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Northwest's labor impasse goes to court

/ Source: The Associated Press

Northwest Airlines Corp. couldn't get its baggage handlers to agree to pay cuts, so it's taking them to court.

Northwest wants its bankruptcy judge to let it throw out its union contracts with baggage handlers and other ramp workers. A trial on that request begins on Monday in bankruptcy court in New York.

Similar trials for Northwest and Delta pilots and Northwest flight attendants ended without a ruling by the judge or, in Delta's case, by a panel of arbitrators. But the threat of a ruling prompted the unions and airlines to make a deal.

Mediated talks between the International Association of Machinists and the airline last week in Minneapolis quickly fizzled, and there were no new talks over the weekend.

Earlier this year 60 percent of those workers rejected Northwest's proposed pay cuts and layoffs, and authorized a strike in case the bankruptcy judge allows Northwest to impose its terms. The union believes a strike by its 5,600 members could shut the airline down.

"If that judge takes away our work rules and our wages, shut the lights off," said Ed Dehn Jr., a ground service worker who has been with the airline for 33 years.

Temporary pay cuts imposed in bankruptcy sliced his hourly wage from $20.20 to $16.35. Some workers feel that the pay cuts and work rule changes Northwest wants won't make the job worth it anymore.

"Strike? We can liquidate as far as I'm concerned. I don't care if it closes the doors and Northwest doesn't exist," Dehn said.

Bobby De Pace, president of IAM District 143, said it would be very difficult for Northwest to replace the baggage handlers quickly enough to keep operating through a strike.

In statements, Northwest said it preferred a negotiated agreement, but would "take whatever actions are required" to meet its labor cost reduction targets. The airline said it believes a strike would be illegal, and that if the union attempted a walkout, it would seek an immediate injunction.

In a court filing in advance of the hearing, Northwest wrote that it responded to union opposition to its demands by enhancing severance pay, reducing planned outsourcing, and allowing IAM workers to take a smaller pay cuts than other Northwest workers.

"The time has come for the holdout IAM groups to reach agreement, as every other labor union has done," Northwest wrote in the filing. "As each week passes, Northwest's losses put it in a deeper and deeper hole, and the 'degree of difficulty' to complete a successful reorganization continues to increase."

Both Delta Air Lines Inc. and Northwest sought labor concessions when they filed for bankruptcy protection on the same day in September, and IAM workers like Dehn are among the last holdouts.

Delta pilots are expected to vote later this month on a tentative agreement that has already been ratified by union leaders. It calls for about $280 million in annual contract concessions including a 14 percent wage cut.

Northwest pilots have approved a new 5 1/2-year wage-cutting deal. Most other Northwest ground workers, including ticket clerks and reservations agents represented by the IAM, are under new, cost-cutting contracts, and flight attendants are voting through June 6 on their own wage cuts. Northwest is hoping to save $1.4 billion a year in labor costs as it restructures in bankruptcy.

But baggage handlers have been loath to give new concessions. Many are bitter at the airline for 1993 concessions in which they were to be awarded shares in the company. Some cashed those shares in, but many did not, and Northwest has said its common stock is likely to be worthless when it exits bankruptcy. A union lawsuit over the matter was in court when Northwest entered bankruptcy.

"Honor your word the first time. You can't be trusted," baggage handler Mary Sansom said of her attitude toward the company. "I'm still waiting for what they promised me the last time."