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Airline may ask court to void labor pacts
"Nothing US Airways does at this point would surprise me," said Craig Conroy, a local aviation analyst.
Canceling union contracts would help the company preserve cash by slashing payroll immediately. Continental Airlines used emergency bankruptcy power to decertify unions and fire all 12,000 employees in 1983, said Michael Boyd, an aviation analyst based in Evergreen, Colo.
US Airways most certainly can ask the court for emergency relief, Boyd said.
Union leaders expect the company to move later this week because it gave the pilots union until Wednesday to negotiate $295 million in wage and benefits cuts. The pilots are expected to miss that deadline.
"I wouldn't be surprised at all'' if US Airways tried to terminate labor contracts this week, said spokesman Jack Stephan of the Air Line Pilots Association. "They certainly have these tools at their disposal."
Airline spokesman David Castelveter declined comment on whether US Airways would seek to terminate union contracts this week.
"Our desire is still to reach consensual agreements," Castelveter said.
US Airways, the nation's seventh-largest airline, filed for bankruptcy protection last Sunday, less than 18 months after emerging from its first bankruptcy reorganization. The company is seeking $800 million a year in labor concessions as part of a $1.5 billion restructuring into a profitable, low-cost carrier.
If US Airways fails to reorganize in bankruptcy court, it will be liquidated. More than 28,000 jobs, including 7,000 in Western Pennsylvania, would be eliminated. That's the worst-case scenario. For Western Pennsylvania, the best-case scenario isn't a lot better.
Even if US Airways survives, it will be doing a lot less flying at Pittsburgh International Airport. Business experts and labor leaders agreed that the airline may eventually reduce local service to about 60 flights a day -- down from 373 at present -- and slash its payroll to about 1,500.
A retrenchment of that size may wipe out up to another 6,500 jobs at local companies doing business at the airport, said the Allegheny Institute. The local think tank said that US Airways' downsizing could take more than $1 billion a year out of a $50 billion local economy.
"It's going to be a huge hit," Boyd said.
The company already has announced plans to reduce local flights this fall by about 37 percent, to about 240 a day, but it has not revealed its plans for 2005.
Fred Freshwater, president of the pilots association's Council 94 in Pittsburgh, predicted that US Airways will shrink the number of pilots based here from about 750 to about 200. Teddy Xidas, president of Association of Flight Attendants Local 40, said her membership could drop from 1,150 to about 400.
"We will do our best to minimize any loss of jobs," Castelveter said.
The promise is cold comfort to local US Airways' employees.
"I am damned concerned that (job cuts) are going to happen -- and soon," said pilot Tim Baker, of Coraopolis.
"I'm beyond nervous -- I'm numb," said gate agent Jim Drummond, of Paris, Washington County.
Drummond, who started with US Airways in 1968 as a reservations agent, said he had hoped to work for the company for three more years, until his 62nd birthday. Instead, he has decided to retire at the end of this year, rather than face another round of layoffs.
"I like the people I work with -- they're like family," Drummond said. "But I have only bitterness toward upper management. It's unbelievable the way they have run this company into the ground."
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