Mechanics Vote Down US Airways Pay Offer
Carrier to Seek Court Approval to Force Cuts

By Keith L. Alexander
Washington Post Staff Writer
Thursday, August 29, 2002; Page E01

The 6,800 mechanics of bankrupt US Airways early today rejected a cost-cutting plan proposed by the airline, setting the stage for a court fight over whether to nullify the mechanics' union contract.

US Airways management, saying it needs to cut costs substantially to survive, had said it would ask the U.S. Bankruptcy Court in Alexandria for permission to impose more severe pay and benefit reductions on any group of employees that didn't agree to voluntary concession packages.

The mechanics, represented by the International Association of Machinists, voted by a 57 percent margin against the agreement, the union said on its Web site. The airline was seeking $154 million a year in concessions.

"Our attorneys are prepared to defend our mechanical and related members and their contracts in bankruptcy court," Robert Roach Jr., IAM general vice president, said in a statement. "The bankruptcy filing is only the first step of a long legal process, and our members can be assured we will defend their rights throughout these proceedings."

The proposal called for a 6.8 percent pay cut through 2004, then 2 percent increases in each of the following four years, as well as significant reductions in sick leave and other benefits.

However, US Airways' 5,400 baggage handlers and fleet service workers, who are also represented by the same union, approved their agreement by a 62 percent majority. That agreement calls for a $65 million a year pay cut, or about 8.5 percent, through July 1, 2005. At that time, the employees will get a 2 percent pay raise each year. The agreement also gave the baggage handlers an equity stake in the airline as well as a profit-sharing plan that have yet to be determined.

Joe Tiberi, a spokesman for the mechanics, said the union has not set another vote before the airline's Sept. 10 bankruptcy court hearing. At that hearing, US Airways said it would ask for permission to nullify labor contracts with groups that have not agreed to the cost reductions.

The nation's seventh-largest airline, which lost nearly $2 billion last year and has the industry's highest costs, is trying to secure about $1 billion in wage concessions from its employees. The airline still has not reached an agreement with 7,200 reservation and airport ticket-counter agents represented by the Communication Workers of America. US Airways is seeking $70 million a year from that group.

US Airways has secured more than $550 million in concessions from its pilots and flight attendants. It has also reached agreements with its flight dispatchers and simulator engineers, represented by the Transport Workers Union, as well as with flight-crew training instructors.