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US Airways Update
Judge Imposes Temporary Cost Reductions
Dear Sisters and Brothers,
After four days of hearings, a bankruptcy judge in Alexandria, Virginia today partially approved US Airways’ request for temporary contract modifications for the carrier’s unionized employees. This request was in addition to the $276 million per year in concessions that IAM members are already voluntarily providing the airline as a result of the company’s first bankruptcy.
Judge Mitchell ordered an immediate 21 percent wage reduction. He also limited the term reductions will be in effect to February 15, 2005. US Airways requested that the term extend through March 2005.
Judge Mitchell suspended contract provisions mandating aircraft fleet minimums, and allowed the carrier to temporarily subcontract Airbus heavy maintenance. He refused US Airways the right to subcontract work because of attrition or speculative job actions.
The 401(k) match has been temporarily eliminated, and contributions into the IAM National Pension Plan have been reduced from 5% to 3%.
IAM attorneys argued that US Airways’ requested modifications to the labor agreements were excessive and not essential to the carrier’s survival. US Airways is inappropriately using the 1113(e) process to achieve permanent changes to our collective bargaining agreements.
US Airways plans to file a motion asking the court to reject collective bargaining agreements if consensual agreements for long-term concessions are not achieved. We will respond to such a motion when it is filed.
It is clear that once again US Airways’ strategy is to reorganize on the backs of its employees without any clear plan for success. Unless a viable business plan is in place, no amount of negotiated or imposed concessions will save this carrier.
Today’s ruling will have far-reaching, dramatic consequences on all of US Airways’ unionized employees. The IAM is carefully reviewing the judge’s order to determine its full effect on the membership.
We will keep you updated as the situation develops.
Sincerely and fraternally,
William O'Driscoll
President-Directing General Chairman
IAM DL 142
Randy Canale
President-Directing General Chairman
IAM DL 141
Judge Imposes Temporary Cost Reductions
Dear Sisters and Brothers,
After four days of hearings, a bankruptcy judge in Alexandria, Virginia today partially approved US Airways’ request for temporary contract modifications for the carrier’s unionized employees. This request was in addition to the $276 million per year in concessions that IAM members are already voluntarily providing the airline as a result of the company’s first bankruptcy.
Judge Mitchell ordered an immediate 21 percent wage reduction. He also limited the term reductions will be in effect to February 15, 2005. US Airways requested that the term extend through March 2005.
Judge Mitchell suspended contract provisions mandating aircraft fleet minimums, and allowed the carrier to temporarily subcontract Airbus heavy maintenance. He refused US Airways the right to subcontract work because of attrition or speculative job actions.
The 401(k) match has been temporarily eliminated, and contributions into the IAM National Pension Plan have been reduced from 5% to 3%.
IAM attorneys argued that US Airways’ requested modifications to the labor agreements were excessive and not essential to the carrier’s survival. US Airways is inappropriately using the 1113(e) process to achieve permanent changes to our collective bargaining agreements.
US Airways plans to file a motion asking the court to reject collective bargaining agreements if consensual agreements for long-term concessions are not achieved. We will respond to such a motion when it is filed.
It is clear that once again US Airways’ strategy is to reorganize on the backs of its employees without any clear plan for success. Unless a viable business plan is in place, no amount of negotiated or imposed concessions will save this carrier.
Today’s ruling will have far-reaching, dramatic consequences on all of US Airways’ unionized employees. The IAM is carefully reviewing the judge’s order to determine its full effect on the membership.
We will keep you updated as the situation develops.
Sincerely and fraternally,
William O'Driscoll
President-Directing General Chairman
IAM DL 142
Randy Canale
President-Directing General Chairman
IAM DL 141