Continental Airlines and the International Association of Machinists and Aerospace Workers, representing 8,300 of the carrier's flight attendants, yesterday reached a tentative agreement on a new contract. The National Mediation Board said it was prepared to release both sides from mediation—which could have prompted the company to unilaterally impose labor costs cuts and set the clock ticking toward a flight attendants strike—had no deal been reached during this week's "final" negotiating sessions in Washington.
Continental's flight attendants will vote to ratify or reject the agreement, with final results expected in late January. Should workers approve the deal, the airline would have secured new, cost-saving pacts with all major unionized work groups
(BTNonline, March 31). A simultaneous strike vote will determine if Continental's flight attendants authorize a work stoppage should they reject the tentative deal.
"We have ensured that IAM flight attendants will not suffer the loss of a defined benefit pension plan and are protected against what occurred to flight attendants at US Airways and United Airlines, even if the current company-sponsored plan fails," said Robert Roach Jr., IAM general vice president of transportation.
Continental's labor relations in recent years have been considered among the more amicable of the major U.S. carriers but yesterday in a Securities & Exchange Commission filing the company said it would seek to impose new terms on the flight attendants, should they vote to reject the new deal.
"If the flight attendants strike or engage in other labor disruptions as a result of the company implementing wage and benefit reductions, the company could be forced to cancel a significant number of flights, which would have a material adverse impact on our results of operations and financial condition," Continental said in the filing.
The airline first announced a $500 million annual labor cost savings target in November
(BTN, Dec. 6, 2004).