NWA pilots ask other unions to take cuts
05-19-2005, 09:35 AM
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NWA pilots ask other unions to take cuts
Last update: May 18, 2005 at 9:07 PM
Pilots to other NWA unions: Take cuts
Liz Fedor
Star Tribune
Published May 19, 2005
The head of the pilots union at Northwest Airlines is warning that the airline faces the threat of bankruptcy, and he implored other unions to accept cutbacks to save employees' jobs and the airline.
"The time has come for all union leaders to move beyond denial and anger and act responsibly for the good of their members," said Mark McClain, chairman of the Northwest branch of the Air Line Pilots Association (ALPA).
His message met with little sympathy Wednesday from other union leaders at the airline, however.
Last November, Northwest's pilots became the first of the airline's major labor groups to ratify a contract that reflects the company's financial straits, accepting a 15 percent pay cut. Northwest management is attempting to reduce the carrier's annual labor costs by $1.1 billion.
The pilots' new contract saves the Eagan-based airline $265 million a year, and Northwest has reduced the compensation of its salaried employees by $35 million a year.
"Northwest, just like the other major carriers, cannot avoid bankruptcy if it continues to lose money at the current rate. It's that simple," McClain said in a memo to Northwest pilots. The airline lost $458 million during the first quarter.
McClain's comments drew a sharp reaction from the Aircraft Mechanics Fraternal Association (AMFA), which is in mediated contract talks.
"AMFA has already given more than any other labor group -- $350 million-plus in headcount reductions," said Jeff Mathews, AMFA's contract coordinator. Roughly 3,500 AMFA jobs have been cut by Northwest, Mathews said during a break in negotiations Wednesday.
"It is presumptuous of Capt. McClain to expect us to allow the wholesale elimination of our membership jobs in order to preserve pilot jobs and lucrative pensions," Mathews said. "AMFA has never attempted to interject our views on ALPA's membership, and the AMFA negotiating committee expects the same courtesy from Capt. McClain."
In addition to tough bargaining talks, the mechanics union is facing more layoffs.
Northwest plans to furlough 669 mechanics on or about July 14, Minnesota state officials confirmed Wednesday. Northwest announced in March that it would cut hundreds of jobs because it is taking 30 DC-9s out of service. The airline has notified the state that it will cut a total of 826 jobs based in the Twin Cities by July.
Those job reductions include 46 general inspectors and 30 cleaners represented by AMFA. Twenty-three work control clerk and 54 stock clerk positions also will be dropped. Those workers are represented by the International Association of Machinists and Aerospace Workers (IAM).
Northwest management wants to bring its workers' pay into closer alignment with the pay rates and work rules at bankrupt United Airlines, a key competitor. On Monday, United's AMFA negotiators reached a tentative agreement that includes a 3.9 percent pay cut for its members. That reduction would be on top of 14 percent pay cuts that were implemented two years ago at United.
Like AMFA's Mathews, Bobby DePace of the IAM was unmoved by the warning from the head of Northwest's pilots union, although he acknowledged the bankruptcy potential. DePace said his negotiators will retain a firm stance with Northwest on the issue of pensions.
"If they don't do anything with pensions to give us parity with everybody else, we're not going to give away work rules or concessions or anything," DePace said. "We've got bankrupt airlines getting better pensions than us," he said, referring to US Airways and United.
Under the current contract, an IAM member at Northwest gets monthly pension benefits of $51 for every year of service, he said, or $1,530 a month for a 30-year employee.
DePace, who has worked with McClain since 1999, said he was not disturbed by the pilot leader's comments, which were released to the news media Wednesday. "I have a good relationship with Mark, and I respect Mark McClain," DePace said.
Considering the high fuel prices and low fares that have hurt Northwest and other carriers, DePace said he concurs that bankruptcy is possible for Northwest.
"I can agree with Mark that there is an urgency," DePace said. "If Northwest doesn't get what they feel is appropriate [in labor cutbacks], yes I think they would go bankrupt."
In his memo, McClain wrote, "There is the possibility that losses in the fourth quarter 2005 and first quarter 2006 may deliver a devastating blow to our company. If Northwest's cash balance falls below an acceptable risk for the Northwest board of directors, there will be a Chapter 11 filing.
"It is time for everyone at our airline to face reality. The fact is our company is in financial jeopardy, and the other unions need to join us in an effort to ensure Northwest's viability."
Jeff Gardner, vice president of the Professional Flight Attendants Association, avoided directly criticizing McClain. But he said, "We are not going to promote fear mongering amongst our group" over a bankruptcy threat.
"We will listen to what our membership wants," Gardner said. "As far as this big issue of bankruptcy, I'd like to know what information these people who are running about screaming have been given. We haven't been given that information."
A Northwest spokesman declined Wednesday to comment on the pilots' memo.
Northwest CEO Doug Steenland said recently that four factors are driving Northwest's losses: high fuel prices, a surplus of seats in the U.S. airline market, low fares and its "noncompetitive labor costs."
"The primary remedy remaining to us, and within our control, is to restructure our labor costs," Steenland said in a message to employees.
In an interview Wednesday, Andrea Fischer Newman, Northwest's senior vice president of government affairs, did not speculate on the potential for a bankruptcy filing. But she stressed that Northwest is lobbying for pension legislation in Congress that would improve Northwest's financial condition by giving the airline 25 years to fully fund its defined-benefit pension programs.
