You're never going to believe this... (sarcasm)

[labbats]

Judge delays action on United union strike sanction

CHICAGO (Reuters) — A federal judge Thursday delayed action until June 7 on a key United Airlines labor union bid to get the court to sanction a threatened labor strike.
The delay, however, would not stop the International Association of Machinists and Aerospace Workers from calling a strike next week if a bankruptcy judge allowed United, a unit of UAL, to void a labor contract with the ground workers represented by the union, an IAM spokesman said.

"We're not asking for (court) permission. We're asking them to prevent United from interfering," said IAM spokesman Joseph Tiberi.

The IAM has threatened a labor strike if the No. 2 U.S. carrier terminated its collective bargaining agreement without a new consensual deal in place.

United is in negotiations with the union, but Judge Eugene Wedoff had said he would issue a verdict on May 31 if they failed to come to an agreement on a concessions package.

United and its unions have completed arguments in a trial in which the bankrupt carrier asked for permission to end collective bargaining agreements with labor groups which have not yielded the cost savings the airline says it needs to exit Chapter 11.

UAL Chief Financial Officer Jake Brace said negotiations continued Thursday and "the attitude remains good."

United, which also faces strike threats from its mechanics union and its flight attendants union, has said a strike under the circumstances would be illegal.

United, in bankruptcy since December 2002, has said it needs $700 million in annual labor savings to exit Chapter 11 bankruptcy protection. The IAM-represented employees are the only labor group with which UAL has no deal.

 

[Rick James]

Will they ever strike (an honest question)? This always seems to be simply a threat, not that I want to see it happen. United says a strike would we illegal, but wouldnt the have to get an injunction quick if the IAM decided to walk?

 

[On Your Six]

Just a lot of talk. I am former UAL (furloughed) and even I know that this deck of cards will fold for the mechanics. Tough talk but no action likely... Expect more labor cuts and benefits reductions while the management secures higher retention bonuses... And now NWA will can thousands of mechanics... Gotta love this business.

 

[seefive]

all the talk of an illegal strikes kills me. if they want to strike (not saying they should or shouldn't), strike. who cares what the courts say.

 

[Big Duke Six]

I'm at a loss here.


I admit I am sort of new to all this, but I can't for the life of me see how a company can on one hand feel it's legal to terminate a labor contract and at the same time claim that a strike would be illegal. I'm guessing their claim of illegality stems from something written into their current contract with the IAM, but if UAL terminates it, how can the no-strike clause be enforced?

Can someone educate me on this?

I wish the IAM would press-to-test on this one. I know everyone says mgmt will be taken care of if they close the doors, but I really don't feel there is anywhere for them to go in this beleaguered industry. They'd be unemployed for awhile. The precedant needs to be stopped before it gains a foothold.

 

[ualdriver]

Simply put, it's a matter of 1113(c) of the bankruptcy code vs. the Railway Labor Act, neither of which I will claim to be an expert on. But here are the bullets:

UAL management wants to terminate the IAM's original contract under the 1113(c) process of the bankruptcy code. They've already temporarily cut the IAM contract under 1113(e) of the bankruptcy code back in January, in the hopes that the two parties could reach an agreement by now, which they haven't. Our bankruptcy judge said that on May 31st, he'll rule on whether or not UAL will be allowed to terminate and replace the original IAM contract with one that UAL management wants.

Now here's where the fun begins. If the IAM and UAL management can't come to a mutually negotiated settlement by the time the judge rules on the 31st, the judge will impose a contract upon the IAM. The contract will be concessionary in nature, proportional to the same concessions that the other unions on the property have already negotiated. As far as the IAM is concerned, if the judge imposes a contract, they no longer have a contract as defined under the Railway Labor Act, and therefore they are free to strike. UAL management feels that they DO have a contract, it's just a different one imposed by the judge, so therefore they DON'T have a right to strike under the Railway Labor Act.

Are you still with me? Good! So if UAL and the IAM don't come to an agreement and the judge imposes a contract on May 31st, obviously the IAM will call a strike, and the IAM knows that UAL will try to obtain an injunction to stop the strike, at least temporarily. So the IAM went to the U.S. District Court last week to obtain a restraining order to prevent UAL management from preventing the IAM from striking through an injunction if their contract is replaced on May 31st. The U.S. District court said they won't rule on the restraining order until June 7th. So here we go.

Plus, AMFA (mechanics, cleaners) vote on their negotiated contract on May 31st. If that gets voted down, will they strike as well? If they do, when will they strike? Right away or do they negotiate some more? Inquiring minds want to know!

