The judge overseeing Northwest Airlines' bankruptcy imposed temporary 19 percent wage cuts on some 14,600 baggage handlers, clerks, reservation agents and other ground employees on Wednesday.
That gives the Eagan-based carrier the short-term savings it says it needs to take more time to finalize contracts with its three major unions.
"The court allowed Northwest to impose significant pay reductions on our members, and it's going to create a great deal of hardship," said Joseph Tiberi, spokesman for the International Association of Machinists, which represents the ground workers. "But we welcome the additional time it provides us to secure a long-term agreement with the company that we can bring back to our members for a vote."
The pilots and flight attendants unions had already agreed to interim pay cuts of up to 24 percent in exchange for more time to bargain contracts.
It appears that Northwest will give the unions two months to reach deals. If they don't, the airline could seek court approval to impose final contracts. That process could take a month or so.
"We are pleased we have temporary wage reductions in place with our three largest unions," said Northwest spokesman Bill Mellon. "We are focused on working out final agreements, and we want to do that as quickly as possible."
Northwest is seeking $1.4 billion in annual wage concessions and other givebacks from its employees.
Northwest, the nation's fourth-largest airline, expects a pretax loss of $1.7 billion this year because of soaring fuel prices and labor costs that have been among the industry's highest.
The Associated Press contributed to this story. Martin J. Moylan can be reached at firstname.lastname@example.org or 651-228-5479.
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