Liz Fedor is at
[email protected].
© Copyright 2005 Star Tribune. All rights reserved.
Pilots to other NWA unions: Take cuts
Liz Fedor
Star Tribune
Published May 19, 2005
The head of the pilots union at Northwest Airlines is warning that the airline faces the threat of bankruptcy, and he implored other unions to accept cutbacks to save employees' jobs and the airline.
"The time has come for all union leaders to move beyond denial and anger and act responsibly for the good of their members," said Mark McClain, chairman of the Northwest branch of the Air Line Pilots Association (ALPA).
His message met with little sympathy Wednesday from other union leaders at the airline, however.
Last November, Northwest's pilots became the first of the airline's major labor groups to ratify a contract that reflects the company's financial straits, accepting a 15 percent pay cut. Northwest management is attempting to reduce the carrier's annual labor costs by $1.1 billion.
The pilots' new contract saves the Eagan-based airline $265 million a year, and Northwest has reduced the compensation of its salaried employees by $35 million a year.
"Northwest, just like the other major carriers, cannot avoid bankruptcy if it continues to lose money at the current rate. It's that simple," McClain said in a memo to Northwest pilots. The airline lost $458 million during the first quarter.
McClain's comments drew a sharp reaction from the Aircraft Mechanics Fraternal Association (AMFA), which is in mediated contract talks.
"AMFA has already given more than any other labor group -- $350 million-plus in headcount reductions," said Jeff Mathews, AMFA's contract coordinator. Roughly 3,500 AMFA jobs have been cut by Northwest, Mathews said during a break in negotiations Wednesday.
"It is presumptuous of Capt. McClain to expect us to allow the wholesale elimination of our membership jobs in order to preserve pilot jobs and lucrative pensions," Mathews said. "AMFA has never attempted to interject our views on ALPA's membership, and the AMFA negotiating committee expects the same courtesy from Capt. McClain."
In addition to tough bargaining talks, the mechanics union is facing more layoffs.
Northwest plans to furlough 669 mechanics on or about July 14, Minnesota state officials confirmed Wednesday. Northwest announced in March that it would cut hundreds of jobs because it is taking 30 DC-9s out of service. The airline has notified the state that it will cut a total of 826 jobs based in the Twin Cities by July.
Those job reductions include 46 general inspectors and 30 cleaners represented by AMFA. Twenty-three work control clerk and 54 stock clerk positions also will be dropped. Those workers are represented by the International Association of Machinists and Aerospace Workers (IAM).
Northwest management wants to bring its workers' pay into closer alignment with the pay rates and work rules at bankrupt United Airlines, a key competitor. On Monday, United's AMFA negotiators reached a tentative agreement that includes a 3.9 percent pay cut for its members. That reduction would be on top of 14 percent pay cuts that were implemented two years ago at United.
Like AMFA's Mathews, Bobby DePace of the IAM was unmoved by the warning from the head of Northwest's pilots union, although he acknowledged the bankruptcy potential. DePace said his negotiators will retain a firm stance with Northwest on the issue of pensions.
"If they don't do anything with pensions to give us parity with everybody else, we're not going to give away work rules or concessions or anything," DePace said. "We've got bankrupt airlines getting better pensions than us," he said, referring to US Airways and United.
Under the current contract, an IAM member at Northwest gets monthly pension benefits of $51 for every year of service, he said, or $1,530 a month for a 30-year employee.
DePace, who has worked with McClain since 1999, said he was not disturbed by the pilot leader's comments, which were released to the news media Wednesday. "I have a good relationship with Mark, and I respect Mark McClain," DePace said.
Considering the high fuel prices and low fares that have hurt Northwest and other carriers, DePace said he concurs that bankruptcy is possible for Northwest.
"I can agree with Mark that there is an urgency," DePace said. "If Northwest doesn't get what they feel is appropriate [in labor cutbacks], yes I think they would go bankrupt."
In his memo, McClain wrote, "There is the possibility that losses in the fourth quarter 2005 and first quarter 2006 may deliver a devastating blow to our company. If Northwest's cash balance falls below an acceptable risk for the Northwest board of directors, there will be a Chapter 11 filing.
"It is time for everyone at our airline to face reality. The fact is our company is in financial jeopardy, and the other unions need to join us in an effort to ensure Northwest's viability."
Jeff Gardner, vice president of the Professional Flight Attendants Association, avoided directly criticizing McClain. But he said, "We are not going to promote fear mongering amongst our group" over a bankruptcy threat.
"We will listen to what our membership wants," Gardner said. "As far as this big issue of bankruptcy, I'd like to know what information these people who are running about screaming have been given. We haven't been given that information."
A Northwest spokesman declined Wednesday to comment on the pilots' memo.
Northwest CEO Doug Steenland said recently that four factors are driving Northwest's losses: high fuel prices, a surplus of seats in the U.S. airline market, low fares and its "noncompetitive labor costs."
"The primary remedy remaining to us, and within our control, is to restructure our labor costs," Steenland said in a message to employees.
In an interview Wednesday, Andrea Fischer Newman, Northwest's senior vice president of government affairs, did not speculate on the potential for a bankruptcy filing. But she stressed that Northwest is lobbying for pension legislation in Congress that would improve Northwest's financial condition by giving the airline 25 years to fully fund its defined-benefit pension programs.
Liz Fedor is at
[email protected].
© Copyright 2005 Star Tribune. All rights reserved.
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