United attendants approve strike
88% of United Airlines’ flight attendants has approved to stage intermittent strikes as United moves forward with its court motion to terminate their existing contract and imposes additional salary and benefit cuts.
United said the actions contemplated by the union are prohibited by both the Railway Labor Act and federal bankruptcy law, reported The Associated Press.
Meanwhile, negotiations also continue between United and unions representing mechanics, baggage handlers and public contact workers. The labor strife and taxpayer burden come as United moves into its third year of Chapter 11 bankruptcy protection.
Fueling the drama, the US government’s pension agency initiated court action on Thursday to assume responsibility for United pilots $2.9 billion in underfunded pension assets as soon as possible, versus next May, under a plan agreed between United and its pilots to help the airline emerge from bankruptcy by terminating the pilot’s pension plan and replace it with a much less expensive 401(k) like plan, in exchange for compensation of $550 million in convertible notes.
The pension agency is trying to avoid the forthcoming annual increase in mandated benefit payments and save as much as $140 million in additional payouts.
Taking over United pension saddles the Pension Benefit program, already operating at a $23 billion deficit, with another huge financial burden. The White House and Congress have been studying options to bailout the agency from insolvency.
Court decisions are expected in early January.
Reported by Charles Kao
Charles Kao
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