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United Airlines Heads To Court Over US Union Contr  
User currently offlineRsmith6621a From United States of America, joined Aug 2005, 194 posts, RR: 2
Posted (9 years 2 months 2 days 11 hours ago) and read 4683 times:

Snip....CHICAGO (AFP) - A day after United Airlines got permission from a federal bankruptcy judge to hand billions of dollars in retirement obligations over to the government's pension agency, a Chicago court is considering the fate of the carrier's union contracts. Two of United's six unions have received authorization from their members to strike, an action that United said would be illegal.

http://news.yahoo.com/news?tmpl=stor.../ustransportairunited_050511200147

Man the news just keeps getting better.....Yesterday the pensions....In a few days the contracts will be gone.....What Next!!!!......The sink in each employees kitchens???

UAL to date has spent over 200 million $$$ in legal fees.


Did You Ever Think Freedom Could Be this Bad
20 replies: All unread, jump to last
 
User currently offlineGigneil From United States of America, joined Nov 2002, 16347 posts, RR: 85
Reply 1, posted (9 years 2 months 2 days 9 hours ago) and read 4591 times:

I guess you don't understand what happened with the pensions. They handed the retirees and those with money in their pension over to the insurance company that covers them.

Those people will still get paid... everyone else will get converted to a 401(k) like just about everyone else in the country.

N


User currently offline1rocco From United States of America, joined Dec 2003, 119 posts, RR: 0
Reply 2, posted (9 years 2 months 2 days 9 hours ago) and read 4552 times:

And in return we the tax payers will feel the burden.. Like it or not the writing is on the wall.. Thanks UAL. UAL and the judge in charge of this bankruptcy have rewritten the meaning of bankruptcy. Now all the other legacy carriers are going to have to follow suit to be competitive. What happened to the strong surviving and the weak folding. So much for capitalism. BTW I have yet to see a thread flaming the IAM for there strike vote. Must not be as much fun as picking on the flight attendants for the possible demise of UAL. I understand it is tough seeing thousands of people out of work but enough is enough. They will move on. This is bringing down the whole industry and many people just can't see this. 1.1 billion dollar loss while under bankruptcy protection.. Its time to stop the nonsense and shut the doors and let the struggling airlines who have been working hard to avoid bankruptcy make a dime.

User currently offlineFlashmeister From United States of America, joined Apr 2000, 2900 posts, RR: 6
Reply 3, posted (9 years 2 months 2 days 6 hours ago) and read 4454 times:
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Those people will still get paid...

You left out how much they'll be paid. Probably 50-66% of what was contractually due them. The bottom line is that the employees did the work and held their end of the bargain up, United knew that they couldn't hold their side up and did nothing, and the court let them get away with it.

In most places outside Corporate America, that's called fraud.


User currently offlineBicoastal From , joined Dec 1969, posts, RR:
Reply 4, posted (9 years 2 months 2 days 6 hours ago) and read 4434 times:

Taxpayers will not get the burden. UAL turned over all of the assets in its pension funds to the PBGC. The PBGC will administer and pay out those assets to eligibles retirees and employees. No taxpayer dollars.

User currently offlinePA110 From United States of America, joined Dec 2003, 1988 posts, RR: 24
Reply 5, posted (9 years 2 months 2 days 6 hours ago) and read 4426 times:
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Quoting Flashmeister (Reply 3):
nited knew that they couldn't hold their side up and did nothing, and the court let them get away with it.

Flashmeister, this is totally irrelevant. You can't get blood out of a stone. The pensions were underfunded by $10 BILLION (with a B). If UA was not allowed to transfer these over to the PBGC, it could have sunk the airline even faster, in which case UA employees and retirees would have gotten zero, nada!!!

Considering UA's precarous position, this is actually a blessing in disguise. I know it is a very bitter pill to swallow, especially for retirees, and those getting ready to retire, but some pension is better than none at all. Think of all the folks at PanAm who lost EVERYTHING. Pensions were wiped out overnight! Sure, our colleagues at UA are getting screwed - but that happened awhile ago and insisting that UA's current management pay the pension benefits is like pissing into the wind. You can't pay what you ain't got. Plain and simple.



It's been swell, but the swelling has gone down.
User currently offlineFriendlySkies From United States of America, joined Aug 2004, 4104 posts, RR: 5
Reply 6, posted (9 years 2 months 2 days 6 hours ago) and read 4412 times:

Quoting PA110 (Reply 5):
You can't pay what you ain't got. Plain and simple.

Finally, someone who understands! Welcome to my RR list.


