Delta Air Lines Inc. subsidiary Comair can toss out its contract with its flight attendants and impose concessions that the regional airline says it needs to emerge from bankruptcy, a judge ruled Friday.
Comair "has demonstrated beyond doubt that a material reduction in Comair's flight attendant costs is essential to the company's ability to be successful in the extraordinarily competitive regional airline market of today," wrote Judge Adlai Hardin of U.S. Bankruptcy Court.
The airline and the union indicated they intended to continue their talks. The airline wants $7.9 million in concessions from the flight attendants...
An airline spokeswoman said the judge's ruling will have no immediate effect on its operations or negotiations that are scheduled to resume on Monday.
"I think the most important message is that we do not view today's ruling as a victory. Instead, it is a necessary step forward in our restructuring, which is critical in securing our future," Comair spokeswoman Kate Marx said.
A spokeswoman for the International Brotherhood of Teamsters, which represents Comair's flight attendants, declined to say if the judge's ruling would be appealed.
"We are going back to, hopefully, reach a consensual agreement next week at the bargaining table," spokeswoman Noa Oren said. "We're disappointed in the judge's ruling. But it does show that the company had to make a lot of changes in its proposal."
Hardin's ruling reversed a previous one in which he rejected the company's request to void its contract with the 970 flight attendants and ordered them to resume negotiations.
The airline made a second request after it was unable to reach an agreement with the flight attendants on concessions.
Unions representing pilots and mechanics have agreed to concessions, but those deals were contingent on the flight attendants accepting cuts as well.
"What we're trying to do is find a fair and equitable solution for all our employees, including the flight attendants," Marx said. "We have employees who have taken considerable sacrifices."
Comair's initial restructuring plans included $27.2 million in concessions from the flight attendants, pilots and mechanics. The airline said it has lowered its demands for concessions from the flight attendants by $1 million to $7.9 million in a June 14 offer.
Hardin, a judge in White Plains, N.Y., wrote that if the union "had accepted Comair's June 14 proposal, the Comair flight attendants could have continued to enjoy by far the highest pay rates and the most favorable work rules in the regional airline industry."
The flight attendants had given the union the authority to call a strike if Comair invalidated the contract and imposed new terms. Marx said Comair would not impose changes before attempting to negotiate again with the Teamsters.
Comair said before filing its second motion that most of the $7.9 million would come from work rule changes. But the union said the wage cut the company is proposing would be 11 percent when including a pay raise the attendants are to receive in November.
Comair puts the impact at an average of $3,700 a year in pay and benefits, Marx said.
The initial restructuring plan released by Comair on Oct. 13, 2005, set out to cut costs by $70 million, including concessions from the unions. Comair has agreements with its pilots for $17.3 million in cuts and for $1 million from its mechanics.
Comair has said it will try to find other ways to reach its target for cuts since it lowered its demands for concessions from the flight attendants. Comair has said that it will not ask the pilots and mechanics for more concessions.
Analysts have said Comair's future is not assured, even if an agreement was reached with the flight attendants or the airline was allowed the concessions it says it needs. Delta, which bought Comair in 2000, has not ruled out the possibility of selling the regional airline.
Delta and Comair, with 6,400 employees and 850 flights daily to 108 cities, are trying to emerge from Chapter 11 bankruptcy. The filed for protection from creditors last year.
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