At long last, Hawaiian Airlines and its pilots have a deal.
The two sides reached a tentative agreement on a three-year contract just before midnight Tuesday night and hours before a federal Bankruptcy Court hearing was to begin to determine whether the company had the legal right to impose a contract on the pilots.
No details were available on the contract, which still must be ratified by the 298 members of the Hawaiian Airlines unit of the Air Line Pilots Association.
"I'm very pleased that we have been able to negotiate an agreement with the Air Line Pilots Association that in their view protects the pilots' retirement needs while also keeping Hawaiian competitive," Hawaiian Airlines trustee Joshua Gotbaum said.
Hawaiian, which will mark its two-year anniversary in Chapter 11 reorganization on March 21, began conversations with the pilots on some of the issues more than a year ago. But there was a lot of acrimony along the way as the pilots took issue with Gotbaum's original plan to freeze the pilots' pension plan and to convert their retirement plan to a defined contribution plan.
Last month, Gotbaum filed a motion seeking this week's hearing after negotiations appeared to have stalled. In the motion, he proposed a two-tiered pension plan that would allow pilots over 55 to remain in the pension plan and for those under that age to convert to a defined contribution plan.
Jim Giddings, negotiating committee chairman for Hawaiian's ALPA unit, said the agreement reached on the pension plan was different than what was proposed but he declined to elaborate.
"What we agreed to is a completely different concept that allows the parties a thorough review and discussion and transition for the pension plan out of bankruptcy," he said.
The union's task is now to convince its members, who have been the most vocal of any of the union groups, that the deal is worthy of ratifying.
"I hope that the membership will look at the agreement on its merits and not have their opinions of the agreement colored by the frustrating and upsetting events of the last year and a half or so," Giddings said.
Gotbaum also is hopeful that the pilots will ratify the deal and get the airline over one of its few remaining hurdles to get out of bankruptcy.
"They wouldn't negotiate a deal that wasn't in the best interest of their members and that they couldn't endorse as a good deal," Gotbaum said.
The hearing that was scheduled for yesterday morning actually was postponed from Tuesday following an all-night negotiating session that brought the sides close to a deal. Bankruptcy Judge Robert Faris gave the sides one more day to reach an agreement before beginning their arguments in court.
While the pending hearing likely sped negotiations along, Giddings said it wasn't the overriding factor for reaching a settlement.
"We're glad we were able to reach an agreement," Giddings said. "Our goals have always been to reach a fair agreement and that was our focus. We've had a lot of big issues to deal with and we focused really on the issues rather than external time pressures."
Giddings said there are still a lot of details to be worked out and that the contract would be sent out for ratification "as soon as possible."
At the same time, the airlines' flight attendants also are planning a ratification vote after previously rejecting a contract.
Other unions representing mechanics, clerical workers, dispatchers and computer network engineers already have ratified deals.
None of the agreements go into effect until the airline exits bankruptcy.
A confirmation hearing that was scheduled to be held Monday to approve a trustee-backed reorganization plan will be rescheduled to March 10 and 11.