US Airways' machinist, flight attendant unions object to management retention plan

By Caroline Salls

Pittsburgh, May 24 - US Airways, Inc.'s proposed transaction retention program drew opposition from the International Association of Machinists and Aerospace Workers and the Association of Flight Attendants-CWA, AFL-CIO, according to filings with the U.S. Bankruptcy Court for the Eastern District of Virginia.

The proposed program includes officer employment contracts and severance and retention policies for salaried employees and was created in anticipation of the newly announced merger agreement between US Airways and America West Holdings Corp.

The machinists' union said US Airways' officers and senior management seek to incur more than $50 million in administrative expenses through the retention program "to bonus themselves along with other officers and management and salaried employees."

"This motion constitutes a disrespectful betrayal of [US Airways'] union workforce, which contributed more than $1 billion in annual sacrifice to [the company's] reorganization efforts," according to the objection.

The machinists union also said in the filing that US Airways does not provide adequate information or justification for the proposed payments or reward under the plan.

In its objection, the flight attendants' union said "having obtained judicial approval to slash unionized employees' wages and benefits, eliminate retiree health benefits and to terminate its pension plans under the guise that salaried and management personnel would share the pain with the unionized workers, it is preposterous and inequitable for [US Airways] to now seek approval for this unjustified management windfall."

Several employees and retirees and the communications workers union have also objected to the retention proposal.

A hearing on the retention plan is scheduled for May 31.

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

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