Judge Rules That Mesaba Can Reject Union Contracts

Mesaba Airlines can throw out its contracts with its three largest unions if it gives 10 days notice first, a bankruptcy judge ruled on Friday, handing a major victory to the feeder carrier for Northwest Airlines Corp.

Judge Gregory Kishel said the 10-day delay was intended to provide one last chance to make a deal. Mesaba spokeswoman Elizabeth Costello sounded conciliatory, saying the company would not start the 10-day clock ticking right away, and pledging to bargain with the airline's pilots, flight attendants, and mechanics.

'We will go on strike at a time of our choosing if they impose conditions,' said Tom Wychor, head of the Mesaba branch of the Air Line Pilots Association. He said pilots would appeal Kishel's ruling.

'They're threatening to impose rates that would push many of our pilots to levels below federal poverty guidelines,' he said. 'We simply will not agree to this -- no matter what the law says.'

Flight attendants also pledged a fight if Mesaba throws out its union contract and imposes the 19.4 percent savings it wants from all three unions. It's threatening sporadic, unannounced strikes that it calls 'CHAOS,' for Create Chaos Around Our System.

'The media won't know, the flying public won't know, when your flight may be struck,' he said.

Mechanics have raised the possibility of a strike, as well. Lead negotiator Kevin Wildermuth said mechanics are leery of agreeing to the six-year contract the airline is demanding, because in the past it has taken three to four years to negotiate a new contract. That could leave this pay-cutting contract in force for up to 10 years, he said.

Kishel had rejected Mesaba's first request on May 18. But his rejection was largely on technical grounds, and he promised to hear the airline's case again promptly if the unions didn't make a deal.

The unions had questioned whether Mesaba really needed the 19.4 percent in labor cost cuts it demanded. Mesaba has said it needs to reduce its expenses that much to have any hope of continuing to fly for Northwest, its only customer. Mesaba, a unit of Mair Holdings Inc., filed for bankruptcy protection in October, about a month after Northwest filed.

Mesaba has said it is losing $2 million to $3 million a month and that it will run out of cash by Sept. 1 without debtor-in-possession financing. Kishel said the airline made its case that its situation was dire, and that it needs the 19.4 percent labor cost reduction. Anything less would leave it at risk for a return trip to bankruptcy court, he said.

Kishel said the minimum 10-day wait to impose a new contract was one last chance for the two sides to make a deal.

'I'm going to entreat both sides here not to waste this opportunity to make peace ... and to avoid the call for a strike, which will undoubtedly engender more legal proceedings,' he said.

Mesaba is the only air service in many of the 98 mostly Midwestern cities it serves. It once flew about 100 planes, including some small jets, but Northwest is reducing Mesaba's fleet to 49 prop-driven Saabs that seat up to 34 passengers by the end of this year. It is one of Northwest's two feeder carriers.

Bankruptcy law gives companies the right to reject contracts, including union pacts. Bankrupt airlines have used this power to negotiate cost savings from workers.

Meanwhile, Northwest has been given permission to impose a new contract on its flight attendants on Monday. Negotiations were expected to continue through the weekend.

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