Bush puts off strike at United
Bloomberg News Service
President George W. Bush signed an executive order creating an emergency board that will block UAL Corp.'s United Airlines mechanics from going on strike, a situation the White House said might hurt the U.S. economy.
Associated Press
United's mechanics voted last week to strike if their union failed to reach agreement with the second-largest carrier on a new contract by today's midnight deadline. The two-year-old negotiations, which broke off last month, have been stymied by disagreement over wage and pension issues, the union has said.
A United Airlines Boeing 747 takes off from Los Angeles Airport Tuesday. United Airlines' chief executive James Goodwin says the carrier will go out of business sometime next year if it cannot soon stem huge losses.
"The president is very concerned about the economy, particularly after Sept. 11, and the effect that airline strikes would have on the economy," said White House spokesman Ari Fleischer.
The union wants wage and pension increases that would make United's 15,000 mechanics the best paid in the industry. UAL is trying to reduce spending as it absorbs daily losses caused by a drop in air travel and fares amid the recession and aftermath of the Sept. 11 terrorist attacks.
Bush's action puts any walkout on hold for as long as 60 days. The union and company said top officials from the two sides met today and agreed to continue working toward an agreement at a meeting in January.
"Resolution to the dispute at United Airlines should be made at the bargaining table without any interference by the president or anyone else," said Machinists spokesman Joe Tiberi.
Chicago-based United said in a statement that it's seeking resolution based on "a common understanding of the facts (leading to) common measures to preserve good jobs and return the company to profitability soon."
UAL shares fell $1.10 to $12.05. The shares have dropped 69 percent this year.
President's Board
The presidential emergency board will study the situation for 30 days and give the parties another month to consider recommendations. If there's still no agreement, the president and Congress can seek to impose a contract.
The president "urges all parties to work together to resolve their differences," Fleischer said.
The National Mediation Board, which has overseen the talks since September 2000, said the president had appointed three professional arbitrators to the emergency board. Helen Witt of Pittsburgh will serve as the chairwoman with David Twomey of Chestnut Hill, Massachusetts; and Ira Jaffe of Potomac, Maryland.
Witt was also the chairwoman earlier this year for a presidential emergency board formed in a dispute between Northwest Airlines Corp. and its mechanics. Twomey, who has also served on prior boards, is a professor in the School of Management at Boston College. Jaffe has been a full-time arbitrator and mediator since 1981.
When Bush appointed a presidential panel in March to resolve contract negotiations between Northwest and the Aircraft Mechanics Fraternal Association there was agreement the following month that was approved by the union's members in May.
Talks between the union and United started in December 1999. About 99 percent of the 10,000 members who returned ballots approved a strike, the International Association of Machinists and Aerospace Workers union said Friday.
