United Airlines pilots' deal sparks backlash from other unions
HONG KONG (AFX) - The pensions deal United Airlines signed with its pilots is
conditional on the termination of all pension plans at the airline, even as the
pilots are partly compensated for the loss of their retirement packages by 550
mln usd in convertible notes, the Financial Times reported on its website.
The FT, which obtained a copy of the pilots' deal, said the contract they
negotiated has sparked a backlash from other unions at United, a unit of UAL
Corp, the report said.
Pat Friend, president of the Association of Flight Attendants, said in an
interview with the FT: "I think (the Airline Pilots Association) should be
expelled from the AFL-CIO. They have no idea what being a trade unionist means."
The report said the deal signed by the pilots undercuts efforts by some of
United's unions to seek a trustee to replace management.
It suggested that the pilots' interests are lined up with management's, with the
agreement subject to terminated if United loses its "exclusive right to file a
plan of reorganization," and in the event of the "appointment of a trustee in
the bankruptcy case."
"If they fail to get 500 mln usd from other unions, they can terminate this,"
Friend said. "And if management is replaced, they can terminate this. It looks
like a mutual protection deal to stop the pesky flight attendants and mechanics
from filing for a trustee, while selling out their pensions.They are really
despicable."
United's flight attendants are voting on a proposal to authorize a strike, with
vote counting due on Dec 30, the report said.
Further challenges to United's pilot deal could come from creditors and from the
Pension Benefit Guaranty Corporation, the agency that would have to pick up
about 6.4 bln usd in liabilities if United's pensions were terminated, the
report said.
On Friday PBGC executive director Bradley Belt said the deal with the pilots
"sets a dangerous precedent. The company is making generous new pension promises
even as it is refusing to honor its old promises. United and the pilots' union
have no authority to force other workers and the PBGC to accept termination of
those plans."