United Airlines, Union Can't Agree on Pact

CHICAGO (AP) -- United Airlines and its machinists' union were unable to agree on a new long-term contract before reaching an unofficial deadline Friday, but the two sides continued to negotiate even as a trial that could force labor concessions reached its final stage.

Neither side would say whether a settlement appeared likely later Friday before a ruling in the case. The International Association of Machinists and Aerospace Workers has threatened to strike if Judge Eugene Wedoff sides with United and imposes its contract terms.

''The parties are still exchanging proposals,'' union spokesman Frank Larkin said from a local hotel where talks continued after stretching through the night.

Asked about the threatened strike, Larkin said: ''It is still possible. We'll wait to see how the judge rules. We're still hoping for a negotiated settlement that would make a ruling unnecessary.''

United spokeswoman Jean Medina said only that talks were continuing.

It was not immediately clear whether Wedoff would rule immediately after closing arguments in the weeklong trial.

When the trial resumed Friday, the IAM immediately sought a restraining order to prevent Untied from barring a strike, but Wedoff said it was irrelevant to the case at hand. After his refusal, the machinists said they would seek the order in District Court.

Medina said United believes a strike would be illegal under bankruptcy law even if IAM succeeds in getting a restraining order.

United, a unit of Elk Grove Village, Ill.-based UAL Corp., is seeking annual concessions totaling $176 million over five years from machinists to complete a targeted $700 million in labor cost reductions.

The IAM presented testimony from two witnesses at a court session Thursday to bolster its argument that United is asking for excessive concessions from its workers.

Tom Roth, the president of Alexandria, Va.-based Labor Bureau Inc. and a consultant for the IAM, said IAM workers are being asked to shoulder an unfair share _ 25 percent _ of the cutbacks in part because United is undervaluing the concessions made by the group in previous contract changes.

''We are looking at a group here that is the least paid, the lowest average paid, has the lowest total compensation, and yet they're asked to take the largest cut,'' Roth said.

Tom Brickner, a top IAM negotiator in current talks as the union's airline coordinator, said United has not bargained in good faith over the allocation of cuts.

''They took a firm position from the first day of negotiations and they never altered that position at all,'' he said.

Unlike the tense and sometimes emotional hearing last week over United's termination of employee pensions, the weeklong labor trial has been largely absent of sharp exchanges and accusations _ suggesting both sides were always hopeful of a resolution through negotiations.

''I'm glad that the courtroom activity has been businesslike and there aren't ... sparks,'' United's chief operating officer, Pete McDonald, said in an interview earlier this week. ''The focus has been at the table to produce a tentative agreement that our employees, their members, can vote on and hopefully ratify.''

Attorneys for the two sides indicated that the inability to reach an agreement during a two-day recess granted by the judge to focus on negotiations did not signify talks were blocked.

Nonetheless, the threat of a possible strike hung over the proceedings.

IAM spokesman Joseph Tiberi reiterated that the union's 20,000 members, who include ramp and store workers and public-contact employees, would not back off their strike threat if the contract is broken.

''If we can't get a deal by the time the judge makes a ruling, we're prepared to shut down United Airlines,'' he said.

Pensions remained the major sticking point in the talks, although neither side would give details. Besides wages and benefits, the two sides were negotiating over a defined-contribution pension plan to replace the defined-benefits plan United is terminating as part of a companywide push to cut labor costs.

Medina said the company would not speculate on the chances of a settlement before a trial verdict. ''We remain committed to trying to reach a consensual agreement outside of court,'' she said.