United Airlines machinists vote
By Herbert G. McCann
Associated Press
CHICAGO — UAL Corp.'s effort to avoid a bankruptcy filing is heavily dependent on a vote by United Airlines' machinists on whether to accept wage concessions totaling $1.5 billion.
The 37,500 mechanics, baggage handlers and reservation agents voted in union halls yesterday on whether to accept pay reductions of 6 to 7 percent.
United mechanics have already rejected the proposal, and in separate votes two other factions of the union approved the plan.
Joseph Tiberi, a spokes-man for the International Association of Machinists and Aerospace Workers, said no one is pleased at giving back contract gains to help the airline.
"Once again, they have to sacrifice in order to save the company," union spokesman Joseph Tiberi said. "Unfortunately, it is vital that United bankruptcy is avoided."
United spokesman Joe Hopkins said the concessions being sought are key to the airline's recovery effort.
Voter turnout was high yesterday at Local Lodge 1487 in Des Plaines, lodge president Mark Connolly said.
"There's a lot of resentment out there," Connolly said of his members. "They're also aware of the trouble the carrier is in."
Connolly, a customer service agent, expected a close vote, saying members are "either scared or mad" about the situation.
"I don't sense the slam-dunk here," he said.
Dan Kaulback, a baggage handler who has been with United for 11 years, said he voted for the plan as the safest way for employees to hang onto their jobs and retain negotiating power. "I think having control of your fate is a lot better than not having it," he said.
United hopes to slash $5.2 billion in labor costs over 5 1/2 years — the linchpin of its $14.1 billion financial recovery package.
"It is a tremendous accomplishment to get to this point," Hopkins said. "We think this will align costs to projected revenues and will allow United to become a competitive company."
A "no" by the machinists is considered certain to doom its request for a $1.8 billion federal loan guarantee, without which United has said it faces a Chapter 11 bankruptcy filing.
United has been losing money at the rate of $7 million a day this fall and is thought to be on a pace to run out of cash early next year.
"Absent a ratified recovery plan, bankruptcy is all but certain to follow and follow quickly," Randy Canale, head of District 141 representing ramp workers and public contact workers, told union members last week in recommending they approve the agreement.
United's 8,800 pilots already have ratified $2.2 billion in cutbacks, and its flight attendants are voting on a tentative agreement for $412 million in wage reductions, with results to be announced Saturday.
