CHICAGO >> United Airlines' flight attendants ratified a cost-cutting deal with the nation's No. 2 carrier yesterday, one day after the company's stock tanked as analysts called bankruptcy nearly inevitable. Flight attendants
for United ratify
wage concessionsAssociated Press
Association of Flight Attendants spokeswoman Dawn Deeks said 87 percent of the flight attendants who voted signed off on the deal. United's 24,000 flight attendants had been widely expected to approve the $412 million in wage concessions.
However, their OK means little as long as the airline's mechanics continue to resist proposed reductions of $600 million in their wages and benefits.
Wage-cutting agreements accepted by United's pilots and other employee groups expire Dec. 31 unless mechanics sign on. United is asking for a total of $5.2 billion in companywide labor cuts over 5 1/2 years.
The airline says its application for a $1.8 billion federal loan guarantee is imperiled if all unions cannot agree on wage concessions. A ruling is expected any day on the guarantee, which cash-poor United says it must have to obtain $2 billion in private loans.
Without the loan guarantee, United has said it would have no choice but to file for bankruptcy.
In a message to employees recorded after the mechanics' vote and before the attendants' approval, United chief executive Glenn Tilton warned that a bankruptcy filing could dramatically alter the what he called a "cooperative" negotiation process.
"We all must then follow a prescribed course that is both unpredictable and potentially adversarial," Tilton said.
A bankruptcy is likely to have no immediate effect on passengers. United has said it will continue flying its normal schedule, as US Airways has been doing since its Chapter 11 filing in August.
United and the International Association of Machinists and Aerospace Workers were scheduled to meet today to discuss the mechanics' rejection. Union spokesman Frank Tiberi said the flight attendants' vote would have no effect on those negotiations.
Shares in United parent UAL Corp. plunged $1.12, or 31 percent, in holiday-shortened trading Friday to close at $2.51 on the New York Stock Exchange. That was the first trading day since the mechanics' vote was announced.