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The Honolulu Advertiser

Posted at 12:00 p.m., Wednesday, January 8, 2003

UAL flight attendants accept pay cuts

By Dave Carpenter
Associated Press

CHICAGO ­ United Airlines' flight attendants consented today to temporary 9 percent wage cuts aimed at helping United get out of bankruptcy, becoming the fourth of the carrier's five unions to do so.

Their ratification of United's emergency proposal leaves the Machinists' union, whose leaders refused to put proposed pay cuts to a vote by its 37,000 members, as the lone holdout.

United's pilots and two small unions, representing dispatchers and meteorologists, approved immediate double-digit pay reductions in voting that concluded a day earlier.

Flight attendants, like the pilots, voted overwhelmingly to accept the interim cuts. Ninety-four percent of those participating in weeklong voting that ended today voted in favor of the wage-cut agreement, the union said, although turnout among United's 24,000 flight attendants was just 62 percent.

United has about 400 flight attendants in Hawai'i. In Hawai'i, about 75 percent of flight attendants voted, and 98.9 percent voted in favor of ratifying the agreement.

"This cut is very painful, especially since flight attendant compensation is so minimal to begin with," said Greg Davidowitch, president of the United branch of the Association of Flight Attendants. "Flight attendants have once again shown that we are committed to seeing our airline successfully emerge from bankruptcy."

Flight attendants' pay before the cuts ranged from $17,000 to $44,000 a year.

Like the pilots, the flight attendants also assailed the company for being "less than forthcoming" with information about its overhaul plans.

"Recognizing the contributions of frontline employees is a key to this process because bankruptcy doesn't end well when the workers and management are not on the same page," Davidowitch said, alluding to the risk of liquidation if labor dissension erupts.

United CEO Glenn Tilton said he was grateful for the flight attendants' decision and pledged that the company will continue to meet and work with its unions to reach consensual agreements.

Elk Grove Village, Ill.-based United, which filed for Chapter 11 bankruptcy last month, has until Feb. 15 to cut costs or it could lose the rest of $1.5 billion in interim financing supplied by a group of banks.

It estimates it can save $70 million a month through the temporary wage cuts, meeting its lenders' strict financing requirements while gaining more time to negotiate permanent pay cuts and work-rule changes with the unions.

Pilots approved a 29 percent pay cut; the 180 controllers and 40 meteorologists will see wages slashed by 13 percent.

The Machinists' union, however, has objected to United's proposal that its members take 13 percent reductions, saying the company has not provided sufficient evidence.

United planned to file a formal response to the machinists' objections in federal bankruptcy court later. Bankruptcy Judge Eugene Wedoff then was expected to rule tomorrow or Friday on whether to impose the pay reductions on the Machinists ­ 13,000 mechanics and 24,000 ramp, customer service and gate workers.

Negotiations continued today for a second day in Chicago between the airline and leaders of the International Association of Machinists and Aerospace Workers on long-term cost reductions. The union said no discussions on United's proposal for interim cuts were taking place.

Shares in United parent UAL Corp. fell 4 cents to $1.45 in afternoon trading on the New York Stock Exchange.

Advertiser Staff Writer Kelly Yamanouchi contributed to this report.