Tuesday, January 11, 2005
By Dan Fitzpatrick, Pittsburgh Post-Gazette
In a final cost-cutting proposal to its machinists union, US Airways
wants to eliminate the jobs of as many as 2,000 mechanics, airplane
cleaners, stock clerks and other technical workers.
The cuts, detailed in a document obtained by the Pittsburgh
Post-Gazette, are part of a final push for $1 billion in annual
savings from all unions that the airline says it must have to exit
bankruptcy.
The International Association of Machinists, the only union not to
approve a new round of concessions with the troubled airline, agreed
last week to send the offer to its 8,800 members for a vote. The votes
will be tallied Jan. 21.
A federal bankruptcy judge voided the IAM's contracts last week, but
the airline agreed not to impose new terms until the rank and file
votes on the new offer. The union, in turn, will not strike while the
votes are being tabulated.
US Airways, undergoing its second bout with bankruptcy this decade, is
seeking a total of $268 million in annual savings from the IAM, not
counting the termination of the union's pension plan and cuts in
retiree health care. The airline claims that "anything less than the
necessary savings may result in the failure of the company."
The company maintains that "a majority" of IAM jobs would be
preserved, and spokesman David Castelveter yesterday said that the
total number of jobs cut could decline in the coming days, depending
on the outcome of talks with the IAM.
The question, of course, is whether workers will be willing to approve
an agreement that eliminates some jobs for the sake of perhaps
preserving even more.
"I wish I could vote 'no,' said Frank Schifano, president of the IAM
Lodge 1976 in Pittsburgh and a member of the union's negotiating
group. "But the alternatives are so grave. Every member is going to
have to evaluate his own position."
The airline is offering a severance package and retiree medical
coverage for people who retire before March 1. If members vote down
the agreement, those incentives will be gone, Schifano said.
"Vote 'yes,' lose your job and get severance," he said. "Vote 'no,'
lose your job and get nothing."
Under the proposal about 2,600 of the company's 4,600 mechanics, stock
clerks, cleaners, inspectors and other technical workers would remain,
or 56 percent.
Hardest hit in that group, however, are the 848 airplane cleaners --
798 would lose their positions to outsourcing. The remaining 50
cleaners would see their base pay drop by 15 percent.
The proposal also cuts the number of stock clerks from 400 to 268, and
reduces their pay 15 percent. The number of mechanics would drop from
about 3,000 to 1,800, with the remaining mechanics losing 8 percent of
their base pay.
The airline also reserves the right to outsource the work of some
baggage handlers in certain cities, although Pittsburgh is not among them.
The good news, Schifano said, is that the union was able to save lots
of jobs during negotiations and keep some maintenance work in
Charlotte, N.C., and Pittsburgh.
Everyday maintenance checks will continue to be performed in both
cities, along with Philadelphia, New York, Washington, D.C. and Boston.
Ground service equipment work will continue to be done in Charlotte,
Pittsburgh and Philadelphia, and heavy maintenance work for some new
Airbus planes that had been done by outside vendors will be brought
in-house.
Maintenance on Boeing 737s that is done every three days also will be
kept in house, along with one-half of the maintenance done on Boeing
737s every 25 days or so.
But the company reserves the right to outsource maintenance on other
Boeing 737s, plus all Boeing 757s, Boeing 767s and Airbus A330s, along
with so-called "shop work."
The fact that some work will be kept in Charlotte and Pittsburgh under
the company's last proposal is a victory for the IAM. At one time, the
company wanted to shut down one of its maintenance facilities, a move
that would have saved US Airways $40 million a year.
Allegheny County Chief Executive Dan Onorato said he spoke again with
US Airways officials by phone yesterday as part of his efforts to keep
maintenance and reservation facilities in the Pittsburgh area. He said
the carrier has yet to finalize its plans, but confirmed that one
option is to retain maintenance facilities in Pittsburgh and Charlotte.
Airline officials gave Onorato "no indication at all" when a decision
would be made on that work or where it might consolidate its two
reservation centers, currently in Green Tree and Winston-Salem, N.C.
US Airways faces several other hurdles this week to keep its survival
plan on track, including finding an additional $100 million to keep a
financing agreement intact with aircraft lender General Electric.
It also must negotiate the continued use of more than $700 million in
bankruptcy financing backed by the federal Air Transportation
Stabilization Board. Its use of that money expires Thursday, and the
company is talking to the ATSB about an extension. An expiration of
the agreement could force US Airways to ground its planes.