User currently offlineGigneil From United States of America, joined Nov 2002, 16347 posts, RR: 85
Reply 7, posted (9 years 2 months 2 days 6 hours ago) and read 4388 times:

Quoting 1rocco (Reply 2):
And in return we the tax payers will feel the burden..

Not 1 dollar. Its an insurance company, funded by premiums wisely invested, as well as the remaining money from the fund.

What they're getting is better than absolutely nothing.

N


User currently offlineMxCtrlr From United States of America, joined Nov 2001, 2485 posts, RR: 35
Reply 8, posted (9 years 2 months 2 days 6 hours ago) and read 4372 times:

While I understand both sides of this saga, at some point you have to ask yourself, when is enough? This is a company that, while under the protection of Bankruptcy, still manages to lose $1.1 billion in a quarter. That equates to approximately $12 million each and every day for the quarter. Assuming 55,000 employees, that equals over $200 per employee, per day. Yes, I know fuel prices caused some of that, but how much more can the employees be expected to foot before they throw their hands up and say "ENOUGH ALREADY!"?

Quoting Gigneil (Reply 7):
What they're getting is better than absolutely nothing.



Quoting PA110 (Reply 5):
I know it is a very bitter pill to swallow, especially for retirees, and those getting ready to retire, but some pension is better than none at all.

Try to look at it from the perspective of someone who is within a year or two of retirement, is expecting a specific amount monthly to live on, and then finds out that he/she can now expect HALF of that. Try to live on a pension to begin with - it isn't easy. Look at the cost of prescription drugs (which, as you age, you can expect to be on something. Now, try to explain to that prospective retiree "how much better it is" getting half of what they expected. I doubt you'd find anyone really happy about this or anyone finding "comfort" in the fact that they're getting half of the benefits they worked for.

MxCtrlr  bouncy 



DAMN! This SUCKS! I just had to go to the next higher age bracket in my profile! :-(
User currently offlinePA110 From United States of America, joined Dec 2003, 1988 posts, RR: 24
Reply 9, posted (9 years 2 months 2 days 6 hours ago) and read 4351 times:
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Quoting MxCtrlr (Reply 8):
I doubt you'd find anyone really happy about this or anyone finding "comfort" in the fact that they're getting half of the benefits they worked for.

Nobody is saying that realizing you're getting half the pension you were promised is comforting by any stretch of the imagination. But, the alternative is far worse. Getting nothing at all could be a financial disaster for many. Getting half will still cause hardships I know I would never want to face, and my heart goes out to my colleagues at UA. But what is the alternative?

Is it really worth the remaining half of the pension to sink the airline out of spite? What does that do for the thousands of workers who really need to hang on to their jobs?



It's been swell, but the swelling has gone down.
User currently offlineMxCtrlr From United States of America, joined Nov 2001, 2485 posts, RR: 35
Reply 10, posted (9 years 2 months 2 days 5 hours ago) and read 4326 times:

Quoting PA110 (Reply 9):
Is it really worth the remaining half of the pension to sink the airline out of spite?

Again, with the constant pressure from management to cut more from the employees - more pay cuts needed, more benefits cuts needed, more pension cuts needed, more productivity increases, all without any substantial increase to the bottom line (presently losing over $12 million A DAY) - at what point do you say "ENOUGH"?

When PA shut down, we didn't "lose" our pensions - PBGC took them over. There were some problems with those of us who were under 55 at the time, and there were some loss of benefits but not anywhere close to a 50% reduction.

I'm certain that Tilton and all the other mis-managers of this great airline haven't lost 50% of their pensions, so why should the rank-and-file - the people who REALLY run the airline day-to-day - lose 50% of their pensions?

MxCtrlr  bouncy 



DAMN! This SUCKS! I just had to go to the next higher age bracket in my profile! :-(
User currently offlinePA110 From United States of America, joined Dec 2003, 1988 posts, RR: 24
Reply 11, posted (9 years 2 months 2 days 5 hours ago) and read 4309 times:
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Blaming Tilton is absurd. He had nothing to do with getting UA into this mess. Take a look at the outrageous Union salaries negotiated in the 90's, along with some poor management decisions along the way.

And how would shutting the airline down benefit the thousands of other employees who really need their jobs now, more than ever?



It's been swell, but the swelling has gone down.
User currently offlineMxCtrlr From United States of America, joined Nov 2001, 2485 posts, RR: 35
Reply 12, posted (9 years 2 months 2 days 5 hours ago) and read 4269 times:

Quoting MxCtrlr (Reply 10):
I'm certain that Tilton and all the other mis-managers of this great airline

Where in that statement did I blame Tilton for the current situation at UA? Tilton did not contribute to the situation that brought UA to Chapter 11 but he has done little, IMHO, to stem the flow of red ink (as the current quarterly results prove).

