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The Honolulu Advertiser
Updated at 3:03 p.m., Friday, May 9, 2008

Aloha Air's lender agrees to pay cargo employees

Advertiser Staff

Aloha Airlines' lender agreed to pay the carrier's cargo employees for work conducted since the middle of April.

Aloha's pilots union had complained that they have not been paid since the middle of last month and that their medical coverage was cut off at the end of March.

During a bankruptcy hearing Wednesday, GMAC Commercial Finance LLC agreed to pay the pilots after the sale of Aloha Cargo is completed as expected on May 14.

But John Dean, an attorney for the Air Line Pilots Association, said it's not clear whether GMAC will pay for medical premiums and other benefits owed to pilots since April 16.

"Everything is somewhat unsettled at the moment," Dean said.

Dean added that the union is in contract negotiations with the cargo division's buyer, Seattle-based Saltchuk Resources Inc.

Saltchuk plans to hire to 35 to 40 of Aloha's pilots but has not said how much the pilots will be paid or what their work conditions will be, said Dean.

Aloha's court-appointed trustee has moved to reject the union contracts for the company's 300 cargo employees

Aloha was the state's second largest carrier before it abruptly shut down its passenger service on March 31. The closing, which resulted in the loss of 1,900 jobs, came 11 days after the company filed for Chapter 11 bankruptcy protection.

"This time is no different. Our pilots are flying without pay, without any guarantee when and if they will receive compensation," said Capt. John Riddel, Aloha Airlines Master Executive Council secretary-treasurer.