Nelson, the Judge and UA

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Nov 25, 2002
[SPAN class=t]Pay Cuts Ordered for United Machinists[/SPAN][BR][SPAN class=tt]Friday January 10, 11:02 am ET[/SPAN]

[DIV class=ar]CHICAGO (AP) -- A federal bankruptcy judge Friday imposed temporary 14 percent pay cuts on United Airlines'' 37,000 machinists, the only employee group to have rejected the carrier''s proposal for emergency reductions.[BR]The action, which United requested, will help it meet strict financing requirements in bankruptcy by saving an estimated $70 million a month when combined with lower interim wages for other union workers.
[P]Equally as important, it gives the airline and its unions additional time to negotiate long-term contracts by ensuring sharply lower labor costs through May 1.
[P]Pilots agreed earlier to take 29 percent pay cuts, while wages will be reduced by 9 percent for flight attendants and 13 percent for dispatchers and meteorologists.
[P]Bankruptcy Judge Eugene Wedoff said the short-term pay reductions were essential to continue United''s business and to avoid irreparable damage to its estate.
[P]The machinists'' pay cuts take effect immediately and equate to 13 percent when applied over the same period as the other employees'' reductions, which were calculated from Jan. 1.
[P]United filed for Chapter 11 bankruptcy protection. It says it must reduce wages by $2.4 billion a year through 2008 if it is to emerge successfully from bankruptcy, which it hopes to do sometime next year.[/P][/DIV]
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