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Pan Am settles with flight attendants.

Financially-troubled Pan American World Airways moved closer to its goal of winning $180 million a year in labor and cost reductions from its unions by settling with the Independent Union of Flight Attendants on a 39month contract calling for a reported cut of $33 million a year. Earlier in 1988, members of the Air Line Pilots and the Flight Engineers Beneficial Association had accepted cuts and Pan Am had imposed an 8-percent pay cut on Teamsters' members under provisions of the Railway Labor Act after the employees had refused to use arbitration to resolve bargaining differences.

Under the Flight Attendants' contract, wages were cut by differing amounts, depending on the tier: for the upper tier or "A" scale (those hired prior to May 1985), the cut was 11.715 percent; for the lower tier or "B" scale (those hired after May 1985), the cut was 2 percent. The only increase was in the starting rate for B scale employees hired during the contract term; they begin at $1,000 a month, instead of $907.

In return for the cuts, Pan Am agreed to move toward elimination of the two tiers. This was accomplished by lengthening the pay progression schedule to 13 years, from 7 years, for B scale employees; but merging it with the schedule for A scale employees after 10 years of service. Previously, top B rates were lower than top A rates.

The accord also provided for cuts in paid vacation for some shorter service A and B scale employees, for decreases in per diem allowances, and for an incrcase in the number of foreign nationals Pan Am may hire (from 150 to 350).

At the time of the Flight Attendants' settlement, Pan Am was negotiating with the Teamsters on a contract to replace the imposed terms for ramp service employees, and was in arbitration to settle differences with the Transport Workers over terms for mechanics.

"Developments in Industrial Relations" is prepared by George lRuben of the Division of Developments in Labor-Management Relations, Bureau of Labor Statistics, and is largely based on information from secondary sources.
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Title Annotation:Developments in Industrial Relations
Author:Ruben, George
Publication:Monthly Labor Review
Date:Feb 1, 1989
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