In their talks with labour unions, four US majors are achieving widely divergent results. FedEx and Delta have resolved protracted negotiations with their pilots. However, American Airlines is still deadlocked with its pilots after almost two years of talks. United Airlines' flight attendants have narrowly defeated a new contract with a novel approach to bargaining.
At FedEx, a two-year negotiation that saw angry pilots initiate holiday work slowdowns last December, came to an end as pilot representatives bowed to management's demands for work-rule changes, with pay increases being tied to company profits. The 3,000 pilots, some disillusioned with their first round of collective bargaining, were expected to approve the settlement.
Delta also was preparing for a final vote over a new pilot contract that will include work-rule changes and allow the establishment of a new low-fare subsidiary to compete with carriers like ValuJet. The results, which will set the tone for many of the other US majors' pilot talks, were expected at the end of April. Delta has long maintained that pilot concessions are a key component in the plan to reduce unit costs.
American, in discussions with its pilots since June 1994, has put forward a 'me too' contract that envisages a low-fare carrier that could save the airline 30 per cent on pilot wages, but would fly long-haul routes as well as short-haul. However, on the eve of a two-week, federally mediated negotiation in the second half of April, a spokesman for the Allied Pilot's Association dismissed the proposal while criticising the Delta plan: 'We see no reason to partake in pattern bargaining. We're not interested in seeing 20 per cent of our pilots take a 30 per cent pay cut.'
At United, a 300-vote margin was enough to turn back efforts by chairman Gerald Greenwald to achieve a new, 'pre-negotiated' contract with its 18,000 flight attendants. Sources say the Association of Flight Attendants membership could not accept a contract that only offered job security with pay increases open to negotiation in 1998.
'If they had simply addressed retirement issues, that would have done it,' says Kevin Lum, president of the AFA Master Executive Council at United. He says the difference was over $42 million relating to a complex linkage between flight attendant savings plans and retirement plans. Management would not relent on its demands that flight attendants cover the full cost of both plans. 'If United hadn't been so greedy, this contract could have been had.' Sources say that Greenwald could not rationalise giving wage increases to only one group of workers, albeit the one group that has no stock investment in the company.
United has blamed two union locals for campaigning hard against the contract. In mid-April it told analysts that without the negotiated language on hiring new foreign-language flight attendants it will probably be forced to open domiciles outside the US, beginning with Japan - one of the most contentious issues.
United probably faces a prolonged negotiation. Depending on management's decisions on new foreign domiciles, this period could also be marked by 'pressures' on flight attendant productivity, Lum says. 'A strike is a long way down the road. But the flight attendants are unhappy, and that has to pose a direct threat on the airplane. Morale is very low.'
Mead Jennings
Source: Airline Business
