ATA requests OK to reject pilots' union collective bargaining agreement

By Caroline Salls

Pittsburgh, Aug. 11 - ATA Airlines, Inc. requested approval to reject its collective bargaining agreement with its cockpit crewmembers represented by the Air Line Pilots Association, International, according to a Wednesday filing with the U.S. Bankruptcy Court for the Southern District of Indiana.

According to the filing, 833 crewmembers are covered by the agreement.

The company said its business plan calls for an investment of up to $100 million in new capital needed to fund its reorganization.

In addition to its need to attract new investment, the filing said ATA is faced with a significant increase in its crewmember labor cost.

After a current interim agreement with the union expires on Sept. 30, the concessions in the interim agreement will snap back, immediately increasing the crewmember costs by about $4 million per month.

"Such an increase will not only inhibit attracting needed investment, it would likely push this estate into liquidation," the motion said.

Also, ATA's current business plan is based upon a $37.6 million per year reduction in crewmember labor costs in 2006.

ATA, an Indianapolis-based airline holding company, filed for bankruptcy on Oct. 26, 2004. Its Chapter 11 case number is 04-19866.

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