WASHINGTON — Major airlines are laying the groundwork for their biggest push yet to get Congress to change the law for resolving airline union contract disputes, claiming such action is necessary to help the industry recover from its worst financial downturn, reports Reuters.
With high labor costs cited by Wall Street as a chief reason for commercial aviation’s financial troubles, the big airlines believe their case against the Railway Labor Act will resonate with the Republican-controlled Congress.
“It has failed to prevent strikes, it encourages acrimonious negotiations, and it leads to agreements that dangerously weaken the airlines,” Carol Hallett, president of the chief lobbying group for the airlines — the Air Transport Association — said in a speech this week.
Some labor experts agreed that the law that was enacted for rail unions in 1926 and amended to include airline workers 10 years later was hopelessly outdated.
But others claimed the airlines have no one to blame but themselves. They assert some carriers used the statute to stall bargaining for years before the timetable permitted a strike or a strike threat that forced a deal the airlines did not want.
“Their campaign is not about reforming the railway labor act but destroying airline workers’ bargaining rights,” said Ed Wytkind, an executive director at the AFL-CIO.
Robert Roach, vice president of the International Association of Machinists, which represents thousands of airline workers, defended the law. “It’s not the law, it’s the people that participate in negotiations,” Roach said.
Unions say airlines want to take away the right to strike.
The Railway Labor Act is set up to keep management and labor talking through mediation. Contracts never expire. Their terms continue until a new deal is reached, which in some cases can take years. Strikes can occur after an exhaustive process but they can be temporarily stopped by presidential order.
President Bush (news – web sites) said early in his term that he would not tolerate airline strikes because of the industry’s role in the economy. In his first 18 months in office, Bush facilitated settlements in several disputes by intervening to temporarily stop a walkout or threatening to do so.
But most recent agreements were blockbusters or provided double-digit wage increases, despite intervention. United Airlines gave its pilots an industry leading pact in 2000 in a deal triggered demands by unions at other airlines for more lucrative packages, which many of them got.
AIRLINES UNDER PRESSURE
Now labor unions are now giving up some of those gains to ease the turmoil that has prompted thousands of layoffs.
Industry losses are projected at $10 billion this year and big airlines are under enormous pressure to reduce labor costs, especially at United and US Airways. Both are bankrupt.
“Wages and work rules are out of whack with productivity and revenues. Companies that are losing millions of dollars every day or week — with no prospect for an early turnaround — are simply not going to stay in business,” Hallett said.
The Air Transport Association has provided start-up funding for a bipartisan group of former lawmakers, political appointees and business interests to press lawmakers.
Former New York Republican Rep. Susan Molinari, who is helping to lead the effort, said a legislative proposal could include a plan for arbitration but nothing is firm.
“We think we need to move this legislation as quickly as possible to at least bring some hope to people in the industry and people who rely on the industry,” Molinari said.
She said the group hopes for legislation next year.
Sen. John McCain, an Arizona Republican and incoming chairman of the Commerce Committee, proposed a bill in 2001 that called for arbitration to settle airline disputes. He has promised to explore it again this year.
Neil Bernstein, a labor expert at Washington University in St. Louis, said current law is ill-suited to airlines because it permits negotiations to drag on. But he said arbitration, in which each side submits a single proposal for a decision that is binding and precludes strikes, may not be any better.
“It is not a sensible way to set wages for a group like the airlines,” Bernstein said, adding that precedent is thin and arbitration decisions are often unpredictable.