Posted on: Saturday, October 2, 2004

Bankrupt airline asks pilots to cut pay

By Paul Nowell
Associated Press

CHARLOTTE, N.C. — Leaders of the pilots' union at bankrupt US Airways were considering yesterday whether to forward to members a proposed contract renegotiation that includes an average pay cut of 18 percent.

The nation's seventh-largest airline said the agreement reached with a negotiating committee for the pilots' union would save the carrier $300 million annually — nearly a third of the cost cuts that US Airways says it needs to remain viable.

A spokesman for the Air Line Pilots Association, which represents the airline's more than 3,000 pilots, valued the concessions at $1.8 billion over nine years.

Union negotiators met into the evening with between 70 and 80 pilots who make up the group's management executive council, at a hotel in Charlotte, where US Airways has its largest hub.

Union spokesman Jack Stephan said this would be the third round of concessions pilots have made to the company since 2002.

"It brings the total amount these pilots have given back to around $7 billion," Stephan said.

Pay cuts under the proposal would average 18 percent, Stephan said. Captains now make $120,000 to $150,000 a year, and first officers make $75,000 to $100,000, he said.

US Airways chairman David Bronner said the $300 million in annual savings is a "good number from the pilots" that should be enough to avoid liquidation if combined with cuts from other labor groups and gains in productivity. Bronner is CEO of the state of Alabama's pension system, which has a $240 million stake in the airline.

The company warned in a bankruptcy court filing on Sept. 24 that it could be forced to liquidate by February if the court did not impose a temporary 23 percent pay cut on union workers. An Oct. 7 hearing is scheduled on the issue.