United ALPA Statement on Pilot Pension Plans

10th Aug 2004

Captain Mark Bathurst, Chairman of the
United Pilots Master Executive Council of the Air Line Pilots Association,
released the following statement regarding pilot pensions at United:
A number of news media outlets have reported that United Airlines will
seek to terminate all employee pension plans, including the pilot pension
plan, as part of its program to exit bankruptcy. The pilots of United
Airlines have the following message for the Company, the media and the
financial markets: we will use every resource at our command and every
legal means available to prevent the Company from destroying the pilot
pension program.

We recognize United’s continuing need to reduce operating costs, given the
current dramatic rise in the price of fuel. However, the Company’s 9,000
pilots have already made huge concessions to provide United with over $6
billion in financial relief over the next five years. Over the last 18
months, the average pilot has forfeited 45% of his or her pay and 20% of
his or her pension benefits, as well as endured a 15% increase in work
hours. We made these enormous financial and lifestyle sacrifices to help
the airline move toward profitability and to protect our pensions. We will
not further sacrifice our futures—and our families’ futures—as well.

The facts are now clear: United’s labor costs are now among the lowest in
the network airline industry, but its non-labor operating expenses remain
among the highest. Outside of labor and fuel costs, American Airlines
enjoys a full 25% operating cost advantage over United. United’s
maintenance and airport operations are substantially less efficient than
its industry peers; its aircraft leases remain well above market; its
relationship with United Express carriers is unprofitable and unstable;
and United fails to manage revenue as well as American, Continental or
Northwest. Any corporate management team can attack employee pensions.
That is the “simple” way to generate a large sum of cash. We are asking
this management team for two things: accountability, and to begin steps
toward executing a solid, rational, and achievable business plan that does
not attempt to solve its problems on the backs of its employees.

United’s pilots have acquiesced to massive pay cuts and much longer
working hours: huge concessions that made it possible for this great
airline to remain viable throughout an extraordinarily difficult period.
Terminating pilot pensions has the potential to destroy the career of
every United pilot, and potentially plunge labor relations at United into
years of hostility and chaos. We will do everything in our power to avoid
that scenario. The pilots of United Airlines will fight for our pensions
every bit as hard as we have fought to ensure that United emerges from
bankruptcy as the best airline in the world.


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