All of the unions know that UAL probably can't survive a real strike and they'll be putting themselves out of a job. So the IAM is in a bind as if they don't strike, I guess it could be perceived as weakness. If they do strike, they'll probaby put their 20,000 members out of a job in short order. Decisions, decisions.

Worst case scenario: The IAM and UAL don't reach an agreement and the judge imposes a new contract upon the IAM under 1113(c) of the bankruptcy code on May 31st. The IAM then goes on strike, UAL tries to get an injunction from our bankruptcy judge or another court and fails, and then UAL probably goes to the big hangar in the sky. The IAM strikes a ghost at the airport with really catchy slogans and neato strike signs while there is a UAL fire sale in downtown Chicago.

If you can avoid bankruptcy, do it at all costs!

 

[Draginass]

When you put people's backs to the wall, sometimes they react pretty strongly. The legality of a general strike is a irrelevant point.

My feeling is that the IAM fold, but then declare victory. The company will come out with the typical "tough choices" and "sacrifices of our employees" news sound byte.

The sad truth is that management hasn't a clue on how they're going to get this airline upright again.

 

[Big Duke Six]

Thanks, UALDriver. I appreciate the time you put into the post!

Like Draginass, I too see the "legality" of a strike as being a moot point. But, I suppose from UAL mgmt's point of view, determining if a strike is legal or not is important because if it is illegal, they can go back later and sue the IAW for the untold billions in losses when the company folds?

I think this really shows that mgmt is truly, truly, truly out of touch with labor. They apparently are so arrogant and disconnected that if (in their minds) a strike is "illegal", that they can do whatever they want with impunity and do not have to fear the consequences. This is the sickness that has been pervading this company for years. It is sad that trust has been lost on both sides and that mgmt does not try to lead the company anymore, they just push it around.

 

[dash8driver]

as precarious as UAL is at this point, one strike...legal or not could close the doors on the company before they, or GWB could intervene. by that time it'd be too late, damage done... wouldnt matter if it was illegal or not. there would be no place for the judge/gwb to force them back to work at.

 

[ualdriver]

Thanks, UALDriver. I appreciate the time you put into the post!

Like Draginass, I too see the "legality" of a strike as being a moot point. But, I suppose from UAL mgmt's point of view, determining if a strike is legal or not is important because if it is illegal, they can go back later and sue the IAW for the untold billions in losses when the company folds?

I think this really shows that mgmt is truly, truly, truly out of touch with labor. They apparently are so arrogant and disconnected that if (in their minds) a strike is "illegal", that they can do whatever they want with impunity and do not have to fear the consequences. This is the sickness that has been pervading this company for years. It is sad that trust has been lost on both sides and that mgmt does not try to lead the company anymore, they just push it around.

If a strike by the IAM is deemed illegal, it is a big deal. The UAL IAM leaders could literally be thrown in jail, and the union could be fined 10's of millions of dollars (or more). Just look at what happened unfortunately at American when their pilot sickout was deemed illegal.

As far as the cuts go, the IAM members are not being asked to give up anything more or less (well actually less, but that's another story) than the other employee groups on the property. I'm not sure that a strike by their membership would accomplish anything other than increase the number of people on some sort of welfare in my state, but the IAM has their own agenda.

 

[P3-Adub]

So how is the mood around the property these days ? Really think they will sink the ship out of spite ? Not like slinging bags is going to be that hard of a job to replace. I know there are a lot of good people in the IAM, just hope they are getting good advice from their representation. That being said though, I think that there is entirely too much complaining considering how much other groups have given, give me a break !

 

[skykid]

I think this really shows that mgmt is truly, truly, truly out of touch with labor.

Have to disagree with you on that one. UAL mgt is in negotiations! Calling a would be strike illegal is part of it. I'd have to wonder about their competency if they didn't use the "illegal strike" tool. They know exactly what they are doing and what the situation is. This is no bluff where there is actually another solution where the IAM can take a fraction of the concessions needed and UAL still gets exit financing. Just kidding guys, you can have your pensions back - never mind Frontier, Airtran, Jetblue, SWA, and any other airline growing seats by double digits doesn't have one. United's contracts will mirror roughly what the LLCs have, with retirement benefits on the top end like Airtran. It would have been nice if the industry could have built on the contracts United and Delta got through - that didn't happen for more reasons than can be contained in this post.

The sad truth is that management hasn't a clue on how they're going to get this airline upright again.

Not hardly. I would have agreed if Goodwin, Doo-daa, and the gang were still around, but Tilton knows what he is doing. Most people can't see that because they are too busy hoping United will die for their own selfish reasons, or are so hung up on the evils of management they couldn't think about it objectively if they had to.

 

[G100driver]

If Tilton is such a great guy, why did he and his cronies keep their pensions while terminating everyone else's?

