Delta Pay Cut Deal a Rare Win for Pilots

While experts say Delta may ultimately get what it wants, for now it appears the airline's pilots have a victory that has been a rarity at other major carriers who have used the bankruptcy court's big stick to meet their goals.


Still, the pilots union isn't conceding anything, and has vowed to keep its threat to strike in the background in case the two sides can't reach a comprehensive deal and a third-party arbitration panel rejects the pilot contract.

Last year, Delta's pilots agreed to $1 billion in average annual concessions, which included a 32.5 percent pay cut.

"All along, our biggest problem has been that the management team did not recognize that a 50 percent pay cut in a year and a termination of their pension plan ... if that wasn't enough to be the tipping point, I don't know what is," said Lee Moak, chairman of the union's executive committee. "So, I believe that they (Delta management) recognized that."

Moak said the fate of the pilots' pension plan remains a sticking point between the union and management. The union believes the company will move to terminate the plan based on Delta's decision not to make contributions to the plan while in bankruptcy. Delta has not said what its plans are for the pension program.

"The pension is a serious problem," Moak said.

Delta, which filed for bankruptcy protection on Sept. 14, and its pilots will ask a New York bankruptcy judge Tuesday to suspend the hearing on the company's motion to reject the pilot contract. The tentative agreement must be approved by the court and Delta's 6,000 pilots.

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AP Business Writers Aleksandrs Rozens in New York, Dave Carpenter in Chicago and Josh Freed in Minneapolis contributed to this report.


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