US Airways Group Inc. yesterday asked a bankruptcy court judge to terminate the long-term contracts of its flight attendants, mechanics, and customer service and ticket agents if the workers fail to agree on millions of dollars in pay and benefit cuts.
The Arlington-based airline also asked the judge for permission to reduce or eliminate company-paid health benefits for retirees and replace the remaining defined-benefit retirement plans of its flight attendants and mechanics with a defined-contribution plan, similar to a 401(k).
Yesterday's motion to cancel contracts for about 20,000 of its 28,000 workers comes as the nation's seventh-largest carrier struggles to conserve cash under bankruptcy protection. US Airways filed for Chapter 11 reorganization in September, its second filing in two years.
US Airways is in negotiations with the three employee groups as it seeks to cut about $1 billion in labor costs. Pilots, flight crew training instructors and simulator engineers have already agreed to steep pay and benefit cuts and are exempt from yesterday's filing.
In a written statement, Bruce R. Lakefield, US Airways' chief executive, said the airline preferred to reach agreements with its workers to avoid court-imposed solutions. Lakefield said the airline had to cut costs soon to save cash for $260 million in lease payments due early next year on 220 of its aircraft.
In a recorded message to workers, Lakefield described the requests to the court as "drastic steps." He added that "to survive, the company must take these actions," and said, "We are quickly running out of time. We need to conclude negotiations now."
Perry Hayes, president of the US Airways flight attendants union, called yesterday's motion a "naked attempt at intimidation" that "demonstrates the company's contempt for its workers and for the collective bargaining process."
If successful in terminating its pension plans, the airline said it would work with the federal Pension Benefit Guaranty Corp. on administering the plans' assets.
Hearings on US Airways' request are scheduled for Dec. 2. Last month, a bankruptcy court judge imposed a temporary 21 percent pay cut through February on those employees who had not agreed to new contracts.
US Airways' motion comes as the airline is struggling to maintain employee morale, which can affect customer service, especially as the airline prepares for the busy holiday travel season.
In a memo to his members, Randy Canale, head of US Airways' mechanics union, said the group hoped to reach an agreement with the airline that "respects our members' sacrifices and dedication to the future of the airline."
Earlier this week, 86 percent of the airline's 6,000 customer service and reservation agents voted to authorize a strike if their union and the airline fail to reach an agreement. The airline is seeking $137 million in pay and benefit cuts from its agents.
Candice Johnson, a spokeswoman for Communications Workers of America, which represents the agents, said US Airways' motion was expected. Both sides will continue to meet over the weekend.
"We're hoping to be able to reach an agreement that will at least offset some of the very severe cuts that the airline has been looking for," Johnson said.