Any wonder why airlines are in management mess that they are in.

 

[skykid]

Hey G100, if you can show me where I said he was a great guy, I'd like to see it. However, I will repeat for your benefit since it seems to apply:

or are so hung up on the evils of management they couldn't think about it objectively if they had to.

 

[G100driver]

Not hardly. I would have agreed if Goodwin, Doo-daa, and the gang were still around, but Tilton knows what he is doing.

 

[FlyBoeingJets]

The sad truth is that management hasn't a clue on how they're going to get this airline upright again.

Maybe, but I disagree. I think the sad truth is they are on a proven path toward getting upright and there seems to be no way to stop them. USAir is still attracting much capitol after gutting pensions and pay. There are some employees who will never quit no matter how much you abuse them.


America West, US Air get new funds
Sunday May 29, 10:47 pm ET


NEW YORK (Reuters) - The proposed merger of US Airways Group Inc. (OTC BB:UAIRQ.OB - News) and America West Holdings Corp. (NYSE:AWA - News) has received a new pledge of $150 million from an investment firm, the Wall Street Journal reported on its Web Site on Sunday.

According to the newspaper, which obtained the information from a filing with the U.S. Bankruptcy Court in Alexandria, Virginia, Boston-based Wellington Management Co LLP pledged $150 million in new equity to the combined company. Wellington has $423 billion of funds under management, the Journal said.

The total pledges for the new company now total about $500 million, the report added.

On May 19, US Airways and America West announced plans to merge in order to compete more aggressively with low-cost rivals. The airline would become the sixth largest domestic carrier as measured by passenger revenue, and would use the US Airways name. The combined carrier would also fly internationally.

U.S. Bankruptcy Court Judge Stephen Mitchell is expected to grant a motion on Tuesday to set guidelines for other investors to make offers that compete with the merger plan, the newspaper reported.

The companies currently employ 43,000 people and operate roughly 400 aircraft combined.

Key investors to the deal include ACE Aviation Holdings Inc. (Toronto:ACERV.TO - News), Air Canada's parent, and Boston's PAR Capital Management. General Electric Co. (NYSE:GE - News) will take back planes and Airbus (Paris:EAD.PA - News) will provide a $250 million loan in exchange for being the A350 launch customer.

America West stock rose two cents, to $5.48 a share, on Friday in trading on the New York Stock Exchange.

 

[ualdriver]

If Tilton is such a great guy, why did he and his cronies keep their pensions while terminating everyone else's?

Any wonder why airlines are in management mess that they are in.

Tilton is the only member of UAL management that got to keep his pension. And long story short, it was his pension from Chevron (his former employer) and not a UAL pension. All other UAL management personnel lost their pensions and are subject to the benefits provided by the PBGC, just like everyone else. In fact, some ex-management people sued UAL for their pensions, claiming that they couldn't live on the benefits provided by the PBGC. Let's just say that they lost their cases.......

 

[ualdriver]

So how is the mood around the property these days ? Really think they will sink the ship out of spite ? Not like slinging bags is going to be that hard of a job to replace. I know there are a lot of good people in the IAM, just hope they are getting good advice from their representation. That being said though, I think that there is entirely too much complaining considering how much other groups have given, give me a break !

The mood on the property is very good, believe it or not. In fact, we've had our best operational performance while in bankruptcy and taking it up the shorts with pay and concessions........go figure. Generally, despite the 94% strike vote, most IAM members that I have talked to are generally clueless about what is going to happen over the next couple of days. Few understand the difference between striking a company in bankruptcy (like cutting your nose off to spite your face) and striking a healthy company under section 7 of the RLA. I assume few will cross the picket lines if there are any, and probably won't realize how fast things can get ugly until they're applying for unemployment benefits with the rest of us in their respective states. I'm sure the IAM leadership will declare victory,though, if that happens!

As far as replacing their jobs, I think the guys on the low end of the seniority scale will be able to find similar paying jobs. However, the guys pulling in $15/hr or more + full benefits + retirement (yes, there still is a small retirement benefit) will have a hard time finding a job of similar pay and quality unless they have a college degree or some sort of vocation. That's their problem to figure out I guess.

ualdriver

 

[ultrarunner]

Hey, when has an airline in dire straights been saved by concessions by an employee?

Was is EAL, PAA, TWA, I can't remember...

someone help me out here.

 

[UALjan15]

Hey, when has an airline in dire straights been saved by concessions by an employee?

Was is EAL, PAA, TWA, I can't remember...

someone help me out here.

How about....American Airlines post 9/11? Concessions definitely kept them out of CH11, now whether it was enough to weather this entire sh!tstorm remains to be seen.