Delta, Pilots Union Reach Tentative Deal
By HARRY R. WEBER, AP Business Writer1 hour, 10 minutes ago
Delta Air Lines Inc. and negotiators for its pilots union reached a tentative agreement Friday on long-term pay and benefit cuts that could avert a strike at the nation's third largest carrier and ease uncertainty among travelers over the busy holiday weekend.
No details of the agreement were released, but the deal means the two sides have cleared a major hurdle though they are not out of the woods yet. The deal is subject to ratification by the airline's 5,930 pilots and must be approved by the bankruptcy court.
The pilots union had threatened to strike if its contract was thrown out. Delta, which has been operating under bankruptcy protection since September, has said in court papers that a pilot strike would put it out of business.
An arbitration panel had until Saturday to reach a decision on Delta's request to throw out its pilot contract so it could impose up to $325 million in annual pay and benefit cuts. That decision is now on hold with the tentative agreement, but it could resurface if the rank-and-file pilots reject the agreement. No date for a vote was set.
"I'm very pleased the parties have reached a tentative agreement," the panel chairman, Richard Bloch, told The Associated Press.
The deal, if approved, would replace an interim pay cut deal the two sides reached in December.
In a statement, Delta said the airline believes passengers can book with confidence.
"We have worked hard together as a team to forge an agreement that is good for Delta and all of its constituents," said Delta's chief financial officer, Ed Bastian.
Meanwhile, talks are continuing between Delta's wholly owned subsidiary, Comair, and its flight attendants. A federal bankruptcy judge agreed this week to postpone until Monday a decision on whether to void Comair's contract with its flight attendants. Both sides requested the postponement to allow more time for negotiations.
The regional airline, based just across the Ohio River from Cincinnati in Erlanger, Ky., filed for bankruptcy protection along with Delta last year. Comair is seeking $8.9 million in wage cuts and other savings from the flight attendants.
Delta's pilot strike threat had unnerved passengers, some of whom scrambled to make alternate travel plans over the holiday weekend. The threat also hurt bookings on the Atlanta-based airline.
Delta's mainline carrier operates 1,722 daily flights and had more than 118 million passengers last year. It has its second-largest hub at Cincinnati/Northern Kentucky International Airport.
In a memo to Delta pilots, the chairman of the union's executive committee, Lee Moak, said the deal was reached early Friday morning. He said the union's governing body will meet in the next week to discuss the deal and determine whether to recommend it to the membership.
"We will not hurry," Moak said. "We will proceed in an unrushed, methodical manner."
Delta's pilots previously agreed to $1 billion in annual concessions, including a 32.5 percent wage cut, in a five-year deal in 2004. But Delta, which has imposed pay cuts on other employees, said it needs more from its pilots.
The company says the average earnings of pilots last year who worked the full year was more than $157,000. But the pilots union has said the figure was inflated by overtime and they have projected a significant decrease in average pilot earnings for 2006.
The negotiations between the company and the union picked up steam on Tuesday, when negotiators for both sides intensified talks at the Grand Hyatt hotel in New York. Those talks continued through the night Thursday.
Delta pilot Keith Rosenkranz, who has been with the company 15 years and generally flies international routes to Europe and South America, said he's not sure how he will vote on the deal. He said he needs to see the details first.
"I was a little worried last night that my last landing in Rome was the last of my career," said Rosenkranz, who lives in Grapevine, Texas.
He said he's glad at least there is some sort of resolution, though union member ratification is still an unanswered question.
"I think the Delta pilots have always been willing to help the company in a time of need," Rosenkranz said. "We've proven that repeatedly over the years. But there does come a point when you have to stand up for your profession and the things that you negotiated in good faith, and if the company is not willing to recognize that then I'm not going to vote for something that continues to take."
At Hartsfield-Jackson Atlanta International Airport, passengers said they were relieved by news of the tentative deal.
"I just had my fingers crossed," said Rose Shefrin of Baltimore, as she waited to pick up her baggage after having arrived on a Delta flight for a few days with relatives. "I had hoped that they would work it out and I'm so happy that they did."
Associated Press Writer Doug Gross in Atlanta contributed to this report.