Bankrupt UAL Corp., parent of United Airlines, today moved two steps away from a potential workers strike and closer to completing its bankruptcy reorganization thanks to new collective bargaining agreements with labor unions. The Aircraft Mechanics Fraternal Association this morning said membership had approved a tentative deal, while a United spokesperson this afternoon confirmed the company had reached a new agreement with the International Association of Machinists and Aerospace Workers.
The last of the company's employee groups to accept a new round of concessions, both AMFA and IAM had said they were prepared to strike should United use any bankruptcy court-approved motion to unilaterally alter collective bargaining agreements. Such a motion would have been the subject of a court hearing today in Chicago had AMFA members rejected their deal
(BTNonline, May 17) or if IAM and UAL had not come to terms before today's deadline.
"This is an important and necessary step in providing the cost savings United needs to finish its restructuring successfully," UAL said in a statement earlier today, regarding the AMFA ratification.
While the AMFA deal now is final, United and IAM in the coming weeks will work out the details of their new tentative agreement, which then would be subjected to a ratification vote.
In other UAL news, the company reportedly must return four aircraft to lessors "and will cancel the flying of one route (Chicago-Buenos Aires) as a result," said Helane Becker, analyst with The Benchmark Co. "Four additional aircraft may also be forced to be returned unless United agrees to higher lease rates. In our view, United may be forced to rethink its business plan again, as lease rates on aircraft have started to move higher."