Northwest, Pilots Union Square Off Over Contracts

Northwest Airlines Corp. may be undervaluing some of the benefit cuts its pilots have offered to help the struggling airline emerge from bankruptcy, experts for the pilots union testified on Monday.

The Air Line Pilots Association (ALPA) offered witnesses Monday as part of its case against the carrier's motion to abrogate its union contracts. The pilots and flight attendants have hinted that they would strike if a contract is imposed.

It was the fifth day of hearings devoted to Northwest's request, which it claims is necessary to emerge from bankruptcy. The airline is looking for $1.4 billion in annual wage and benefit concessions from employees and has run into opposition from pilots and flight attendants who say the company seeking more than it needs.

Both sides have offered a proposal, but each values elements of the other's proposal differently.

Some of the differences between both sides hinge on how they value medical benefits for retirees and insurance provided to a pilot's family.

Another issue that both sides value differently is how the carrier pays pilots who switch from one aircraft type to another.

The pilots also are disputing the term of how long a pilot must stay with a particular aircraft type after being trained on it. That's an issue because pilots earn more when they fly larger planes, so rules keeping them in a particular plane would limit their earnings.

Beyond the bankruptcy period, Eagan, Minn.-based Northwest is looking to raise money through the sale of debt and stock for an ambitious refitting of its aging aircraft fleet that is expected to cost $10 billion to $11 billion over the next decade.

Negotiations between Northwest and its pilots and flight attendants, meanwhile, continued at two Manhattan locations.

The hearing is expected to resume next week.

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