ContractsProf Blog

Editor: Myanna Dellinger
University of South Dakota School of Law

Monday, November 15, 2004

Airline seeks to avoid labor contracts

Usairways US Airways has asked a bankruptcy court to let it void three union contracts if the workers to not agree to million dollars in pay and benefit cuts. The company is trying to reorganize in Chapter 11 but says if it fails to get concessions it will go into liquidation.

The company says it must eliminate $1 billion in labor costs.  Among the targets are retiree health benefits and the company's last remaining defined benefit pension plan.  Pilots and some other unions have already agreed to steep cuts; Friday’s filing affects flight attendants, mechanics, and customer service/ticket agents.

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