Concession Demands Too Hefty for Delta Pilots

5th Aug 2004

The pilots’ union at Delta Air Lines on Wednesday said management’s demands for $1 billion in wage cuts and other concessions “far exceed” the company’s economic situation, and suggested it might have to take “another path” in the negotiations.

Delta, the No. 3 U.S. airline facing possible bankruptcy, last week said it asked pilots for a minimum $1 billion in concessions and proposed changes to the pension plan. In a letter to union members on Wednesday, John Malone, head of Delta’s Air Lines Pilots Association, said the union presented management with a proposal worth between $655 million and $705 million in annual concessions for four years.

In return, the union requested equity, profit-sharing and corporate governance rights. But Malone said that Delta did not address the requirements or provide a tie to an overall restructuring including other stakeholders.

“How did management respond to the huge wage, benefit and job cuts we offered? By foisting upon us a set of demands that far exceed the economic situation the company faces.”

Some of those demands were a 35 percent pay cut, no night pay, gutted job security and a new post-retirement medical plan, according to the letter.


“Either management will figure out what it ‘needs,’ address our equity requirements and make other stakeholders participants in a comprehensive restructuring, or we will take another path,” he said. The letter did not say what the other “path” was.

Delta responded by saying this was not a “take it or leave it process.” A Delta spokesman said the airline has no intent to be punitive or affix blame in the process.

“Our motivation is, and remains, to avoid bankruptcy and to rebound as a viable airline,” said spokesman John Kennedy.


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