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Waiting for the Worst

Many US Airways Employees Are Not Optimistic About Airline's Latest Restructuring

By Bill Brubaker
Washington Post Staff Writer
Monday, September 20, 2004; Page E01

The three years since the Sept. 11, 2001, terrorist attacks have been treacherous for airline employees. Thousands have lost their jobs and many of the rest have felt the squeeze on their daily lives as airlines slashed pay and benefits.

For US Airways employees, the unease is intensifying as the carrier takes its second dip into bankruptcy restructuring in two years. In the first restructuring, the carrier's employees agreed to give up $1.2 billion a year in pay and benefits. Now, they are bracing for another wave of cutbacks and wondering how to keep their lives intact.


US Airways pilot Steve McKee is among the employees who expect to lose their jobs. (Rich Lipski -- The Washington Post)

_____US Airways Group, Inc._____
(UAIR) Stock Quote and News
Historical Chart
Company Description
Analyst Ratings
_____Washington Investing_____
US Airways' Woes Reflect Industry In a Tailspin (The Washington Post, Sep 20, 2004)
_____More From The Post_____
US Airways, Dispatchers Agree to Cuts (The Washington Post, Sep 22, 2004)
US Airways Loses Loans For 100 Jets (The Washington Post, Sep 18, 2004)
Costs Must Be Reduced Soon, US Airways Says (The Washington Post, Sep 15, 2004)
Pension Agency Seeks More Power (The Washington Post, Sep 15, 2004)
US Airways Miscalculated Financial Needs (The Washington Post, Sep 14, 2004)
Analysts Cast Doubt On US Airways' Value (The Washington Post, Sep 14, 2004)
This Time, Frequent Fliers A Little Edgy (The Washington Post, Sep 14, 2004)

"Frankly, I expect to lose my job in the next 90 days," said Steve McKee, a pilot who flies Boeing 737s for the airline. "And if I don't lose my job, I expect my salary will go down by at least 25 percent."

McKee is one of 28,000 employees awaiting details on how the Arlington carrier will reduce labor costs by the promised $800 million. About 2,000 of US Airways' employees are based in the Washington area.

"I have a wife who's a stay-at-home mom, three teenage stepchildren and a 3-year-old daughter from my first marriage. No matter what happens, the money is going to be too tight for me. We'll be buying a smaller home," said McKee, 50, who commutes to his base at Reagan National Airport from his home near Kansas City.

John A. Taylor, another US Airways pilot, sold his home in Spotsylvania, Va., 10 miles west of Fredericksburg. "I had to reduce my expenses," said Taylor, 51. "So I'm renting it back from the gentleman I sold it to in May. That gives me the option to downsize if my job goes away."

US Airways' Chapter 11 bankruptcy filing was just the latest piece of bad news from the large legacy carriers. United has been restructuring under Chapter 11 for two years. Delta Air Lines has said it might file for Chapter 11 protection if it can't make a deal with pilots to reduce costs. Delta also recently announced plans to cut as many as 7,000 jobs and close its hub at Dallas-Fort Worth International Airport.

Airlines blame a combination of factors for their problems: the Sept. 11, 2001, attacks that grounded airplanes and put fear into flying, the Iraq war, soaring fuel prices and competition from low-cost carriers such as Southwest and JetBlue, which have forced larger carriers to lower their fares.

US Airways Group Inc. sought bankruptcy protection for the second time after failing to win additional wage and benefit concessions from its unions. In a news release, the airline said there will be no disruption in service while it seeks to restructure $8.7 billion in debt. And it assured frequent fliers that their miles will be honored.

At the same time, US Airways chief executive Bruce R. Lakefield put employees on notice that "sacrifices" are "necessary in the changing airline industry."


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