Source: Rocky Mountain News
Author: David Kesmodel

Third-party workers highlight of carrier's latest plan to unions

If United Airlines has its way, fewer and fewer of the people working for the company at airports across the country will sport United uniforms.

Instead, they will wear the jerseys of third-party contractors. In some cases, existing United employees will simply change uniforms - but receive lower pay and benefits.
 
The giant carrier's latest proposals to its unions for sweeping contract changes reflect a company increasingly venturing down the path of outsourcing jobs as it seeks to slash costs and survive its long trip through bankruptcy court.

For example, United has proposed to the union representing mechanics and aircraft cleaners that it be given the right to farm out all plant and ground equipment maintenance; all computer technician work; all airplane cleaning and all fueling of planes.

It also proposed gaining the right to outsource heavy aircraft repairs to foreign contractors and the authority to lay off maintenance employees without regard to seniority.

In addition, mail and cargo running, security-guard jobs and food service could wind up in the hands of contractors under a proposal to the union representing ramp workers, ticket agents and others.

At least several thousand of United's 62,000 jobs could go away.

"What they're asking is that we vote ourselves out of a job," Bill Moons, an official with the Denver unit of the Aircraft Mechanics Fraternal Association, said of the proposal given to the union last week.

He said it appears virtually all of the 7,500 mechanic and airplane cleaner jobs at United are vulnerable in the carrier's restructuring. "Make no mistake about it: (Chief Executive Glenn) Tilton is about union-busting. They're using the 1113 process to try to bust the unions."

The 1113 process refers to the part of the bankruptcy code under which United can abrogate existing labor contracts if negotiations fail and the judge allows changes to be imposed.

"That's ridiculous," United spokeswoman Jean Medina said in response to Moons' comment about Tilton. "We have to have a financeable business plan to exit bankruptcy. That means we have to make difficult but necessary decisions now to ensure that we have a viable, sustainable company that will continue to provide jobs going forward."

UAL Corp.'s United, Denver's largest carrier, already has outsourced many jobs in its restructuring.

For example, it won contract concessions allowing it to farm out hundreds of airplane-cleaning jobs. In some cases, former United cleaners at Denver International Airport are donning uniforms of contractors and doing the same work they did at United but for lower wages, said Moons, a United mechanic at DIA.

Bob Mann, an industry consultant in Port Washington, N.Y., said major U.S. carriers have little choice but to seek ways to dramatically cut costs. The industry is being hammered by high jet-fuel prices and depressed fares. Increasingly, low-cost carriers are eating into the market share of titans such as United.

But Mann said increased outsourcing can lead to lower-quality service. "There's a limit to what you can do there. The issue is, where do you find reliable third-party handlers? It's a God-awful, terrible business. It is a risk every time you sign your signature on a dispatch document or something else."

Moons said United's proposal, if approved, could quickly result in nearly 1,600 job cuts for AMFA-represented workers across United's system. The union represents more than 700 workers in Denver.

The union has not formed a formal stance on the airline's proposal, which includes 9 percent wage cuts.

United, which filed for bankruptcy in 2002, wants to negotiate wage and benefit cuts with all its unions by mid-January as part of an effort to save another $2 billion annually.

The union representing United flight attendants made public Monday a proposal from United that includes 10 percent pay cuts, with 4 percent being temporary. The union says it will fight United over "every dime" of the $138 million in annual savings it is seeking from the group.

United won $2.56 billion in wage and benefit cuts and work-rule changes from workers in 2003.