Yes, the unions themselves are equally to blame for this mess (something I have said repeatedly in threads on this subject over the past two years). The "Summer of Hell" job action by the pilots back in 2000 was probably the final nail in the coffin however, that does not let management off the hook for not paying into the pensions when times were good. How do you think they got almost $10 Billion (with a "B") in the red? That didn't happen overnight.

Quoting PA110 (Reply 11):
And how would shutting the airline down benefit the thousands of other employees who really need their jobs now, more than ever?

By staving off the virtually inevitable, over and over again, and by cutting the employees' money time and time again, it almost becomes cost-effective to just "get it over with". I and many of my co-workers survived having our "job for life" at PA disappear. My standard of living is pretty close to what it was then. Was it easy? Certainly not.

What is worse, staying with the sinking ship, losing money and benefits a little at a time, to the point where you cannot maintain your current standard of living, then having to declare personal bankruptcy (which, our clueless leader has just made tougher on the consumer) and then lose everything anyway because your employer is constantly blaming your salary/benefits package as the reason they are losing money, or getting it over with now and maybe staving off the resultant problems by getting on with another carrier?

If UA does ultimately fail (and, mind you, I am not wishing that on anyone - been there, done that, lost the T-shirt in personal bankruptcy) do you honestly think other carriers, now stronger due to the loss of a majority player, won't rush to fill the void?

MxCtlr  bouncy 



DAMN! This SUCKS! I just had to go to the next higher age bracket in my profile! :-(
User currently offlinePA110 From United States of America, joined Dec 2003, 1988 posts, RR: 24
Reply 13, posted (9 years 2 months 2 days 4 hours ago) and read 4233 times:
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Quoting MxCtrlr (Reply 12):
By staving off the virtually inevitable, over and over again, and by cutting the employees' money time and time again, it almost becomes cost-effective to just "get it over with".

MxCtlr, I actually do see your point of view. I too went through an employer bankruptcy and it was the most unnerving event of my life. I was almost pushed to the bring of personal bankruptcy as a result. I wouldn't wish that on anyone. My company ended up being purchased out of bankruptcy and is now far stronger than ever before. My personal finances are on the mend, althougth I still have a ways to go. So, I thoroughly respect your experience and point of view.

The current challenges at UA are somewhat a factor of the carrier's sheer size. While union employees bear the brunt of the givebacks, tons of non-unionized employees have simply been let go. The bloated ranks of middle management at WHQ has been slashed. There isn't a single legacy carrier making money at the moment. Who's to say that given the right incentives and investment UA can't rebound? I know it sounds pretty grim at the moment, but with an injection of cash, and a clear plan - things could get better. Personally, my fear is that once UA receives new cash, old animosities and entrenched attitudes will only squander that money. Unions, not realizing that old salaries are gone for good will demand pay raises. Old management will be tempted to do the same old same old in an era where new ideas are desparately needed.

That said, I hope that UA can attract some fresh faces with new ideas. At the very least, try to raid some of the talent at the LCC's.



It's been swell, but the swelling has gone down.
User currently offlineCkfred From United States of America, joined Apr 2001, 5154 posts, RR: 1
Reply 14, posted (9 years 2 months 2 days 3 hours ago) and read 4200 times:

1rocco:

Remember when Frank Lorenzo put CO into bankruptcy, so that he could have all of the union contracts voided? After that, Congress raised the standard for declaring bankrupcty.

There are certain ratios of debts to cash and other assets that a corporation or individual must meet, before a bankruptcy petition may be filed.

With $3.5 billion in cash, AA can't just walk in to bankruptcy court and ask a judge to have its pensions transferred to the PBGC.

Remember when UA created the ESOP, and the employees took pay cuts in exchange for shares of the company? I know several people at AA who thought that UA's cost advantage would drive AA out of business. It didn't happen.


User currently offline1rocco From United States of America, joined Dec 2003, 119 posts, RR: 0
Reply 15, posted (9 years 2 months 1 day 16 hours ago) and read 4089 times:

ckfred,

I see your point but how long do you think AA will be able to keep 3.5 billion in cash when they will be playing on a completely unleveled field? Mark my words if UAL survives this ordeal many other legacy carrier will burn through what's left of there cash trying to keep up with the likes of US and UAL and be forced into bankruptcy themselves. Soon there will be nothing but LCC ruling the skies and quality of service will tank. Its going to be a very sad day for aviation especially for the legacy carriers. Everyone is looking at this through the eyes of UAL employees. Well it's time to look outside the box folks and see the effects these bankruptcy ruling are going to have on all of our lives not just in aviation. The PBGC is strapped for cash now and it's only going to get worse once more and more company follow suit. Who do you think is going to bail out the PBGC? Yep that's right we the tax payers. Please dont think of me as a cold hearted person wishing the demise of any airline but lets not let one or two sinking ship bring down the whole fleet.


