UAL Corp. (NYSE: UAL), the parent company of United Airlines, today announced that it has reached a tentative, six-year agreement with the Air Line Pilots Association (ALPA) that creates a new framework of labor costs and productivity.Ê The agreement has been endorsed by ALPA’s Master Executive Council (MEC) and is subject to approval by the UAL board of directors.Ê In addition, the tentative agreement requires ratification by United’s pilots.Ê
“Our pilots are to be highly commended for their leadership role in tackling the fundamental issues we face at a critical time for United Airlines and the industry,” said Glenn Tilton, chairman, president and chief executive officer.Ê “This breakthrough agreement is a significant step forward in making the hard changes necessary to reposition United to compete more effectively both immediately and over the long-term.Ê This agreement helps provide the flexibility United needs to strengthen our business, compete where we choose, and become a resilient, profitable company that can offer stable jobs on a sustainable basis.Ê
“We recognize the sacrifices this agreement represents and admire the pilots for taking these difficult actions.Ê This is a huge step in enabling this airline to emerge from Chapter 11 as a stronger, more competitive company.ÊÊ We’ve consistently said that this was the chance to get it right for the long-term, so I especially appreciate Captain Paul Whiteford and the ALPA MEC for engaging in the tough but necessary work that allowed us to arrive at this agreement together,”Ê Tilton said.
Leaders from the pilots union will present the agreement to their membership and establish a schedule for ratification.Ê The tentative agreement between ALPA and United addresses the company’s short- and long-term cash needs and supports the company’s plan for transformation
In total, the tentative agreement provides annual labor costs savings of approximately $1.1 billion, in line with the company’s financial requirements.
“We are committed to continuing to work collaboratively with our remaining unions on similar agreements and will continue to negotiate with them around the clock, if necessary, in the days and weeks ahead,” Tilton said.
United earlier this month reached a tentative agreement with the Transport Workers Union on behalf of the 18 meteorologists working at United’s world headquarters that has since been ratified.Ê The agreement with the TWU calls for a permanent reduction in wages of 13 percent and changes to certain work rules.Ê
News releases and other information about United Airlines can be found at the company’s website, www.united.com.