NWA Targets Ground Workers for Added Savings

Nov. 7, 2005
District 143 of the International Association of Machinists has so far rejected the airline's pitch to provide 60 percent of the labor savings the airline eventually wants.

With pending deals that would give it most of the labor savings it wants from pilots and flight attendants, bankrupt Northwest Airlines is weighing how to extract similar givebacks from its ground workers.

District 143 of the International Association of Machinists, which represents some 16,400 baggage handlers, reservation agents and other workers at Northwest, has so far rejected the airline's pitch to provide 60 percent of the labor savings the airline eventually wants.

If it gets such down payments from the IAM, pilots and flight attendants, Northwest is willing to push back a Nov. 16 hearing at which it's slated to ask a bankruptcy judge to impose contracts on the unions.

The IAM expected Northwest would move by Friday to impose an interim contract on it, petitioning the judge for 19 percent pay cuts. The airline did not.

"But we're still expecting it at anytime," said union spokesman Joe Tiberi late Friday afternoon.

Eventually, Northwest wants $190 million in wage and other givebacks from the IAM, though it's just looking for $114 million for now.

"We don't have enough information to determine what cost savings are necessary in an interim or long-term agreement," Tiberi said. "We just need more time to get this done."

Northwest had no comment Friday about contract negotiations. The airline, which has lost more than $3 billion on its operations since the start of 2001, complains it has the highest labor costs in the industry.

Meanwhile, leaders of the pilots' union prepared Friday to sell an interim pay-cut deal to members. It would save Northwest about $215 million a year, largely through 24 percent wage reductions.

In exchange, pilots would get a few more months to bargain key issues, such as maximizing the flying that's done by Northwest pilots and minimizing the flying sent to regional airlines.

Pilots start voting next week and end balloting on Nov. 14.

When it's finished extracting concessions, Northwest expects it will have cut its annual pilot labor costs by$612 million.

Flight attendants will not vote on an interim deal with Northwest that would save the airline $117 million annually, mostly with 20 to 25 percent wage cuts. The interim agreement is not subject to a vote because of its "limited time frame," says the flight attendants' union. But any final consensual agreement would be subject to membership ratification.

After leaning on employees for big-time concessions for nearly three years, Northwest is still about $900 million short of its $1.4 billion target.

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