Airline Congestion at the Bargaining Table, Too

Contentious contract talks bedevil the four major airlines

As a frequent traveler, Chicago businessman Stephen M. Purduski has experienced more than his share of airline delays lately. That's why he's already dreading his family's Easter vacation flight to Florida. He's booked on American Airlines, where unhappy mechanics recently staged a work slowdown and flight attendants are in contract talks. Trouble is, if he switches to United Airlines, its flight attendants threaten to strike this spring over the carrier's proposed merger with US Airways Group Inc. "I'm wondering whether I should have some kind of driving vacation contingency," he says.

For lots of fliers these days, that's worth considering. With unions at the four leading carriers, United, American, Delta, and Northwest, all in contentious contract talks, the specter of delays, cancellations, and simply sour service is looming large. Strikes are likely to be averted in most of these disputes. And even if strikes occur, federal mediators can ensure they don't all happen at once. But workers have other ways to express displeasure--slowdowns, sickouts, and the refusal of voluntary overtime. "The whole industry is at a low point in its labor relations," says AMR Corp. Chief Executive Donald J. Carty.

The seeds of the current disputes were sown in the gloomy early '90s, when airlines sought worker concessions to stay afloat. Now, after six straight years of profits, workers want a payback for their sacrifices, just as management is bracing for the economic downturn. Further complicating relations is a series of proposed or possible mergers among the biggest players, fueling worker anxiety about pay, seniority, and work rules.

Moreover, worker expectations ratcheted up last summer after United signed an unusually rich deal with its pilots. The pact followed thousands of flight cancellations forced by the pilots' refusal to fly overtime. The outcome sparked a wave of me-too contract demands and pressure tactics.

SHORTER TIMETABLE. As the sparks fly, a growing number of labor and industry leaders are realizing there's got to be a better way to work out their differences. True, the Railway Labor Act, under which the industry operates, has successfully minimized strikes and disruptions. But the often lengthy process exacerbates worker frustrations, setting off the kind of job actions for which travelers get no warning. At Northwest Airlines Corp., for instance, where the carrier accuses mechanics of slowing operations, the two sides have been bargaining for 4 1/2 years.

Increasingly, parties on both sides are calling for a shorter bargaining timetable. Former National Mediation Board Chairman Patrick J. Cleary, now heading human resource policy at the National Association of Manufacturers, says the board should be more aggressive, entering disputes earlier and pushing the parties to a quick resolution. Such timeliness would help airlines align worker expectations to the economic cycle and the industry's ability to pay.

Some labor leaders and managers, fearing a backlash if the industry can't clean up its act, appear ready to deal. "If we don't fix it, we're going to get government intervention with a fix that nobody likes," warns Air Line Pilots Assn. President Duane E. Woerth. President Bush has signaled that if Northwest's mechanics strike on March 12, he'll create an emergency board to halt the walkout. And federal judges increasingly issue restraining orders to halt slowdowns and other job actions. With pressure like that, maybe labor and management will find a new route to smoother relations.

By Wendy Zellner in Dallas with Michael Arndt in Chicago and bureau report

    Before it's here, it's on the Bloomberg Terminal.