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United Plans to Use Court to Take More Concessions

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Source: AFA

Date: Oct 15, 2004

Ladies and Gentlemen:

Today in court United announced that it would seek additional cost cutting through Section 1113 of the Bankruptcy Code in an effort to put employee concessions in place by January of 2005. The company’s exploitation of the bankruptcy process for additional concessions comes as no surprise to each of us after months of hearing Glenn Tilton and Pete McDonald say that our previous concessions are “not enough” and warning that we will need to “dig deeper.” Tilton announced to the media on September 16 th that United would require another $500 million in cost savings – in addition to the likely termination of employee pension plans.

We continue to reject the notion that targeting employees with more concessions is the key to success at our airline. We have already made enormous concessions for United’s financial turn around and we feel the effects of those sacrifices on a daily basis. Still, Flight Attendants and other front-line employees continue to provide United with industry-leading service and operational records that bring our passengers back. Our dedication, professionalism and care of our passengers should not be misread as complacency over management’s continued attack on our wages, benefits, work rules and pensions. This management still fails to recognize that a successful reorganization is impossible without the support of Flight Attendants and other workers.

At this time, we do not have any specific information regarding management’s targeted cuts. The United Master Executive Council will continue to represent Flight Attendants throughout this bankruptcy process to ensure that our interests are best protected. We continue to retain bankruptcy legal counsel as well as financial professionals to assist in this action.

Additionally, the court was advised today on the potential for an agreement that would eliminate the need to conduct the Trustee hearings scheduled to begin on October 27, 2004. We are currently working to ensure that the issues addressed in our motion to appoint a Trustee are brought to a positive resolution for Flight Attendants and the future of our airline. Over the past several weeks, the Creditors Committee has organized several working groups, consisting of principals and consultants of the Committee. Working groups were organized to work directly with United management to develop a viable business plan. Working groups have been established to critically analyze decisions on the most important elements of United’s restructuring including exit financing, United Express, Aircraft Maintenance, United’s Network, United’s business model, cost improvement, revenue enhancements, aircraft financing and pension issues.

United Flight Attendants have demonstrated an unwavering commitment to a successful reorganization of our airline along with our steadfast dedication to ensuring the protection of our wages, work rules, healthcare and pensions. Focusing on the values most important to United Flight Attendants, we will continue to determine our collective action. Remain informed and engaged through our website, Dear AFA, AFA E-lines and your Local Council while we meet the unrelenting challenges of United’s bankruptcy. Our solidarity will lead us to our future success.

In Solidarity,

Greg Davidowitch, President
United Master Executive Council

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