CHICAGO (AP) -- United Airlines' machinists union said Thursday its members have ratified a new collective bargaining agreement, concluding the bankrupt carrier's contentious effort to cut costs from its largest labor group.
The new contract includes a 5.5 percent pay cut and trims some benefits, which should save United about $175 million (euro144 million) annually in wage and benefit cuts. It also allows pension contributions for current employees to go into the union's pension plan, rather than a company-sponsored retirement plan as United had originally proposed.
With the ratification, each of United's six unions has agreed to new contracts, resulting in $700 million (euro574 million) in annual labor savings. It clears the way for United to file a reorganization plan with the bankruptcy court, which it expects to do around Aug. 1.
''We now have ratified, consensually negotiated collective bargaining agreements with all our labor groups, bringing a difficult phase of our restructuring to a close,'' United spokeswoman Jean Medina said.
About 67 percent of members of the International Association of Machinists and Aerospace Workers, which represents 20,000 baggage handlers, customer service representatives and other ground workers, voted in favor of the agreement. The union this spring had threatened to strike if a bankruptcy judge annulled their contract.
IAM officials made clear Thursday, though, that hard feelings linger after the company's eight-month effort to squeeze more savings from its workers.
''We have reached the limit of our members' sacrifice and patience,'' said Randy Canale, president of IAM District 141. ''If United management cannot utilize the cost savings their employees provided to reverse course and become competitive, they must be replaced with more capable individuals.''
Meanwhile, United's flight attendants' contract _ ratified by members in January _ has been in arbitration since April after the union accused United executives of failing to cut their own salaries along with those of workers as agreed. The company denies that allegation.
United, a unit of Elk Grove Village-based UAL Corp., has asked a federal bankruptcy judge to schedule a September hearing on its reorganization plan. The company has said it hopes to exit a more than 2 1/2-year bankruptcy sometime this fall.
