Washington, D.C., March 7, 2006 - Members of the International Association of Machinists and Aerospace Workers (IAM) at Northwest Airlines (NWA) delivered a split decision today on the bankrupt airline’s $190 million cost cutting proposal.
In separate voting by classification, Northwest’s proposal was accepted by the 7,677-member Clerical, Office, Fleet and Passenger Service (COFPS) group and the 18-member Plant Protection (PP) group. A similar proposal was rejected by the 5,632-member Equipment Service and Stock Clerks (ESSC) and the 42-member Flight Simulator Technicians and Simulator Support Specialists (SIMOP).
A simple majority of those casting ballots determined the outcome in each classification. Seventy five percent of all eligible voters cast ballots.
Terms of Northwest’s offer included reducing the current court-imposed wage cut from 19 percent to 11.5 percent and replacing the airline’s faltering pension plan with the IAM National Pension Plan. The NWA proposal also called for significant job cuts, reduced health care benefits and station closures.
The ratified agreements will take effect upon approval by the bankruptcy judge overseeing the carrier’s financial affairs. Northwest is expected to ask the court to set a date for the resumption of the Section 1113(c) trial for the two groups that did not ratify the company proposal.
“The anger and frustration among all employee groups at Northwest Airlines was evident throughout the voting process,” said District 143 President Bobby De Pace. “In the end, Northwest management failed to convince a majority of the workforce that the proposal was appropriate or that they could be trusted to honor their commitments.”
In August 2003, NWA refused to abide by terms of the 1993 Employee Stock Plan calling for the carrier to redeem all outstanding NWA Corp. preferred shares held by an IAM trust. Following a court ruling that the carrier breached its promise to buy back the employee stock, the airline filed for bankruptcy.
“The IAM is prepared to meet Northwest Airlines at the bargaining table and in the courtroom,” said De Pace who warned NWA of dire consequences if they fail to bargain in good faith. “The ESE and SIMOP groups also authorized a strike if acceptable contract terms are not reached and the bankruptcy court abrogates their contracts.”
Additional information is available at www.iam143.org.
