Union Appeals Delta Pension Payment Ruling

The union representing Delta Air Lines Inc.'s pilots is appealing a bankruptcy judge's rejection of a motion that would force the carrier to restore certain pension payments.

Judge Prudence Carter Beatty did not rule on the merits of the motion following a hearing Oct. 17 in U.S. Bankruptcy Court in New York, indicating instead that a group representing retired pilots needed to file a lawsuit if they hope to challenge Delta's decision not to make the pension payments. Two weeks later, the judge formally denied the motion.

Late Thursday night, the Air Line Pilots Association filed a notice of appeal of the judge's decision. It's not clear when the appeal, which is being filed in U.S. District Court in Manhattan, would be ruled on.

Active and retired Delta pilots want the nation's third-largest carrier, which filed for bankruptcy protection Sept. 14, to continue making minimum contributions to their pension plan and certain payments to higher-paid retirees. The Atlanta-based company vows it won't do either unless a judge forces its hand.

The pilots argue their contract with Delta requires the airline to continue making the pension payments in question until it applies for and gets permission from the bankruptcy court to void the contract. A hearing on Delta's request to void the pilot contract is set for Nov. 16.

The company argues that the payments are unsecured, pre-petition claims against the airline and, therefore, Delta does not have to make the payments a priority during its reorganization.


On the Net:

Company: http://www.delta.com

Union: http://www.dalpa.com

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