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Pilots to picket over pension

| Friday, May 23, 2003

The leadership of US Airways' pilots union has voted to pursue informational picketing -- which could begin in a few weeks -- mainly in response to management's handling of the pilots' pension plans.

"This management team is not being honest with us," said Air Line Pilots Association spokesman Roy Freundlich on Thursday. "Management has contractual obligations, and they seem to be trying to needle and pick at our contract."

The US Airways Master Executive Council for the pilots union resolved to pursue "all legal and representational avenues," including informational picketing. That is when off-duty pilots parade signs at airports and other permitted spots. The union currently is seeking such permits.

The union claims US Airways violated an agreement early this year wherein pilots acceded to having their defined-benefit pension terminated, if the company supported federal legislation to restore the pension with a new funding scheme. While still in bankruptcy, US Airways substituted that pension with a more affordable, defined-contribution plan.

Draft legislation would lower US Airway's annual funding obligation to $310 million, which is below the $325 million the carrier said is the maximum it could afford, Freundlich said. Such a bill has not yet been introduced in Congress.

But that $310 million assumes US Airways terminates its flight attendant and mechanic pensions, Chris Chiames, senior vice president of corporate affairs, said yesterday. The pilot portion of that annual liability is $124 million.

"We don't believe the Association of Flight Attendants and the International Association of Machinists would embrace our terminating their pensions in order to achieve some other savings," Chiames said.

"At the end of the day, if we're not comfortable with the numbers -- since we're writing the check -- we have to be confident that the numbers work," he said.

Chiames added that US Airways' reorganization plan had assured key creditors -- including aircraft financier General Electric -- that the airline had settled the pilot-pension dispute by substituting the defined-benefit plan with the more affordable defined-contribution plan.

Union leadership noted the pilots have lost 1,827 jobs and, in the last 10 months, conceded benefits and wages worth more than $3 billion over the next seven years. That is the term of their contract and of the $1 billion loan guaranty from the Air Transportation Stabilization Board.

"Given our obligation to repay a $1 billion loan that US taxpayers have guaranteed to help save this company, we are more than a little disappointed that our pilot union leadership has deemed it useful to undermine the accomplishments and sacrifices of so many hard-working employees because complex and difficult decisions had to be made," US Airways said in a prepared statement.

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