Examiner Finds For United

[Eagle]

Independent Examiner Finds for United Airlines
Thursday, March 18, 2004 07:51 PM ET

Confirms Timing of Decision About Retiree Medical Benefits
CHICAGO, March 18 /PRNewswire-FirstCall/ -- An independent examiner Thursday found that United Airlines (OTC Bulletin Board: UALAQ, news) told the truth when the company said it had not made a decision to seek changes to retiree medical benefits before July 1, contrary to allegations made by certain labor leaders.



"I conclude that United's decision to seek section 1114 relief was not made before July 1, 2003," the Examiner wrote in his report. He also said, "I found no evidence to support the suggestion that United had a financial incentive to induce flight attendants to retire between May 1 and July 1, 2003."

"This makes clear what we said all along -- we told the truth," said Peter D. McDonald, executive vice president - operations. "The allegations from the Association of Flight Attendants were a distraction that led to a colossal waste of time and resources, and the examiner's report is an emphatic repudiation of those baseless claims."

The proposed modifications United is seeking are designed to bring the medical benefits of those who retired prior to July 1, 2003, more in line with future retirees and with the marketplace. The company is beginning negotiations with retirees' authorized representatives on necessary modifications to benefits, and looks forward to moving ahead toward consensual agreements with retirees.


About United Airlines


United, United Express and Ted operate more than 3,400 flights a day on a route network that spans the globe. News releases and other information about United may be found at the company's Web site at http://www.united.com .


Worldwide Communications:

Media Relations Office: 847.700.5538
Evenings/Weekends: 847.700.4088

Source: United Airlines

Contact: United Airlines Worldwide Communications, Media Relations Office, +1-847-700-5538, or Evenings-Weekends, +1-847-700-4088

 

[TravelDude]

"This makes clear what we said all along -- we told the truth," said Peter D. McDonald, executive vice president - operations. "The allegations from the Association of Flight Attendants were a distraction that led to a colossal waste of time and resources, and the examiner's report is an emphatic repudiation of those baseless claims."

EXCELLENT EXCELLENT

I so proud and happy to hear UA standing up to AFA and using such bold language!

 

[Bear96]

Interesting. That is UA's spin from their press release; below is AFA's. Talk about differing points of view!

----------------------------------

United Concealed that Changes to Retiree Health Care were Likely


Date: March 18, 2004
Contact: Sara Nelson Dela Cruz 847-292-7170 ext.524


United’s Proposal to Change Benefits Product of Bad Faith Bargaining
CHICAGO — United Airlines CFO Jake Brace admitted that he knew well before July 1, 2003, that the company would likely seek changes to retiree health benefits through the bankruptcy court. Meanwhile, thousands of United employees decided to retire thinking their health care benefits would be preserved.

In an interview with Bankruptcy Court Examiner Ross O. Silverman, Brace stated that during the 1113 process and throughout most of the bankruptcy proceedings he believed it likely that United would seek 1114 relief and would have done so during the first part of 2003 if it had sufficient manpower and resources.

United sought and received $2.56 billion in annual concessions from employees through the 1113 process. The fact that changes to retiree benefits were likely was never revealed to the flight attendants, leaving out a key piece of information during the concessionary negotiations and for employees who were considering retirement.

“When United’s CFO believes that the company was likely to seek changes to retiree health care, our flight attendants deserved to know about it before they turned in their wings,â€￾ said United AFA Master Executive Council President Greg Davidowitch. “This was a sin of omission. Management of the most senior level concealed vital information and stood silent while thousands of employees made the difficult decision to end their careers.â€￾

The fact that United withheld this vital information equates to bad faith bargaining and therefore taints the company’s request to change retiree health benefits. “While we take some small comfort that United did not commit outright fraud, the flight attendants are still deeply disturbed that the examiner’s report exposes a pattern of bad faith bargaining and deception by United Airlines,â€￾ Davidowitch said.

