The Senate Commerce Committee virtually assured approval of major legislation designed to curtail federal regulation of the nation's airlines by reaching agreement yesterday on a labor protection addition to the bill.
By a vote of 8-6, the panel endorsed a compromise proposal of committee chairman Warren Magnuson (D-Wash.) and Sen. John C. Danforth (R-Mo.), to compensate workers who may lose jobs because of increased airline competition under derregulation.
The labor protection section was the last major controversy the committee faced, and yesterday's vote cleared the way for final approval of the overall legislation. Another meeting has been scheduled for next Tuesday, at which time the legislation is expected to be reported out to the full Senate.
Airline industry unions had lobbied strongly for some form of monetary compensation, especially after the committee adopted a section that would permit airlines to add routes without prior approval of the Civil Aeronautics Board.
Fearing that some airlines might be forced to go out of business or to curtail services in an environment of increased competition in major markets, the unions sought aid for workers with five years' experience whose firms began layoffs. Overall, the domestic U.S. airlines have about 300,000 workers.
Under the proposal approved yesterday, federal aid would go to workers with four years or more of experience. The program would continue for a decade but an individual worker could gain benefits only for a maximum of three years: the actual amount of potential federal outlays has not been estimated.
The Secretaries of Labor and Transportation would promulgate rules and establish the maximum payments the affected workers would receive under the plan beyond unemployment compensation. In addition, the CAB would have to find that employees or employers have been affected adversely by events following the projected de-regulation.
If the committee endorses the full airline bill, which is supported strongly by the Carter administration, there is a slim chance the Senate may vote on the measure before adjornment.
Although deregulation is opposed by some major airlines, unions and industry organizaitons, Senate passage is expected. Hearings have been held this week in the House, but completion of legislative action there is not expected until next year.
Secretary of Transportation Brock Adams said aviation regulatory reform is "now close to success" and he vowed to work with Congress in the next few months to complete a bill that would "truly reform the air carrier industry."
But John J. O'Donnell, president of the AFL-CIO Air Line Pilots Association, said his union has seen "no persuasive evidence to warrant enactment of comprehensive legislation designed to completely restructure the economic regulatory framework which governs this nation's air transportation system."
O'Donnell said a major reason why no "complex and controversial" legislation is necessary now is the rapid development of "virtually unprecedented" price competition in recent months. In addition, the CAB appears to be "moving forward in the processing of applications for new carriers," he told the House subcommittee.
Government regulation of air transport as a public service is absolutely necessary. O'Donnell said. And he warned that "real losers" under the proposed deregulation would be the medium-sized cities which airlines will drop in order to serve more profitable nonstop markets between large cities.
In testimony this week, airline presidents split on the subject. Pan American World Ariways chairman William T. Seawell strongly supported the House legislation but said it doesn't permit enough international aviation reform.
Specifically, Seawell noted that Pan Am has been denied the right to offer domestic services for 40 years at a time when international routes are being awarded airlines with strong domestic systems to feed overseas flights. "It is difficult for us to qualify," he said, calling for an amendment that would allow international airlines to carry domestic passengers between U.S. cities on their overseas routes.
In another development, The Los Angeles Times reported that a U.S. official in Tokyo says this country is willing to consider letting Japan Air LInes fly a North Pacific route to Chicago and to pick up passengers on the West Coast bound for Latin America - but only if Japan agrees to expand Pacific air services.
The U.S. and Japan have opened talks on a new air agreement which are expected to move here in November. To date, Japan has been reluctant to allow free competition. The U.S. also is seeking cut-rate fares on Pacific flights.