United Airlines, union hold contract talks down to the wire; pension question looms

Tuesday, May 10th 2005, 2:35 pm

By: News On 6

CHICAGO (AP) _ Trying to avert a threatened strike, United Airlines and its machinists union negotiated through the night as an unofficial Friday deadline neared for resolving a standoff over a new long-term contract.

The Machinists union said negotiators remained at the bargaining table Friday morning, hoping to resolve remaining differences over a new lower-cost pension plan before the conclusion of a bankruptcy-court trial.

Closing arguments in that proceeding, on United's proposal to impose pay and benefit cuts without the union's consent, were scheduled to begin later Friday. The union representing 20,000 machinists said they will walk off the job if Judge Eugene Wedoff approves the company's plan to break the contract.

United, a unit of Elk Grove Village, Ill.-based UAL Corp., is seeking annual concessions totaling $176 million over five years from machinists to complete a targeted $700 million in labor cost reductions.

Pensions remained the major sticking point in the talks a week after the airline was given court approval to dump its four pension plans.

Unlike the tense and sometimes emotional hearing last week over United's termination of employee pensions, the weeklong labor trial has been largely absent of sharp exchanges and accusations _ suggesting both sides were hopeful of a resolution through negotiations.

``I'm glad that the courtroom activity has been businesslike and there aren't ... sparks,'' United's chief operating officer, Pete McDonald, said in an interview earlier this week. ``The focus has been at the table to produce a tentative agreement that our employees, their members, can vote on and hopefully ratify.''

Nonetheless, the threat of a possible strike hung over the proceedings.

Union spokesman Joseph Tiberi reiterated that the union's 20,000 members, who include ramp and store workers and public-contact employees, would not back off their strike threat if the contract is broken.

``If we can't get a deal by the time the judge makes a ruling, we're prepared to shut down United Airlines,'' he said.