User currently offlineDvk From United States of America, joined Jun 2000, 1058 posts, RR: 1
Reply 16, posted (9 years 2 months 1 day 16 hours ago) and read 4079 times:

I have read that recipients will get approximately 75% of their previous income with the transfer of the pensions. That's a huge decrease, but what else can be done? The thought of losing 25% of my post-retirement income is terrifying, but it sounds like they could lose 100% if the takeover doesn't happen. It's a bad situation all the way around.


I'm not dumb. I just have a command of thoroughly useless information.
User currently offlinePropilotJW From United States of America, joined Mar 2000, 589 posts, RR: 7
Reply 17, posted (9 years 2 months 1 day 16 hours ago) and read 4033 times:

Quoting 1rocco (Reply 2):
And in return we the tax payers will feel the burden.. Like it or not the writing is on the wall.. Thanks UAL. UAL and the judge in charge of this bankruptcy have rewritten the meaning of bankruptcy. Now all the other legacy carriers are going to have to follow suit to be competitive. What happened to the strong surviving and the weak folding. So much for capitalism. BTW I have yet to see a thread flaming the IAM for there strike vote. Must not be as much fun as picking on the flight attendants for the possible demise of UAL. I understand it is tough seeing thousands of people out of work but enough is enough. They will move on. This is bringing down the whole industry and many people just can't see this. 1.1 billion dollar loss while under bankruptcy protection.. Its time to stop the nonsense and shut the doors and let the struggling airlines who have been working hard to avoid bankruptcy make a dime.

well said. Taxpayers are paying for UAL's mistakes whether people want to believe it or not


User currently offlineSupa7E7 From , joined Dec 1969, posts, RR:
Reply 18, posted (9 years 2 months 1 day 15 hours ago) and read 4018 times:

I am furious that someone's speculative assets are covered through political thievery, which is what the PBGC is. It's a nonprofit that is 20 BILLION underfunded at this time and promises to snowball quickly. According to the PBGC, it is currently secure today but the future points to almost certain Federal taxpayer bailout as the 20 billion deficit becomes due... or will it be 80 billion when GM, NW, DL get on this welfare gravy train?

If you don't understand how union economics are elitist and morally wrong, then you won't agree with my sentiment. But when you bankrupt your own company by demanding market-incorrect wage and benefit levels, you have no right to expect pension payments. That is the crucial balance against over-demanding wages and pensions.

If the Feds will insure the pension for an insanely small fee, in effect a massive subsidy from taxpayers' future liability (=$$$), that's also unfair. The net effect of the UA and US situation is a generous welfare nest egg valued at around $600,000 per worker (a $45k annual annuity). Since it's not funded at this time, it's a liability of the US Government and nothing more. It's a Treasury bill in the name of each worker. Can I have one too?

The PBGC is a handout to some very politically powerful people, i.e., union members. Their power and greed make me sick.


User currently offlineLTBEWR From United States of America, joined Jan 2004, 13004 posts, RR: 12
Reply 19, posted (9 years 2 months 1 day 15 hours ago) and read 4008 times:

I do fear that the actions of the BK court as to UA to force changes in the union contracts may trigger CHAOS or more extensive labor actions from people whom cannot be easily replaced. Of course if some key groups go on strike, UA will collaspe and everyone is out of a job. Worse, as the job actions threats build up it will chase many pax to other airlines - if they have a choice. I just hope some sanity can prevail, that perhaps UA could restructure itself and become a slightly smaller airline, by ditching usually unprofitable routes and markets, try to keep up some standards to retain loyal pax, and become a more sustainable and realistic airline.

User currently offlineSchipholjfk From United States of America, joined Jan 2005, 579 posts, RR: 6
Reply 20, posted (9 years 2 months 1 day 15 hours ago) and read 3994 times:

Quoting Gigneil (Reply 1):
I guess you don't understand what happened with the pensions. They handed the retirees and those with money in their pension over to the insurance company that covers them.

Those people will still get paid...

You are partly wrong. A significant amount of employees will loose some part of their pension. The Pension Guaranty Corp. (or something like that) does not gaurantee entire pension. In addition, this origanization itself is $23 BILLION short and with more corporation pensions likely to be turned over to this Fed agency due to this amazing ruling, don't bet on collecting pension from anyone!



The fun of flying... love it !!!
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