US Airways to impose terms.

The union, which represents about 8,800 baggage handlers, mechanics and ramp workers, had vowed to strike if that happened. Instead, union leaders put the company's last offer to members for a vote. The contract calls for pay cuts of up to 18 percent for some mechanics, and will eliminate as many as 2,500 jobs by allowing the company to send work to outside companies.

Among the union's three labor groups, 61 percent of mechanics voted in favor of the cuts; 62 percent of ramp workers and 97 percent of the maintenance-training specialists.

US Airways' pilots, flight attendants and customer service agents have already approved contracts calling for sweeping cuts. US Airways warned it would liquidate if workers did not grant US$1 billion in wage and benefit concessions, their third set of cuts since 2002.

The employee concessions provide US Airways with "a strong tail wind," the chairman of US Airways, David G. Bronner, said in a statement Friday night.

Union leaders bemoaned the situation in letters to their members. "Your vote came down to bad or worse," said William O'Driscoll, president of Machinists' District Lodge 142 in Kansas City.

He went on, "Where US Airways goes from here is now out of your hands. Hopefully, management won't waste the substantial sacrifice you agreed to make."

US Airways, the nation's seventh-biggest airline, filed for bankruptcy protection on Sept. 12, its second Chapter 11 filing in two years.

In doing so, the airline defaulted on the US$717 million balance on a package of federal loan guarantees that it used to emerge from its first round of court protection.

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