United Airlines appears headed for more labor turbulence after unionized pilots on Tuesday elected new leaders who vow to get tough with management.
Chicago-based United follows in the footsteps of American Airlines, whose pilots this summer also installed an activist slate.
Although the United pilots' five-year agreement is not due for negotiations before 2010, many pilots want United's management to open talks earlier, a move that the carrier's other unions also advocate.
Steve Wallach, a San Francisco-based Boeing 747 captain, is the new chairman of the master executive council of the Air Line Pilots Association at United. With that post, Wallach will also gain a seat on the Chicago-based carrier's board.
Jeff Barath, a pilot who also holds an MBA, is the new vice chairman of the council. Barath had also been in the running for the chairman's slot, an observer says, emphasizing that he was a member of the team led by former chairman Rick Dubinsky that reaped steep contract concessions from management in 2000.
"You'll have a team that charts a more confrontational approach and also is diligent, prepared in how they go about it," said a senior United pilot who knows both men and spoke on condition he not be named.
Most employees gave up about one-third of their pay to help the carrier survive a bankruptcy that followed the Sept. 11, 2001, attacks. But the pay concessions were far higher for some pilots, who saw their salaries plummet by as much as 60 percent when they were forced to take lower-paying jobs, analysts said.
Elected to a two-year term, Wallach will play a crucial role in shaping labor relations at the nation's second-largest carrier and laying the groundwork for the next United pilots' contract.
"If you have labor upset, it's for a reason," said Michael Boyd, president of the Boyd Group, a Colorado-based aviation consulting firm. "At this point labor is going to say, 'I don't care about $80 [per barrel] oil. We want ours back.'"
Some of the anger stems from stock and options worth millions given to United's senior management after the carrier emerged from bankruptcy in early 2006. Union leaders' talk of reclaiming lost salary and benefits has been stoked by the carrier's disclosure that it is exploring spinning off its frequent-flier program, maintenance division and other assets, which could reap billions.
Wallach, who has a reputation for being smart, thorough and militant, has not been involved in union politics for years, a source says. His election is " a repudiation of past leadership," said the senior United pilot, who has been active in union affairs. "The pilots are about as angry and disillusioned with their leadership as they are with management."
Wright B. George, a retired United pilot and union leader, called Wallach very professional. "He was always prepared, more than most of us. He did his homework. So the board's getting a great member."
Wallach succeeds Mark Bathurst, who reached the four-year term limit set by United's chapter of the Air Line Pilots Association. Although Bathurst ran on a platform of "no give-backs" in 2003 he ultimately presided over contract talks that cost pilots, and all other United employees, their pensions -- a controversial move that enabled the carrier to exit bankruptcy in early 2006.
Anger on the part of organized labor is playing out at other carriers, too.
Pilots at American Airlines this summer voted in a new slate of activist union leaders, who have vowed to press management for steep concessions in contract talks that resumed earlier this month.
At US Airways a group of pilots are pushing to decertify their union as they battle over seniority issues that stem from the carrier's 2005 takeover by America West Airlines.
Rhetoric aside, union officials at United and other airlines will find it difficult, if not impossible, to restore pay to 2000 levels, analysts say. Although carriers like United are again making money they are also carry staggering debt loads and badly need to boost spending on planes and technology in order to remain competitive.
"It's a tough political position," said Kit Darby, a consultant and retired airline pilot. "You have the relatively high expectations of the pilots' group. The goal of the union is to keep costs up; the goal of the company is to keep costs down."
United CEO Glenn Tilton vowed in a prepared statement to work with the new leadership team and thanked Bathurst for his service on the board.
