Pilots union finally settles with Northwest, avoiding rejection of collective agreement

[JURIST] After nearly five days of round-the-clock negotiations in New York City, bankrupt Northwest Airlines (NWA) [official website; press release] has reached a tentative agreement with its pilots union, NWA officials announced Friday. The pilots' union, the Northwest Airlines Air Line Pilots Association (NAALPA) [official website; press release], is the second union to settle with the reorganizing airline this week, following the flight attendants who also reached an tentative agreement [JURIST report] on Wednesday.

Although details of the pilot's agreement have not yet been released, NWA had insisted in its bankruptcy filings that the pilots take a permanent pay cut of an additional 28.4% - which would save the company $361.8 million annually - on top of the 15% pay reduction the pilots already agreed to in late 2004. After announcing the settlement, a NAALPA spokesman stated that the union accepted cuts beyond those agreed to in 2004 so that the airline could "emerge from bankruptcy as a proud and profitable airline."

The settlement, if ratified by a majority of NAAPLA members, eliminates the possibility of a bankruptcy judge ruling to allow NWA to reject the collective bargaining agreement, pursuant to Section 1113 of the US Bankruptcy Code [text], which would effectively leave the pilots jobless and without a remedy. The settlement also forecloses on the pilots' previous threat of a work strike, which NWA argued would have been unlawful during bankruptcy under the Railway Labor Act (45 U.S.C. 151) [text]. The Minneapolis Star Tribune has local coverage.

 

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