Aloha to cut 79 maintenance jobs

By Dan Nakaso
Advertiser Staff Writer

Aloha Airlines plans to eliminate 79 aircraft maintenance positions even after Aloha mechanics and inspectors this week agreed to an immediate 10 percent pay cut and other concessions to help the troubled carrier emerge from bankruptcy.

High fuel costs, bargain-conscious travelers and stiff competition forced Aloha to file for bankruptcy protection in December, joining Hawaiian Airlines, United Airlines, ATA and US Airways. Aloha said at the time that in 2005 it needed to cut its operating expenses by 15 percent or $60 million.

To help cut costs, Aloha plans to outsource heavy maintenance work performed on three of the company's Boeing 737-200 planes used for inter-island flights, Aloha spokesman Stu Glauberman said yesterday.

The 79 positions to be outsourced represent about 32 percent of the 250 Aloha members in the International Association of Machinists and Aerospace Workers District Lodge 142.

"The number 79 (lost positions) is based on the maintenance work to be outsourced," Glauberman said. "However, it includes existing vacancies that will not be filled. There will be reassignments based on seniority. There will be retirements and workers leaving the company for other reasons. These are not 79 bodies out the door."

Glauberman said it's too soon to know exactly how many workers will lose their jobs.

Workers take pay cut

The outsourced heavy maintenance will be done by a company that specializes in the work and is inspected and certified by the Federal Aviation Administration, Glauberman said. Despite the changes, internal standards will remain high at Aloha, he said.

"We would never compromise the safety of our maintenance program in any way," he said. "We're all going to do our best to make this company succeed."

Aloha mechanics and inspectors voted Monday for a 28-month contract.

"The majority of the membership" approved the contract, said Joseph Tiberi of the union's Washington, D.C., office. Tiberi declined to say how many voted for or against the contract.

It calls for a 10 percent pay cut through Dec. 31, 2006, on top of a 10 percent reduction for both union and management employees that went into effect in December 2004. An expected 2 percent pay increase that was due in 2006 will be eliminated.

A beginning aircraft mechanic's current hourly wage of $14.48 now drops to $13.03. In January 2007, it would then rise to $13.68. A top-scale aircraft mechanic's current $22.02 hourly salary will fall to $19.82, then increase to $20.81 in 2007.

The highest-paid workers in the union, top-scale maintenance/dock planners, currently earn $22.40 an hour. Their pay drops to $20.16 and will rise in 2007 to $21.17.

Outsourcing allowed

The new contract specifies that Aloha can outsource former union work and furlough employees. It also freezes the union's defined benefit retirement plan and eliminates the defined benefit plan for workers hired after the beginning of this year.

If the freeze continues beyond June 2007, employees will instead receive 3 percent of their salary into a 401(k) plan.

The members of IAM 142 were the last of Aloha's five unions to approve a new contract. The company asked all unions to make similar sacrifices in their new contracts.

David A. Banmiller, Aloha's president and chief executive officer, met with mechanics and inspectors yesterday in what is known as a "hangar hui."

"This decisive action by Aloha's mechanics and inspectors brings to a close an important chapter in our reorganization. With the support of all of our employees, Aloha can move quickly toward its goal of emerging from bankruptcy as a stronger, more competitive airline," Banmiller said in a statement yesterday.

Reach Dan Nakaso at dnakaso@honoluluadvertiser.com or at 525-8085.