United Air Lines flight attendants oppose exclusivity extension

By Jeff Pines

Washington, Aug. 13 - The United Air Lines' Association of Flight Attendants, affiliated with the AFL-CIO, became the second labor union to oppose extending United's exclusive right to file a reorganization plan and the exclusive right to solicit votes for the plan.

United said it needs until Dec. 31 to file a reorganization plan and until March 31, 2005 to solicit votes for the plan. After striking out with the Air Transportation Stabilization Board by failing to get government guarantees for its exit financing, UAL, United's parent, asked the U.S. Bankruptcy Court for the Northern District of Illinois for the extended exclusivity.

The first union to object was the International Association of Machinists and Aerospace Workers.

"United Airlines' management is making decisions that are simply reckless," said Greg Davidowitch, United Airlines Flight Attendant Master Executive Council president, in a news release.

"They negotiated new DIP financing on terms that purportedly require the company to withhold employee pension plan payments that are mandatory under the law and under our contract," he said. "Choosing financing that threatens the future security of front-line employees reflects baseless business sense. We will challenge any actions that distract from the extraordinary efforts flight attendants are making to see our airline succeed."

The flight attendants' objection argues the extension is unwarranted because management illegally refuses to make mandatory pension contributions, fails to make good faith progress toward reorganization, gross misjudgment on how the ATSB would treat its application and failure to develop a contingency plan in the event of an ATSB denial.

In its objection, the International Association of Machinists said management had various warnings not to rely on ATSB support for exit financing and said that even though management was supposed to be working with labor, United surpised the union when in open court the company said it would no longer make mandatory pension plan payments.

An Aug. 20 hearing is scheduled.

United filed for bankruptcy on Dec. 9, 2002. Its Chapter 11 case number is 02-48191.

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