Continental Seeks Mediator in Labor Talks

HOUSTON (AP) -- Continental Airlines Inc. said Tuesday it wants a federal mediator to help the company reach a deal with flight attendants to cut wages and benefits.

The nation's fifth-largest carrier said it has asked the National Mediation Board to appoint a mediator to help with talks, which have continued on and off since flight attendants rejected an $82 million pact more than two months ago.

''Bringing in a federal mediator is the next step in the process of reaching an agreement that's fair to the company, fair to the flight attendants, and fair to all co-workers,'' Larry Kellner, Continental's president and CEO, said in a statement.

Joseph Tiberi, spokesman for the International Association of Machinists and Aerospace Workers, which represents Continental's flight attendants, said sticking points to reaching a deal include pension security, cuts in vacation time and overall cost of the company's proposals to workers.

In late March, Continental reached pay and benefit cut agreements with its largest unions except the airline's 9,000 flight attendants. The deals approved by pilots, mechanics and other unions, along with $169 million in previously disclosed wage and benefit cuts affecting nonunion employees, reached about $418 million of the carrier's goal to cut costs by $500 million to combat continued losses and soaring jet fuel prices.

Tiberi said flight attendants rejected the company's proposed deal March 31 and turned down subsequent proposals in May and again Monday. He said if Continental presents another deal that doesn't address flight attendant concerns in six months, ''they'll still be unsuccessful, so we need something to spur these talks forward.''

Continental said earlier this year the airline expects significant losses in 2005, but projected cash flows and reserves will be enough for the year if unions approved the cuts. Kellner told shareholders last week Continental hopes to return to profitability in the next two years.

Shares of Continental rose 44 cents, or 3.2 percent, to close at $14.20 Tuesday on the New York Stock Exchange, near the high end of a 52-week range of $7.63 to $15.60.