U.S. Airways gets temporary order to cut workforce pay

By Jeff Pines

Washington, Oct. 15 - U.S. Airways Inc. obtained an interim court order enabling the company to cut the base rate of pay of its pilots, mechanics and other workers by 21% and provide other concessions until Feb. 21.

The order was filed with the U.S. Bankruptcy Court for the Eastern District of Virginia Friday.

Judge Stephen Mitchell ruled the pay cuts and other reductions were essential to the continuation of the airline.

Among the other changes the airline can now make are an across-the-board 10% contribution to its pilots' pension instead of the current pension contribution rate, authority for U.S. Airways' management to increase the monthly obligation for all flight attendants in a given base by 5 or 10 hours, or by one extra trip, suspension of the employer match to the mechanics' 401(k) plans and a reduction in the company's contribution to the International Association of Machinists & Aerospace Workers' national pension plan to 3%.

But Bruce Lakefield, the airline's chief executive officer, said in a news release that "the interim relief is not a substitute for permanent relief" and that management will continue its negotiations with the unions to reach consensual agreements.

Arlington, Va.-based U.S. Airways filed for bankruptcy on Sept. 12. Its Chapter 11 case number is 04-13819.

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