Note to US Airways: Fix Labor Problems First

[Omaha Steve]

http://www.thestreet.com/story/10722283/1/note-to-us-airways-fix-labor-problems-first.html?cm_ven=GOOGLEFI

By Ted Reed 04/09/10 - 01:51 PM EDT

CHARLOTTE, N.C. (TheStreet) -- A merger between US Airways(LCC) and United(UAUA) would face big labor hurdles. But they would hardly be insurmountable.

Key union leaders are reluctant to pass judgments, claiming the carriers have so far failed to communicate with them. But the unions do not oppose a merger ipso facto. Even the most vexing labor problem this merger would face -- the lingering four-year seniority battle among US Airways pilots -- could potentially be resolved.
United Airlines and US Airways



A key to that solution would involve US Airways management, which has so far refused to have anything to do with the seniority battle. CEO Doug Parker has repeatedly said it's an issue for the pilots to resolve. In the meantime, the battle has enabled the carrier to avoid making any improvements in the contract since the 2005 merger between US Airways and America West.

In 2007, US Airways offered to enhance a joint pilot contract by $122 million annually; that offer is still sitting there. As Parker said during an earnings conference call in April 2008, "We are not going to move the pay scales of one contract without having a combined contract."

Conceivably, to facilitate a merger, the airline could become involved in seeking to end the seniority conflict, in combination with enhancing the contract. "If they really want a deal, we need to be a partner in the deal," said James Ray, spokesman for the U.S. Airline Pilots Association. Ray said Delta(DAL) paved the way to a smooth merger with Northwest because "Delta went to the pilots and made them partners." A US Airways spokeswoman declined to comment.

FULL 3 page story at link.