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Airline update.

At American Airlines, the Transport Workers agreed to a 45-month contract that provides for lump-sum payments in lieu of wage increases. The accord, covering 12,000 mechanics and other ground workers, calls for payments of $750 in April 1986, $1,000 in 1987, and $1,500 in 1988. The lifetime job guarantee program was expanded to cover some workers hired after the ratification date of the new contract. The program, which was established under the 1983 contract in return for lower entry pay rates and changes in work rules, originally covered only workers on the payroll when that contract was ratified.

Provisions of the 1985 accord increased the probationary period to 180 days, from 90, for new hires, requires them to pay for their own insurance during their first year on the job, reduces their ultimate maximum vacation to 4 weeks, from 6, and permits American to hire more part-time workers.

Other terms included a three-step increase in pension rates to a range of $25.05-$35 a month (varying by job classification) for each year of service for employees retiring at age 65; a new "voluntary separation program" for employees who quit their jobs, with payments ranging from a minium of $5,000 to a maximum of 23 weeks of pay.

At Continental Airlines, the Machinists and the Flight Attendants unions ended their 18-month strike and asked the airline to reinstate their members. Continental agreed to do so, but specified that "there will be no displacement of current employees under any circumstances as a result of the unions' action." This means that some of the strikers might have long waits before returning to work. About 50 percent of the members of both unions had earlier returned to work without union authorization and Continental had also hired some nonunion replacements.

The dispute began in 1983, when the airline reacted to the Air Line Pilots and the Flight Attendants rejection of profit sharing in exchange for labor cost concessions by seeking protection under Chapter 11 of the Bankruptcy Code, then resuming operation with employees paid substantially less than under prior union contracts. (See Monthly Labor Review, November 1983, p. 73.)

Despite the two unions' decision to return to work and negotiate with Continental on wages,benefits, and work rules, the Air Line Pilots continued their strike, even though 25 percent of its members had returned to work without authorization. One possible reason was that the striking pilots are receiving strike benefits of $2,400 a month from their union, compared with $70 a week for the mechanics and nothing for the flight attendants.

both the Flight Attendants and the Machinists unions said they were ordering the return to work because it was time for a change in strategies and because they wanted to correct a mistaken public impression that they were out to ruin Continental. An official of the Flight Attendants also conceded that, "financially, our members could not deal with it any longer." Despite the change of strategy, both unions noted that they had not withdrawn several lawsuits they had filed against Continental.

A Continental spokesman said that the company earned a profit of $50.3 million in 1984, compared with a loss of $218.4 million in 1983, and that "we are a much more efficient operation now, and we are better utilizing our work force."

At USAir, a settlement with the Machinists union for 2,100 ground service employees featured a lengthened pay progression schedule for new employees and a new "voluntary separation program" to induce current employees to retire. The company said that it hopes that "as many [employees] as possible" choose to leave so that it can reduce costs by hiring replacements under the new pay progression schedule.

Under the new schedule, workers will reach the maximum for their pay grade after 5 years of service, instead of the previous 18 months. The starting rates for employees hireed after the effective date of the contract are $12.95 an hour for mechanics (formely $16.22), $9.27 for utility workers (formerly $12.35), and $10.73 for stock clerks (formerly $12.96).

The 3-year accord raised pay rates 9.9 percent, in steps, over the term. For mechanics at the top of their pay schedule, the resulting hourly rates are $16.90 retroactive to March 1, 1984 (formerly $16.65), $17.25 retroactive to November 1984, $17.60 in November 1985, $18 in September 1986, and $18.30 in January 1987. Over the term, top rates will rise to $13.10 (from $11.92) for utility workers and $15.17 (from $13.79) for stock clerks. The voluntary separation program, which is limited to employees eligible for retirement, provides for payments to participants calculated at 1 week's pay for each year of service. The minimum payment is $5,000 and the maximum is 23 weeks' pay.

Other terms include 55 cents an hour pay (formerly 45 cents) for each of up to two Federal licenses held, improved dental benefits, and increases in tool insurance.
COPYRIGHT 1985 U.S. Bureau of Labor Statistics
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Title Annotation:labor relations
Author:Ruben, George
Publication:Monthly Labor Review
Date:Jul 1, 1985
Words:838
Previous Article:Teamsters, trucking companies settle.
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