The examiner will present his findings to Judge Eugene Wedoff on March 19 who has made it clear that United’s attempt to seek changes through the court has a wider impact. In his memorandum of decision to appoint the examiner Wedoff said, “The question of whether United misled its flight attendants about the likely effect of retirement during the two-month window is more than a two-party dispute between United and AFA; it bears on United’s overall good faith in dealing with its employees and former employees. This is an issue in United’s pending efforts to obtain relief under Section 1114 (f) (g), since modification of retirement benefits can only be ordered if all affected parties are treated fairly and equitably. But the issue has a broader impact here: fair treatment of employees is key to any successful reorganization of a debtor’s business.â€￾

 

[ITRADE]

At this point, basically the only point that matters is that of the examiner. Relitigating the matter in press releases does zippo, nada, zilch.

Take your beating and try next time.

 

[Bear96]

Take your beating and try next time.

Yes but who took the beating?

According to UA, AFA did. According to AFA, UA did.

 

[ITRADE]

Take your beating and try next time.

Yes but who took the beating?

According to UA, AFA did. According to AFA, UA did.

Again, what matters is what the examiner says.

I always love it when the losing part grovels and tries to relitigate the issue in its press release. When US got spanked by the District Court in the IAM outsourcing matter, they whined and whined in their press release. Of course the tables were turned when the 3d Circuit went the other way.

 

[Just Plane Crazy]

It just sounds like politics. And the examiner has the last word, regardless what the AFA wants every one to believe.

It is like Martha, she lied and was convicted. No matter what she wants everyone to believe.

Just because you don't like what UA is doing to get out of the trouble it dosn't mean that it is all wrong and corupt.

What matters in the end is that UA will survive and be a strong player in the industry! And to every one who thinks that they will get jobs with other airlines if UA shuts down, think again!

 

[ITRADE]

It just sounds like politics. And the examiner has the last word, regardless what the AFA wants every one to believe.

It is like Martha, she lied and was convicted. No matter what she wants everyone to believe.

Exactly.

BTW, were you same Just Plane Crazy that used to post on PBB?

 

[TravelDude]

At this point, basically the only point that matters is that of the examiner. Relitigating the matter in press releases does zippo, nada, zilch.

Take your beating and try next time.

Exactly!

AFA, is the one making the relationship between the company and employees worse by continuing to spread propaganda, even after being proven wrong. The company did act in good faith! Ask the examiner!

 

[Just Plane Crazy]

BTW, were you same Just Plane Crazy that used to post on PBB?

Sorry its not me!

 

[Cosmo]

What I don't understand is how the AFA can continue to make these silly claims after the issuance of the examiner's report since THEIR OWN WEBSITE, prior to July 1, 2003, included a statement that, to paraphrase, said United reserved the right to change the retiree medical plan. United also included this caveat in a letter sent to all of the flight attendants, again prior to July 1. So can anyone please logically explain to me AFA's legal or moral basis for continuing this fight?

 

[TravelDude]

So can anyone please logically explain to me AFA's legal or moral basis for continuing this fight?

First off, in my opinion they have no legal or moral basis for continuing this fight.

But with that said, AFA has recently been merged into a much larger union, I believe it Communication Workers of America (CWA). A vote that was about 50% supported by United AFA members. As such, there are now rumblings of United FA's starting a new union. So, AFA is trying to show muscle and they are deeply involved.

 

[ITRADE]

I don't think the level of involvement is what is driving the union campaign against AFA. It is an effort to form a union that will not have to abide by a DOH requirement if, by chance, United decides to merge with or acquire US Airways.

 

[Bear96]

I don't think the level of involvement is what is driving the union campaign against AFA. It is an effort to form a union that will not have to abide by a DOH requirement if, by chance, United decides to merge with or acquire US Airways.

Though the seniority issue is a factor, it is a relatively small / side issue.

The real driving force behind the new union movement is long dissatisfaction with the inadequate voice UA F/As have in the AFA structure. The CWA merger epitomizes that. In fact *80%* of the UA vote was against the merger-- but with the way AFA is structured, the merger happened anyway. That plus other long-standing issues is what really sparked the movement.

Their website is www.uafu.org. Not much on it yet as things are just getting up and running, but that is probably the best way to watch it unfold.

 

[aislehopper]

From my perspective as an outsider, the AFA has a habit of engaging in hyperbole, highlighting facts that give the impression that an AFA loss was really a win, or complaining that outside forces beyond all reason conspired to put the AFA in the inferior position. The AFA did it in the first Delta campaign. Unfortunately, this release appears to be more of the same.

For more examples, see AFA Media Relations Page Look at 2002.


ah