United mechanics call off vote on wage cuts

By Dave Carpenter
Associated Press

CHICAGO — United Airlines mechanics called off a vote planned for today on wage cuts after a government panel rejected the financially troubled carrier's request for a $1.8 billion federal loan guarantee.

A lone passenger arrives for a flight at the United Terminal in Chicago. A government panel's rejection of a $1.8 billion loan guarantee is a major setback in United Airlines' efforts to avoid bankruptcy. Associated Press

The machinists' union canceled the vote just hours before it was to begin at union halls nationwide and condemned the decision by the Air Transportation Stabilization Board.

"We were ready to partner with United, the union coalition and the government to return United Airlines into the nation's premier carrier," said union president Tom Buffenbarger. "Unfortunately, the United States government walked out on that partnership."

The mechanics' support was the last missing link in a $5.2 billion package of targeted labor cutbacks that was the key to United's application for the $1.8 billion loan guarantee.

Without it, cost-cutting agreements with the other employee groups expire Dec. 31.

Afraid another rejection by the mechanics' union could sink the airline's recovery plan, union leaders this week had urged ratification of the agreement, warning that a bankruptcy judge could dissolve their contract and wipe out decades' worth of negotiated gains.

United's chief executive officer, Glenn Tilton, also campaigned for approval, speaking Tuesday night and yesterday to United mechanics in San Francisco.

Many of the 13,000 mechanics and aircraft cleaners, angry about years of perceived mismanagement and foregone raises, have indicated they think the airline might fare better under the steering of a bankruptcy court judge.