Despite Economy, Airline Unions Strong?


Aug 20, 2002
Despite Economy, Airline Unions Strong
Tuesday April 29, 10:41 pm ET
By Leigh Strope, AP Labor Writer

Due to Strength in Numbers, Airline Unions Retain Some Muscle, Even in Bad Economy

WASHNGTON (AP) - A bad economy is brutal for unions. Just ask any airline employee. But unions at American Airlines showed that they''ve still got some muscle at the bargaining table despite the repeated layoffs and contract cuts their workers have been forced to accept. Unions'' outrage over[sup],[/sup] bankruptcy-proof pensions and huge bonuses granted to American executives, disclosed after workers had agreed to $1.8 billion in cuts, led to the resignation of Chief Executive Donald Carty last week.

Strength really is in numbers, experts say.

The airline industry is one of the most unionized in the country, with almost 60 percent of all pilots, flight attendants, mechanics and air traffic controllers belonging to a union. Overall, just 13.2 percent of the U.S. work force is unionized.
In sectors where unions are strong, even if there are serious economic problems, unions still will have power, comparable to the market power of the industry they’re working with, said Rick Hurd, director of labor studies at[sup],[/sup] Cornell University.

Airlines have been battered by a weak economy, the 2001 terrorist attacks, the war in Iraq the outbreak of[sup],[/sup] SARS.

“It’s not surprising the unions have been forced to make concessions because the airline companies have lost significant market power,†he said. But at the same time, they were able to hold their own in a certain way and force the company to make comparable concessions,†Hurd said. Besides Carty’s resignation, unions were able to win back some of the concessions they had agreed to, including [sup]-[/sup]a shorter term for the new contracts. Workers[sup]-[/sup] also would get bonuses, like management, if certain operating targets are met. Following the American agreement, Delta Air Lines pilots, angry over similar retention bonuses and other perks awarded to senior management last year, proposed to curb severance payments for managers and force the company to account for stock options as expenses. The proposals require board approval. Unions can lose a lot of power when unemployment is high and people are desperate for work. The nation’s unemployment rate has hovered at an eight year high for months now. “It’s very difficult to engage in strikes when there’s a … ready pool of strike breakers waiting to come in and take your place.†said Paul F. Clark, a Penn State professor of labor studies and industrial relations.

As for the $1.8 billion, in annual concessions at American, the unions had little choice. They stood to lose even more in a bankruptcy. United Airline workers faced the same tough choices several months ago. Bankruptcy law allows labor contracts to be voided if a company can prove those obligations are endangering the health of the business.
Virtually all of the unions are taking one cut after another, and they don''t really have the bargaining power[sup],[/sup] to resist that, Clark said.

Airline officials and unions need to learn from the auto and steel industries, said[sup],[/sup] Robert Bruno, labor professor at the University of Illinois at Chicago.

Relations between management and labor were venomous, but they were forced to work together in the 1980s to salvage their industries from overseas competition.
But it''s hard for unions to work with management when tactics like American’s private pensions and bonuses breed mistrust and animosity, he said.
Airline management just continues to mishandle[sup] [/sup]their bargaining relationships over and over and over again, Bruno said.