Monday, September 18, 2006

Northwest Airlines/Flight Attendants Right to Strike Ruling and Midway Privatization

Northwest Airlines/Flight Attendants Right to Strike Ruling

According to Ted Reed of the Street.com, a U.S. District Court Judge ruled last Friday in favor of a move by Northwest Airlines to impose contract terms on its flight attendants and issued a temporary injunction to keep them from striking.  Judge Victor Marrero concluded that a strike would hurt the traveling public and could seriously harm the fifth-largest airline, which is reorganizing in bankruptcy court.

Marrero said that the Association of Flight Attendants hadn't completed the procedure that labor law requires before a strike can occur because it wasn't formally released from mediation.

He referred the case back to U.S. Bankruptcy Court Judge Allan Gropper, who ruled last month that flight attendants had the right to strike.  However, at the time, Gropper said he lacked the jurisdiction to issue an injunction preventing a work stoppage, and he encouraged an appeal.  Marrero said Gropper does in fact have jurisdiction.

Judge Marrero also said that Northwest has "demonstrated at least fair ground for further litigation of its claim, if not a likelihood of success on the merits."  Marrero said that in light of Northwest's "prospects for reorganization and the impact on the traveling public, the hardships tip decidedly in favor of Northwest."

The Association of Flight Attendants has indicated that it will appeal the decision.

Further Resources:

1) Full Street.com article

2) Northwest Airlines press release responding to the decision

Midway Privatization

A preliminary application was filed with the FAA by the City of Chicago last Friday indicating that the City would like to participate in an FAA pilot program for the leasing or selling of airports.  If the City of Chicago follows through with the process, Midway would be the first major U.S. commercial hub airport to be privatized under this program.

No timetable has been set by the City for the completion of the process as the airlines and FAA must give a series of approvals.  The FAA indicates that it will make a preliminary decision regarding whether or not it "accepts" the application within thirty days.

The City of Chicago envisions that it would use the privatization proceeds for "construction and maintenance of critical infrastructure within the City as well as to address other critical city financial obligations and requirements."

Although five other airports have filed applications to participate in the FAA’s Airport Privatization Pilot Program since the program began in September 1997, only one airport with commercial service (Stewart International Airport in New York) has received final approval from the FAA.

Further Resources:

1) August 2004 FAA report on the Status of the Airport Privatization Pilot Program

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