US Airways reached a tentative $4.5 million cost-cutting agreement with leaders of the union that represents the carrier's 150 flight dispatchers, the airline said yesterday.
The contract is the first such agreement that US Airways has reached with an employee union since it began seeking $800 million in labor cuts earlier this year.
Though the union is tiny and the saving is small, US Airways applauded the move. "We appreciate the leadership that the dispatchers have shown in stepping up and reaching an agreement," said Jerrold A. Glass, US Airways senior vice president of employee relations.
Don Wright, president of the Transport Workers Union Dispatchers Local 545, said union leaders decided to send the agreement to members for a vote on Sept. 30 in hopes of staving off potentially steeper cuts imposed by the bankruptcy court.
US Airways filed for bankruptcy protection last week after failing to secure concessions from workers as part of its overall $1.5 billion restructuring plan.
The proposed contract, which calls for workers to give up about $4.5 million a year in pay, benefits and work rule changes, would require bankruptcy court approval.
Wright said union leaders wanted to act quickly, fearing the implications of a prolonged bankruptcy. United Airlines, for example, has been in bankruptcy for nearly two years and has cut about $2 billion. Last week, United said it needs about $1 billion more in cuts.
"We looked at the alternatives, talked with our attorneys and felt it was in the best interest of our membership to strike a deal as quickly as we could," Wright said. The union agreed to the carrier's original proposal of $4.5 million in cuts.
US Airways has said that if it was unable to secure consensual pay and benefit cuts from its unions, it would ask the bankruptcy court to impose the cuts.
Wright said it was too early to determine if the agreement signaled a broader movement by the unions toward acceptance of concessions.
"We're a small group. We tend to follow the larger groups," Wright said. "We just don't think it's in the best interest of the company for this bankruptcy to last over a long period of time."
The dispatchers make up one of the three employee groups represented by the Transport Workers Union. The other two groups -- the flight crew training instructors and the simulator engineers -- have not reached an agreement with the airline.
US Airways continues to meet with representatives from its larger labor groups.
Jack Stephan, a spokesman for the pilots union, said yesterday that the airline had introduced a proposal that would cut pilots' pay by 19.5 percent, the Associated Press reported. Stephan said the proposal, which the airline did not confirm, would be discussed today by the union's governing committee.
"We have a difficult decision with unattractive alternatives," Stephan said.