United, US Airways Push for Labor Cuts
United Airlines is asking its employees to approve cutting labor costs by $1.5 billion annually for the next six years as part of an emergency restructuring plan.
The cutbacks, to include pay reductions and the scrapping of recently negotiated raises, would provide the bulk of $2.5 billion the struggling carrier has targeted in annual savings to ensure its recovery.
The unions did not immediately respond.
Without a consensus on cuts, Chief Executive Jack Creighton told employees this week, the airline might be forced to file for Chapter 11 bankruptcy protection.
Shares of United parent company UAL Corp. fell 23 cents to $3.05 on the New York Stock Exchange.
Meanwhile, machinists for US Airways rejected wage and benefit concessions, while workers who load luggage and freight accepted them.
The air carrier, which has filed for Chapter 11 bankruptcy protection, had sought a combined $219 million in annual savings from its largest union as part of a $1.2-billion cost-cutting plan. The divided vote amounts to a savings of $65 million, according to a union estimate.
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